- Twitter's IPO to Make Market Debut (WSJ); Twitter Raises $1.82 Billion, Pricier Value Than Facebook (BBG)
- Worried Senators Press Obama on Health Law (WSJ)
- Greenspan Says Yellen Was His Guide to Economics Research at Fed (BBG)
- European Central Bank seen holding rates despite inflation tumble (Reuters)
- Wall St. Bonuses Over All Are Predicted to Rise 5 to 10% (NYT)
- Cautious consumers seen curbing U.S. economic growth (Reuters)
- China Grants U.S. Investors Indirect Access to Its Stock Markets (WSJ)
- Higher Tax Rates Give Top U.S. Earners Year-End Headaches (BBG)
- Iran Loses Nuclear Leverage as World Ignores Export Drop (BBG)
- NYPD Commissioner Ray Kelly in the running for JPMorgan job (Post)
Ah Silvio, never change or, if possible, resign: the comedic world of Italian politics will never be the same without you. The latest soundbite by the billionaire with a penchant for easy, underage women comes by way of an interview conducted by Italian television journalist Bruno Vespa for his latest book, and summarized by Reuters. To wit: "Former Italian prime minister Silvio Berlusconi said his children feel persecuted just as Jewish families did in Nazi Germany because he is being hounded by the country's magistrates who want to eliminate him politically."
And so another conspiracy theory, that Palestinian leader Yasser Arafat was poisoned with Polonium, becomes non-conspiracy fact.
- Christie Sets Himself Up for Run in 2016 (WSJ)
- De Blasio Elected Next New York City Mayor in Landslide (WSJ)
- Hilsenrath: Fed Study: Rate Peg Off Mark (WSJ)
- MF Global Customers Will Recover All They Lost (NYT) - amazing what happens when you look under the rug
- Virginia, Alabama Voter Choices Show Tea Party Declining (BBG)
- Explosions kill 1, injure 8 in north China city (Reuters)
- Toyota boosts full-year guidance as weak yen drives revenues (FT)
- Starbucks wants to recruit 10,000 vets, spouses to its ranks (Reuters)
- U.S. Economy Slack Justifies Stimulus, Top Fed Staff Papers Show (BBG)
- Israel set to become major gas exporter (FT)
It was the deep of illiquid night when the momentum ignition trading algos struck. Out of the blue, a liftathon in all JPY crosses without any accompanying news sent the all important ES leading EURJPY surging by 50 pips, which in turn sent both the Nikkei up over 1% in minutes, and led to an E-Mini futures melt up of just about 8 points just when everyone was going to sleep. All of this happened completely independent of the actual data, which was chiefly European retail sales which missed (-0.6%, Exp. 0.4%, prior revised lower to 0.5%), Eurozone Service PMI which dropped (from 52.2 to 51.6) but beat expectations of 50.9 (notably the Spanish Service PMI of 49.6, up from 49.0 saw its employment index drop from 46.5 to 45.3, the lowest print since June), and finally, German Factory Orders which surged from last month's -0.3% to +3.3% in September. And while all this impacted the EUR modestly stronger, it had little if any residual effect on the ES. The bigger question is whether these slightly stronger than expected data point will offset the ECB's expected dovishness when Mario takes to the mic tomorrow).
Global stock markets are soaring and near record highs. Credit markets are exuberant and near record tight spreads and low yields; and volatility (bond, FX, and stock) has been suppressed to the point of non-existence. So why is it that just 3 months after Nigeria issued debt (in an oversubscribed auction) at a yield below that of Portugal's, Nigerian lender Diamond Bank has suspended the launch of its seven-year $550 million bond? It appears it's the Fed's fault! as the bond's marketers noted "pricing turbulence in the international debt market," in a presentation seen by Reuters on Tuesday. Still think the Fed will ever actually exit?
With Twitter's pre-IPO price range rising by the hour and its oversubscription levels growing exponentially - matched only by the volume of "why you must buy Twitter" discussions on CNBC, Reuters created the following simple interactive calculator to enable the retail investor to 'judge' whether buying it out of the gate is the best use of your 401(k)...
