Archive - Sep 2015 - Story

Earlier today yet another "very serious policy maker" confirmed that cash as we know it, may be on the endangered species list - again, a necessary precondition to make global NIRP effective - when overnight former Bank of England central banker, Charles Goodhart, told a London audience that bills such as the Swiss National Bank’s 1,000-franc note and the European Central Bank’s 500-euro note should be abolished, adding this "move that might also prove beneficial by trimming interest rates."

With just 3 months left on the calendar, many investors are down on the year for one simple reason: nothing is really working.  That leaves them only a short period to show a positive return, or at least a less-negative result than whatever index they track. To do that, many will have to make very specific and concentrated bets. It might be about equities generally – will they recover from the current growth scare?  Or it might be asset allocation – will bonds finally go up on the year?  For stock pickers, the key question is certainly “Play the winners, or look for laggards?” All we know is that with 69 days left to play catchup, time favors the fleet.  And the bold.

Oh, the irony. A senator of the world's largest creditor nation has demanded America's allies do 'whatever it takes' to support Ukraine in breaking international law by refusing to pay back $3bn of debt owed to Russia in December. As RT reports, US Senator Chris Murphy of the Foreign Relations Committee exclaimed, "the international community should make it clear that we should take whatever steps necessary to give Ukraine the legal cover it needs to walk away from that debt... I don’t think Ukraine should be obligated to pay Russia back a dime." One can only wonder how US's creditors will feel about this perspective (maybe China and EM are already showing theirs).

Clash of the Titans? President "we don't spy/cyberhack other nations" Obama and President "we don't devalue our currency" Xi will hold a joint press conference to show the world how much US and China love each other (despite China dumping Treasuries and looming US cybersecurity sanctions on China)... grab your popcorn as Xi is supposedly taking questions from the Western press...

You'd have to be in full denial mode not to see that it's getting ugly out there in global markets: currencies are melting down, trade and shipping are tanking, commodities are swooning and global stock markets are increasingly on central-bank life support.

When will the “nothing is happening” crowd finally wake up?

As Russia gears up for an offensive designed to rout anti-government forces operating in Syria, the US finds itself in the awkward position of having to partner with two of Washington's fiercest critics in the fight against terror. With the clock ticking on America's Mid-East strategy, Obama is set to sit down for a critical one-on-one with Putin that could have major geopolitical implications.

Just when you thought the idiocy couldn't get any more surreal, it does, courtesy of Reuters:

• BREAKING NEWS: House Speaker Boehner cancels press conference on resignation

And just like that, "folding" Boehner folded one last time, ironically, on folding his Congressional Career.

This is the sort of thing you’d expect to see in a Banana Republic. Which makes perfect sense, because America is a Banana Republic.

Despite the promises of all the central planners that wage growth is coming (any day, week, month, quarter now with the recovery promised originally in first half of 2012 now delayed to the 9th half ), it appears that Americans are starting to give up hope in that one most important economic component: income growth.

Just when the market was confused what event to trade in the last day of the week, here comes, or rather, goes John Boehner and announces he has folded one last time resigning from Congress and as House Speaker, unleashing a new wave of uncertainty in both the GOP and Congress, which as a reminder was blamed by Yellen as one of the reasons the Fed couldn't hike rates, and the FOMC.

Despite rising modestly from the preliminary print, UMich Consumer Sentiment for September finalised at 87.2 - the lowest since October 2014. This is now the biggest 8-month drop since 2011. Inflation expectations fell modestly as "hope" fell to the lowest level since September. Household Income gain expectations continue to slide (now just 1%) back to 13 month lows.

After widespread weakness in global (yes and US) manufacturing PMIs, US Services PMI dipped in September (after 2 months of modest bounce back). The pace of expansion slowed to three-month lows with service sector confidnce close to its lowest in three years. This latest print indicates a slowdown in overall new business growth for the second month running, which brought the pace of expansion down to its weakest since January. Prices dropped for the 2nd month in a row and Markit warns that "various warning lights are now flashing brighter, meaning growth may continue to weaken in coming months."

The combination of another debt limit fight, the defunding of Planned Parenthood, and prospect of another government shutdown tearing his party apart, the GOP just suffered its latest major blow, when news hit that House speaker John Boehner, just 24 hours after getting a visit by none other than the Pope, is folding one last time: according to the NYT, "Speaker John A. Boehner will resign from Congress and give up his House seat at the end of October."