It was a week ago when we first observed that the defense of 1400 in the ES at all costs must go on, or else the only thing that is keeping the market propped up - psychology (now with the AAPL euphoria long gone), would be gone as would all support. But once again, the overnight session has proven that, with a little help from its central banking friends, 1400 (and 1.2900 in the EURUSD) can be defended. This was in danger of being breached until China reported two PMI numbers: an official one which printed at 50.2, or modest expansion, and up from 49.8, magically right on top of expectations of 50.2, and the HSBC PMI, which also rose to 49.5, from 47.9: the 12th straight contraction print, but the highest number in 8 months. The market spin is naturally that this is an indication of a rebounding China. Sadly, just like in the US, this is merely pre-party congress data manipulation. The only thing that does matter out of China: whether or not the country will actually ease as opposed to doing day to day reverse repo injections. Without the former, the Chinese economy will not rebound, and will not lead to an improvement in corporate outlook for US tech stocks, period, the end.
A cyber attack does not have to be limited to a single country and its networks. It could be used to strike multiple countries and fuel a global firestorm of systems failures. Globalists need a macro-crisis, a world-wide catastrophe, in order to present their “global solution” to the desperate masses. This solution will invariably include more dominance for them, and less freedom for us. A global crisis can also be used to manipulate various cultures to forget concerns of sovereignty and think in terms of one-world action. Surely, a worldwide breakdown can only be solved if we “all work together and all think alike”, right...? Without a doubt, a cyber attack serves the interests of elitist entities and banking monstrosities like nothing else in existence. Set off a nuke, start WWIII, turn the U.S. dollar into stagflationary dust; a cyber attack tops them all, because a cyber attack can lead to them all while maintaining deniability for the establishment. The fact that whispers of cyber threats have turned into bullhorn blasted propaganda should concern us all. Are we being conditioned for a cyber event in the near future? That remains to be seen. However, none of us should be surprised if one does occur, especially in light of the many gains involved for globalists, and all of us should be ready to dismantle and expose any lies surrounding the event before the American public is whipped into a 9/11 style frenzy yet again
- Greece Faces Need for Additional Assistance: €30 billion (WSJ)
- Greeks fail to agree on bailout terms (FT)
- The report that got the NYT banned on the Chinese interweb: Billions in Hidden Riches for Family of Chinese Leader (NYT)
- Bo Xilai: China parliament expels disgraced politician (BBC)
- Japan Adds Stimulus Amid Threat of Bond-Sale Disruption... $9.4 billion (Bloomberg)
- Hubbard Said to Prefer Treasury Chief to Fed If Romney Wins (Bloomberg)
- 9 More Banks Subpoenaed Over Libor (WSJ)
- Romney raises $112m in 17 days (FT)
- Amid Cutbacks, Greek Doctors Offer Message to Poor: You Are Not Alone (NYT)... no, we are all broke
- Muni Downgrades Top 2011 Total on Weak Economy: Moody’s (Bloomberg)
- Ireland urges ECB to commit to bond-buying (FT)
- Cameron and Clegg unite in EU demands (FT)
The 2012-2013 election season is exceptional, with more than 100 elections in economies accounting for approximately 60% of global GDP. So far, Goldman notes that markets have navigated through elections in Russia, Egypt, Greece, France, Mexico and Venezuela, among others. The closely watched Presidential election in the US will take place shortly, followed by the culmination of the political transition in China. Later on, markets will see countries like Italy, Iran, and Japan go to the ballots too. This extraordinary election season brings several questions to the forefront: Why are elections important market events? What are the main factors affecting that market-driving impact and its seasonality? And which states are key? Critically, Goldman finds that a divided government has on average produced considerably tighter fiscal policy - not a good sign for the Keynesians.
