Buying more time may not change the outcome but it always reduces stress and fear that a deadline leads to sloppy work and missed opportunities. Buying more of a trend has the opposite effect as a linear move becomes parabolic. The contrast of what more time means dominates the week ahead. The extension of US/China trade talks and the removal of any magic around March 1 maybe seen as a benefit to investors given the laser focus on the US/China talks and the building hopes that a deal is near. Sequencing events suggest, more talks now mean a mid-March meeting with Trump/Xi and a April 1 deal. That drives risk-on. Against this, you have the US markets underperforming last week as EM and Asia shine with hopes that global trade and growth return. The annual investment letter from Buffet and the Berkshire Hathaway results may be a counter to this given his America investment theme and $25bn 4Q loss. Some of the blame for this was leveled on Kraft Heinz (KHC) given its SEC investigation. In the week ahead, the focus is likely to remain on trade, Brexit, FOMC policy and the heavy economic data releases from US 4Q GDP to ISM, to German jobs and China PMI. The theme of US growth and policy divergence versus the rest of the world was 2018’s story and yet many continue to see this holding using the USD and S&P500 as the barometers. US shares are up 11% year-to-date and the broad Russell 2000 index has had its best weekly winning streak since 1996. But so too has emerging markets with the focus on China recovery and value driving.

Buffets letter is taken as a guide map for value investors into 2019. He wrote that investors should continue betting on the American economy because Berkshire has prospered by doing so, but that they shouldn't forget about the rest of the world. "There are also many other countries around the world that have bright futures. About that, we should rejoice: Americans will be both more prosperous and safer if all nations thrive," Buffett wrote. "At Berkshire, we hope to invest significant sums across borders." Berkshire continues to hold roughly $130 billion in cash and short-term investments because he hasn't found any reasonably-priced acquisitions in recent years, so he'll likely continue investing more in stocks. "Prices are sky-high for businesses possessing decent long-term prospects," he wrote.

The profit margin focus in US shares is significant and contradictory as FactSet highlights in its weekly insight report. “For the first quarter, the S&P 500 is projected to report a year-over-year decline in earnings of 2.7%, but year-over-year growth in revenues of 5.2%. Given the dichotomy in growth between earnings and revenues, there are concerns in the market about net profit margins for S&P 500 companies in the first quarter. The estimated net profit margin for the S&P 500 for Q1 2019 is 10.8%. If 10.8% is the actual net profit margin for the quarter, it will mark the first year-over-year decline in the net profit margin for the index since Q4 2016. It will also mark the lowest net profit margin reported by the index since Q4 2017.”

Question for the Week Ahead: What matters most in the week ahead? The next week brings a host of economic data, political decisions and important meetings. The battle of politics is every present in the market headlines whether its Brexit, EU immigration and nationalism, US immigration and the 2020 Presidential race, or China and its middle-income trap. The evolution of the debate in markets has shifted from the end of history to a battle between capitalism and socialism again.

Korea maybe the first focus, with the Trump/Kim summit grabbing the headlines, but the Bank of Korea rate decision and the early February data from Korea leading the economic reports on the present cost of the trade disruption and China slowdown. The role of China in the debate connects with the expectation being that North Korea denuclearization rests on a good outcome for US/China trade talks. Xi has a card to play and won’t give up leverage without something from Trump. The politics of South Korea are in play as well as the growth hit of 4Q continuing in 1Q will make the pressure to solve North Korea issues that much more intense. The WSJ article last week on the Moon push for higher minimum wage and its effect on growth stands out. Its minimum wage will rise by 10.9% this year, after a 16.4% increase last year. At 8,350 Korean won per hour ($7.44), the rate is now higher than the U.S. federal minimum wage, even though the country’s gross domestic product per capita is around half the U.S.’s. Even before these increases, the Korean minimum wage was equivalent to 53% of the country’s median wage in 2017—on par with the U.K.’s and higher than Japan’s.

Brexit remains a key focus. The ECB highlighted the effects of Brexit on growth last week. The May progress report next week will clearly be in play for markets as it will add to the political risks ahead. The splintering off of 7 Labour MPs last week brought some hopes that a Corbyn government wasn’t imminent. The Tory support for May’s plans remains in doubt and the lack of any consensus over how to divorce from the EU leaves many expectations a delay first. GBP gains in the last week will be watched against the reality of the deadline in March.

