Recession

FedSpeak - Lost In Translation

Federal Reserve speakers appear to be suffering from an inability to contain themselves to the detriment of their audiences. So damaging is FedSpeak, so to speak, that it’s become the Fed’s greatest liability, chipping away at what little credibility monetary policymakers have left in reserve. Perhaps what is most disturbing about today’s stretch of FedSpeak is how it parallels with the months preceding the Great Recession.

Bank Of Canada Warns Of "Higher Possilbity" Of Housing Downturn, Sees Vancouver, Toronto Prices Unsustainable

Just a few days after the OECD warned of the risk of a "disorderly housing market correction" in Canada, moments ago the Bank of Canada also chimed in and warned that the "potential" for home price downturn in some areas has increased, and that Vancouver, Toronto home price gains likely unsustainable.  Which is curious because the vast majority of price gains in Toronto and Vancouver have been driven by the outflow of the trillion in Chinese inert deposits, which promptly find their way into Canadian real estate (and lately bitcoin). In other words, is the BOC assuming that China will crash soon?

A Dismal Picture Of Decline

A population of illiterate, non-thinking morons can’t possibly obtain good paying jobs. This country spends $12,000 per public school student per year on education and this is the outcome? The factual data presented below paints a picture of an empire in rapid decline. We are too far gone. No amount of money or presidential election is going to change this course. We chose this path in the 1960s and now we will reap the consequences.

"The Whole Shebang Is Broke" - The Only Thing That's Growing Is Debt

Despite what the media try to tell you, as do the close to 100% manipulated economic data emanating from various -tightly controlled- sources, the economy is not growing, and it hasn’t for years; the only thing that grows is debt. And you can’t borrow growth. The single best thing to do for all of us not in positions of politico/economic power is to recognize the irreversible collapse of the system. Simply put, the whole shebang is broke.

Goldman Turns Downright Gloomy, Warns Market "Despair" Is Coming, Prepare For A Major Drawdown

As Goldman warns in a note overnight, "Large equity drawdowns often mark the end of an equity cycle and tend to coincide with a recession or financial market/geopolitical shock or a combination, which tend to result in a sharp equity correction driven by a decline in both earnings and valuations." As it turns out, Goldman thinks precisely such a "drawdown" is coming...

China Oil Imports Drop To Four Month Low As Demand Is Expected To "Moderate Significantly" In 2016

Oil imports by China fell to a four-month low in part due to congestion at one of its biggest ports curbed purchases from independent refiners. Inbound shipments in May totaled 32.24 million metric tons. That’s equivalent to 7.62 million barrels a day , down 4.3 percent from the previous month, and the lowest since January. It gets worse; according to an analysis from S&P Global Platts "China's oil demand growth is expected to moderate significantly in 2016 as gross domestic product growth slows on the back of economic rebalancing."

The Beveridge Confusion: Hiring Tumbles Despite Job Openings Rising To Record High

In a surprising twist, today's JOLTS report revealed that while job openings continued rise, and in fact hit a record high. actual hiring slowed down substantially: at 5.092MM new hires in the month of April, this was the lowest since September of 2015. As the chart below, which correlates the 12 month change in NFPs to hires, the labor market may indeed be rolling over.

Futures Levitate To Session Highs As ECB Enters The Bond Market; Crude Hits $51

In an overnight session dominated by the latest political developments out of the US where Hillary Clinton officially claimed the democratic nomination, the financial newsflow focused on China's trade data, where exports fell 4.1% from a year earlier, in line with expectations, but imports dropped 0.4% from a year earlier, the smallest decline since they turned negative in November 2014, driven entire by soaring "imports" from Hong Kong - aka capital outflows - which soared by 243% y/y.  The other main news was the official launch of the ECB's corporate bond buying, which helped drive government bonds yields in German to new record lows, and the average yields on investment-grade corporate debt below 1%.

Would New All-Time Highs Negate The Bear Market?

... it is not uncommon for the markets to briefly make new “all-time” highs during a correction process as emotional sentiment runs ahead of fundamental and economic deterioration.