Belgium

 Markets have found a good excuse to be on hold. Elections. No real US figures and a tendency to ignore European ones. No shoe dropping means upside, a little. Core EGBs rather firm nevertheless, for choice. Periphery, in absence of news, trading back and forth, so better today. EZ Q4 growth looks like stalling with a catch-up of a more lenient summer. More to come.
"Elected " (Bunds 1,43% +1; Spain 5,64% -9; Stoxx 2513 +0.5%; EUR 1,281)

Rochdale Securities executes a trade levered at 294x its capital base, in direct contradiction to BoomBustBlog research & FINRA arrives with a fire hose to wet the smoldering ashes.

Nothing really mattered… Eventually. Europe correcting Friday’s excessive optimism, in line with the US, treading water ahead of the elections. Still, the Periphery remained under (controlled) pressure with Spain cornering most, if not all negative headlines today – ahead of Thursday’s auction. 10 YRS periphery backing up to (selective) symbolic levels of 5% and 5.75% (damn’ near 6%).

We had ended the week on Fri 26 being “On the Road to Nowhere”, which essentially wasn’t that wrong a call, as markets got stuck on Sandy’s path.

So, as last week: Nothing new. Spailout OMT still not in play – and might not be this year's business. Officially. Hmmm... Yeah. Sure. We'll see. Greece, haggling not over.

Big Disconnect between Risk and Reality, Equities and Bonds.

Self-sufficiency matters. Bridgewater's Ray Dalio sees this logical concept as consistently an important ingredient for individuals, and even more so for societies as a whole, to become successful. As he notes in a recent missive, "self-sufficiency encourages productivity by tying the ability to spend to the need to produce," adding that is likely not controversial to state that people spend money they earn differently than money they are given (i.e. the connection between working hard and spending is a healthy one). By quantifying 'self-sufficiency' as one of the parts of 'the formula for economic success', Dalio shows that "Societies in which individuals are more responsible for themselves grow more than those in which they are less responsible for themselves." The nine-factor gauge of self-sufficiency provides some interesting insights into those nations most likely to experience above-average growth going-forward and those that are not; as European countries, notably Italy, France, Spain, and Belgium, all ranking at the very bottom on self-sufficiency. Perhaps, in order to encourage growth, these nations must enable their citizens' self-sufficient animal spirits by removing their pacifying nanny-state support?

European corporates continue to report considerably more negative surprises in production than expectations a mere three months ago - with the divide now at extreme levels. As Morgan Stanley notes though, there remains a 'hope' for green shoots in the euro area on the back of the ECB's OMT announcement and an apparently more robust China. Unfortunately, as these ywo simple charts indicate, the reality is that business surveys are pointing to a continued slide and that recent resilience is unlikely to last. In fact, in Morgan Stanley's view, incoming data and anecdotal evidence would suggest Q4 could be even worse than had been expected and the recessionary envionment will drag well into next year.

Uhhhh. It just couldn’t last. Risk had been pushed higher and higher in anticipation, but a combination of reality-check, rather unsettling Q3 earnings and renewed Spanish jitters just made players come down hard from their previous week’s high flying exercise.
Nothing new.

Spailout OMT still not in play. Greece, haggling not over. Earnings rather bad. PMIs dismal. Central Banks on hold, as everything is on the table, at least for the moment.

If it wasn’t because the government sponsorship doping Q3 US GDP, we wouldn’t have much on the bright side.

European equities still desperate to shoot up. Feels like too many fickle shorts and too many uncomfortable longs at the same time.

Markets uneasy after round-tripping back to OMT / QE unleash levels and no follow-up stimuli to be seen.

Puh… Why don’t we just wait for Apple? They might pitch a maxi iPhone 6? Or so…

Otherwise, rather Bad Karma day.

Flat start, bullish morning, refreshing afternoon. Nothing concrete or fundamental, so it’s a spiritual thing.

While regional independence is superior to both the failing European Union and the façade of special interest controlled democracy, one further action should taken by any jurisdictions that choose secession: Newly restored sovereign nations should repudiate their share of the illegitimate sovereign debt when they exit existing unions and nation-states. Created by distant banking elites buying national politicians and parliaments to load up on sovereign debts that can never be paid off, this massive national debt load is illegitimate and destructive to existing and new national economies. Governments have three ways to deal with debt loads of this magnitude: The first is hyperinflation designed to destroy the payoff value of the debt, second is the official repudiation of the debt or third, a combination of both options. Attempting to hold the bankers accountable is not an option. The first nations to repudiate sovereign debt will have the advantage; and as nations undertake this endeavor, they should keep this in mind: All government bureaucracies grow until contained, taxes rise until curtailed and politicians borrow and seek power until thrown out of office.

Might have missed something today .

The weakness after the US close and soft sentiment figures understood.

The mid-morning change in mind and subsequent rebound seems a bit puzzling here.

PMIs rather bad, the rest not good enough…

Uuuhh. Yesterday a heart attack and today Lights Out? Then again, markets went up seamlessly with no trigger and can thus slide the same way.

AAPL will need to come up with a helluva surprise mini iPad that does the cooking and bring the kids to school to turn around things overnight.

Spain situation still by far not settled enough to last without some real interventions / decisions.

Mostly boring.

European equity resilience seems surprising, given the otherwise gloomier mood. No news still played out as being good news and even catch-up to US levels seems a doubtful explanation.

Beats me.

This week was more spaced out with pessimism followed by Spain and equities ripping higher on  no news, at least nothing major nor new.

So we’ll dedicate the week to the Fab Fours’ song, which title’s abbreviation  has always been linked to substance abuse.

Just be careful when coming down…

Spacy week, though… Song pick of yesterday’s said it all. Somehow, things have spun out of control and the rocket started stalling and then drifting into the void…

Poor Major Tom left the capsule too early.

Regional elections in Spain over the weekend. As Rajoy denies there’s any pressure to seek help, BONOs slide. Damned if you don’t; damned if you do…

Interesting to see Core EGBs’ only muted reaction to the fading Risk sentiment, though (Bunds and UST still +15 on the week).