EU growth and politics. The drum beats warning about the EU Parliamentary elections in May continues across markets. Since the last EU election in 2014, Britain has voted to leave the EU and Italy and Austria have government coalitions that include the far right. Over a dozen EU nations have fragile minority governments and Poland has turned as hostile toward Brussels as Hungary. The role of growth in fixing anti-EU nationalist politics will be clear and the Draghi comments highlighted over the weekend the pressures on EU institutions and Brexit/anti-EU debates. The PMI reports for Europe next week will be watched accordingly. 

FOMC and the Powell Collar. The idea that the FED is targeting financial conditions and that the S&P500 below 2300 or above 2800 matters to policy remains in play for markets. There is clarity coming over the Fed reaction function coming as FOMC Chair Powell presents his testimony to Congress. This matters as it sets the tone for rate hike expectations and the role of politics in driving the Fed. 

Market Recap: The focus on the week was China-US trade talks. Expectations for a deal rose during the week with leaks of an MOU and Trump planning on a Xi meeting soon to seal a deal.  Brexit was also a focus with the news that 7 Labour MPs split off adding to the political drama of the UK. The FOMC minutes added to a “wait and see” view of Fed policy risks for 2019. US data was mixed but core durable goods orders fell suggesting less business investment while jobless claims fell. US existing home sales fell to 3-year lows. The flash PMI for the US showed a surprise uptick in Services. The contrast to rest of the world continued with Eurozone manufacturing going into contraction for the first time since 2Q 2013 while German IFO business sentiment hit a 4-year low. Japan reported a big drop in exports in January – off 8.4% y/y –the worst since Oct 2016, highlighting the US/China trade spill-over. BOJ Kuroda added to negative yields with suggestions that he would ease further should the JPY hurt the economy. China shares rallied sharply, mostly due to trade deal hopes, with little other data supporting the economy. In Brazil, a campaign finance scandal hit the government with Bolsonaro’s secretary general Bebianno blamed for misusing campaign money delaying the debate on pension reform. South Africa was also in focus with the national budget released by FM Mboweni including a 30-year $5bn bailout for state-utility Eskom hurting the debt-to-GDP.  

Equities: The MSCI all-country World Index rose 1.18% to 504.15 on the week. The MSCI EM rose 2.71% to 1058.65 on the week. The US markets lagged as did India and some of Europe as Asia outperformed led by China. The Earnings for the S&P 500 in 4Q are 89% reported with 69% beating EPS and 61% beating revenues. The blended growth in earnings is 13.1% for 4Q – the fifth quarter of double-digit gains.  

• The S&P 500 rose 0.62% to 2792.67 on the week. This was the ninth week of gains, the best winning streak in nearly 25 years, albeit in thin volume given the Monday Presidents’ Day holiday. Materials and utilities led the gains while health care lagged.  The DJIA rose 0.57% to 26,031.81 on the week. The NASDAQ up 0.74% to 7,527.54 on the week. The Cboe VIX fell 9.39% to 13.51 on the week – now at 4-month lows. .
• The Stoxx Europe 600 rose 0.73% to 370.30 on the week.  The German DAX rose 1.4% to 11,457.70 on the week. The French CAC40 rose 1.22% to 5,215.85 on the week. The UK FTSE fell 0.80% to 7,178.60 on the week.  The Italian MIB rose 0.25% to 20,262.51.
• The MSCI Asia Pacific Index rose 2.20% to 159.03 on the week. The Japan Nikkei rose 2.51% to 21,425.51 on the week. The Hong Kong Hang Seng rose 3.28% to 28,816.30 on the week. The China Shanghai Composite index rose 4.54% to 2,804.23 on the week. The India Nifty rose 0.63% to 10,791.65 on the week. The Korea Kospi rose 1.57% to 2,230.50 on the week. The Australian ASX rose 1.52% to 6,241.90 on the week.

