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Month: September 2017

Irma Turning Into Monster Hurricane: “Highest Windspeed Forecasts I’ve Ever Seen”

Hurricane Irma continues to strengthen much faster than pretty much any computer model predicted as of yesterday or even this morning.  Per the National Hurricane Center’s (NHC) latest update, Irma is currently a Cat-3 storm with sustained winds of 115 mph but is expected to strengthen to a devastating Cat-5 with winds that could top out at 180 mph or more.  Here is the latest from the NHC as of 5PM EST:

Irma has become an impressive hurricane with intense eyewall convection surrounding a small eye.  Satellite estimates continue to rapidly rise, and the Dvorak classifications from both TAFB & SAB support an initial wind speed of 100 kt.  This is a remarkable 50-kt increase from yesterday at this time.


Irma continues moving west-northwestward, now at about 10 kt. There has been no change to the forecast philosophy, with the hurricane likely to turn westward and west-southwestward over the next few days due to a building ridge over the central Atlantic.  At long range, however, model guidance is not in good agreement on the strength of the ridge, resulting in some significant north-south differences in the global models.  I am inclined to stay on the southwestern side of the model guidance, given the rather consistent forecasts of the ECMWF and its ensemble.  In addition, the strongest members of the recent ensembles are on the southern side on the consensus, giving some confidence in that approach.



INIT  31/2100Z 17.3N  34.8W  100 KT 115 MPH

12H  01/0600Z 17.8N  36.2W  105 KT 120 MPH

24H  01/1800Z 18.2N  38.3W  105 KT 120 MPH

36H  02/0600Z 18.3N  40.7W  105 KT 120 MPH

48H  02/1800Z 17.9N  42.9W  105 KT 120 MPH

72H  03/1800Z 16.8N  47.5W  110 KT 125 MPH

96H  04/1800Z 16.0N  52.0W  115 KT 130 MPH

120H  05/1800Z 16.5N  56.5W  120 KT 140 MPH

As of now, Irma remains in the far eastern Atlantic ocean and is moving west at roughly 11.5 mph.  Based on current projections, the storm will make its first landfall in the eastern Caribbean sometime toward the middle of next week.



Longer term computer models still vary widely but suggest that Irma will make landfall in the U.S. either in the Gulf of Mexico or Florida.  Meteorological Scientist Michael Ventrice of the Weather Channel is forecasting windspeeds of up to 180 mph, which he described as the “highest windspeed forecasts I’ve ever seen in my 10 yrs of Atlantic hurricane forecasting.”

These are the highest windspeed forecasts I’ve ever seen in my 10 yrs of Atlantic hurricane forecasting. #Irma is another retiree candidate.

— Michael Ventrice (@MJVentrice) August 31, 2017

In a separate tweet, Ventrice had the following troubling comment: “Wow, a number of ECMWF EPS members show a maximum-sustained windspeed of 180+mph for #Irma, rivaling Hurricane #Allen (1980) for record wind”

Meanwhile, the Weather Channel has the “most likely” path of Irma passing directly over Antigua, Puerto Rico and Domincan Republic toward the middle of next week. Nuevo análisis del huracán #Irma por The Weather Channel

— Roberto F. Pardo A. (@robertofaridp) August 31, 2017

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In Latest Reversal, Trump Weighs Tying Debt Limit Increase To Harvey Disaster Aid

This afternoon, we showed that even as stocks were pushing back to all time highs, a part of the Treasury market was turmoiling as the “debt ceiling” T-Bill spread (Sept/Oct) blew out to the widest level on record.


There were several possible catalysts suggested for this spike in concerns about a favorable outcome of the debt ceiling negotiation, which has to be concluded ahead of the Treasury’s X Date, now expected as early as October 1: some cited Steven Mnuchin’s interview on CNBC, in which the Treasury Secretary said that the additional spending needed to help Texas recover from Hurricane Harvey may reduce the amount of time Congress has to increase the federal debt limit; another possibility was month-end liquidity needs and relative positioning across the curve. But the most likely explanation is that earlier today the chairman of the conservative House Freedom Caucus said aid for victims of Hurricane Harvey should not be part of a vehicle to raise the debt ceiling.

Quoted by The Hill, Rep. Mark Meadows (R-N.C.), a Trump ally who leads the conservative caucus, said disaster aid should pass on its own, apart from separate measures the government must pick up in September to raise the nation’s borrowing limit and fund the government.

“The Harvey relief would pass on its own, and to use that as a vehicle to get people to vote for a debt ceiling is not appropriate,” he said an interview with The Washington Post, signaling agreement with what Trump’s approach on the matter has been. It would “send the wrong message” to add $15 to $20 billion of spending while increasing the debt ceiling, Meadows added.

Ironically, as we showed previously, it was precisely the Harvey disaster that prompted Goldman yesterday to lower its odds for a government shutdown from 50% to 33%, on the assumption that it would make conservatives more agreeable to a compromise, when in fact precisely the opposite appears to have happened, and the new dynamic is now playing out in the market where the odds of a government shutdown have never been greater.

Well, late on Thursday the dynamic changed yet again, as Trump now appears to have changed his mind, and instead of seeking a “clean” debt ceiling increase as he did as recently as one week ago, when he adopted the Democratic Party’s (and Steven Mnuchin’s) position and bucking conservatives who traditionally demand new curbs on spending in exchange for authorizing more debt, Bloomberg reported that Trump is now weighing tying the debt limit increase to the initial $5.95 billion request in disaster relief for Hurricane Harvey.

According to Bloomberg, the White House request, which could be unveiled as soon as tomorrow, would include $5.5 billion to FEMA and the remainder to the Small Business Administration. The request is being prepared primarily to cover funding demands through the Sept. 30 end of the federal fiscal year.

Earlier in the day, Texas Republican Senator Weber said Congress will most likely vote on the “first phase” of emergency relief money for Hurricane Harvey in mid-September, which however did not incorporate Trump’s revised plan and/or schedule.

Tying the debt limit increase to a Harvey bill is intended to ease early passage of a debt limit increase and avoid a potential stand-off over what could potentially escalate into a technical default – the outcome that is violently spooking the Bill market – and could rattle financial markets, one of the officials said. According to Bloomberg sources, “the White House would like to extend the debt limit long enough to move back the threat of a U.S. default until after Congress can deal with funding for the full federal fiscal year and tax legislation the Trump administration backs.”

In other words, yet another can kicking, one which would likely push back the debt limit debate to some time in December.

How likely is the success of this latest U-turn by Trump? Bloomberg writes that administration officials have already begun talks with congressional leaders about the new approach. It remains to be seen if Trump will be able to win over enough Democrats to silence what, at least as of this moment, appears to be staunch opposition by the Freedom Caucus which also succeeded in sinking Trump’s first attempt at repealing Obamacare back in March.

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