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A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web

U.K.-based economist James Pomeroy recently published a 25-page report assessing relative debt levels for the world’s major economies. It won’t come as a huge surprise to most investors that Canada did not finish well. Mr. Pomeroy’s debt scorecard has the domestic economy flashing red for household debt to GDP, corporate debt levels (a bit of a surprise for me, to be honest), financial sector debt, and debt service ratio.

The economist also built a ‘sustainability score’, comparing current growth levels relative to longer term trends and recent changes in employment to population ratios. In this case Canada ranks well, with an economic slowdown unlikely. Korea, Australia and Norway are most at risk of slowing economies with this methodology.

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“@SBarlow_ROB Canada's debt scorecard (HSBC)” – (table) Twitter

“@SBarlow_ROB Canada's 'sustainability score' is not high” – (chart) Twitter

“@SBarlow_ROB "Financial stability concerns are concentrated in small, wealthy nations" – ibid” – (chart) Twitter

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Credit Suisse economist James Sweeney is predicting a case of whiplash for the global economy, featuring a temporary recovery in manufacturing activity followed by a slowdown,

“Recent weakness in manufacturing – and probably PMIs too – has been related to short term disruptions to the European and Japanese automobile sectors that are now reversing. .. Global IP momentum should thus rebound in the coming months. The outlook for 2019 global IP is darkening due to tightening financial conditions, the natural forces of reversal after nearly three years of above trend growth, the effects of broadening trade disputes, and reduced tailwinds from the energy sector. But first: whiplash”

“@SBarlow_ROB CS predicts whiplash: "Recent weakness in manufacturing – and probably PMIs too – has been related to short term disruptions to the European and Japanese automobile sectors that are now reversing."” – (research excerpt) Twitter

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Related: “@SBarlow_ROB UBS: not late cycle, ‘transitory’ global growth skid” – (research excerpt) Twitter

“The chart that strongly suggests bond yields will soon head lower” – Barlow, Globe Investor

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Oil markets have been hit really hard in the past ten days, and the West Texas Intermediate crude price has now fallen below US$70,

“'There is no slowing down the bear train,' said Stephen Brennock, an analyst at London brokerage PVM Oil. ‘Instead, the energy complex has extended a rout driven by swelling global supplies and a softening demand outlook.’”

“Oil falls below $70 as U.S. crude enters 'bear market'” – Reuters

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“US oil falls below $60 as US bear market deepens” – CNBC

“@MaleehaMBCC Too much #oil, curve moving to contango. Supply is up whilst demand is down given weak shoulder period. #trump will be happy, not that his sanctions had anything to do with it as all #iran partners have waivers. #oott #opec $spy “” – (charts) Twitter

“Not every oil price is falling as consumers step in for 2020 and beyond” – Bloomberg

“@JavierBlas FACT OF THE DAY: WTI #oil is down again today, marking the 10th consecutive day of daily price drops. If the contract closes down tonight, it will mark the longest streak of daily drops since it was launched back in March 1983” – Twitter

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Tweet of the day:

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Diversion: “American Meritocracy Is Killing Youth Sports” – The Atlantic

Globe Investor Newsletter: “Know your personal investing Achilles heel” – Globe Investor

Editor’s note: A previous edition of this column stated that Canada ranked 27th out of 30 countries for economic sustainability. This was in error, as HSBC ranks the Canadian economic growth as the fourth most sustainable in their analysis.
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