Fixed Income: The pressure on bonds came more from asset allocation (equities up) than from any new data suggesting a turn in policy. Easy money policy continues and the FOMC minutes suggested a clear pause with data dependency. The FOMC also showed less consensus about forecasts and models except for the need to stop the balance sheet QT early – sometime in this year likely at $3.5trn. The same came from the ECB and from the Riksbank, both are more data dependent and perhaps a bit less dovish than the market hopes. Throw in clearly lower inflation than expected in Sweden, weaker flash PMI in Europe and you have a boring week for bonds as they watch geopolitical headlines and worry about politics, Brexit, US/China Trade talks and the like with safe-haven core outperforming others. EM markets benefited with better flows – but more in equities – as budgets and borrowing have limites, as in the case of South Africa with Fitch downgrading it. China continued to wait for the PBOC to do more and got nowhere, with less data and more focus on US/China talks.

• US Bonds see mild curve steepening with deficit fears, Fed balance sheet focus. For the week - 2Y 2.50% off 2bps, 3Y 2.46% off 3bps, 5Y 2.47% off 2bps, 7Y 2.55% off 2bps, 10Y 2.65% off 1bps, 30Y 3.02% up 2bps.
• The Canadian 10-year bond yields were flat at 1.89% for the week - BOC Poloz remains biased to hike but data point to a long wait. Focus is on commodities, US/China still.
• Japan JGBs rally with bull curve steepening as data erodes from trade to flash PMI, BOJ sounds more dovish – 2Y -0.18% off 1bps, 5Y -0.17% off 1bps, 10Y -0.04% off 3bps, 30Y off 2bps to 0.58%.
• Australian bonds rally with weaker commodities, RBA minutes – 3Y 1.64% off 3bps, 10Y 2.10% off 4bps. The New Zealand 10-year off 2bps to 2.21%.
• UK Gilts curve flatten waiting for Brexit news, political clarity vs better data.  For the week – 5Y up 8bps to 0.90%, 10Y flat at 1.16%, 30Y up 1bps to 1.69%.
• German Bunds hold bid with data mixed, politics in play – 2Y -0.56% off 1bps, 5Y -0.38% off 1bps, 10Y 0.09% off 1bps, 30Y 0.71% off 1bps.
• French OATs see curve flattening with mixed data, political doubts – 2Y -0.45% flat, 5Y -0.9% up 2bps, 10Y 0.52% off 2bps (back to lows), 30Y 1.52% off 3bps.  Auctions went off without issue.
• Italy BTPs see bear curve flattening with politics, growth doubts driving – 2Y up 10bps to 0.54%, 5Y up 9bps to 1.84%, 10Y up 8bps to 2.88%, 30Y up 6bps to 3.72%.
• Spain Bonds rally despite election fears with mixed growth views – 10Y off 7bps to 2.30% on the week.
• Portugal sees rising political doubts, growth fears even as 10-year bond yields fell 8bps to 1.49% on the week.
• Greek bonds extend rally, focus is on growth and value – 10-year bond yields fell 2bps to 3.81% with 3.50% next big target.

Foreign Exchange:The US dollar index fell 0.45% to 96.51 on the week. In emerging markets the USD was mostly weaker led by China and Russia. Asia: CNY up 1% to 6.701, IRN up 0.4% to 71.02, KRW up 0.3% to 1122; EMEA: ZAR up 0.6% to 13.99, RUB up 1.3% to 65.357, TRY off 0.9% to 5.317; LATAM: MXN up 0.5% to 19.136, BRL off 1.3% to 3.748, ARS off 1.5% to 39.17.

• EUR: 1.1340 up 0.45% on the week with 1.1250-1.1380 holding the line and ECB vs. FOMC still the focus with data dependency. US/China talk hopes drive EUR bid.
• JPY: 110.70 up 0.2% on the week with EUR/JPY 125.40 up 0.6% - focus is on risk on and rates with BOJ Kuroda comments on JPY key 110-112 holding pattern
• GBP: 1.3050 up 1.25% on the week with EUR/GBP off 0.9% to .8690 with focus on Brexit deal hopes and politics still, 1.30 pivot for 1.27 or 1.34 on some clarity for deal.
• CHF: 1.0000 off 0.5% on the week with EUR/CHF off 0.1% to 1.1335 as CHF safe-have over Italy and ECB doubts rising while 1.00 remains pivot for .9880 or 1.0150.
• AUD: .7125 off 0.15% on the week with commodities (coal and China story) along with RBA dovishness (new calls for May cut) driving .7050 still key with NZD .6845 off 0.3% - with China issues rising.
• CAD: 1.3135 off 0.8% on the week with data mixed to stronger and BOC still biased to hike standing out along with oil/Venezuela story driving – 1.32 break opens 1.3050 test.

