BOE

Through The Looking Glass On Rates

Negative interest rates act effectively as a hidden tax funneled directly to banks. They are inherently unhealthy. Currently, they could indicate also a measure of unease among two of the four most powerful central banks. If so, that could well escalate.

The War On Savers And The 200 Rulers Of World Finance

There has been an economic coup d’état in America and most of the world. We are now ruled by about 200 unelected central bankers, monetary apparatchiks and their minions and megaphones on Wall Street and other financial centers. Unlike Senator Joseph McCarthy, we actually do have a list of their names. They need to be exposed, denounced, ridiculed, rebuked and removed.

Futures Unchanged, Global Stock Algos Anemic Ahead Of U.S. Payrolls Report

US futures were largely unchanged overnight, with a modest bounce after the European close driven by a feeble attempt to push oil higher, faded quickly and as of this moment the E-mini was hugging the flatline ahead of today's main event - the January payrolls, expected to print at 190K and 5.0% unemployment, however the whisper number - that required to push stocks higher - is well lower, at 150K (according to DB), as only a bad (in fact very bad) jobs number today will cement the Fed's relent and assure no more rate hikes in 2016 as the market now largely expects.

Futures Flat As Dollar Weakness Persists, Crude Rally Fizzles

After yesterday's torrid, chaotic moves in the market, where an initial drop in stocks was quickly pared and led to a surge into the close after a weaker dollar on the heels of even more disappointing US data and Bill Dudley's "serious consequences" speech sent oil soaring and put the "Fed Relent" scenario squarely back on the table, overnight we have seen more global equity strength on the back of a weaker dollar, even if said weakness hurt Kuroda's post-NIRP world and the Nikkei erased virtually all losses since last Friday's surprising negative rate announcement. Oil and metals also rose piggybacking on the continued dollar weakness as the word's most crowded trade was suddenly shaken out.

Key Events In The Coming "Payrolls" Week

After last week's relatively quiet, on macro data if not central bank news, week the newsflow picks up with the usual global PMI survey to start, and end the week with the US January payrolls report.

"The BoJ's NIRP Will Result In More Currency Wars And Global Growth Slowdown"

"The BoJ actions should lead to further intensification of global currency wars with central banks around the world trying to engineer sustained competitive devaluation against the background of slowing global trade and growth as well as persistent commodity price disinflation. With its latest measures the BoJ will allow Japan to borrow more growth from its trading partners and limit the severity of the imported disinflation."

China Warns Soros Against Starting A Currency War: "You Cannot Possibly Succeed, Ha, Ha"

Soros’s war on the renminbi and the Hong Kong dollar cannot possibly succeed — about this there can be no doubt. Reckless speculations and vicious shorting will face higher trading costs and possibly severe legal consequences. And just as proved in the yuan exchange rate case, the Chinese government has sufficient resources and policy tools to keep the overall economic situation under control and cope with any external challenges.”

Oil Slides Dragging Global Stocks, US Futures Lower, After Saudi Aramco Supply Comments

After the biggest two-day surge in oil in seven years, early in the overnight session both Brent and WTI continued their run for a third day, entering a bull market, 20% up from recent lows hit just last week (still 15% down on the year) when Saudi Arabia spoiled the momentum party after  the world’s biggest crude exporter said it’s keeping up investments in energy projects while diesel consumption in China dropped for a fourth consecutive month, signaling an industrial slowdown. And thanks to the near record correlation between equities and oil, global stocks and US equity index futures initially rose only to slide following the Saudi comments.

"Dip Buying Is Officially Dead"

"dip buying is officially dead and stocks (esp. US ones) are no longer impressed by promises of central bank largess. The reason the SPX has only witnessed insipid rally attempts during this weeks-long swoon is the absence of robust dip-buying."

- JPMorgan

When Omnipotence Fails: JPMorgan Warns Upside Uncompelling As Central Bank Put Wanes

It would be hard for a year to start any worse than 2016 has... "Prices are oversold and sentiment hasn’t been this despondent in a long time (even Aug/Sept wasn’t this palpably negative) but any bounce will not be particularly impressive and in a lot of ways that is the main problem as the upside just isn’t compelling enough to make a major stand...as Western central banks attempted to mollify sentiment with dovish rhetoric but to no avail."

The Great Unraveling Looms - Blame The 'Austrians'?

Decades of accumulated market distortions appear to be on the brink of a great unwind, most of which can be blamed on expansionary monetary policies. If so, the banking crisis of 2008 was a prelude, rather than the crisis itself. The Keynesians will blame the Fed for a complete policy failure. The reality is, that by implementing conventional policies on the recommendation of group-thinking macroeconomists, the central banks have dug a hole too deep to escape. Recognition of the merits of Austrian sound money theory will simply expose this reality sooner than later.