American Spring Night 2: Coast-To-Coast Protests, "We Have Every Right To Destroy A System That Seeks To Destroy Us"Submitted by Tyler Durden on 11/25/2014 23:53 -0400
Another day, another case of central banks, not one but two this time, dictating "price" action.
There are things going on with the financial markets currently that seem just a bit "out of balance." For example, asset prices are rising against a backdrop of global weakness, deflationary pressures and rising valuations. More importantly, there is a rising divergence between sentiment and hard data. While weather can't be blamed yet, it will likely be the main "excuse" in the months ahead as early record snowfall is already impacting economic production. However, it isn't just the manufacturing data that seems "out of whack."
Here Are The Highlights From The Senate's Finding That Banks Manipulate Physical Commodities - Live Hearing FeedSubmitted by Tyler Durden on 11/20/2014 10:28 -0400
After two years, and 396 pages of report, the Senate investigations committee finds (translating their gobbledygook into English) that the banks did indeed corner and rig the commodity market. As Bloomberg reports, the Senate panel said the firms have eroded the line separating banking from commercial activities to the detriment of consumers and the financial system. The holdings give banks access to non-public information that could move markets and increase the likelihood that industrial accidents will spur taxpayer bailouts, the report said... (i.e. manipulated the system). The hearing, involving bankers from Goldman, Morgan Stanley, and JPMorgan begins at 930ET...
- Japan Prime Minister Shinzo Abe Calls Snap Election (WSJ) - as repeatedly priced in...
- Flash Boys Raising Volatility in Wild New Treasury Market (BBG)
- Not Greece again: Greek Bailout Review Stalls as Troika Demands Final Steps (BBG)
- Iran uses China bank to transfer funds to Quds-linked companies (Reuters)
- Porn Mags With Free Madrid Theater Tickets in Tax Protest (BBG)
- Hong Kong, China stocks ease on profit-taking after stock connect launch (Reuters) - Hang Seng down 500 points in past 2 days
- Halliburton Mega-Deal Sealed by CEOs Over Coke and Coffee (BBG)
- Wall Street to Reap $316 Million From Day of Mega Deals (BBG)
- Mass murderer Charles Manson gets marriage license, state says (Reuters)
Perhaps the biggest shock following last night's completely expected and very predictable (previewed here over a month ago) Japanese slide into triple- (actually make that quadruple) dip recession, is that it took the BTFTripleDip recession algos as long as they did to recover most of the overnight futures losses. Because after surging to 107 on a confused short squeeze kneejerk reaction, the USDJPY subsequently tumbled 150 pips to 105.50 as rationality briefly emerged, and the market wondered for a few brief hours if rewaring the destruction of one's economy is actually a prudent thing. Then, however, when European traders started walking into work, the now default USDJPY levitation on no volume came right back, and with that the correlation algo buying of E-mini futures, no doubt helped by the Bank of Japan itself taking advantage of the CME's ES liquidity rebate program. Because without confidence as expressed by the lowest and only common denominator left - global equities - there is nothing else.
When a member of the press dared to ask Obama if the head of the "most hypocritical transparent administration ever" "misled Americans" about the taxes and about keeping the plan "in order to get the bill passed" the response was "No, i did not." This was Obama's conclusion after he had just gotten "well-briefed before he came out here." Indeed, nothing escapes the American president who continued: "The fact that some adviser who never worked on our staff expressed an opinion that I completely disagree with in terms of the voters is no reflection on the actual process that was run." Unfortunately, because Obama apparently wasn't briefed quite as well as he would have hoped, let's just take a look at what Dr. Gruber did do.
If there were no puppet masters in Washington DC or the Kremlin, what would happen next week?
The key event overnight was the release of European Q3 GDP data, which saw Germany averting a recession by the narrowest of margins when following a -0.2% drop in Q2 economic growth, Germany grew by the smallest amount possible in Q3, or 0.1%, in line with expectations, thus averting two consecutive quarters of decline, the technical definition of a recession. The French economy likewise posted a modest increase in Q3, although one wonders how aggressively the data had to be fudged for a country whose PMIs all indicate a -1% or greater contraction. Italy however was less creative with its use of "hookers and blow", and continued its recession with a 3rd negative print, contracting at -0.1% as expected, while Portugal also missed third quarter growth estimates.
