Alongside the Draghi presser, the ECB moments ago the terms and conditions of its Q€, or as the ECB calls it, the "public sector purchase programme (PSPP)" Here are the full details and the Q&A.
It has been a while since we have seen the USDJPY rampathon push US equities higher, so in a day dominated by central banks (first the BOE momentarily), and then the ECB's much anticipated announcement of the actual QE launch at the Draghi press conference at 1:30pm CET (taking place, ironically enough, in the place that was the blueprint for the Eurozone's capital controls, Cyprus), it only makes sense that after weeks of stage fright, the USDJPY algos reminded the world they are alive and well, and proceeded to ramp the key FX pair above 120, even though the currency that everyone will be talking about today is the Euro, hugging 1.10 as of this moment, but the real question is what happens after Draghi gives the asset buying green light: has all of Q€ been priced in already in FX, and will the EURUSD resume its surge higher, or is parity next stop?
Who should you believe? Record stock market valuations and consensus spouting, highly paid economists who tell you all as is well...or oil, negative economic indicators, and your own eyes that this is just one more artificial boom desperately trying to run from the inevitable bust?
So today what is different is not the Wall Street spiel that Nasdaq is anchored by the likes of Apple rather than Webvan. Since the two days of March 9 and 10 in the year 2000 when the Nasdaq closed over the 5,000, the financial markets have been converted into central bank managed gambling halls and the global economy has bloated beyond recognition by 15 years of non-stop financial repression. Back then, a few hundred stocks were wildly over-valued based on monetizing eyeballs; now the entire market is drastically overvalued owing to the false financial market liquidity generated by $14 trillion of central bank asset monetization - mostly public debt - since the turn of the century. As a result, the global financial system and economy are orders of magnitude more fragile and vulnerable to collapse than they were 15 years ago.
Bill Clinton Dusted Off the Same Marketing Strategy Which Bad-Mustache Used On the Eve of Invading Poland ... And Obama's Been Using It Ever Since
Just like yesterday, it has - so far - been mostly about Asia in the overnight session, where as reported previously, we got the latest central bank engaging in an "unexpected" rate cut, after Reserve Bank of India Governor Rajan cut rates in an unscheduled move days after the government agreed for the first time to give the central bank a legal mandate to target inflation. This was India's second rate cut in 2 months, and yet despite the Sensex surging to a all time high over 30,000, it subsequently ended up closing red on the day, down -0.7%, despite the Indian currency sliding 0.4% to 62.1463 to a dollar. Is the half-life of thany incremental rate cut in an unprecedented barage of global central bank easing now less than a day?
Echoing former US Treasury Secretary Larry Summers’ quip, “There is surely something odd about the world’s greatest power being the world’s greatest debtor,” it appears that economic reality is finally beginning to set in for Americans... Only hours ago, Gallup released a new poll showing that only a small minority (just 17%) of Americans still view the US as the world’s economic superpower.
To be sure, we’ve written quite a bit lately about the ECB’s upcoming plunge into the world of 13-figure debt monetization (or as we call it, Draghi’s Waterloo), and while we hate to beat a dead horse, the sheer lunacy of a bond buying program that is only constrained by the fact that there simply aren’t enough bonds to buy, cannot possibly be overstated. Here is everything you need to know about Q€ ahead of the ECB's Thursday meeting.
With little newsflow out of Europe, and just as little on deck out of the US (just NY ISM and auto sales later today), the main overnight events were out of Asia where first the RBA decided to leave rates unchanged but not before the announcement was leaked up to a minute early. In China, the rate-cut euphoria lasted just one day, and after a feeble 0.8% bounce on Monday, the SHCOMP was down 2.2% this morning over fears the PBOC is doing too little, too late to halt what is now perceived by many as a massive "tightening" capital flight out of China. Finally, Japan made the newsflow, after it JGBs continued to slide following a weak auction, fears that the BOJ is done easing after Abe advisor Etsuro Honda warned against overheating, and after the biggest jump in base pay in over a decade led some to think the BOJ may soon have to halt easing altogether, especially if real wages proceed to rise
One of Chancellor George Osborne’s senior advisers on economic policy has been captured on video smoking crack cocaine in a drugs den. Prof Douglas McWilliams, who last year estimated we would all be £165 a year better off by the election, is seen inhaling it through a glass tube at a flat in North London. Red-faced and slurring his speech, he later told the dealer he had “too much” and that he had spent the day on a binge. Two rocks of the deadly drug can clearly been seen on a table beside the dazed professor. The grainy footage, seen by the Sunday Mirror, will heap embarrassment on the Chancellor and raise serious questions about his choice of adviser.
With key economic data either behind us (with the downward revised GDP), or ahead of us (the February payrolls on deck), and the Greek situation currently shelved if only for a few days/weeks until the IMF payment comes due and the farce begins anew, stocks are focuing on the widely telegraphed 25 bps Chinese rate cut over the weekend, which however has so far failed to inspire a broad based rally either in Asia (where the SHCOMP closed up 0.8% after first dipping in the red) or across developed markets. In fact, as of this moment futures are hugging the unchanged line as the USDJPY attempted another breakout of 120.000 but with numerous option barrier expiration stop at that level, it has since retracted all the overnight gains and is back to the Sundey lows, even as the EURUSD has seen a powerful breakout from overnight lows and is currently at the highest level since the US GDP print, following the release of the final European February PMI data, as a result of USD weakness since the European open.
"...a small proposal for the emendation of such tatters of the Constitution as can be found: For voting in federal elections, we should employ a literacy test to disenfranchise the majority of the population, to the infinite betterment of the country. This wise move should be accompanied by an increase in the voting age to twenty-five. The necessity cannot be denied..."
PIIGS Go To War: Spain, Portugal Slam Tsipras' Accusations Of "Conspiracy Plot" To Overthrow Greek GovernmentSubmitted by Tyler Durden on 03/01/2015 16:25 -0400
Yesterday Tsipras made clear his displeasure with the betrayal of what were formerly his socio-economic equals quite well-known, when he accused Spain and Portugal on Saturday of leading a conservative conspiracy to topple his anti-austerity government, saying they feared their own radical forces before elections this year. As Reuters reports, in a speech to his Syriza party, Tsipras turned on Madrid and Lisbon, accusing them of taking a hard line in negotiations which led to the euro zone extending the bailout programme last week for four months. And the inevitable response: both nations are now demanding that the EU "arbitrate" and respond to Tsipras' allegations, in the process essentially validating his accusations.
Those of us who are libertarians have a tendency to speak frequently of “the New World Order.” When doing so, we tend to be a bit unclear as to what the New World Order is. Is it a cabal of the heads of the world’s governments, or just the heads of Western governments? Certainly bankers are included somewhere in the mix, but is it just the heads of the Federal Reserve and the IMF, or does it also include the heads of JPMorgan, Goldman Sachs, etc.? And how about the Rothschilds? And the Bundesbank—surely, they’re in there, too?
Never has our nation, corporations and wealthy top 1% faced so many new threats to their efforts to grow their power and wealth around the world. But a real war would provide the crisis excuse to confiscate your gold and "excess" retirement plan and IRA assets, reduce or curtail your social security benefits, dramatically raise taxes and institute total exchange controls while curtailing your remaining freedoms and ability to resist for the duration of the crisis.