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'The game's changed': Central banks are no longer driving markets, strategist says

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The game has changed in the last year or so, with markets now driven by politics instead of central banks, according to a strategist at a widely followed investment group.

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Christopher Wood, an equity strategist at investment group CLSA, said Tuesday that central banks have been the key driver of markets in the last decade, and the “great thing” about them was that they were “doing their best to be entirely predictable.”

Speaking to CNBC’s Akiko Fujita at the 2018 CLSA Investors’ Forum in Hong Kong, he said: “In the last 12 to 18 months, the game’s changed. The central banks are no longer the key driver … the key driver is politics.”

“The risk but also the opportunity is that politics are much less predictable than the central banks,” he added. “The only chart I have relating to politics was on Donald Trump’s popularity.”

This year, there have been several geopolitical developments, such as the U.S.-China trade tensions, as well as U.S. pressure on North Korea to denuclearize, which included a meeting between U.S. President Donald Trump and North Korean leader Kim Jong Un.

On the rapid growth in the U.S. economy, Wood said the cyclical momentum may have peaked last quarter, but not before having an “extraordinary impact.”

“The dominant phenomenon in the markets this year is the extraordinary impact on the U.S. stock market and the U.S. economy … driven by U.S. corporate tax cuts, which has been dramatic. You can see the surge in earnings … the collapse in corporate tax revenues … the dramatic surge in small business confidence … and most spectacularly, you can see it in the surge in share buybacks,” he said.”

In the first quarter alone, multinational enterprises brought home about $300 billion of the $1 trillion held abroad, according to a recent Federal Reserve study. A good chunk of that went to share repurchases. For the top 15 cash holders, some $55 billion was used on buybacks, more than double the $23 billion in the fourth quarter of 2017.

Goldman Sachs economists predicted that the total buybacks from all companies in 2018 could exceed $1 trillion.

— CNBC’s Jeff Cox contributed reporting to this story.

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On Politics: Democrats Continue to Gain as More Midterm Races Are Finalized

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On Politics: Democrats Continue to Gain as More Midterm Races Are Finalized

Good Wednesday morning. Here are some of the stories making news in Washington and politics today.

_____________________

What seemed like a mixed midterm result for the G.O.P. has turned more grim as Democrats continue to pick up seats in the House and narrow the Republican hold on the Senate. Read about the stronger Democratic gains.

President Trump is considering firing Kirstjen Nielsen, the secretary of Homeland Security who has long been a target of the president’s displeasure, according to three people close to him. Read about the staff shake-up.

There were conflicting reports on Tuesday on whether Mira Ricardel, a deputy national security adviser, had been fired. But there is no question that the first lady, Melania Trump, no longer wants her at the White House.

Mr. Trump issued a blistering personal attack against President Emmanuel Macron of France, and sought to defend his decision not to visit a cemetery of American soldiers while in France because of rain. Read more on his comments.

With a recount underway in the Florida governor’s race, Andrew Gillum, the Democratic nominee, is back on the campaign trail a week after conceding the election. Though the outcome is unlikely to change, Mr. Gillum has made it clear he is not going away.

Representative Kyrsten Sinema’s victory marked the first time a Democrat has been elected to the Senate from Arizona since 1988. Read more about Ms. Sinema, and here are six takeaways from her historic race.

On an otherwise bleak election night for North Dakota Democrats, Ruth Buffalo became the first Native American Democrat elected to the state legislature, unseating the architect of the very law tribes had feared would disenfranchise them.

As freshman orientation for new members of Congress began, Representative-elect Alexandria Ocasio-Cortez led activists in a protest in Nancy Pelosi’s office. The move is an early notice to Democratic leaders that the new House may be divided.

Despite a dismal election last week, Representative Kevin McCarthy of California looks set to become House minority leader. Read more about Mr. McCarthy — and his chances of securing the new role.

For weeks before the midterms, Mr. Trump warned ominously about the threat from a caravan of migrants streaming toward the United States border. But only a week after the election, he has dropped the issue almost entirely.

An independent bipartisan commission concluded in a sharply critical report that strained forces and budget shortfalls have cast doubt on the Pentagon’s strategy to confront global threats, in a challenge to Mr. Trump’s commitment to support a strong military.

