Archive - Sep 2015 - Story

"There is a general understanding that joint efforts in the fight against terrorism should go hand by hand with the political process in Syria. Assad agrees to this and has also agreed to early parliamentary elections and to include healthy opposition." 

Update - Equity market weakness is accelerating...

September rate hike probability jumped up to 34% (and December 62%) following the 'headline' positive payrolls print. The market is reacting very hawkishly to the data with USD surging, bonds and stocks selling off and commodities leaking lower.

The "most important and anticipated payrolls number ever", or at least since the last payroll number, is out and it is a doozy at only 173K, it is a huge miss to the 217K expected (and almost in line with LaVorgna's forecast). This was the worst monthly payrolls number since Marhc, and the second lowest number in 19 months. However, the curious twist is that the July and June NFPs were both revised higher to 245K, making the net revision up  The unemployment rate dropped to just 5.1%, below the 5.2% expected, and well below July's 5.3%, further boosting the Fed's case that labor slack is evaporating.

With just 20 minutes to go until the latest most important jobs report ever in the history of man, Richmond Fed Chief Lacker just explained why "the case for raising rates is still strong"...

LACKER: BOTH MANDATE CONDITIONS 'APPEAR TO HAVE BEEN MET', EXCEPTIONALLY LOW RATES NO LONGER WARRANTED BY JOB MKT
LACKER: AUG. JOBS REPORT UNLIKELY TO `MATERIALLY ALTER' PICTURE

But perhaps most crucially, Lacker explains "recent financial market volatility is unlikely to affect economic fundamentals in the United States and thus has limited implications for monetary policy," removing the one last leg for permabulls to rely on (that is if you velieve The Fed is not Dow-Data-Dependent).

Three words - retest the lows!

As WSJ reports, "Chinese navy ships off the coast of Alaska in recent days weren’t just operating in the area for the first time: They also came within 12 nautical miles of the U.S. coast, making a rare foray into U.S. territorial waters, according to the Pentagon."

• Jobs Report Could Seal the Deal on Rates (WSJ)
• The Jobs Report and the August Curse: Jobs Day Guide (BBG)
• Migrants hold out on Hungarian 'freedom train'; Orban says millions coming (Reuters)
• Migrant Crisis Divides Europe (WSJ)
• German industry orders fall in July on weak foreign demand (Reuters)
• Alibaba’s Jack Ma, Joe Tsai to Borrow $2 Billion Against Shares (WSJ)
• U.K. Retailers Post Worst Sales Decline Since Financial Crisis (BBG)

Perhaps one of the most notable features of the upcoming nonfarm payrolls report - which those with a flair for the dramatic have once again dubbed the "most important ever" simply because it may greenlight (or not) a Fed rate hike (any NFP print at 230K and above likely assures a September move by the Fed - which Wall Street consensus sees rising by 217K in August (although with Goldman a far below consensus 190K, and Wall Street's biggest cheerleader Joe LaVorgna predicting only 170K one has to wonder) is just how hard the punditry is trying to talk it down, with everyone from Joe LaVorgna to Bloomberg explaining why it is very likely that - due to seasonals only, and nothing but seasonals - it will be a weak report, only to be revised higher.

Moments ago, US equity futures tumbled to their lowest level in the overnight session, down 22 points or 1.1% to 1924, following both Europe (Eurostoxx 600 -1.8%, giving up more than half of yesterday's gains, led by the banking sector) and Japan (Nikkei -2.2%), and pretty much across the board as DM bonds are bid, EM assets are all weaker, oil and commodities are lower in what is shaping up to be another EM driven "risk off" day. Only this time one can't blame the usual scapegoat China whose market is shut for the long weekend.

America’s descent into totalitarian violence is accelerating. It is a land in which facts have been redefined as enemy propaganda, a land in which legally protected whistleblowers are redefined as “fifth columns” or foreign agents subject to extermination, a land in which America is immune from criticism and all crimes are blamed on those whom Washington intends to rule.

The narrative of the omnipotent central banker continues to be questioned with China's inability to save its own market the latest incarnation of investors losing faith. Nowhere has the religious zealotry been more fervent than in trading Japanese stocks where Abe and Kuroda have broken every independent rule in their manipulation of wealth-giving stocks. However - it appears their time is up, as Bloomberg reports, foreigners dumped 1.43 trillion yen of Japanese equities in the three weeks through Aug. 28, Tokyo Stock Exchange data updated Thursday show. That’s the most for any three-week span on record, overtaking the period when Bear Stearns Cos. collapsed in 2008.

There is no doubt that the Chinese economy is in a material economic slowdown. Policy officials’ aggressive actions and scare tactics against equity short sellers could continue to cause capital flight. However, this does not mean that China is going to sell large quantities of Treasuries. There is too much co-dependency between the US consumer and Chinese exporter. Destabilizing the US Treasury market with large sales would be tantamount to shooting themselves in the foot.

Did you know that the UN is planning to launch a “new universal agenda” for humanity in September 2015?  That phrase does not come from us – it is actually right in the very first paragraph of the official document that every UN member nation will formally approve at a conference later this month.  The entire planet is going to be committing to work toward 17 sustainable development goals and 169 specific sustainable development targets, and yet there has been almost a total media blackout about this here in the United States.

Just as the machines had learned the "Buy when Japan opens" signal, Japanese leaders unleash their usual stream of utter tripe and break the bid. Tonight's chosen member was Japanese Economy Minister Amari who said "it is important for markets to act calmly, not move in a volatile manner," adding "stock markets are not reflecting fundamentals," reflecting on the fact that G-20 ministers had discussed China and "monetary tightening was likely in some advanced countries." This sparked a plunge in USDJPY and an instant 100-point plunge in Dow futures.