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)
Two days ago, when QE ended and knowing that the market is vastly overstimating the likelihood of a full-blown ECB public debt QE, we tweeted the following: "It's all up to the BOJ now." Little did we know how right we would be just 48 hours later. Because as previously reported, the reason why this morning futures are about to surpass record highs is because while the rest of the world was sleeping, the BOJ shocked the world with a decision to boost QE, announcing it would monetize JPY80 trillion in JGBs, up from the JPY60-70 trillion currently and expand the universe of eligible for monetization securities. A decision which will forever be known in FX folklore as the great Halloween Yen-long massacre.
QE destroys societies, economies and financial systems, it doesn’t heal them. So maybe it’s a touch of genius that the great powers of global finance have first pushed Keynes into the academic world and then academics like Bernanke and Yellen into positions such as head of the Fed, making everyone blind to the fact that what they think is beneficial, including many who think they’re real smart, actually hurts them most. This whole thing is so broken and perverted it’s getting hard to understand why anybody would want to continue clinging on to it. But then, what does anybody know? 95%+ of people have been reduced to pawns in someone else’s game, and they have no idea whatsoever.
Could we have imagined anything more far-fetched and unlikely as this practice by the SEC itself? We’ll answer this question. No.
- Fed set to end one crisis chapter even as global risks rise (Reuters)... you mean, for the third time?
- Insider-Trading Probe Focuses on Medicare Agency (WSJ)
- He's sorry: Rajoy Apologizes as New Wave of Graft Allegations Hits Spain (BBG)
- China could 'punish' Hong Kong over protests, says ex-HK central bank chief (Reuters)
- Dubai Insists the Boom is Not a Bubble This Time Around (BBG)
- Bank-Data Sharing Accord Expands Push to Find Tax Cheats (BBG)
- Deutsche Bank Sinks to Third-Quarter Loss on Legal Costs (BBG)
- Kim Jong Un Executes 10 Officials for Watching Soap Operas (BBG)
- French drugmaker Sanofi sacks CEO Viehbacher (Reuters)
- CDC says returning Ebola medical workers should not be quarantined (Reuters)
- Sweden’s central bank cuts rates to zero (FT)
- Hacking Trail Leads to Russia, Experts Say (WSJ)
- Discount-Hunting Shoppers Threaten Stores’ Holiday Cheer (BBG)
- Apple CEO fires back as retailers block Pay (Reuters)
- Repeat after us: all China data is fake - China Fake Invoice Evidence Mounts as HK Figures Diverge (BBG)
- FX Traders’ Facebook Chats Said to Be Sought in EU Probe (BBG)
- Euro Outflows at Record Pace as ECB Promotes Exodus (BBG)
- Apple boosts R&D spending in new product hunt (FT)
NYC Doctor Confirmed Positive For Ebola; Contact With Girlfriend (Quarantine) & 3 Others; "Unlikely" Contagious On SubwaySubmitted by Tyler Durden on 10/23/2014 23:52 -0400
*PATIENT IN NYC TESTS POSITIVE FOR EBOLA, NEW YORK TIMES SAYS, EBOLA PATIENT GIRLFRIEND QUARANTINED: CNN
*TREASURIES ADVANCE, S&P 500, NASDAQ 100 FUTURES EXTEND DECLINES ON EBOLA REPORT
Cuomo: "There is no reason for New Yorkers to be alarmed..." *HAVE IDENTIFIED 4 PEOPLE IN CONTACT WITH EBOLA PATIENT, PATIENT WENT ON 3-MILE JOG, BOWLING, SUBWAY
Dr Craig Spencer, 33, who returned to the U.S. ten days ago from Guinea, was admitted to Bellevue Hospital in midtown Manhattan on Thursday and is being cared for in isolation. The doctor flew to Africa on September 18 to treat patients in Guinea with non-profit organization, Medecins San Frontieres (MSF). On October 16, he checked in at a hotel in Brussels, Belgium, presumably on his return journey from Guinea to the U.S.
- Russia Loses Oil Ally in De Margerie After Moscow Crash (BBG)
- Austria's Erste denies report it has failed stress tests (Reuters)
- Sweden gets two new sightings, as hunt for undersea intruder goes on (Reuters)
- Companies Try to Escape Health Law’s Penalties (WSJ)
- Mud and Loathing on Russia-Ukraine Border (BBG)
- NOAA employee charged with stealing U.S. dam information (Reuters)
- Lower Oil Prices Seen Easing Japan’s Trade Pain (WSJ)
- Michigan becomes 5th U.S. state to thwart direct Tesla car sales (Reuters)
- Maglev Train Seen Making Washington-to-Baltimore Trip at 311 MPH (BBG)
"There is no crueler tyranny than that which is perpetuated under the shield of law and in the name of justice." —Charles de Montesquieu
If there was any silver lining to the horrifying events that took place in Ferguson, Missouri which riled the month of August, it has finally brought the issue of police militarization to the forefront. How did this happen?