Archive - Oct 2014
October 29th
Goldman Cuts 2015, 2016 EPS Forecasts On "Diminished Global GDP Growth" Just As Fed Surprises With Hawkish Outlook
Submitted by Tyler Durden on 10/29/2014 15:48 -0500It is perhaps the definition of irony that just two hours after the Fed issued a surprising statement that was so bullish on US growth it is as if the past month never happened, as if Williams and Bullard never threatened with QE4 just because the market almost entered a correction, and that made Goldman's chief economist Jan Hatzius to a express "modest hawkish surprise" that the very same bank, Goldman, whose alum is in charge of the NY Fed (leading to hours of secret tapes exposing the white glove treatment Goldman gets at the Fed), just announced it was cutting its 2015 and 2016 EPS forecasts "diminished global GDP growth and lower crude prices."
Martin Armstrong Rages "Government Is Corrupt & Rotten To The Core"
Submitted by Tyler Durden on 10/29/2014 15:31 -0500Government is corrupt and rotten to the core – it is honorable only for brief shinning moments when the dark clouds leave a crack.
Buyers Focus On Dollars, 30 Year After Fed, Stocks Shrug
Submitted by Tyler Durden on 10/29/2014 15:06 -0500Stocks slid slowly lower into the FOMC statement, then tumbled as no matter how hard talking heads tried they could not find a silver lining in the hawkish tone reflected across near universal sell-side confirmation. Stocks tumbled, commodities tumbled, and the USDollar surged but the Treasury curve flattened dramatially as 30Y was well bid and the rest of the curve offered (2Y surged higher in yield). The last few minutes saw the ubiquitous levitation to VWAP which lifted Small Caps briefly into the green briefly and stocks all ended higheer from the FOMC statement. By the close, the USDollar was up notably, stocks lower, gold down 1.5%, oil up over $82, and the Treasury curve flattened dramatically (5Y +8bps, 30Y -2bps).
Life Lessons To Derive From QE And Stress Tests
Submitted by Tyler Durden on 10/29/2014 14:42 -0500QE destroys societies, economies and financial systems, it doesn’t heal them. So maybe it’s a touch of genius that the great powers of global finance have first pushed Keynes into the academic world and then academics like Bernanke and Yellen into positions such as head of the Fed, making everyone blind to the fact that what they think is beneficial, including many who think they’re real smart, actually hurts them most. This whole thing is so broken and perverted it’s getting hard to understand why anybody would want to continue clinging on to it. But then, what does anybody know? 95%+ of people have been reduced to pawns in someone else’s game, and they have no idea whatsoever.
In Memoriam: Abenomics
Submitted by Sprout Money on 10/29/2014 14:25 -0500Shinzo Abe has lost his magical touch as Japan's economy is nose-diving again...
And The Biggest Beneficiary Of QE3 Is...
Submitted by Tyler Durden on 10/29/2014 14:18 -0500When it comes to the Fed's QE3 generosity, what was the bottom line? Here is the answer.
Treasury Curve Flattens Despite Yesterday's Record-Setting Steepener Trade
Submitted by Tyler Durden on 10/29/2014 13:52 -0500The spread between 30Y Treasury yields and 10Y yields tumbled 4-5bps today post-FOMC back to its flattest in 4 weeks as hawkish sentiment sparked bond-selling out to 10Y and buying at the long-end. The reason this is notable is that yesterday, as Nanex details, there were two "monster" sized trades in 10Y and 30Y Treasury Futures putting on a significant steepening bet.
First Sell-Side Responses To FOMC Trickle In: "This Should Be A Risk Off Trade"
Submitted by Tyler Durden on 10/29/2014 13:31 -0500"The dove dissenting says it all," trader quips. "Fed comes in with a bit of a Hawkish tilt as it rids of key policy line around labor market..." If they are only fighting inflation now, they have less ability to enact more dovish policy. I think this should be a "risk off" trade.
Verbal Deflation: FOMC Statement Has Fewest Words In Over A Year
Submitted by Tyler Durden on 10/29/2014 13:15 -0500The Fed's implicit tightening and simplification of monetary policy was not apparent merely in the message conveyed by the FOMC moments ago: it was also clearly visible in the grammar of the statement itself, and specifically in the word count. Because after hitting a record 895 words last month, the October statement tumbled in complexity and its message to just 707 words: this is also the fewest words the Fed used to explain its actions in over a year, or since July of 2013.
Hilsenrath Warns: Fed's "Vote Of Confidence In US Economy" Means Mid-2015 Rate Hike Possibility
Submitted by Tyler Durden on 10/29/2014 13:15 -0500Pointing to “solid job gains” and a falling unemployment rate, the Fed said a range of labor market indicators suggest that labor market slack is “gradually diminishing.” In the process it struck from the statement an earlier assessment that labor market slack was substantial, a phrase investors have been watching closely for signs the Fed is becoming more confident about the economy. If all goes as they plan, officials will turn their attention in the months ahead to discussions about when to start raising short-term interest rates and how to signal those moves to the public before they happen. Many expect to move on rates by the middle of 2015.
Japan Reacts to Worsening Fukushima Disaster By ... Reopening Nuclear Plant Next to Active Volcano Which Is About to Blow
Submitted by George Washington on 10/29/2014 13:01 -0500D'oh!
FOMC Ends The QE Dream, Keeps "Considerable" Period Hopes Alive - Full Statement Redline
Submitted by Tyler Durden on 10/29/2014 13:00 -0500"Steady as she goes" was expected... having kept the "considerable time" dream alive last month, the FOMC ended QE3 on schedule but remained 'data-dependent' on reviving it... (even as Kocherlakota dissented)
- *FED ENDS THIRD ROUND OF QUANTITATIVE EASING AS PLANNED
- *FED SEES `SOLID JOB GAINS' WITH LOWER UNEMPLOYMENT
- *FED REPEATS RATES TO STAY LOW FOR `CONSIDERABLE TIME'
And so now the "flow" has stopped; given that "bond buying" did not work, we are reminded of Alan Greenspan's warning that "I don’t think it’s possible" for the Fed to end its easy-money policies in a trouble-free manner. Full redline below.
U.S. Mint Gold Coin Sales Near 60,000 - "Islamic State, Ebola, Putin, Ukraine" and Swiss Gold Initiative
Submitted by GoldCore on 10/29/2014 12:59 -0500Smart money is willing to pay a small premium to own segregated and allocated coins and bars rather than have the exposure of an ETF or digital gold platform ... Prudent diversification into physical coins and bars will again reward those who take a long term view.
FOMC: "We Screwed Up"
Submitted by Bruno de Landevoisin on 10/29/2014 12:49 -0500FOMC Statement: "We are stuck like squealing pigs............."






