Brazilian Presidential Candidate Dies In Jet Crash

UPDATE: *BRAZIL PRES. CANDIDATE CAMPOS DIES IN PLANE CRASH: GLOBONEWS

Brazil's stock market is reeling this morning as rumors and now news hit that Brazilian Presidential candidate Eduardo Campos was on board a private jet that crashed in the city of Santos. Polls had put Mr. Campos head-to-head with Ms. Rousseff (but behind Ms. Silva). A police official in Santos said there were "certainly" fatalities in the crash, but could not say how many or provide any additional information. Campos had run on a platform of less government intervention and proposed a bill to ensure central bank indpendence.

We're Relying On Phantom Wealth To Fund Our Retirement

Phantom wealth cannot possibly fund unprecedented retirement and healthcare promises. Only real wealth can do that, and central bank liquidity and the asset bubbles it inflates are not real wealth.

The Housing Recovery Continues Apace - Mortgage Apps At 14-Year Low

How much longer can the myth of a housing recovery remain alive in the mainstream media's narrative? The smoothed average of Mortgage Applications in the US fell to its lowest since September 2000 this week. Mortgage applications have slumped for 9 months... as mortgage rates have declined notably... but still we are told 'rates are just too high'. And yet, bullish market protagonists are convinced rates are due to rise (and the bond market is wrong) - one can only imagine the slump if that should occur...

Stocks & Dollar Drop, Bonds & Bullion Pop On Dismal Retail Sales Print

Oddly, overnight news in Asia and Europe was terrible enough to juice US equity futures back to Monday's highs (and run those stops) as USDJPY was pressed up to 102.50... but dismal US retail sales data sent them reeling. Treasury yields are tumbling (5Y now -3bps on the week), gold and silver are jumping (over $1310 and $20 respectively) after an early slam down, The USD is getting monkey-hammered as EUR repatriation strength dominates, oil is up, and stocks have leaked notably back off the day's highs.

Retail Sales Miss For Third Month In A Row, Worst Print Since January

But the talking heads said that the consumer is back and jobs are soaring? Retail sales missed expectations for the 3rd month in a row (after the weather rebound was supposed to kick in?) with an unchanged 0.0% print in July (against expectations of a 0.2% rise). This is dramaticaly off the 1.5% growth rate seen in March. Across the board, retail sales were weak with Ex Auto & Gas up only 0.1% against expectations of a 0.4% gain. Department Store sales fell 0.7% MoM. So much for pent-up demand.

Ukraine Slams "Provocation By A Cynical Aggressor", Refuses Russian Convoy Entry

With the Russian humanitarian convoy approaching the Ukraine border, there was much confusion yesterday whether Kiev would or wouldn't allow the roughly 280 trucks carrying "stuff" to enter its territory. The confusion rose yesterday afternoon when Russia's Lavrov told reporters in Sochi that Russia, after it asked for Germany's aid in getting Kiev to agree, received Ukraine’s permission for the convoy to enter after agreeing to Ukraine’s proposed route, agreeing that the convoy trucks will carry Ukrainian license plates, and complying with Ukraine’s demand for Ukrainian govt representatives to be on trucks. Turns out Ukraine was just kidding, and as Reuters reports this morning, the Kiev government once again denounced the dispatch of a Russian humanitarian aid convoy to eastern Ukraine as an act of Russian cynicism on Wednesday and said it would not be allowed in.

Frontrunning: August 13

  • Obama says Missouri shooting death tragic, reflection needed (Reuters)
  • U.S. Weighs Iraq Rescue Mission to Save Yazidis (WSJ)
  • Maliki says Abadi's appointment as Iraqi PM 'has no value' (Reuters)
  • Iran Joins U.S. in Backing Replacement for Iraq’s Maliki (BBG)
  • Kurds Push Attack in North Iraq as Maliki Clings to Power (BBG)
  • Obama Donors Embrace Corporate Inversions He Criticizes (BBG)
  • Syrian Forces Advance on Aleppo, Rebels Fear Another Siege (WSJ)
  • Israel, Palestinians pursue Gaza deal with ceasefire clock ticking (Reuters)
  • Ebola Drug’s Success Bolsters Approach for Other Diseases (BBG)
  • With Natural Gas Byproduct, Iran Sidesteps Sanctions (NYT)
  • Kazakhs to Hoard Food as Putin Sanctions Rattle Alliance (BBG)

Just The Right Amount Of Bad Overnight News To Ramp Global Equities

If it was crashing German business confidence yesterday setting the somber mood for European economic "growth" in the second half, with a European GDP decline if not outright contraction now almost practically inevitable, then overnight it was disappointing data from virtually every other spot in the globe (and Europe again) to hammer the message in, starting with a historic 6.8% drop in Japanese GDP driven by a record plunge in consumption, quickly followed by total social financing out of China which in aggregate rose by only RMB273.1bn in July, or just 18% of what was expected, with missing industrial production and retail sales just the cherry on top. Then it was Europe's turn again, where June Industrial Production contracted -0.3% on expectations of a 0.4% increase, to set the stage for tomorrow's Eurozone GDP print which, following Italy's triple-drip recession shocker last week, probably means it will be not only Japan but also Europe which are about to have taken a sharp move for the worse. All of which of course, explains why just as Europe opened, the USDJPY blasted off and took both EuroSTOXX and US equity futures higher with it, and at last check ES was some 10 higher.

