One of the guns used in the November 13, 2015 Paris terrorist attacks came from Phoenix, Arizona where the Obama administration allowed criminals to buy thousands of weapons illegally in a deadly and futile “gun-walking” operation known as “Fast and Furious.” ATF leaders went out of their way to keep the information under the radar and ensure that the gun owner’s identity was “kept quiet,” according to law enforcement sources involved with the case. “
"As gamma exposure turned significantly short on Monday 6/27, it also contributed to a larger squeeze up on Tuesday and Wednesday (please note, these were even more prominent on 8/26 and 8/27 than this week)... We maintain the view that we have not yet seen the highs of VIX due to Brexit and related risks. The points discussed above suggest equity markets face elevated risk in the days and weeks ahead."
Despite mainstream economists hopes that somehow “this time will be different,” the ongoing massaging of economic data through seasonal adjustments to obtain better headlines did not translate into actual prosperity. Of course, “reality” is a cruel mistress and despite ongoing hopes and overstatements, “fantasy” eventually gives way.
"We learned yesterday evening that NHTSA is opening a preliminary evaluation into the performance of Autopilot during a recent fatal crash that occurred in a Model S. This is the first known fatality in just over 130 million miles where Autopilot was activated"
Despite the alphabet soup of bail-out facilities provided by the ECB, people still do not trust the system. In our view, the TARGET2 chart is the best way to assess trust in central banks and as it clearly shows, the narrative is failing. It seems impossible for Draghi to reestablish monetary confidence.
GREED & fear continues to believe that the real flash point in the EU is likely to be Italy. GREED & fear was reminded of this reading this week that Italian Prime Minister Matteo Renzi is now seeking Europe’s agreement for a €40bn state-funded recapitalisation of the country’s banking system.
It is one of the great ironies of life that each generation believes its experiences are unique. The reality is that we have seen this movie before - with different actors, plot twists, and technological advancements. The basic plot seems to push along a hauntingly familiar path.
A day after the most awkward three-way handshake in history between Obama, Trudeau, and Nieto, the latter's central bank just pushed rates higher by a bigger than expected 50bps to 4.25% (exp +25bps). The Peso is surging back (extending its bounce off January lows) retracing all the post-Brexit losses... on what seems like fears of a surge in food inflation.
China has taken the opportunity of lower oil prices since early-2015 to accelerate the strategic petroleum reserve (SPR) builds at c.1mbd, pushing the total oil in stock under SPR to an estimated 400mmbbl, or 53 days of net crude oil import equivalent. This volume might be close to the capacity limit and together with potential teapot utilization pullback and slower-than-expected demand from China could increase near-term risks to global oil prices (c.1.2mbd impact).
Earlier this week we noted that Hillary's lead over Donald Trump in the polls was either 1% or 12%,depending on which poll you believed. We also pointed out that the polls were taken prior to the UK referendum. Today,in the first post-Brexit poll, the result is a quite stunning reversal from last week, Rasmussen finds Donald Trump is leading Hillary Clinton 43% to 39%.