No 882 - The changing value of work

　　原创

　　BANDSFinancial

　　磐石金融有限公司（ BANDS Financial Limited ）在香港注册成立，是一家持有香港证监会（SFC）2号牌照的期货经纪公司，业务涉及中国以外全球大部分活跃期货及期权市场。

　　Not many years ago, the price direction of copper was a surrogate for the outlook for the Chinese economy. In the absence of investment products, Chinese investors were generally limited to being long or waiting to go long, so as the largest importer of copper, going short copper became a viable way to express a negative view of the Chinese economy. As Chinese exchanges are closed for the May Day holidays until tomorrow and prompted by the poor Chinese PMI numbers that were published on Saturday, Chinese investors sold LME copper which opened yesterday well offered and went lower, ending Tuesday down 3.25%, which prompted a general collapse pushing zinc down 5.06% and aluminium down 4.08%.The news today is that after forty-seven days of lockdown my compound has been downgraded to a precautionary zone, and my wife and I can use the compound‘s park-like gardens, but not leave the compound itself. The gardeners have returned, but fully hazmat suited and mask-wearing, as if dressed for a nucleic war they are taking the shears to the hedges and lawns that after a 47-day absence, similar to me, need a haircut. Local supermarkets are delivering directly to the entrance gate so the nagging anxiety around food supply has dissipated. And like other compound’s I would expect that one person from each household will be allowed to leave to go to the supermarket once every three days. However, should I or my wife walk to the supermarket, there is no chance of being run over by a car. The streets are still bereft of traffic except for the delivery trucks that scuttle past intermittently. Currently, I could use the four-lane highway below my building as a tennis court with no fear of interfering with traffic, as there isn‘t any.With the rollback of globalisation, the fracturing of cross border supply lines, which by the way is quite outside the control of Fed monetary policy. There is perhaps an additional known unknown at work. The assumption is that by offering more money more people will return to work, it’s a linear assumption that may now be broken. The FT reports today a “Record 4.5mn US workers quit jobs in March as labour market tightens. The number of job openings reaches high of 11.5mn as employers struggle to fill positions.” Let us assume wages in the US are rising although slower than inflation, workers are leaving employment not only in a search for higher wages but what the FT does not grasp, is the search for an appropriate lifestyle. Working in an office 2 or 3 days a week may be inappropriate for those who have grown accustomed to walking their dog at lunchtime or being home when their children return from school. How they value that, is not compensated by wages alone.As we wait for the FOMC decision tonight, one can argue that fractured supply lines and the changing value of work will continue to push US inflation much further and certainly longer than the FOMC currently expects.

　　Have a good day Regards John