Archive - Sep 2015

The brief dead cat inventory-stacking bounce in Chicago PMI is over. With a print of 48.7, back below 50, (against hope-strewn expectations of 52.9) this was below the lowest economist estimate and the lowest since May. Aside from employment (which somehow rose), the components were ugly with New Orders and Prices Paid all tumbling, while Production was the lowest since 2009 at 43.6.

The Fed is creating not just uncertainty but appears to be destroying any credibility it ever had along the way. This morning's spewing Fedspeak from Bill Dudley was full of unbelievable and explicit lies.

Milwaukee joins the party with its lowest ISM print since April 2009. Based on the regional Fed survey collapse - Dallas, Richmond, New York, Philly, Chicago, and even Kansas City - it's unanimous - they are all flashing recessionary warnings.

It takes ignorance on an almost unbelievable level to try to claim that “nothing is happening” in the financial world right now.

September isn't even over yet, but ADP already knows how many jobs were added for the full month of September: precisely 200K, which just happens to be the consensus expectation for Friday's NFP number.

When a lot of Keynesian cowbell doesn't work, the only cure for the deflationary fever must be more Keynesian cowbell which explains why Japan is about to double down on Abenomics, and why the ECB will almost invariably expand PSPP now that the deflationary boogeyman is back in Europe. Indeed, S&P is now out calling for ECB Q€ to last for nearly two years longer than originally planned and for the size of the program to be expanded to a Dr. Evil-ish €2,400,000,000,000.

China boosted central bank gold holdings 1 percent as the country that rivals India as the world’s largest bullion consumer seeks to diversify its foreign exchange reserves.

"The military goal of these operations is exclusively limited to air support for the Syrian government forces in their campaign against ISIL. The point here is not in achieving any foreign policy goals or satisfying ambitions. We’re talking exclusively about Russia’s national interests."

• Asia shares rally, but on track for worst quarterly loss in four years (Reuters)
• Global Rally Shows Relief at End of $11 Trillion Stocks Meltdown (BBG)
• Glencore Extends Rebound as Turmoil Shows Signs of Easing (BBG)
• Putin wins parliamentary backing for air strikes in Syria (Reuters)
• China Cuts Minimum Home Down Payment for First-Time Buyers (BBG)
• German Unemployment Unexpectedly Rises in Sign of Economic Risks (BBG)
• Japan Industrial Output Slide Hints at Recession (WSJ)

Terrible economic news is wonderful news for markets, all over again, and with the worst S&P500 quarter since 2011 set to close today, some horribly "great" news is just what the window-dressing hedge funds, most of whom are deeply underperforming the broader market (not to mention Dennis Gartman) ordered.

Obama’s speech at The UN made clear that Washington accepts no responsibility for the destruction of the lives and prospects of millions of Muslims. The refugees from Washington’s wars who are overflowing Europe are the fault of Assad, Obama declared. Obama’s claim to represent "international norms" was an assertion of US hegemony, and was recognized as such by the General Assembly. The presidents of Russia, China, and Iran did not accept Washington’s definition of "international norms." The lines are drawn. Unless the American people come to their senses and expel the Washington warmongers, war is our future.

Since the start of June, global equity markets have lost over $13 trillion. World market capitalization has fallen back below $60 trillion for the first time since February 2014 as it appears the world's central planners' print-or-die policy to create wealth (and in some magical thinking - economic growth) has failed - and failed dramatically. To rub more salt in the wounds of monetray policy mumbo-jumbo, despite endless rate cuts and balance sheet expansion around the world, the last 4 months have seen an 18% collapse - the largest since Lehman.

As Case-Shiller clearly shows, Detroit - after staging a brief dead cat bounce in the aftermath of its bankruptcy and since sliding once again - may no longer be the worst city for home prices in the US. It has now been displaced by a city which many speculate will be nothing short of the "next Detroit."

What worked in the post-global financial meltdown era of 2008-2014 will not work the same magic in the next seven years.