Bank of America

"We Do Not Have An Explanation" - Home Improvement, Luxury Spending Unexpectedly Plunges

What was most disturbing in BofA's latest debit and credit card spending report is what happened with spending in  home improvement stores: spending which traditionally is directly correlated to new home purchases and construction. It crashed, leaving even Bank of America speechless: "We do not have an explanation for this divergence"

Global Bonds Yields Plunge To Record As Treasuries Test Flash-Crash Lows

German, Japanese, and British bond yields are plumbing historic depths as low growth outlooks combined with event risk concerns (Brexit, elections, etc.) have sent investors scurrying for safe-havens (away from US Biotechs). At 2.0bps, 10Y Bunds are inching ever closer to the Maginot Line of NIRP which JGBs have already crossed, and all of this global compression is dragging US Treasury yields to their lowest levels since February's flash-crash... and it appears stocks are catching down to that reality.

Mario Draghi Is Now Buying Junk Bonds

A few days after the ECB unexpectedly announced its CSPP, or corporate bond buying program which based on its definition was limited to investment grade, non-financial debt, we explained "Why The ECB Will Be Forced To Buy Junk Bonds", saying that "the EU corporate sector’s penchant for bond buybacks may ultimately force Draghi further down the ratings ladder lest the ECB should end up entangled tender offers or else end up without enough debt to monetize." This was confirmed on the very first day of the ECB's bond purchases.

These Are The Bonds The ECB Is Now Buying

Today is a historic day for the corporate bond market: with the launch of the ECB's CSPP, Mario Draghi is now directly buying European investment grade non-financial bonds. This means that no longer will European corporate bonds trade based on their fundamentals, but purely on expectations of frontrunning future ECB purchases, such as the following...

Futures Levitate To Session Highs As ECB Enters The Bond Market; Crude Hits $51

In an overnight session dominated by the latest political developments out of the US where Hillary Clinton officially claimed the democratic nomination, the financial newsflow focused on China's trade data, where exports fell 4.1% from a year earlier, in line with expectations, but imports dropped 0.4% from a year earlier, the smallest decline since they turned negative in November 2014, driven entire by soaring "imports" from Hong Kong - aka capital outflows - which soared by 243% y/y.  The other main news was the official launch of the ECB's corporate bond buying, which helped drive government bonds yields in German to new record lows, and the average yields on investment-grade corporate debt below 1%.

Toyota Issues Bond At A 0.001% Coupon, Japan's Lowest Ever

Overnight a Toyota Motor unit sold yen bonds with the lowest coupon ever for a Japanese company. Toyota Finance Corp issued 20 billion yen ($186 million) of notes at a yield of 0.001%, according to a filing with the nation’s Finance Ministry. That’s the lowest coupon ever for a regular bond by a domestic company that isn’t backed by the government

Goldman Sachs Gets A Quarter Million Summer Job Applicants

Goldman Sachs attracted more than a quarter of a million applications from students and graduates for jobs this summer, "suggesting fears of a ‘brain drain’ in the sector may be exaggerated as banks introduce more employee-friendly policies." The number of applications from students and graduates globally have risen more than 40% since 2012, the paper adds. This means there is greater demand to get a job at Goldman than there is even in China where recently 1.2 million job candidates applied for 19,000 much-desired govermment positions.

The Case For A Super Glass-Steagall

By embracing this kind of Super Glass-Steagall Trump would consolidate his base in the flyover zones and reel in some of the Bernie Sanders throng, too. The latter will never forgive Clinton for her Goldman Sachs speech whoring. And that’s to say nothing of her full-throated support for the 2008 bank bailouts and the Fed’s subsequent giant gifts of QE and ZIRP to the Wall Street gamblers.

Futures Flat Ahead Of Strike-Impacted Jobs Report; Commodities Approach Bull Market

After yesterday's two key events, the ECB and OPEC meetings, ended up being major duds, the market is looking at the week's final and perhaps most important event of the week: the May payrolls report to generate some upward volatility and help stocks finally break out of the range they have been caught in for over a year.

Bank of America's Winning Excuse: "We Didn't Mean To"

A federal appeals court overturned a $1.3 billion judgement against Bank of America, ruling that good intentions at the outset shield bankers from fines for subsequent fraud... “Is the idea that a good state of mind initially can insulate you from fraud later on?” exclaimed one law professor, adding, "that would be a very strange and troubling doctrine...it almost seems like the 2nd Circuit fell victim to a lawyer’s trick."

Wells Fargo Reintroduces 3% Down Mortgages

Wells Fargo & Co. is rolling out a new mortgage for borrowers making minimal down payments, an offering that could allow the bank to step back significantly from a controversial Federal Housing Administration program. The bank’s new mortgage allows borrowers?with credit scores?as low as 620 on a scale of 300 to 850?to make down payments of as little as 3%, while also allowing them to use income from family members or renters to qualify.

Saudi Officials Crackdown On FX Market As Currency Peg Starts To Strain

As we warned previously, the devaluation, or breaking of the Saudi Riyal peg to the dollar, could be the black swan event for crude oil and the recent weakness in SAR forwards - while not as violent as Nigeria's Naira - certainly signals a renewed market fear that breaking the peg is imminent. It appears Saudi officials are none too pleased with the free markets speculating on this devaluation and as Bloomberg reports, banks in Saudi Arabia are coming under fresh pressure over products that allow speculators to bet against the kingdom’s currency peg, according to people with knowledge of the matter, which were supposedly banned in January.

Quantitative Easing And The Corruption Of Corporate America

Since the turn of this century, debt-financed share buybacks have severely tested the character of those charged with growing publicly-traded U.S. firms. Should she ignore the potential for further QE-financed share buybacks to exact more untold economic damage, it would be akin to intentionally corrupting Corporate America. The time, though, has come for these wayward companies’ banker and enabler, the Fed, to hold the line, no matter how difficult the next inevitable test of their character may prove to be. It’s time for the Fed to defend the entire Union and end a civil war that pits a chosen few against the economic freedom of the many.