Commodities: The GS&P/GSCI total return index rose 1.5% to 2510.23 on the week. NatGas and energy support much of the gains this week along with Palladium/Platinum as clean auto technology demand continues. The losers were wheat, lumber, coffee and cocoa – all wrapped around supply stories.

• Oil: $57.26 up 2.29% on the week (Apr futures). Brent $67.12 up 1.31% on the week – with US inventories still building out, its offset by Venezuela and OPEC and growth/trade story with $55-$58 consolidations.
• Gold: $1332.80 up 0.8% on the week – with focus on $1325-$1345 consolidation as risk-on in equities and less US/China trade fear battles with USD weakness, EU fears.  Silver up 1.09% to $15.914 – with $16 pivot in play again. Platinum $845.90 up 4.83% and Palladium $1462.20 up 3.91% on the week.
• Corn: $375.20 up 0.15% on the week. Soybeans $910.20 up 0.3% - all about the US/China trade (10mb more China buying promised) and offsetting inventories. Wheat $4.8660 (Mar) off 3.47% with weather and rest of world in play. USDA forecasts a slight improvement in 2019 for all major crops, except cotton. This year’s season-average price for corn is forecast at $3.65, up 1% from 2018. The season-average price for soybeans in 2018 is forecast at $8.80, a 2% increase from 2018. Wheat had a tough week off 3.47% to $4.8660 – watching weather as key.
• Copper: $2.9185 up 4.14% cash on the week, with March futures $2.9515 up 5.47% and with May futures $2.9470. The China March Iron Ore futures $83.07 fell 1.7% with focus on China demand drop/coal story. 

Calendar for the Week Ahead: The magic deadline on US/China trade talks, the US/North Korea summit, more Brexit debate, the usual month-end and month-beginning economic data from flash HICP, consumer sentiment to global manufacturing PMI. The US 4Q GDP will be critical in setting the tone for the FOMC Chair Powell testimony to Congress. The PCE inflation guage will be viewed to see if Goldilocks remains. US auto sales and ISM will be watched to confirm 1Q soft patch or worse.

Monday, February 25: UK Brexit, US 2Y and 5Y sale

• 1200 am Japan Dec LEI 99.1p 97.9e / Coincident 102.9p 102.3e
• 0300 am Spain Jan PPI (y/y) 1.6%p 1.2%e
• 0830 am US Jan Chicago Fed national activity 0.27p 0.11e
• 0900 am Mexico 4Q final GDP (q/q) 0.8%p 0.3%e (y/y) 2.5%p 2.6%e
• 1000 am US Dec wholesale inventories (m/m) 0.3%p 0.2%e
• 1030 am US Feb Dallas Fed manufacturing 1p 2e
• 1130 am US Treasury sells 3M and 6M bills
• 0100 pm US Treasury sells 2Y and 5Y notes
• 0400 pm UK PM May statement on Brexit

Tuesday, February 26: UK inflation hearings, Hungary rate decision, US housing starts,  home prices, consumer confidence, 7Y note sale

• 0200 am German Mar GfK consumer confidence 10.8p 10.8e
• 0245 am French Feb consumer confidence 91p 92e
• 0400 am Austria Feb Bank Austria manufacturing PMI 52.7p 53e
• 0400 am UK inflation hearings / BOE FPC meeting
• 0430 am UK Jan mortgage approvals 38,779p 40,100e
• 0540 am German 2Y Schatz auction
• 0545 am Italian 6M BOT auction
• 0800 am Hungary central bank rate decision – no change from -0.15% / 0.9%
• 0830 am US Dec housing starts (m/m) 3.2%p -0.5%e / 1.256m p 1.253m e
• 0900 am US Dec FHA home prices (m/m) 0.4%p 0.4%e
• 0900 am US Dec S&P/Case-Shiller home prices (y/y) 4.7%p 4.5%e
• 1000 am US Feb Conference Board consumer confidence 120.2p 125e
• 1000 am US Feb Richmond Fed manufacturing -2p +1e
• 1130 am US Treasury sells 1Y bills
• 0100 pm US Treasury sell 7Y notes
• 0430 pm US weekly API crude oil inventory +1.26mb p +0.5mb e