Mr. Trump’s trade war is stoking an internal fight among his top economic advisers, with officials sparring over the White House’s approach to dealing with China and other trading partners. Here’s more on the feuding.

_____________________

Today’s On Politics briefing was compiled by Margaret Kramer in New York.

Check back later for On Politics With Lisa Lerer, a nightly newsletter exploring the people, issues and ideas reshaping the political world.

Is there anything you think we’re missing? Anything you want to see more of? We’d love to hear from you. Email us at onpolitics@nytimes.com.

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Brexit deal: Tory ministers meet to decide fate of agreement – Politics live

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  1. Brexit deal: Tory ministers meet to decide fate of agreement – Politics live  The Guardian
  2. This is a Brexit deal that delivers! May breaks EU deadlock as Cabinet summoned TODAY  Express.co.uk
  3. Brexit: UK and EU ‘agree text’ of draft withdrawal agreement  BBC News
  4. Full coverage



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The Atlantic Politics & Policy Daily: Putting on Ayers

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Written by Elaine Godfrey (@elainejgodfrey) and Madeleine Carlisle (@maddiecarlisle2)


Today in 5 Lines

  • President Donald Trump is reportedly considering replacements for several senior-level administration officials, including Homeland Security Secretary Kirstjen Nielsen and Chief of Staff John Kelly. One name being floated as Kelly’s replacement is Nick Ayers, Vice President Mike Pence’s current chief of staff.

  • CNN filed a lawsuit against Trump and several White House aides, after the administration suspended CNN journalist Jim Acosta’s press pass last week.

  • Trump named Neomi Rao, administrator of the Office of Information and Regulatory Affairs, to fill the seat vacated by Brett Kavanaugh on the D.C. Circuit Court of Appeals.

  • Hate crimes in America increased by 17 percent last year, even while overall violent crime fell very slightly, according to newly released data from the FBI.

  • At least 44 people are dead, and more than 200 people are still missing, as the Camp Fire—now the most destructive fire in California history—continues to blaze through the northern part of the state.


Today on The Atlantic

  • This Is a Problem: President Trump appointed Matthew Whitaker to replace former Attorney General Jeff Sessions last week. The move is unconstitutional, argues former deputy assistant attorney general John Yoo.

  • ‘A New Kind of Centrism’: Even though they had some high-profile losses, progressives still see last week’s midterms as a victory for progressive thinking. (Elaine Godfrey)

  • Young and Blue: The House of Representatives is an “unfriendly environment for rising talent,” reports Elaina Plott. Why is it so hard for young Democrats to get leadership roles there?

  • Doomed Policies: President Trump reportedly plans to fire Secretary of Homeland Security Kirstjen Nielsen for weak enforcement of his immigration policies. But Nielsen isn’t the reason why they’re failing, writes David A. Graham.

  • Becoming Michelle Obama: The former first lady’s new memoir is a strikingly intimate look at life as a political spouse. (Hannah Giorgis)


Snapshot

Georgia state Senator Nikema Williams (D) is arrested by capitol police during a protest over election ballot counts in the rotunda of the state capitol building in Atlanta. Dozens filled the rotunda in the center of the Capitol’s second floor Tuesday just as the House was scheduled to convene for a special session. (John Bazemore / AP)

What We’re Reading

Oops: A poorly designed ballot might have swayed the midterm elections in Florida. Here’s how. (Dana Chisnell and Whitney Quesenbery, The Washington Post)

Bigger Than They Thought: With all the votes counted, the Democrats had a larger win this year than Republicans did in 2010. (Matthew Yglesias, Vox)

A New American Revolution: Revolutions have always shaped American society, starting in 1776. In 2018, the left has tried to stage a new revolution—one modern America doesn’t need, argues Victor Davis Hanson. (The National Review)


Visualized

Mapping Fire: California’s wildfires are still raging. Keep track of them. (Lauren Tierney, Laris Karklis, and Tim Meko, The Washington Post)


We’re always looking for ways to improve The Politics & Policy Daily. Concerns, comments, questions, typos? Let us know anytime here.

We want to hear what you think about this article. Submit a letter to the editor or write to letters@theatlantic.com.

Elaine Godfrey is an assistant editor at The Atlantic.
Madeleine Carlisle is an editorial fellow at The Atlantic.

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