Goldman Downgrades Valeant On "Lack Of Confidence" After Charlie Munger Slams Company

A bigger problem for Valeant, however, emerged today when none other than Warren Buffett's right hand man Charlie Munger in an interview with Bloomberg "tore anew into the besieged drug company, calling its practice of acquiring rights to treatments and boosting prices legal but “deeply immoral” and “similar to the worst abuses in for-profit education.”  And to prove just how much clout Munger does indeed have, moments ago the most important Wall Street bank, Goldman Sachs, downgraded Valeant to Neutral from Buy, cutting its share price target from $180 to $122.

Futures Rebound From Overnight Lows On Stronger European Manufacturing Surveys, Dovish ECB

On a day full of Manufacturing/PMI surveys from around the globe, the numbers everyone was looking at came out of China, where first the official, NBS PMI data disappointed after missing Mfg PMI expectations (3rd month in a row of contraction), with the Non-mfg PMI sliding to the lowest since 2008, however this was promptly "corrected" after the other Caixin manufacturing PMI soared to 48.3 in October from 47.2 in September - the biggest monthly rise of 2015 - and far better than the median estimate of 47.6, once again leading to the usual questions about China's Schrodinger economy, first defined here, which is continues to expand and contract at the same time.

The Military-Industrial Complex's Latest Best Friend - Barack Obama

The Pentagon just won another small skirmish in its long war with Social Security and Medicare. That is the unstated message of the budget deal just announced gleefully by congressional leaders and the President.  To understand why, let’s take a quick trip down memory lane.

PBOC Fixes Chinese Yuan Higher By 0.54%, Most Since 2005

As per the fixing limits established as part of the August 11 Yuan devaluation, moments ago the PBOC announced that it had set the Yuan at a USDCNY fixing of 6.3154, a strengthening of a massive 0.54% - the most since 2005 - following the manic end of trading PBOC intervention on Friday that sent the Yuan soaring some 300 pips from 6.3475 to 6.3175.

Putin's Approval Rating Reaches A New High

Vladimir Putin’s approval rating in Russia has soared to yet another all time high; leaving all those who don’t like Putin or were hoping for some sort of regime change in Russia continue to be out of luck. One reason why we are even posting about this is that the Western press has also reported on the event, employing a somewhat less neutral tone of voice. What makes the sour grapes style reporting in the Western media especially funny is that while it is true that the Kremlin exerts extraordinary influence on the media in Russia, one wonders in what way their reportage on Syria is different from the reporting in the happily self-censoring US mainstream media on the Iraq war, especially in the run-up to said war.

Confusion: US Equities Drift Lower (China Higher), Yuan Surges & Purges As China Manufacturing Misses (And Beats)

Confusion reigns... China's Manufacturing PMI is in contraction according to both the Official and Markit/Caixin measures (but the former was flat and missed while the latter rose and beat "confirming economic stability" according to the 'official' press). Following the largest strengthening fix for the Yuan in 10 years, both the onshore and offshore Yuan are weakening by the most since the August devaluation. Finally, having cliff-dived at the open, Chinese stocks have bounced back to unchanged on the Ciaxin PMI beat (but US equities drift lower still).

Peak Unicorn

Things are getting crowded in the once-exclusive unicorn club...

Homicide Rates Cut In Half Over Past 20 Years (While New Gun Ownership Soared)

The American public believes that homicides and gun deaths are increasing in the United States. Those who think violence is getting worse should probably watch less television and look around them instead. The murder rate in the US is currently similar to 1950s levels. Meanwhile, the number of privately owned guns (and gun commerce in general) in the United States has increased substantially in recent decades.

US, Japanese Stocks Extend Losses; Turkish Lira Soars Most In 7 Years As Gold Mini-Flash-Crashes

Despite the world seemingly exuberant at Turkey's fraud election, sparking the biggest rally in the Lira since Nov 2008 (confirming once again that "markets love totalitarian governments,") it appears the centrally-planned machinations of the US equity markets are not living up to their promises of wealth for all (and rate-hikes don't matter). US and Japanese equity futures are opening notably lower, erasing all of the post-Fed exuberance with Dow Futs down over 200 points from pre-BoJ hope highs. Finally, gold futures were hammered lower at the Asia open (on heavy volume) only to rip back to practically unchanged.

"What The Heck Is Going On Here"

Succinctly summarizing the state of the mainstream media's cognitive dissonance at the state of 'real' America...

Ban Ki-Moon Condemns The American Stand On Syria, Endorses Putin's

In an interview with Spanish newspapers that was published October 31st, U.N. Secretary General Ban Ki-Moon condemned U.S. President Barack Obama’s demand that Syrian President Bashar al-Assad be removed from office, and Moon said: “The future of Assad must be determined by the Syrian people." The U.N. Secretary General's detailed comments are implicitly blaming all of this - lots of blood and misery - on U.S. President Obama, and on the “many Western countries” who ally with him and have joined with him in demanding regime-change in Syria. Ban ki-Moon took a rare courageous position here: what he said was correct, though it’s virtually unmentionable in the West.

JPM Quants: The Catalyst For The October Rally Is Over; "All 4 Sectors Are Currently Long Equities"

In all, while balanced mutual funds and risk parity funds are the ones which appear to have triggered the equity rally since the end of September, the rally was amplified at around mid October by CTA capitulation. The reversal of CTAs equity exposure from a short to a long position means that all four sectors, CTAs, Discretionary Macro hedge funds, risk parity funds and multi-asset or balanced mutual funds, are currently long equities.

Stocks, Symmetry, & A Significant Threat To The Global Economy

Central banks can’t afford a big correction to take place as it goes counter to their mandate, a stable growing economy, hence they interfere every single time a correction of size is about to unfold. And any threat to the global economy must be prevented. Now that fiscal year end mark-ups are over for many funds buyers have to prove how committed they are to driving markets higher. Price will ultimately confirm how this will play out, but altogether this chart is an amazing construct of symmetry and, as fans of structures and symmetry, it certainly has our attention. We can’t recall ever seeing such a precise structure.

"Social Expenditures" In the US Are Higher Than All Other OECD Countries, Except France

While redistributive social spending in the US is indeed different from many other countries, the overall magnitude is actually greater (both proportionally and in absolute terms) in the US than in almost all other countries measured. One can argue that the way that the wealth is redistributed through public policy in the US is "wrong" or "suboptimal." But, to argue that there is less redistribution as a result of public policy in the US than elsewhere is simply wrong.