Wednesday, February 27: Eurozone economic sentiment, Canada CPI, US factory orders, FOMC Powell, pending home sales

• 0400 pm Korea Feb business confidence 67p 68e
• 0830 pm China Jan industrial profits (y/y) 10.3%p
• 0830 pm BOJ Kataoka speech
• 0300 am Sweden Feb consumer confidence 92p 93.8e / business confidence 100.3p 102.5e / consumer inflation expectations 3.4%p 3.2%e
• 0300 am Sweden Jan household lending (y/y) 5.5%p 5.5%e
• 0400 am ECB Jan M3 (y/y) 4.1%p 4.0%e / loan growth 3.3%p 3.2%e
• 0400 am Italy Feb consumer confidence 114.0p 113.2e / business 102.1p 101.4e
• 0500 am Eurozone Feb economic sentiment 106.2p 105.8e / business confidence 0.69p 0.63e 0
• 0540 am German 10Y Bund auction
• 0545 am Italy 5Y and 10Y BTP auction
• 0600 am France Jan jobless claims 8.4k p -4.2k e
• 0615 am Spain Feb business confidence -4.1p -6.7e
• 0830 am Canada Jan CPI (m/m) -0.1%p +0.1%e (y/y) 2%p 1.4%e / core 1.7%p 1.5%e
• 0900 am Mexico Jan trade balance $1.836bn p -$2.3bn e
• 1000 am US Dec factory orders (m/m) -0.6%p 0.6%e / ex trans -1.3%p +0.8%e
• 1000 am FOMC Chair Powell testimony
• 1000 am US Jan pending home sales (m/m) -2.2%p -0.5%e
• 1030 am US weekly EIA crude oil inventories 3.672mb e +1mb e
• 0130 pm Mexico Banxico inflation report

Thursday, February 28: Korea IP, BOK rate decision, flash HICP from Germany, France, Italy,, China PMI, India 4Q GDP, Sweden 4Q GDP, Fed speeches.

• 0600 pm Korea Jan industrial production (m/m) -1.4%p -1.7%e / manufacturing (y/y) 2%p 1%e
• 0600 pm Korea Jan retail sales (m/m) 0.8%p 0.1%e (y/y) 3%p 1.9%e
• 0650 pm Japan Jan retail sales (m/m) 0.9%p -1%e (y/y) 1.3%p 1.1%e
• 0650 pm Japan Jan industrial production (m/m) -0.1%p -2.5%e (y/y) -1.9%p -1.5%e
• 0730 pm Australia 4Q Private Capex (q/q) -0.5%p +0.5%e / private sector credit (m/m) 0.2%p 0.3%e
• 0800 pm China Feb NBS manufacturing PMi 49.5p 49.5e / service 54.7p 54.5e
• 0800 pm Korea rate decision no change from 1.75% expected
• 0830 pm BOJ Suzuki speech
• 0200 am German Jan import prices (m/m) -1.3%p 0.2%e (y/y) 1.6%p 1.2%e
• 0245 am French Feb flash HICP (m/m) -0.6%p 0%e (y/y) 1.4%p 1.7%e / National CPI 1.2%; 1.3%e
• 0300 am Spanish Feb flash HICP (m/m) -1.7%p 0.2%e (y/y) 1%p 1%e / National CPI 1%p 1.1%e
• 0330 am Sweden Jan retail sales (m/m) -1.4%p 0.7%e (y/y) -1.1%p 0.7%e
• 0330 am Sweden 4Q GDP (q/q) -0.2%p 0.5%e (y/y) 1.6%p 2.1%e
• 0330 am Sweden Jan PPI (y/y) 5.6%p 4.5%e
• 0500 am Italy Feb flash HICP (m/m) -1.7%p -0.4%e (y/y) 0.9%p 1%e / National CPI 0.9% 0.9%e
• 0700 am India 4Q GDP (y/y) 7.1%p 6.9%e
• 0800 am German Feb flash HICP (m/m) -1%p 0.6%e (y/y) 1.7%p 1.8%e / National CPI 1.4%p 1.5%e
• 0800 am FOMC Vice Chair Clarida speech
• 0815 am FOMC Chair Powell speech
• 0830 am Canada Jan PPI (m/m) -0.7%p 0.4%e
• 0830 am Canada 4Q C/A deficit C$10.3b p C$11.5bn e
• 0830 am US 4Q preliminary GDP 3.4%p 2.4%e / price index 1.5%p 1.7%e
• 0830 am US weekly jobless claims 216k p 220k e
• 0945 am US Feb Chicago PMI 56.7p 57.5e
• 1215 pm Fed Harker Speech

