Recession

Futures Storm Into The Green, 20 Points Off The Lows; NY Fed's Chicago Office Kept Busy All Night

With futures slamming the lows at their open yesterday evening, touching levels not seen since May, and with the EuroStoxx 50 officialy entering correction just hours ago, down 10% from the June highs, many were wondering if the NY Fed's Chicago Trading Desk, aka Overnight Ramp Capital LLC, would be put in damage control duty and send futures right back to unchanged (because with new Ebola patient alerts springing up everywhere from Boston to Los Angeles, the pandemic is clearly contained). The answer, with a whopping 20 point levitation on no volume, and futures which are pointing now well into the green (not to mention the Eurostoxx rebounding off the lows and now green too), is a resounding yes (thank the  AUDJPY, which is over 100 pips off the overnight lows and back over 94).

A New Age Of IMF Bailouts – Great Britain In The 1970s

Hearing of IMF interventions generally conjures up images of developing nations (and the occasional Eurozone peripheral economy of late) facing some kind of financial difficulty. But it was actually Great Britain, the cradle of the industrialized world, which in 1976 became one of the first countries ever to be "bailed out" by the IMF in the modern sense of the term.

Monetary Policy And Impact On Assets

The last note briefly addressed the benefits associated with the reverse repurchase facility (RRF). Indeed liabilities have increasingly moved from bank balance sheets to the Fed, freeing lending capacity. One must recall reserves are not fungible outside of the banking system (but can act as collateral for margin). With flow decreasing, the opportunity for small relative volume bids spread over a large quantity of transactions (most instances per unit time) decreased with market prices in many asset markets. Is more downside coming?

5 Things To Ponder: Through The Looking Glass

“If I had a world of my own, everything would be nonsense. Nothing would be what it is, because everything would be what it isn't. And contrary wise, what is, it wouldn't be. And what it wouldn't be, it would. You see? - Lewis Carroll, Alice's Adventures in Wonderland

The Oil Weapon: A New Way To Wage War

It was heinous. It was underhanded. It was beyond the bounds of international morality. It was an attack on the American way of life. It was what you might expect from unscrupulous Arabs. It was “the oil weapon” -- and back in 1973, it was directed at the United States. Skip ahead four decades and it’s smart, it’s effective, and it’s the American way. The Obama administration has appropriated it as a major tool of foreign policy, a new way to go to war with nations it considers hostile without relying on planes, missiles, and troops.  It is, of course, that very same oil weapon.

After Abenomics Failed In Japan, It Is About To Be Tried In Europe

After two years of Abenomics, Japan officially admitted it has entered a triple-dip recession. While people with a modicum of common sense warned this would happen long ago, it actually came as a surprise to traditionally trained economists: after all, a country whose economy collapsed under piecemeal episodes of "Abenomics" over the past three decades was supposed to, if only for those trained in the Keynesian school, promptly recover (even though its fundamental problem is not economic but demographic) when that which had failed for so long was applied in one shock episode. It didn't work. So now that Abenomics has officially failed in Japan (but will remain in place until Abe is ouster, either voluntarily as the local population has had enough of Japan's record inflation imports) what comes next? It is about to be tried in Europe of course

The Stronger Dollar = Stealth QE

Whether this trend will hold or reverse is unknown, but it does suggest that there are advantages to being the cleanest shirt in the dirty laundry.

GoldCore's picture

This week has seen some market volatility (see VIX Chart) reminiscent of the functioning market from days of old. The markets are spooked, bad news is overtaking good news and bearish views are becoming vogue. We are seeing a titanic battle taking place between the various bull and bear camps and they are starting to unleash some serious firepower. 

Frontrunning: October 10

  • It wasn't Obama this time: Pakistani teen, Indian activist win Nobel Peace Prize (Reuters)
  • Surging VIX Shakes Bulls as S&P 500 Charts Go Haywire (BBG)
  • Global shares hit six-month low as growth worries mount (Reuters)
  • Police, protesters clash in St. Louis ahead of weekend of rallies (Reuters)
  • We're Sitting on 10 Billion Barrels of Oil! OK, Two (BBG)
  • Spain seeks answers as seven more enter Ebola isolation (Reuters)
  • Iran will sell its oil to Asia in November at the biggest discount (BBG)
  • Redefining honeypot: U.S. DEA 'most interested' in U.S. investors in Canadian marijuana firms (Reuters)
  • UKIP Wins First Commons District With Conservative Defector (BBG)
  • Fake Ebola Patients Help Hospitals Prepare for Next Case (BBG)
Phoenix Capital Research's picture

At the end of the day, the Fed with its misguided theories have demolished capitalism: the single most powerful form of wealth generation in the history of mankind. All the Fed has really accomplished is leverage the entire financial by an even greater amount… which has set the stage for a collapse that will make 2008 look like a picnic.