Tyler Durden's picture

Beware The Putrid Stream Of Terrified "Liquidity"

"Did a few loose strands of Ebola seep into the organs and tissues of global finance last week? The US equity markets sure enough puked, the Nikkei bled out through its eyeballs, all the collagen melted out of Greek bonds, and treasuries bloated up grotesquely on a putrid stream of terrified “liquidity” that led two Federal Reserve proctologists to maunder about the possibility of a QE-4 laxative, out of which, in due time, will surely gush explosive bloody fluxes of deeper financial sickness."



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RANsquawk Week Ahead - 20th October 2014



Tyler Durden's picture

"The Economic Outlook Keeps Getting Better And Better" Says Fed President Who Last Week Unveiled QE4

"I’ll be honest: These speeches get more and more enjoyable as time goes by because the economic outlook keeps getting better and better. Instead of gloom and doom with a scattering of hopeful notes, things are now pretty upbeat, with only a couple of standard economist’s caveats thrown in....  So the message is that things are getting better. We’re on track to end our asset purchases and we’re preparing for the time the economy can sustain an end to accommodation. We’ll want to see improvements in unemployment, wages, and inflation, and we’ll be driven by the data. But all in all, it’s good news—with just a few of those requisite caveats thrown in."



Tyler Durden's picture

The Artists' Road To Serfdom: The Commoditization Of Creative Content

This is the net result of commoditization: there's no premium for commoditized capital, labor, goods, services or content.



Tyler Durden's picture

But, Stocks Are Cheap... Right?

Umm... No!



Tyler Durden's picture

Why Chinese Growth Forecasts Just Crashed To A Paltry 3.9% - And Are Going Even Lower - In One Chart

Sadly for China's social instability, Chinese growth is going not only to 3.9% but much, much lower. The reason? Quietly, over the past 5 years, China raked up an epic debt load, which by 2015 is expected to hit a whopping 252% of GDP, or a 100% of GDP increase in debt, just to keep its growth dynamo running. A dynamo which has now fizzled, as can be seen best in the Chinese housing bubble which as we have reported previously, has now burst, and China is desperate to keep imminent hard landing, as controlled as possible. Here is Exhibit A...



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Vatican Blesses Porsche, Blocks Plebs From Sistine Chapel

For the first time in the 600-year history of Michelangelo's masterpiece, Pope Francis has decided to rent out the Sistine Chapel for an $8000-per-head Porsche Travel Club concert. What makes this unprecedented action even more 'interesting' is the fact that The Vatican - in all its omnipotent wisdom - also made an announcement that it will be limiting the number of vistors (read 'common folk') allowed inside the chapel and as IBTimes reports, demanding vistors must be silent and cannot take photographs. So much for Pope Francis' "poor Church of the poor."



Tyler Durden's picture

On The Origin Of Crashes & Clustering Of Large Losses

"...the underlying cause of a crash will be found in the preceding months or years, in the progressively increasing build-up of market cooperativity, or effective interactions between investors, often translating into accelerating ascent of the market price (the bubble). According to this ‘critical’ point of view, the specific manner by which prices collapsed is not the most important problem: a crash occurs because the market has entered an unstable phase and any small disturbance or process may have triggered the instability."



Tyler Durden's picture

E-Mini Liquidity Has Crashed 40% In The Past Quarter, JPMorgan Finds

Confused why one second the market is down 1%, and then moments later, upon returning from the bathroom, one finds it up by the same amount on negligible volume? Simple: there continues to be zero liquidity. Although, not just in equities, but in bonds as well, something this website - and the TBAC and Citi's Matt King - has warned for over year. It is the lack of bond liquidity that led to last week's dramatic surge in bond prices as Bloomberg noticed overnight. So for those curious just how bad bond liquidity is now, here is JPM's Nikolaos Panigirtzoglou with the explanation:



Tyler Durden's picture

Doctors "Hit Breaking-Point" As Ebola Death Toll Tops 4500; Nigeria 'Clear' But Harvard Issues Travel Ban