Friday, March 1: Japan Tokyo CPI, 4Q Capex, Korea trade, global manufacturing PMI and ISM, German jobs, UK M4, Canada GDP, US PCE, car sales, Michigan consumer sentiment

• 0430 pm Australia Feb AIG manufacturing PMI 52.5p 52e
• 0630 pm Japan Feb Tokyo CPI core 1.1%p 0.9%e
• 0630 pm Japan Jan unemployment rate 2.4%p 2.4%e
• 0650 pm Japan 4Q Capex Spending (y/y) 4.5%p 2.2%e
• 0700 pm Korea Feb Trade surplus $1.34bn p $1.5bn e / exports -5.8%p -7%e
• 0730 pm Japan Feb Nikkei final manufacturing PMI 50.3p 48.5e
• 0845 pm China Feb Caixin manufacturing PMI 48.3p 48.7e
• 1200 am India Feb Nikkei manufacturing PMI 53.9p 52.5e
• 1200 am Japan Feb consumer confidence 41.9p 41.6e
• 0200 am German Jan retail sales (m/m) -4.3% 2.5%e (y/y) -2.1%p -0.8%e
• 0200 am German Jan unemployment rate 3.3%p 3.3%e
• 0315 am Spanish Feb manufacturing PMI 52.4p 51.5e
• 0345 am Italian Feb manufacturing PMI 47.8p 47.4e
• 0350 am French Feb final manufacturing PMI 51.2p 51.4e
• 0355 am German Feb final manufacturing PMI 49.7p 47.6e
• 0355 am German Feb unemployment change -2k p -5k e / rate 5%p 5%e
• 0400 am Eurozone Feb final manufacturing PMI 50.5p 49.2e
• 0430 am UK Jan mortgage approval 63,790p 63,500e / cons. Credit G0.687bn G0.8bn
• 0430 am UK Feb manufacturing PMI 52.8p 52e
• 0500 am Eurozone Feb flash HICP (y/y) 1.4%p 1.5%e / core 1.1%p 1.1%e
• 0500 am Italy 2018 government budget -2.3%p -2.6%e / GDP 1.6%p 1%e
• 0830 am Canada 4Q GDP (q/q) 0.5%p 0.4%e (y/y) 2%p 1.3%e
• 0830 am US Dec personal income (m/m) 0.2%p 0.3%e / spending 0.4%p -0.2%e / core PCE 1.9%p 1.9%e
• 0930 am Canada Feb manufacturing PMI 53p 52e
• 0945 am US Feb final manufacturing PMI 54.9p 53.7e
• 1000 am US Feb ISM manufacturing 56.6p 55.9e
• 1000 am US Feb final Michigan consumer sentiment 91.2p 95.6e
• 1250 pm Atlanta Fed Bostic speech
• 0300 pm US Feb total vehicle sales 16.7m p 16.8m e

Conclusions: Are we really just playing on borrowed time? The extensions of the business cycle in the US from the Trump tax reform and deregulation leave many economists nervous that the US economy is on borrowed time. Others see that the FOMC rate hikes have been too effective and have moved the US growth back to potential faster than expected.  Many investors were interested in the Buffet Letter this weekend and his warning about “the Big One” -  a major hurricane, earthquake, or cyber-attack that will 'dwarf hurricanes Katrina and Michael.' Although he said such a disaster could occur tomorrow or in decades, he warned that it was inevitable and losses would be 'very big.'

The other read for the weekend came from the BBC where a focus piece on the demise of civilizations highlighted some worrying signals about the present world. The interconnected globalization push of the major nations makes the world far more complicated and the risk of a collapse between socialists or capitalists seems far too simple a story now. What Buffet and this article share in common is that both highlight the risk of climate change and natural disasters in destroying societies. 

The point is that unknown unknowns play an important role in the present market risk analysis given the lack of cushion most central bankers have to battle against a significant market shift caused by any outside shock.  Many see the world as balanced and the price action as supportive for a reasonable 2019 – all that makes sense as long as we have no surprises. But as we know, the chances for such increase with the time allotted.