- Banks to Pay $3.3 Billion in FX-Manipulation Probe (BBG)
- Symbolic being the key word: U.S., China sign symbolic emissions plan, play down rivalry (Reuters)
- Europe (so really Russian sanctions) is the new "snow in the winter" - Carney Sees Europe Stagnation Impact as Growth Outlook Cut (BBG)
- Eurozone Industrial Output Points to Weak Third Quarter Growth (WSJ)
- Not everyone around Abe is insane: Kuroda Ally Flags Warning on Delaying Sales-Tax Increase (BBG)
- Hong Kong to scrap daily yuan conversion limit to boost stock investment (Reuters)
- Barclays Falls After FX Settlement Delay Reduces Discount (BBG)
- Some unhappy Yahoo investors asking AOL for rescue (Reuters)
Non-bombastic overview of the forces influencing the capital markets in the week ahead.
Lack Of Daily Central Bank Intervention Fails To Push Futures Solidly Higher, Yen Implosion ContinuesSubmitted by Tyler Durden on 11/03/2014 07:47 -0400
While it is unclear whether it is due to the rare event that no central bank stepped in overnight with a massive liquidity injection or because the USDJPY tracking algo hasn't been activated (moments ago Abe's deathwish for the Japanese economy made some more progress with the USDJPY hitting new mult-year highs just shy of 113.6, on its way to 120 and a completely devastated Japanese economy), but European equities have traded in the red from the get-go, with investor sentiment cautious as a result of a disappointing the Chinese manufacturing report. More specifically, Chinese Manufacturing PMI printed a 5-month low (50.8 vs. Exp. 51.2 (Prev. 51.1)), with new orders down to 51.6 from 52.2, new export orders at 49.9 from 50.2 in September. Furthermore, this morning’s batch of Eurozone PMIs have failed to impress with both the Eurozone and German readings falling short of expectations (51.4 vs Exp. 51.8, Last 51.8), with France still residing in contractionary territory (48.5, vs Exp and Last 47.3).
On the one Hand: "Consumers expect better economic growth and rising incomes in the coming months, pushing a measure of confidence to a seven-year high in October. The University of Michigan said Friday that its index of consumer sentiment rose to 86.9 from 84.6 in September. That's the highest since July 2007, five months before the Great Recession began. Richard Curtin, the survey's chief economist, says that almost six in ten of the respondents said the economy has improved recently, the highest proportion in more than 10 years."
On the other: "Voters are deeply frustrated with the economy as they head to the polls Tuesday for a midterm election Republicans hope will yield them control of the Senate."
If yesterday's Citi debacle was a buying opportunity (which it is according to the pre-market), then news that Ally Financial (formerly GMAC) is under regulatory and DoJ investigation must be great news:
*ALLY CITES REQUEST FROM SEC ON SUBPRIME AUTO FINANCE PROBE & MORTGAGE-BACKED SECURITIES; REQUESTS INCLUDE SUBPOENAS FROM DOJ
Of course, do not forget that GM itself recently admitted to the DoJ probing its subprime auto loan underwriting practices. But, but, but - isn't this exactly what FHFA's Mel Watt wants?
- Futures rally after BOJ ramps up stimulus (Reuters), Japan's central bank shocks markets with more easing as inflation slows (Reuters)
- Kuroda Jolts Markets With Assault on Deflation Mindset (BBG)
- Japan Mega-Pension Shifts to Stocks (WSJ)
- Russia Raises Interest Rates (WSJ)
- Oil-Price Drop Has Saudi Officials Divided (WSJ)
- Not anymore, the BOJ is here: Fed Exit Could Spark Slump in All Markets, ATP CEO Says (BBG)
- Wal-Mart Weighs Matching Online Prices from Amazon (WSJ)
- Euro-Area Inflation Picks Up From Five-Year Low on Stimulus (BBG)
- Big Banks Brace for Penalties in Probes (WSJ)
- Ex-UBS Trader Defense Could Be Threat to U.S. Forex Cases (BBG)