- China premier warns against loose money policies (Reuters)
- Brussels forecasts tepid Eurozone growth (FT)
- SAC Case Began With Informant’s Tips on Cohen, Rajaratnam (BBG)
- Dirty Munich Home’s Nazi Loot Estimated at $1.35 Billion (BBG)
- Mortar hits Vatican embassy in Damascus, no casualties (Reuters)
- India Launches Mars Mission (WSJ)
- Lael Brainard to leave Treasury, heading to Fed (FT)
- U.S. Takes Aim at 'Forced' Insurance (WSJ)
- Wife of Jeff Bezos attacks book about Amazon (FT)
- Fall of Brazil’s Batista embarrasses President Dilma Rousseff (FT)
- The One Thing People Still Really Like About BlackBerry (BusinessWeek)
This morning US futures are an unfamiliar shade of green, as the market is poised for its first red open in recent memory (then again the traditional EURJPY pre-open ramp is still to come). One of the reasons blamed for the lack of generic monetary euphoria is that China looked likely to buck the trend for more monetary policy support. New Premier Li Keqiang said in a speech published in full late on Monday that adding extra stimulus would be more difficult since printing new money would cause inflation. "His comments are different from what people were expecting. This is a shift from what he said earlier this year about bottom-line growth," said Hong Hao, chief strategist at Bank of Communications International. Asian shares struggled as a result slipping about 0.2 percent, though Japan's Nikkei stock average bounced off its lows and managed a 0.2 percent gain. However, in a world in which the monetary tsunami torch has to be passed every few months, this will hardly be seen as supportive of the "bad news is good news" paradigm we have seen for the past 5 years.
In what is the biggest black eye for Bill Gross and the largest bond manager in the world, moments ago Bloomberg reported that the title of the world's largest mutual fund has just changed hands:
- PIMCO TOTAL RETURN LOSES LARGEST MUTUAL FUND TITLE TO VANGUARD
- GROSS'S PIMCO TOTAL RETURN BECAME LARGEST MUTUAL FUND IN 2008
- PIMCO TOTAL RETURN HAD $247.9 BILLION IN ASSETS AS OF OCT. 31
This comes on the heels of what Reuters reports is the sixth consecutive month of outflows for the TRF, with $4.4 billion withdrawn in October, while on the other side Vanguard, now at $251 billion, has more than tripled in size since the end of 2008 as the scramble for equities in Bernanke's new normal has become the only game in town.
While we are sure many will proclamin 'this is just a witch-hunt' - and all the hangers-on will be defending Stevie's decision... the fact is that:
- *SAC AGREES TO PLEAD GUILTY TO END U.S. INSIDER-TRADING CASE
- *SAC WILL PLEAD GUILTY TO EVERY COUNT IN INDICTMENT, U.S. SAYS
- *U.S. SAYS SAC AGREEMENT PROVIDES `NO IMMUNITY' FOR INDIVIDUALS
Seems pretty cut-and-dried to us... As part of the deal, Reuters notes that SAC will terminate its investment advisory business.
- Investors are stampeding into initial public offerings at the fastest clip since the financial crisis (WSJ)
- Kerry hails disgruntled Saudi Arabia as important U.S. ally (Reuters)
- SAC Capital prepares for a second life (FT)
- BlackBerry's Fate Goes Down to the Wire (WSJ)
- Dutch Gamble on U.S. Housing Debt After Patience Wins (BBG)
- U.S. Wants Broad Divestitures From AMR, US Airways (WSJ)
- Tensions with allies rise, but U.S. sees improved China ties (Reuters)
- China berates foreign media for Tiananmen attack doubts (Reuters)
- China manufacturers squeezed as costs rise (FT)
- European Borders Tested as Money Is Moved to Shield Wealth (NYT)
- Zurich Probe Finds No ‘Undue Pressure’ Put on Late CFO (BBG)
China bought more than 100 tonnes of gold from Hong Kong for a fifth straight month in September as demand for bullion bars and jewellery stayed strong. Chinese demand appears to have fallen marginally in recent days but remains on track to overtake India as the world's biggest store of wealth gold buyer this year.
Having done a bang up job in Syria, where Obama nearly started world war III so Qatar could send its natgas to Europe at a lower price than Gazprom's, while alienating America's legacy allies in the region, Saudi Arabia and Israel, and ensuring its enemies see it even weaker in the international arena following Obama's schooling by Putin, the US president continues to win friends abroad (while spying there, here and everywhere, namely the Pope) with the latest snafu coming from Pakistan, another former ally, where America just droned the leader of the Taliban fighters on Saturday, leaving his body "damaged but recognizable".
It is now clear why according to the Obama administration there were no glitches plaguing the Healthcare.gov website administering Obamacare: because a whopping six people managed to sign up on the first day it was launched - the same day the government proudly reported previously it had received 4.7 million unique visitors - a conversion factor of, well, Div/0. By the end of the second day: 248 happy participants in a socialized healthcare ponzi scheme. It is also clear why there was nobody happier than the president when the republican party decided to shut down government on the same day as Obamacare was rolled out: because if public attention had focused on the absolute and now confirmed, disaster that the healthcare law's rollout had been, then everyone, not just the Tea Party, would be demanding a substantial delay in Obamacare.