This Time Isn't Different
Submitted by Tyler Durden on 01/04/2016 - 12:36
The reckless herd has been in control for the last few years, but their recklessness is going to get them slaughtered. Corporate profits are plunging. Labor participation continues to fall. A global recession is in progress. The strong U.S. dollar is crushing exports and profits of international corporations. Real household income remains stagnant, while healthcare, rent, home prices, education, and a myriad of other daily living expenses relentlessly rises. The world is a powder keg, with tensions rising ever higher in the Middle East, Ukraine, Europe, and China. The lessons of history scream for caution at this moment in time, not recklessness. 2016 will be a year of reckoning for the reckless herd.
Here Are The Key Findings From The SEC's ETFlash Crash Data Dump
Submitted by Tyler Durden on 01/04/2016 - 12:30
An 88-page "Research Note" from the SEC's Division of Trading and Markets titled "Equity Market Volatility on August 24, 2015," outlines the facts of that fateful trading day, discussing what went wrong, and which classes of securities were affected. The conclusions of the piece are purely factual, with little or no conjecture, and there's absolutely no policy recommendations. There are dozens of unintended consequences already baked into its proposed rulemaking. That's bad enough when you're talking about the inner workings of mutual funds and ETFs; it's a bigger deal when we're talking about the inner workings of the markets themselves.
Atlanta Fed Just Slashed Q4 GDP Forecast To Barely Positive 0.7%, Down 1.2% In Ten Days
Submitted by Tyler Durden on 01/04/2016 - 12:18
Moments ago, in its latest Q4 GDP revision, the Atlanta Fed just pulled the rug from under the economy (and the market now that bad news for the economy is bad news for stocks), and slashed its latest quarterly forecast by another 50%, from 1.3% to a barely positive 0.7%. In other words, according to the Atlanta Fed, Janet Yellen launched a rate hike cycle in a quarter when GDP will be just 0.7%, and which when averaged across the prior 3 quarters, would mean that the US will have grown at just 1.8% in 2015, a 25% drop from the 2.4% GDP growth in 2014.
European Stocks Suffer Worst Start To Year Ever
Submitted by Tyler Durden on 01/04/2016 - 12:17
Led by a 4.3% collapse in Germany's DAX index, European Stocks plunged 2.5% today which is the worst start to a year ever. European credit markets spiked higher in risk. 10Y bund yields tumbled over 6bps and peripheral sovereign risk spreads jumped 10-15bps. Not a good start for Draghi and his pals...
Gun Stocks Soar Ahead Of Obama's Gun-Control Executive-Action Tomorrow
Submitted by Tyler Durden on 01/04/2016 - 12:05
German Anger Boils Over: Shots Fired At German Refugee Home; One Asylum Seeker Hit
Submitted by Tyler Durden on 01/04/2016 - 12:01
Early on Monday, gun shots were fired at a home for asylum seekers in western Germany and one resident was lightly injured, police said. The shots were fired at a window of the building in the town of Dreieich at around 2.30 a.m (0130 GMT), and one hit a 23-year-old asylum seeker who was sleeping, according to police in Offenbach, near Frankfurt. He was taken to a hospital, but was able to leave shortly afterward.
A Close Up Of The Market Ripple Which Stopped Stocks Tumbling At 11:01 am
Submitted by Tyler Durden on 01/04/2016 - 11:45
A funny thing happened at 1101ET. Amid the deep plunge in stocks, 'someone' suddenly traded an enormous block of e-mini S&P futures which appeared to stall the sell-off (for now). This followed a similar (but smaller) block trade at 1042ET which also extracted all the liquidity from the market momentarily and enabled a brief rally.
RANsquawk Week Ahead Video: Market focus will be on the FOMC minutes and NFP following the Fed rate-hike in December
Submitted by RANSquawk Video on 01/04/2016 - 11:35Saudi Default, Devaluation Odds Spike As Mid-East Careens Into Chaos
Submitted by Tyler Durden on 01/04/2016 - 11:31
On the heels of a tumultuous weekend that saw Saudi Arabia cut diplomatic ties with Iran after the Saudi embassy was torched by protesters angry at the execution of a prominent Shiite cleric, CDS spreads for the kingdom have blown out to six-year wides while the implied odds of the riyal peg finally breaking are hitting new record highs.
Dow Dumps 450 Points (Back Below 17,000) As Crude Oil Crashes Into Red
Submitted by Tyler Durden on 01/04/2016 - 11:12
Dispppointing drops in China and US Manufacturing PMIs, combined with a record glut, appears to have trumped Mid-East tensions and sent WTI plunging back into the red. This has triggered another round of selling in US equities, sending The Dow down 450 points and back to a "16" handle...
Market On Track For Worst Opening Day Loss In 84 Years
Submitted by Tyler Durden on 01/04/2016 - 10:59
If the market closes here, that would make it a worse first day of trading than in such "dramatic" years as 2008 and 1933. But wait, there's more, because unless the S&P somehow manages to stage a rebound and closes above the current levels, it would suffer the worst opening day loss in the past century except for the historic -8.1% collapse it suffered on January 4 of 1932.
What Really Happened In 2015, And What Is Coming In 2016...
Submitted by Tyler Durden on 01/04/2016 - 10:36
A lot of people were expecting some really great things to happen in 2015, but most of them did not happen. But what did happen? A global financial crisis began during the second half of 2015 threatens to greatly accelerate as we enter 2016. This is what the early stages of a financial crisis look like, and the worst is yet to come.
Saudi Arabia Bans Flights, Travel To Iran
Submitted by Tyler Durden on 01/04/2016 - 10:18
This morning, the headlines surrounding what's quickly mushroomed into a Mid-East melee are coming fast and furious and in the latest escalation, the Saudi foreign ministry says the kingdom will now cut all commercial ties with Iran.
Industrial Recession Now Inevitable As Manufacturing ISM Worst In Six Years
Submitted by Tyler Durden on 01/04/2016 - 10:11
Following China's disappointing drop in Manufacturing PMI overnight, this morning started off poorly with Canada's PMI crashing to its lowest reading since records began at 47.5. Then US Manufacturing PMI tumbled to 51.2 - its lowest print since October 2012 (with US factory orders collapsing to weakest since 2009). But The ISM Manufacturing crashed to 48.2 (deep in contraction) - the weakest level since June 2009, with employment bumping along at its lowest level since September 2009 and imports (reflecting domestic demand perhaps) crashed to levels only seen twice in 20 years.
As Stocks Plunge, Swedish Central Bank Holds Extraordinary Meeting, Says Will "Instantly Intervene" If Necessary
Submitted by Tyler Durden on 01/04/2016 - 10:02
Markets have started 2016 with a healty dose of turmoil, and so many were wondering how long - and who - would be the first central bank to intervene in either directly or verbally in markets. Moments ago we go the answer when Sweden's Riksbank announced it has held an extraordinary monetary policy meeting in which it took the decision required to be able to "instantly intervene on the foreign exchange market if necessary, as a complementary monetary policy measure, to safeguard the rise in inflation."