Ferguson As America: "There Is A Brewing Problem... And It's Extremely Dangerous"

The riots and looting that erupted in Ferguson is symptomatic of something much more worrisome in America. This is a problem that is brewing and is extremely dangerous to say the least. The killing of this black teen is not simply racism. The problems are much deeper. Claiming this is just racism deflects the entire issue and makes it simply black-v-white. This is something far more serious for it is impacting our entire society. The police are being transformed from protecting the public into protecting government from the public. Most do not even see what transformation they have gone through.

Deflation Hits Oldest Profession In The World: Hookers By The Numbers

As The Economist finds, the internet is making the buying and selling of sex easier and safer (from what we have been told). But it's not all Pretty Woman... not only is the oldest profession in the world seeing prices going down (the dreaded deflation) as the shift online has boosted supply by drawing more locals into the trade; but as the following four charts show, rates vary dramatically by 'services', ethnicity, geography, build, and bust size.

The One Question About Ebola That Nobody Can Seem To Answer

How in the world is it possible that more than 170 health workers have been infected by the Ebola virus? That is the one question about Ebola that nobody can seem to answer. The World Health Organization is reporting this as a fact, but no explanation is given as to why this is happening. We are just assured that Ebola “is not airborne” and that getting infected “requires close contact with the bodily fluids of an infected person”. If this is true, then how have more than 170 health workers caught the disease? These workers are dressed head to toe in suits that are specifically designed to prevent the spread of the virus. So how is this happening?

 

Las Vegas Will Go Dry If Water Levels Drop 7% Further - Lake Mead Hits Record Lows

Six weeks ago we highlighted how "screwed" Las Vegas is as the ongoing 14-year drought weighs on water levels. Today, AP reports, Lake Mead - the main source of fresh water for Las Vegas and its 40 million visitors - just hit record low levels at 1080 feet. Most concerning - at 1,000 feet, drinking water intakes will no longer function and Las Vegas will go dry. As analysts concluded previously, "unless it can find a way to get more water from somewhere, Las Vegas is out of business. Yet they’re still building, which is stupid."

The FAA Just Closed Low-Flying Airspace Over Ferguson

FDC 4/2599 ZKC MO..AIRSPACE FERGUSON, MO..TEMPORARY FLIGHT RESTRICTIONS WITHIN AN AREA DEFINED AS 3 NM RADIUS OF 384428N0901812W (ST LOUIS VORTAC STL129011.0) SFC-3000FT TO PROVIDE A SAFE ENVIRONMENT FOR LAW ENFORCEMENT ACTIVITIES. PURSUANT TO 14 CFR SECTION 91.137(A)(2) TEMPORARY FLIGHT RESTRICTIONS ARE IN EFFECT. ONLY RELIEF AIRCRAFT OPERATIONS UNDER DIRECTION OF ST. LOUIS COUNTY POLICE DEPARTMENT ARE AUTHORIZED IN THE AIRSPACE. AIRCRAFT LANDING AND DEPARTING ST. LOUIS LAMBERT AIRPORT ARE EXEMPT FROM THIS TFR. ST. LOUIS COUNTY POLICE DEPARTMENT, TELEPHONE 3148892360 , IS IN CHARGE OF THE OPERATION. KANSAS CITY /ZKC/ ARTCC, TELEPHONE 9132548500, IS THE FAA COORDINATION FACILITY. 1408121315-1408182000

Japanese GDP Plunges 6.8% As Consumer Spending Collapses By Most On Record

Compared to the 3.6% drop in GDP when Japan last hiked its consumption tax in 1997, today's Q2 GDP collapse of 6.8% annualized is an utter disaster (even if it is slightly better than the expected -7.0% expectations thanks to a surge in the deflator). Inventory additions added 1.0% growth. Consumer Spending collapsed 5.2% QoQ - the most on record. Of course, in the traditional of Keynesian hockey-sticks, this XX% collapse in Q2 is expected to surge back to a 2.5% growth figure in Q3 and lead Japan to the holy grail once more.. only it didn't quite work out that way last time for Japan. Simply put this is the worst posible outcome for bulls, small beat not enopugh to rejuice QQE. As a gentle reminder of just what happened in 1997 - the last time Japan hiked taxes - we provide the eerily analog chart below...

Obama Sends Another 130 Marines Into Iraq To... Advise

In what appears to be the peak of arrogance (at the ignorance of the American people), Secretary of Defense Chuck Hagel has just announced that an additional 130 "military advisers" - mostly Marines - will be sent to Iraq to help the Kurds fight ISIS. We have two simple questions: 1) Since when did Marines become non-combat-troops? and 2) Is the President going to call all their wives and explain that their boots will not touch the ground? As gentle reminder, no less than 8 hours ago the adniinstration was considering 75 'military advisers' and now it's nearly double that?