In lieu of this week’s report, we have attached a slide deck presentation titled “US Fiscal Dominance and the UST Market.”  The overall theme of the presentation reviews how the gap between UST issuance and FX reserves 2014-present has triggered the macro equivalent of the famous “I Love Lucy” chocolate factory episode, the macro implications that have ensued in that time, and the implications we see unfolding in 1H24.

The economic incentive to import oil from the U.S. Gulf Coast to Asia has closed as the cost of booking supertankers on the route has surged amid a jump in bookings for the vessels, traders said this week.  “The hike on freight rates came as a shock,” said a Singapore-based trader with a North Asian refinery. “The direct outcome is that the U.S. crude is no longer competitive in Asia.”     – Bloomberg, 1/10/24 Key points:

An estimated 20% of global oil this year was bought and sold in currencies other than the USD. … Twelve major commodities contracts settled in nondollar currencies were announced in 2023, compared with seven in 2022 and just two in 2015 through 2021 … Russia and Iran in particular have stepped up oil sales in alternative currencies, and have found buyers in China, India and elsewhere that are happy to buy these exports, often at