American shares are back on top for year-to-date performances for the main regional slices of global stock markets, based on a set of exchange-traded funds. The leadership switch knocked China’s equity market to second place at the close of trading in the U.S. on Wed., May 27.

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China-India tensions at Himalayan border continue to escalate: Guardian
China votes to impose controversial security law on Hong Kong: CNN
Hong Kong’s role as financial hub at risk of fading: CNBC
Grim milestone: US Covid-19 deaths top 100,000: Politico
US jobless claims set to rise again by 2 million-plus in today’s update: Reuters
Herd immunity for Covid-19 is still nowhere on the near-term horizon: NY Times
Is the Fed considering a yield-curve control policy? Bloomberg
Fed Beige Book: businesses remain wary of economic outlook: MW
Business uncertainty continues to rise in May, reaching sharply elevated level: AF
Richmond Fed Mfg Index continues to show deep contraction in district: RF
Unemployment rates around the world on track for sharp increses in 2020: BBG

Risk comes in many forms in the money game, but perhaps the first one on every investor’s list is the risk of experiencing extreme losses. This year has been a real-world case study on that front and so it’s timely to revisit the subject of modeling, forecasting and otherwise studying a subject that resonates far and wide for portfolio management, namely: profiling fat tails in return distributions.

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China’s military says it will protect country’s interest in Hong Kong: NY Times
Trump to announce response to China’s security law for Hong Kong: Reuters
US military accuses Russia of covertly deploying fighter jets to Libya: BBC
US consumer sentiment rebounded modestly in May: CNBC
Senate Leader McConnell: Congress will ‘probably’ another stimulus bill: CNBC
IEA warns that global energy investment is set for record decline: CNBC
US economy is showing signs of rebounding from coronavirus lockdown: WSJ
Home prices in US continued to rise in March despite Covid-19: MW
New US home sales edged up in April: CNBC
US economic downturn accelerated in April: Chicago Fed
Economists expect a slow recovery following US recession: FiveThirtyEight

Trading in the US begins this week with stocks less than 13% below the previous high. It’s anyone’s guess if the S&P 500 will recover the Feb. 19 peak in the near term, but the bounce off the Mar. 23 low to date continues to give aid and comfort to optimistic thinking.

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Global equity markets rise on optimism for economic reopening: WSJ
China’s military chief in Hong Kong vows to uphold ‘national sovereignty’: CNN
Responding to China’s security law, Taiwan’s president backs Hong Kong: CNBC
Memorial Day weekend crowds raise concern for coronavirus infections: MW
World Health Organization warns of ‘second peak’ for Covid-19: CNBC
WHO suspends Covid-19 testing of malaria drug hydroxychloroquine: Reuters
China preparing for ‘worst case’ economic scenario: SCMP
German consumer sentiment rebounds slightly in May after dramatic decline: Gfk
Daily change in US Covid-19 deaths fell to 2-month low on Monday (May 25): JHU

Remember and honor our military men and women.

Disabled American Veterans
Paralyzed American Veterans
USO

● Trade Wars Are Class Wars: How Rising Inequality Distorts the Global Economy and Threatens International Peace
Matthew C. Klein
Excerpt via Barron’s
The open global trading system has been in trouble for years. The coronavirus could push it over the edge, and if we’re not careful, the world could see a breakdown of the international economic and financial order, as happened in the 1930s.
The most obvious impact of the virus on trade is that Covid-19 has forced governments, businesses, and consumers to appreciate the vulnerabilities created by global supply chains. Shortages of everything from meat to disinfectant wipes and face masks have been exacerbated by export controls imposed by China, Europe, and other producers.
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The Law of Regression to the Tail: How to Mitigate COVID-19, Climate Change, and Other Catastrophic Risks
Bent Flyvbjerg (University of Oxford)
13 May 2020
Regression to the mean is nice and reliable, regression to the tail is reliably scary. We live in the age of regression to the tail. It is only a matter of time until a pandemic worse than Covid-19 will hit us, and climate more extreme than any we have seen so far. What are the basic principles for navigating such risks, for government, business, and the public?
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US set to withdraw from another nuclear arms treaty: CNN
In threat to Hong Kong’s independence, China signals stricter oversight: BBC
China omits growth target, suggesting challenging economic outlook: WSJ
US-China tensions rise on new front: financial markets: CNBC
Economist predicts 40%-plus of lost jobs in US are gone forever: NY Times
UK retail spending crashed 18% in April–biggest monthly drop on record: FT
US Leading Economic Index continued to fall in April after record drop: CB
US existing home sales fell sharply in April: CNBC
Philly Fed Mfg Index in May still reflects deep sector downturn: MW
US jobless claims continued to surge last week, rising 2.4 million: CNBC
Composite PMI survey data for April points to deep loss for US GDP in Q2: