Archive - May 14, 2015 - Story

For the second time in a week, amid ongoing discussions on infrastructure spending, a train has derailed in Pennsylvania. As CBS Pittsburgh reports, emergency crews have been called to a train derailment in Hazelwood. At least 10 cars are off the track but no injuries have been reported yet.

It would appear someone at NBC News got a rather large tap on the shoulder. In what is a stunning reversal of their confirmation that President Obama lied and lying about the killing of bin Laden, NBC News has updated their original story - that "two intelligence sources tell NBC News that the year before the U.S. raid that killed Osama bin Laden, a 'walk in' asset from Pakistani intelligence told the CIA where the most wanted man in the world was hiding" - to this - "Sources say that while the asset provided information vital to the hunt for bin Laden, he was not the source of his whereabouts." As Slate concludes, while NBC’s story doesn’t use the word correction or retraction, that’s what this appears to be.

Confirming Gallup's demise of the confidence of the consumer, Bloomberg's non-government-sanctioned Consumer Comfort index has now fallen for the 5th straight week - the longest streak of uncomfortableness since Nov 2013. The index is barely above unchanged for 2015 with people in The South and NorthEast feeling the misery the most in the last week (and rather oddly, only the 65+ age cohort saw an improvement - rising rates?).

Bund yields rose once again overnight, testing last week's melt-up 77bps top briefly but have 'stabilized' as US markets come online hovering 1bps lower. As bund prices have collapsed so it appears knife-catchers have been busily leveraging up with Call option open interest soaring dramatically (and put option open interest). This has smashed the put-call ratio from multi-year highs in mid-March (before the collapse began) to 6-month lows now. Whether this is a contrarian's dream is unclear (suggesting that there is further price downside as the weight of positions are skewed to the upside is unclear).

The last 3 days have seen precious metals surging. Silver is up over 7% - its biggest such rise since Aug 2013, and Gold up 3% - its largest in 4 months. Volume is heavy also. A specific catalyst is unclear but USD weakness is being cited, weak macro data suggesting further easing, China demand ahead of SDR-backing, and finally the realization that the Chinese shift to unconventional monetary policy (LTROs) is a slippery slope to full-blown QE from which few (if any) have ever escaped.

A lawyer for the conductor of Amtrak Regional 188 which derailed earlier this week killing 7 and injuring hundreds says his client has no recollection of the event and no explanation for what happened. Meanwhile, politicians rush to blame infrastructure spending.

Breaking: 5 #Iran Revolutionary Guard boats fire across bow of Singapore-flagged cargo ship, ship fled to UAE waters, no U.S. on board

— Jim Sciutto (@jimsciutto) May 14, 2015

Something funny happened on the way to the global reflation (telegraphed so loudly by the recent surge in 10Y yields to the highest level of 2015): PPI just crumbled by a sequential 0.4% in the month of April, despite expectations it would rise by 0.1% and continue the 0.2% monthly increase seen in March.   This was a -1.3% drop in PPI - the fastest fall in 5 years. Worse, the annual decline in final demand goods was -5.2% Y/Y, the biggest drop in the revised series in record!

Only once in the last 42 years have jobless claims been lower than this week's 264k print... Other than April 2000, this is the 'best' jobless claims print since 1973! But not everyone is loving it as Texas continues to turmoil (no matter how diversified the talking heads tell the people their economy is).

PetroChina just surpassed Exxon Mobil to become the largest energy company in the world, on a market cap basis. Now the question becomes: can PetroChina retain its status as the world’s largest energy company?

Germany throws its support behind a Greek referendum on euro membership while Putin invites Athens to join BRICS Bank. Meanwhile, Yanis Varoufakis has a plan for resolving Greece's debt problem — and he imagines the ECB chief is terrified of it. 

"Former BoE governor King yesterday made a timely intervention, warning that central banks risk tipping the world into a currency war. We're there already, of course, but if $60bn per month of money printing by the ECB can't get the euro down (because of the USD), then what's next? The RBA has cut rates twice this year, and AUD/USD trades back over 0.8100. Is FX intervention next?"

• Amtrak train in Philadelphia wreck was traveling at twice speed limit (Reuters)
• The engineer has no recollection of the crash and “no explanation” for what happened (WSJ)
• Taliban claim attack on Afghan guesthouse that killed 14 (Reuters)
• Chicago’s Junk Rating From Moody’s Puzzles Investors (BBG)
• House votes to end spy agencies' bulk collection of phone data (Reuters)
• Wesley Clark: The Penny-Stock General (BBG)
• AOL’s Armstrong to Leave $213 Million Richer After Verizon Deal (BBG)