- Moody’s Cuts Ratings on Catalonia, Four Other Spanish Regions (Bloomberg)
- And the market top: Billionaire Ross Interested in Buying Spanish Bank Assets (Bloomberg)
- Japan Jojima denies govt seeks $250 bln BOJ asset buying boost (Reuters)
- China hints at move to strengthen Communist rule (Reuters)... well everyone else is doing it
- Euro-Area Bailout Fund Faces Challenge at EU’s Highest Court (Bloomberg)
- Obama, Romney now tied in presidential race: Reuters/Ipsos poll (Reuters)
- Former China Leader Jiang Resurfaces Before Political Transition (Bloomberg)
- Some in Congress look to $55 billion fiscal cliff 'fallback' (Reuters)
- CLOs stage comeback in US (FT)
- TXU Teeters as Firms Reap $528 Million Fees (Bloomberg)
- China’s Factories Losing Pricing Power in Earnings Threat (Bloomberg)
From 1987: How much time do I have to liquidate? Answer: We need you to do this by Monday night.
BP's New Excuse Doesn't Hold Water
Here is the bottom line. From the day Pandit took control in December 2007 until today, C stock is down 90%.......Even as Pandit has been paid a total of over $260 million during his CEO tenure, even including his famous $1 comp received in 2010. While CEO of Citigroup in 2007, Vikram Pandit earned an annualized compensation of $3,164,320, which included a base salary of $250,000, stocks granted of $2,914,320, and options granted of $0. In 2008, he earned a total compensation of $38,237,437, which included a base salary of $958,333, stocks granted of $28,830,000, and options granted of $8,432,911. In 2009 he received total compensation of $128,751, including base salary of $125,001; In 2010 he received total compensation of $1,00; In 2011 he received total compensation of $14,857,103 including base salary of $1,671,370. Oh, and this number includes the $165 million Pandit received for his low performing hedge fund which was purchased by Citi in 2007, and was closed by Citi a few months later for epic underperformance.
Divergence in thinking.
A new week begins. Here are the major global market-moving events to look forward to for both the next week, and for the remainder of October and November.
Hint: It Was Not To End the War Or Save Lives
Just when we all thought the Macondo disaster could be put behind us and TV ads proclaim the Gulf's recovery, a sheen of oil has reappeared and the coastguard confirms it is directly linked to the Macondo well. According to WDSU, the sheen is a light oil and would be difficult to clean up. "The exact source of the sheen is uncertain at this time but could be residual oil associated with wreckage and/or debris left on the seabed from the Deepwater Horizon incident in 2010," the agency said in a release Wednesday night.
We have been very active in our discussions of the impact of the pending rise in food prices around the world (from central bank largesse to weather-related chaos). As Goldman notes, food inflation has been one of the most significant sources of headline inflation variation in emerging markets (EM) over the past few years. Since June, international prices for agricultural commodities have risen almost 30%, increasing the risk of fresh, food-related increases to EM headline inflation. We, like Goldman, expect EM headline inflation to start to reflect the relevant pressures more broadly in the October prints at the latest. While the effects, for now, are expected to be less extreme than the 2010-2011 episode, the timing as the US enters its fiscal-cliff-prone malaise, could mean a further round of easing will reignite this critical inflationary concern.
Spoiler Alert: They’re mostly still in office (so much for building suspense).
On October 3, 2008, 338 elected officials (263 House reps, 74 Senators and 1 President) took it upon themselves to save America from certain financial doom by passing the Emergency Economic Stabilization Act of 2008, completely ignoring the will of the American people, opting instead to fulfill a Thomas Jefferson prophesy:
“The end of democracy and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations.”
~ Thomas Jefferson
- Draghi Says Next Move Not His as Spain Resists Bailout (Bloomberg)
- EU Doubts on Deficit Cutting May Hinder Spain’s Path to Bailout (Bloomberg)
- Merkel to Visit Greece for First Time Since Crisis Outbreak (Bloomberg)
- Fed's Bullard warns inflation won't ease U.S. debt burden (Reuters)
- Walmart Workers Stage a Walkout in California (NYT)
- Natural Gas Glut Pushes Exports (WSJ)
- BOJ Refrains From More Stimulus as Political Pressure Mounts (Bloomberg)
- Big funds seek to rein in pay at Wall Street banks (Reuters)
- Hong Kong Luxury Sales Fall as Chinese Curb Spending (Bloomberg)
- Dave and Busters Pulls IPO due to "Market Conditions" (Reuters) - so market at anything but all time highs now is market conditions?
- Weak U.S. labor market looms ahead of elections (Reuters)
- Glut of Solar Panels Poses a New Threat to China (NYT)