NAR Admits Oil Slump Finally Hits Housing Sales

We were told that low oil prices were unequivocally good for America, so it's odd that, after seeing the weakest growth in pending home sales since Nov 2014, NAR blames "softness in sales on oil-related job losses from low oil prices." Pending home sales grew 2.1% YoY in October, (way below the 4.3% expected growth and 3.2% growth in September).

Chicago PMI Plummets To 48.7, Below Lowest Estimate

One month ago, the Chicago PMI soared, printing at 56.2, far above the highest estimate. It was not meant to be, and printing moments ago at 48.7, a mirror image of last month, as this time it printed below the lowest estimate of 49, with consensus expected a 54.0 print. And confirming that that US is indeed in a manufacturing recession is the starting fact that the PMI has been below 50 (shrinking) for more months in 2015 (6) than it has been above this expansionary threshold.

Milwaukee ISM Bounce Dies As Employment, New Orders Plunge

For the 10th month in the last 12, Milwaukee's ISM missed expectations. After bouncing hopefully off 6-year lows in October, November saw weakness return with a plunge in New Orders and weakness in employment (even as exports supposedly soared). This is the 8th straight month of contraction (sub-50) in the survey.

Saudi Interbank Rates Soar, Deposits Flee As Cash Crunch Intensifies

Faced with a sharp deterioration in government finances, the Saudis have resorted to tapping the bond market and delaying contractor payments in an effort to avoid further depletion of the kingdom's SAMA reserves. Now, Saudi banks are bleeding private and public sector deposits, while interbank rates have spiked the most since 2008. 

Key Events In The Coming Very Busy Week

As noted earlier, after last week's snoozefest, this week starts off with a bang when the IMF announces in a few hours it will accept the Chinese Yuan in the pantheon of world reserve currencies alongside the USD, EUR, GBP and JPY the only question being what the alotted weighing of the currency will be. Things then progress to tomorrow's global PMI numbers, Yellen speeches on the economy to the Economic Club of Washington and Congress (Weds/Thurs), the eagerly anticipated ECB meeting on Thursday and finally Friday's OPEC meeting and US payroll print - the last before the FOMC in 2 weeks time.

An Angry Trader Rages: "There Is Nothing Normal About It"

"All global events have been reduced to monetary policy events, i.e., buy the dip opportunities. France’s CAC-40 sold off the two trading days before the recent horror. It was a solid buy the following Monday. By always protecting risk-takers, the authorities are complicit in trivializing issues that need an all hands on-deck response. Bad news is good news has metastasized into an even baser concept"

BTFD "Is Coming To An End" JPM Warns, As It Lowers Equity Allocation Most In 6 Years

"We think that the equities risk-reward will be less attractive than it was in the past few years. We reduce our equities OW in a balanced portfolio to a minimal one, at 5% vs benchmark, the lowest we have had since the current upcycle started. The long period of indiscriminately buying any dip might be coming to an end."

Frontrunning: November 30

  • Dollar rises versus euro, oil drops before ECB, OPEC meetings (Reuters)
  • Smog chokes Chinese, Indian capitals as climate talks begin (Reuters)
  • Obama: COP21 Paris Climate Talks Could Be ‘Turning Point’ For Planet (BBG)
  • China plans to launch carbon-tracking satellites into space (Reuters)
  • Scientists Dispute 2-Degree Model Guiding Climate Talks (WSJ)
  • At NATO, Turkey defiant over downing of Russian jet (Reuters)
  • ECB Left With No Choice But Action After Draghi's Priming (BBG)

Futures Rebound On Latest Chinese Intervention, Renewed Hopes For "Moar From Mario"

Without a rerun of last Friday's Chinese stock market rout, European traders could focus on what "really matters", namely how much of the ECB's upcoming 20 bps rate cut and €20 billion QE expansion (with Commerzbank saying Draghi may even hint at Europe's QE3) is priced in, and whether the ECB's actions are just modestly priced in, or more than fully, and just how big the "sell the news" event will be.The result: the Euro falls to a new 7 month low, the dollar spot index hits a new all time high, and European stocks and US futures stage another remarkable overnight comeback on the usual low volume levitation and central bank intervention.

Paul Craig Roberts Rages At The "Arrogance, Hubris, & Stupidity" Of The US Government

"This is a disaster. Only the stupid Americans could have produced such a disaster. Does Putin need to do anything? We’re doing it all for him. So he doesn’t need to do anything. He’s not going to attack anybody. What does he need to attack anybody for? The idiot Americans are destroying themselves and their allies. This is an amazing fiasco.

Argentines Stumped By Mystery Trucks Loaded With $130 Million In "High Denomination" Bills

Apparently taking a page out of the Spanish government's playbook, Argentines in the Santa Cruz region were surprised yesterday afternoon when at least five bright yellow armored trucks accompanied by heavily armed police paraded through the city. Just weeks after Kirchner's Peroniost government lost the election, and coming after five office fires (destroying banking and economic files from the current regime), local press reports the trucks loaded up with $130 million of banknotes at the airport and driven to banks in the region where outgoing President Kirchner's sister-in-law is governor. Amid comments by the central bank that there are no reserves left, and ongoing discussions of larger banknote denominations and (implied 50% devaluations), one could only speculate where the officially "business-as-usual" transfer of $100s of millions of banknotes will end up.

Chinese Stocks Tumble As Offshore Yuan Surges Most In 2 Months After Apparent PBOC Intervention

Update - Chinese stocks continue to plunge... Offshore Yuan surges on intervention.

Aside from 3 very small adjustments, The PBOC has fixed the Yuan weaker for the last 20 days, driving the mid-line to 6.3962 - the weakest since August 28th. After Chinese stocks collapsed on Friday, they are holding the losses for now as the biggest question remains just what the weighting will be for Yuan inclusion in The IMF's SDR basket (which looks set to be announced tomorrow - US time). Metals are tumbling (with Iron ore down 3.7%) and broad AsiaPac stocks are down around 1% as brokerages in China are plunging (Haitong -9.2%),

It's Official: Chinese Buyers Have Left The U.S. Housing Market

Our condolences to the Fed: as Chinese buyers exit US luxury housing double time, watch as the bottom falls off the top in housing, and slowly at first then very fast drags the rest of the market lower, forcing the Fed to undo whatever tightening in monetary conditions it may have launched, or is contemplating.

Newly-Completed Fukushima 'Containment' Wall Already "Slightly Leaning"

Just weeks after re-starting the building of a giant ice-wall to contain groundwater leaking from the Fukushima nuclear plant, TEPCO has been forced to admit that a 780-meter protective wall built alongside the crippled power station (completed only last month and designed to prevent contaminated groundwater from seeping into the sea)  is already "slightly leaning." While this sounds a lot like being half-pregnant, TEPCO remains 'optimistic' that the wall will hold. But you can't say the government is not trying - in an effort to 'calm' the public, scientists have developed a special scanner to accurately measure the amount of radioactive material inside the bodies of young children... which is odd given just how "contained" Abe said it was.

Turkey's Trump Card: Erdogan Can Cut Russia's Syrian Supply Line By Closing Bosphorus

Now that Russia has hit back at Turkey with economic sanctions designed to punish Ankara for the brazen downing of a Russian Su-24 near the Syrian border last Tuesday, the ball is back in Erdogan's court. Unless the autocrat President plans on shooting down another Russian warplane, Turkey's options may now be limited to diversifying away from Russian gas or closing the Bosphorus strait through which Moscow resupplies its forces at Latakia.