Battling a barrage of negative headlines about rising health insurance premiums and shrinking doctor networks for people participating in the program, Obama will speak in Florida about the need for a "public option" and will urge more young, uninsured people to sign up for the subsidized insurance plans offered under the law.
While expectations are low from Thursday's ECB meeting, it may ultimately boil down to Draghi’s communication about asset purchases. Any hint of QE tapering would spur a large-scale sell-off in the rates market, according to most Wall Street strategists. Here is what else the sellside thinks will happen.
Will we ever learn?Bonds which never pay back principal, yield only 1%, and are converted to equity if the issuer gets into trouble (that is, at exactly the time when you don’t want to own their stock), are being enthusiastically snapped up by Japanese investors.
"...debt is simply everywhere, at least to the extent we can see and measure it. Corporate and sovereign debt, of both the developed world and emerging market varieties, are at record levels. China’s debts certainly add to that record but who really knows to what extent? It’s the ultimate black box of leverage on Planet Earth... You cannot NOT worry about the Fed in this world...The simple truth is ending reinvestment would bring the bond market to its knees.”
One day after a slump in Chinese trade sparked a global market selloff on concerns the world's second biggest economy had once again hit a downward inflection point, overnight China surprised once again, this time to the upside when the latest inflationary data printed hotter than expected, sending European and Asian stocks higher and pushing the yen lower after China’s producer price index rose for the first time since March 2012.
This past Saturday October 8th, Bank of Japan Governor Haruhiko “Peter Pan” Kuroda delivered some prepared remarks on its new QQE with yield control (see here and here) at the Brookings Institute in Washington DC. The conference was attended by "luminaries" like Jeffries’ David Zervos, Princeton economist and Hillary supporter Alan Blinder, as well as many members of the press.
"I am doubtful that the price of oil can rise very high, for very long. Our oil price problem is part of a much larger problem. Once we understand the reason for our low-price problem–diminishing returns and the economy’s tie to the use of energy - it is clear that there is no way out of the problem over the longer term."
"If Everybody's Watching, You Know, All Of The Back Room Discussions And The Deals, You Know, Then People Get A Little Nervous, To Say The Least. So, You Need Both A Public And A Private Position" - Hillary Clinton
The global economic recovery would still leave about a quarter of banks in developed countries too weak to support further growth and susceptible to future shocks. This means that banks controlling about $12 trillion of assets would remain vulnerable during a rosy economic environment marked by faster economic activity, rising interest rates and declining defaults
With the rumor, or at least trial balloon, of an ECB taper rocking bond markets and pushing EM equities lower, a dire forecast has emerged from Mint Partners' head of capital markets Bill Blain who in his latest note warns that "if the ECB’s trillion-billion bond buying largesse is over – then get set for the European sovereign debt crisis Part Two as markets focus back on debt fundamentals."
"The punchline is that the passive / smart beta / risk-parity / risk-control systematic universe often times ARE the entities in the market causing counter-intuitive trading behavior, such as today’s price-action."
"Central bankers have fostered a casino like atmosphere where savers/investors are presented with a Hobson's Choice, or perhaps a more damaging Sophie's Choice of participating (or not) in markets previously beyond prior imagination. Investors/savers are now scrappin' like mongrel dogs for tidbits of return at the zero bound. This cannot end well."
"Even if he’s as bad as he sometimes projects to be, he’s not as bad as Hillary’s policy-record already is." Sometimes, things in politics are the opposite of the way they seem. The Presidential contest between the ‘liberal’ Hillary Clinton’ and the ‘conservative’ Donald Trump is perhaps the most extreme example of this - for these ten reasons...