Archive - Sep 2014

What happens when a camera on a stick captures an Argentinian gun-yielding thug on a bike? This.

The word “gloomier” inconveniently shows up to describe CEOs’ outlook.

Minutes ago the Yen hit another multi-year low against the dollar, which sure enough, is great for the nominal value of Japanese stocks, if horrible for the actual Japanese companies, the Japanese middle class, and pretty much everyone except for a few superrich people. Such as Sony. Because the (now former) electronic giant, which once upon a time was the target of an activist campaign by none other than Dan Loeb who mysteriouly saw value in the company, once again stunned everyone when it reported overnight that it expects its annual loss to swell to $2 billion, but, far worse, canceled the payment of its dividend for the first time ever after writing down the value of its troubled smartphone business.

Member of Senate Armed Services Committee Agrees

Another day, another Presidential address. We wonder, popcorn-drooling-mouth agape, what the warmonger-in-chief will be talking about today as he delivers remarks at MacDill Air Force Base... Will it be a Fed hint (economy's doing great but we need to do more), Scottish DEpendence support, Anti-ISIS coalition propaganda, Ray Rice, Ebola-battling benefits, or standard vote-grabbing populist rhetoric? We will have to wait and see...

There is no point in lamenting the disappearance of the gospel of that god among FX gods, Goldmans' Tom Stolper, whose fades generated anyone who did the opposite of his recos nearly 15,000 pips in profits over the years. It is time to move on... and start doing the same to his peer at Bank of America, the firm's head chartist, MacNeill Curry, aka Stolper 2.0, who incidentally was just stopped out of his EURUSD short.

The Islamic State/ISIS/ISIL has released its initial 'rebuff' propaganda response to President Obama's declaration of war against the 'non-islamic' terrorist organization. The brief video entitled "Flames of War" is shot like a blockbuster-movie-style trailer and threatens US troops and the White House. As Politico reports, the militant terror group vows that the “fighting has just begun” in the minute-long video, which features clips of American military forces under fire and a wounded U.S. soldier being taken from the battlefield. The video concludes as the words "Flames of War" flash on the screen, followed by "Fighting has just begun" and ends ominously: "Coming Soon." Even more concerning perhaps is al-Qaeda branches calling for all jihadists to unite against the common threat from a US-led coalition.

For climate change activists and those hoping for an energy future dominated by renewables or even less-polluting natural gas, the death of coal cannot come quickly enough. But with coal still the dominant form of cheap electricity throughout the world, it is unlikely the bogeyman of climate change will disappear anytime soon.

As the "Big Mac Index" is to global purchase price parity levels of inflation, so when it comes to the state of the "recovery" if not for everyone, then certainly for the 0.1%, there is no better metric than the "Porsche Indicator." Recall: "Porsche Reports Record Sales in 2013; 21 Percent Increase Over 2012" which certainly didn't come on the back of yet another year of declines in real incomes for the middle class (spoiler alert: it came on the back of some $10 trillion in liquidty injections by the world's central banks). Yet one place where the "Porsche" recovery forgot to make landfall, is none other than the biggest casualty of Europe's artificial monetary, political and wealth-transferring union: insolvent Greece.

China warns "the outside world doesn't get it, we do," in a statement related to the "stealth QE" they unleashed yesterday, noting investorsd "do not realize that today's Chinese economy is moving towards "new normal" in the process," and "need to accept the volatility of economic data," during this transition. Crucially, PBOC adviser Chen Yulu clarifies what Western central banks simply cannot grasp: "Hoping for stimulus policies in the face of increased economic pressure is short-sighted and does no good to long-term economic development," warning investors should not expect "strong stimulus." Wall Street is less than exuberant about the liquidity injection, as the impact on real economy may be limited due to lenders' risk aversion.

Despite lagging mortgage applications and home sales, homebuilder sentiment surged for the 4th month in a row to 59 (against expectations of 56) to its highest since November 2005. Prospective Buyer Traffic (hope) soared to 47. The South region rose dramatically as Midwest fell. The disconnect between hard data in the housing market and soft survey guesses by the homebuilders grows ever wider...

“It’s a questionably unquestionable situation... Are the markets prepared for a shocking answer... Will Janet Yellen announce the final end to QE? Or electrify the bulls with more accommodation? Can Yellen’s eloquent elocution energize the markets…or will she magnetize the bears? Tune in next time Fed fans... Same Fed time... Same Fed channel”

The financial media has no concern of negative outcomes, Wall Street has growth priced in that has never occurred in history, and there is NO expectation of a recession built into any forward assumptions. We have indeed discovered financial “Utopia,” or at least that is what is currently believe.

Brought to you exclusively by Banzai7 News...

The cold war is on, literally, because it will determine who will survive Europe's upcoming cold winter - a Europe with decreasing Russian gas supplies, or Russia now officially starved of Western sources of funding. The "Plan Bs" - Europe has record gas inventories in storage giving it hope it can last out an entire winter without any incremental Russian gas, while Russia is increasingly reliant and hoping on China-based sources of funding. While it remains to be seen just how Russian corporations will react to the recently imposed credit starvation, the chart below shows the steps Russia is now taking ahead of the European winter. Clearly, the trend in Russian gas supplies into Europe's core distribution hub, Slovakia, is not Europe's friend.