Mission Accomplished Abenomics? The Nikkei 225 just hit fresh 7 year highs at around 17,900 (the highest since July 2007) managing to soar 24% off the mid-October 'Bullard lows' and once again trading above the Dow. Great news for all the bulled up US investors we see day after day on financial TV... wrong! In US Dollars, US investors remain down 4% year-to-date (and have yet to have a positive close in 2014). But hey on the bright side, your Japanese brethren are loving the nominal surge in their 'wealth' as their currency collapses to 119.4 this evening.
If you notice that display racks this holiday season are nicely scented, it’s not just shops are tidier at year’s end. Scents like citrus and floral can make you linger and stay alert in the shop to buy more. The use of scent is just one of four sensory marketing tricks being used on us by shops eager for more sales. Collated in the new infographic below you can find a number of scientific studies that indicate what we see, hear or touch affect our buying decisions. Do you know why Apple Store leaves its notebook display half-open, or why you suddenly crave for a tropical vacation while inside Bloomingdale’s?
- DAX’s ‘Brilliant’ Run Sends Red Flag as German Index Tops Record (BBG)
- U.S. military warned of possible Islamic State attacks at home: report (Reuters)
- Russia Faces First Recession Since 2009 as Banks Add to Oil Pain (BBG)
- Dodgy Home Appraisals Are Making a Comeback (WSJ)
- U.S. Corporate Bond Sales Pass $1.5 Trillion for Annual Record (BBG)
- Basic Costs Squeeze Families (WSJ)
- China Orders Stricter Checks on Local Debt as Sales Surge (BBG)
- Draghi Powerless on ECB Path Toward QE Without Reforms (BBG)
"As was true at the 2000 and 2007 extremes, Wall Street is quite measurably out of its mind. There’s clear evidence that valuations have little short-term impact provided that risk-aversion is in retreat (which can be read out of market internals and credit spreads, which are now going the wrong way). There’s no evidence, however, that the historical relationship between valuations and longer-term returns has weakened at all. Yet somehow the awful completion of this cycle will be just as surprising as it was the last two times around – not to mention every other time in history that reliable valuation measures were similarly extreme. Honestly, you’ve all gone mad."
Unvarnished analysis as if people were not stupid, easily manipulated, or subject to false consciousness.
Money is stored labor. Labor is part of human life. To devalue money is to debase life itself.
If you ever needed proof that the financial press has been completely indoctrinated in the cult of Keynesian central banking consider the following...
In some respects we’re in danger of running out of appropriate descriptive superlatives for the current bout of “irrational exuberance” (we’re open for suggestions). The current asset bubble is in many respects reminiscent of the late 1990s tech bubble, but it also differs from it in a number of ways. One of the major differences is that the exuberance recorded in the data is largely confined to professional investors, while the broader public is still licking its wounds from the demise of the previous two asset bubbles and remains largely disengaged (although this has actually changed a bit this year). Monetary pumping merely redistributes existing real wealth (no additional wealth can be created by money printing) and falsifies economic calculation. This in turn distorts the economy’s production structure and leads to capital consumption, thus the foundation of real wealth that allows the policy to seemingly “work” is consistently undermined. At some point, the economy’s pool of real funding will be in grave trouble (in fact, there are a number of signs that this is already the case). Widespread recognition of such a development can lead to the demise of an asset bubble as well.
Oil Slumps To 4 Year Low Ahead Of OPEC, Eurozone Yields New Record Lows: Summary Of Overnight EventsSubmitted by Tyler Durden on 11/27/2014 06:46 -0500
While the US takes the day off after another near-record low volume surge to a new all time high in the S&P500, a level which is now just 125 points away from Goldman's year end target for 2016, the rest of the world will be patiently awaiting to see if oil's next step, as a result of today's OPEC meeting will be to $60 or to $100. For now at least the answer is the former (see more here from the WSJ), with Brent recently touching a fresh 4 year low in the mid-$75s, as WTI doesn't fare much better and was down 2% at last check to $72.20 after touching a low of $71.89. It appears the prepared remarks by the OPEC president to the 166th conference have not eased fears that despite all the rhetoric OPEC will be unable to get all sides on the same story, even though the speech notes "ample supply, moderate demand and warns that "if falling price trend continues, “long-term sustainability of capacity expansion plans and investment projects may be put at risk."
Fed’s wealth effect kicks in: “Mind-blowing” how the luxury market has been “completely on fire.” The rest, well….
Who Are the Worst Looters?
On this day in 1876, a group of influential, yet irate, Americans met in Indianapolis. Their primary purpose was to send a message to Washington on how to get the economy moving again.... So this group decided that what was needed was re-inflation (put more money in everyone's hands, you see). The method they proposed was to issue more and more money. Cynics called them "The Greenback Party". And on this day, the Greenbacks challenged Washington by running an independent for President of the United States. His name was Peter Cooper. He lost but several associate whackos were elected to Congress.
Case Shiller Reports "Broad-Based Slowdown For Home Prices", First Monthly Decrease Since November 2013Submitted by Tyler Durden on 11/25/2014 09:21 -0500
While the just revised Q3 GDP surprised everyone to the upside, the Case Shiller index for September which was also reported moments ago, showed yet another month of what it called a "Broad-based Slowdown for Home Prices." The bad news: the 20-City Composite gained 4.9% year-over-year, compared to 5.6% in August. However, this was modestly above the 4.6% expected. However, what was more troubling is that on a sequential basis, the Top 20 Composite MSA posted a modest -0.03% decline, the first sequential drop since February. And from the report itself: "The National Index reported a month-over-month decrease for the first time since November 2013. The Northeast region reported its first negative monthly returns since December 2013 and its worst annual returns since December 2012 due to weaknesses in Washington D.C. and Boston."
Why is Bitcoin dangerous and of little intrinsic value? Because my local Central Banker Told Me So! - OR - The lasting message from the highly Centralized, Centrally Planned, Central Banks of the World? "We think, so you don't have to!"
"This last 1900 point Dow Jones push upwards - and the Ebola events leading into it - it was so orchestrated and heightened at critical points but the ascent and push straight up in price, and sideways nonreaction after was completely unlike anything I've seen before. After going up for a record-breaking amount of time the last five or so years, in a nonlinear exponential mania type of ascent, there should normally be tremendous volatility that follows... After this year and especially this last 1900 point Dow run up in October, and post non-reaction, that I am 100 percent confident that that one buyer is our own Federal Reserve or other central banks with a goal to "stimulate" our economy by directly buying stock index futures."