The WHO is coming under increasing scrutiny over its response to the the deadly epidemic. As The BBC reports, after stating that the death toll has hit 4,555 worldwide, a leaked internal document shows "nearly everyone involved in the outbreak response failed to see some fairly plain writing on the wall." There are a few tidbits of good news this weekend: the Spanish patient's test returned negative, 48 "at-risk" people in Dallas have been cleared, and Nigeria has been declared "ebola-free". Sadly, the bad news keeps coming: the virus has spread to new regions of Guinea (affecting mining operations), Moodys warns the economic legacy will linger, IMF slashes growth forecasts for Africa, and most critically, MSF doctors are at their breaking point: "The epidemic is still getting worse... I don't see a light at the end of the tunnel." Lastly, Harvard has imposed a travel ban from Ebola-affected nations.



Tyler Durden's picture

Guess Who Wasn't Shorting Treasurys

After America's commercial/investment banks crushed all momentum chasers hedge funds in 2014, with one after another after a third recommendation to go long stocks and short bonds starting in late of 2013 and repeating the broken record every single month because, you know, "the recovery", ignoring the massive outperformance of bonds over stocks in 2014 as Treasury shorts have been forced to cover at ever higher prices now that the global economic emperor was finally was revealed to be completely and utterly naked (thanks Goldman) one would think that banks would have eaten at least a little of their own cooking, and partaken in what has become a ridiculously crowded 10 Year TSY short. Well, one would be wrong. As in very wrong.



Tyler Durden's picture

Stocks, Bond Yields Drop After Rosengren-IBM-Oil Triple-Whammy

As futures opened last night, it was all looking so bright as the 'rebound' extended and every knife-catching "in it for the long-run" manager was proved 'right'. Then Eric Rosengren pissed in the punchbowl - explaining QE will end in October "unless somethinh dramatic happens" - somewhat taunting the market to crash to ensure the Fed keeps the party going. Markets leaked lower and then came Big Blue which slammed futures lower. Oil prices are falling once again this morning, ECB's bond-buying was a disappointment, and USDJPY's fundamentals hit an air-pocket. Having retraced perfectly 50% of last week's losses, the S&P 500 is fading at the open...



Tyler Durden's picture

Hedge Funds Have Worst Week Since 2011: Here Are The Best And Worst Performers In October And 2014

First, the bad news: Last week was the worst week for hedge funds since 2011.... Then the good: hedge funds dropped by less than half what the decline in the broader market was, largely because many hedge funds still haven't been fully shaken out of their shorts, despite 6 years of relentless central planning seeking to crush all bears.

Here is a summary of the best and worst performing hedge funds in October and 2014.



Tyler Durden's picture

Technical Glitch Downs Bank Of England's $110 Trillion Payments System

The Bank of England's "Real Time Gross Settlement Payment System" (RTGS) - the UK's equivalent of the US FedWire - has gone offline this morning due to a technical glitch, according to The Telegraph. RTGS, which processes large payments in real-time (including home purchases) between British banks - and processed GBP70 trillion in payments across 5000 entities last year - has been down since 6am London time (the fault was disclosed over 5 hours later at 1130 London Time). For now the largest payments are being processed manually and smaller payments are on hold.



Tyler Durden's picture

ECB Unleashes (Covered) Bond Buying Program, Sovereigns Sell Off

Draghi, we have a problem. Just as Coeure 'promised' the ECB, according to The FT, began its bond-buying program this morning. However, peripheral sovereign bond-buying front-runners banking on the ECB greater fool to offload to are disappointed as they are go no easy money love. The initial program is covered-bond-buying (similar to US MBS, but a considerably smaller market) and the ECB will reveal how much it has bought each Monday afternoon (starting next week). Greek bonds are suffering the most with 5Y yields at cycle highs once again and prices at lows (vanquishing all of Friday's gains).



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