One Minute Macro Update

News again refuses to register, as reverse decoupling is the only relevant metric in the world: the US will pull the world out of its doldrums, and that's all that matters. That economic "growth" may actually mean the end of QE and the elimination of about 300 S&P point purchased via Brian Sack, is completely ignored.

US:  Futures are firmly in positive territory in the early AM driven by signs of global recovery.  Yesterday’s ADP Employment Change numbers were especially bullish and the ISM Non-Manufacturing Composite index seemed to confirm the trend (though we note that the employment portion of the print was actually down MoM).  The confluence of data have caused estimates for Friday’s jobs report to be revised significantly upward. Private Payrolls survey estimates grew from 150K to 170K and NFP grew from 135K to 150K.  Expectations are high for Friday and for GDP later in he month, which should provide a good opportunity to reset long volatility/blowup option trades on the euphoria.

Europe:  German November Factory orders +5.2% MoM v +1.0%E, further fueling the expansionary data onslaught.  France issued €8.98B in bonds with yields in the context of the market before the auction, but +49-69bp wider than prior auctions of like maturities.  BOE’s quarterly credit conditions survey noting further housing market weakness and firmer business credit conditions.  UK Dec Services PMI 49.7 v 52.8E with the significant dip blamed on snow.  The EU Commission’s consultation paper posing bondholder haircuts for Euro area banks is scheduled to be published today.  EFSM issued its €5B in bonds yesterday (px at mid swaps +12bp) with the EFSF slated to come later.  Greece PM reportedly suggesting a central Treasury for the EMU to complement the common currency – a move we believe will have to occur in one form or another for the Eurozone to end its issues.

Asia:  Shanghai Securities News reporting that China may not set a clear target for new loans for 2011, but guide loan growth in response to economic development.  Flooding impacts in AUD continue to reprice markets as housing data prints continue to disappoint.

From Brian Yelvington of Knight Capital

Comments

[Invisible Hand]

Interesting that Greece is the nation suggesting centralizing fiscal power in the EU.  I guess if you want the welfare, you have to give the central government more power.

This battle has already been fought (and lost) in the US.  Maybe the Tea Parties can reverse some of the terrible effects of centralizing power with the (more, on average) corrupt central government.

It will be interesting to see if the nations with some assets (i.e. Germany, Finland) will agree to centralized looting to benefit the welfare queens (i.e. Greece, Italy) of Europe.

[topcallingtroll]

The hardworking disciplined nations will continue to subsidize the spendthrift undisciplined lifestyle of the greeks and their clones.....at least long enough for the spx to make an all time high. Germans are guilt ridden masochists at least the politicians that run germany

[topcallingtroll]

Party on! Go long! Stay strong! I am calling a top in hysteria and fear.

[gwar5]

I'm getting whiplash