"The environment remains uncertain with a number of potentially frosty developments. The result of the constitutional referendum in Italy is a harbinger of renewed turbulence that could spill over from the political arena to the economy – with Europe particularly endangered."
Despite a small rise MoM, The Fed's own Labor Market Conditions Index has now deteriorated year-over-year for 5 straight months, despite significant upward revisions over the last 6 months, most notably in September and October. As Deutsche's Jo Lavorgan notes,"the upshot is that the economic outlook remains fragile despite the ostensible robustness of the labor market."
Less than a month after the "shocking" election of Donald Trump as US president, the world prepares for another day of political shockwaves, this time out of Europe, when on Sunday all eyes will be on Italy and, to a slightly lesser extent, Austria.
Two months after paying $38 million to settle a silver price-fixing case, on Friday Deutsche Bank agreed to pay $60 million to settle private U.S. antitrust litigation by traders and other investors who accused the German bank of conspiring to manipulate gold prices at their expense.
In September, headlines of Deutsche Bank trading clients pulling collateral sparked grave concern over the world's most systemically dangerous bank. Today, the stock is sliding once again as WSJ reports the bank said it would cease providing some coverage for about 3,400 actively trading clients in its global markets division, according to a memo sent to equities staff.
Following a November to remember, which saw tremendous market gains following the election of Donald Trump, December has started off on the back foot, with US equity futures lower, European stocks halting a two day advance ahead of the Italian referendum, US Treasury yields higher and the US dollar backing away from a 9 month high.
We, and the rest of the world, are patiently hanging around, waiting to see if the Federal Reserve wakes up to what’s happening to dollar liquidity, and the threat it poses to the global economy and to its own (glacially slow) tightening cycle.
“More volatility in the near future is likely and the potential for an abrupt reversal remains significant amid heightened political uncertainty around the globe and underlying emerging market vulnerabilities,” the ECB wwarned in its twice-yearly Financial Stability Review published on Thursday.
Germany's second-largest shipping lender, German Landersbank NordLB warned it was facing a loss of “more than €1bn” this year, as a result of the latest shoring up of reserves against losses on its portfolio of shipping loans, and that a whopping €8 billion, or 40%, of its shipping loan book was now non-performing.
Each year in November the Financial Stability Board releases is ranking of the 30 banks that pose the greatest systemic risk to the global financial system and the two at the top of 2016's list just might surprise some folks.
The EU fired a major global trade war tit-for-tat retaliation today against US banks and the UK in a single action. Brussels will raise costs for foreign lenders while simultaneously taking a pot shot at London.