Happy morning, Munchers! 🙏

As always, here is your daily dose of the news that matters, from Wall Street to Dalal Street - in 5 minutes and 12 seconds.

That's less time than it takes for Liz Truss to wave the white flag, Turkish inflation to hit 80%+, and Japanese inflation to surge. 🔥

Let’s dive in.

What’s hot, what’s not?

Market Commentary

• US markets remained muted after investors see more tightening from the Fed's end.

• Markets are now pricing in a peak benchmark rate of 5%.

• Traders think no plan is better than Liz Truss's plan - the Pound rallied after the announcement of her resignation.

Story Roundup

1 - Bye bye, Ms. Truss! 👋

We are witnessing a new era in modern British politics.

Liz Truss resigned yesterday - making history as the shortest-serving British Prime Minister ever.

The easy favorite now seems to be Rishi Sunak - the guy who correctly predicted that markets would spark with turmoil if she went ahead with debt-funded tax cuts.

And guess what. They did.

However, some MPs dislike him. His resignation as Chancellor had a pretty big hand in getting Boris Johnson out of office.

My bet's on him though.

Diwali might be coming to Downing Street. 🙏

2 - Japan's economy seems in a hot spot. 🥵

Inflation in Japan rose to an 8-year high of 3%.

This is the steepest increase in recent history, with prices only rising this fast in 1991.

Markets more-or-less saw through this - with inflation spiking because of 2 big things.- a weak Yen- sky-high energy prices

Their central bank is still reluctant to raise interest rates in some unorthodox ultra-loose monetary policy.

And this widening policy gap has caused the Yen to shed about 23% of it's value this year.

Sign of the times. 🗾

3 - US Navy Chief sees a Chinese invasion of Taiwan in a year. ⚔️

If there wasn't much news to be worried about - here's some!

The Head of the US Navy warned that America needs to be prepared for the possibility of a Chinese invasion of Taiwan before 2024.

He's mainly emphasized this because of the increasing Chinese military activity near the island.

A lot of these drills increased after US House Speaker and master trader Nancy Pelosi landed in Taiwan during summer.

Congress is soon gonna vote on sending $10 billion to Taiwan to buy weapons.

We'll see what the narrative is when that time comes. 💣

4 - Turkey cuts interest rates despite inflation close to 100%. 

In Year 7 economics, you learn that high inflation is fought with higher interest rates.

With inflation at 83%, Turkey doesn't think that way.

They just cut rates from 12% to 10.5%.

In fact, their President has said time-and-time again that he believes "interest rates to be the mother of all evil".

The Turkish Lira has tumbled almost 30% since the start of the year as a killer combination of soaring inflation and policy missteps led to a sell-off.

There isn't a single government that can't be overthrown by an empty dinner table. 🔥

5 - Retail traders seek shelter in cash. 💰

This year's brutal sell-off has spooked retail investors - with most deciding to pile into cash or leave markets entirely.

Retail money market funds have seen 10 straight weeks of inflows. They're also a little more attractive, since the Fed has started hiking interest rates.

It's the first time in a long time that you can get some return - and people are eating it up.

Ripsawed. 🔪

A few nibbles from Pasiv

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Hope you enjoyed this issue of the Market Munch. If you've got any feedback - good or bad (😏) you can hit reply to this email. Thanks a ton for reading!

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Cheers, and have a lovely day. 🙏

Aryaansh