Frontrunning: October 5

  • ECB 'taper' talk hits stocks, sterling hits 31-year low (Reuters)
  • Crude Rises to Three-Month High After U.S. Stockpiles Plunge (BBG)
  • Gross Says He Shortened Duration on Europe After Taper News (BBG)
  • Chicago Fed's Evans 'fine' with December hike if data stays firm (Reuters)
  • Euro zone business growth at 21-month low in September (Reuters)
  • Deutsche Bank Brings Too-Big-to-Fail Quandary Home to Merkel (BBG)

Gundlach: "Deutsche Bank Will Be Bailed Out But What About Credit Suisse"

While Germany's largest lender would ultimately be rescued by the German government if needed, other banks in the region wouldn’t be able to count on such support, Gundlach said. “Deutsche Bank will be supported by Germany if push comes to shove, but what about Credit Suisse, which has shown a similar decline in stock price? Who’s there to bail them out?”

US Considering Air Strikes On Assad Regime After Top General Warns It Could Lead To War With Russia

US military strikes against the Assad regime will be back on the table Wednesday at the White House, when top national security officials in the Obama administration are set to discuss options for the way forward in Syria. One proposed approach is to strike the Assad regime without a U.N. Security Council resolution would be to carry out the strikes covertly and without public acknowledgment, the official said.

Philippine President Tells Obama "You Can Go To Hell, I Will Buy Weapons From Russia"

Philippine leader Rodrigo Duterte on Tuesday told U.S. President Barack Obama to "go to hell" and said the United States had refused to sell some weapons to his country but he did not care because Russia and China were willing suppliers. He also lashed out at the EU advising it to "better choose purgatory. Hell is full already. Why should I be afraid of you?"

"This Cannot End Well" Bill Gross Warns

"Central bankers have fostered a casino like atmosphere where savers/investors are presented with a Hobson's Choice, or perhaps a more damaging Sophie's Choice of participating (or not) in markets previously beyond prior imagination. Investors/savers are now scrappin' like mongrel dogs for tidbits of return at the zero bound. This cannot end well."

Frontrunning: October 4

  • WikiLeaks' Assange signals release of documents before U.S. election (Reuters)
  • Kaine and Pence Look to Assure (and Attack) at Vice-Presidential Debate (BBG)
  • Pound tumbles to 31-year low, Deutsche Bank bounces (Reuters)
  • Trump Digs In Over Tax Disclosure (WSJ)
  • Oil eases as Iran, Libya output rises hit OPEC deal momentum (Reuters)

Sterling Tumbles To 31 Year Low Pushing The FTSE100 Near All Time High; US Futures Flat

Sterling dropped to its weakest since 1985, hit by a growing sense that the UK may be heading for a 'hard' Brexit in which it cuts links to the EU's single market in favor of total control over immigration. The dollar strengthened, the Nikkei225 rose as the Yen fell,  stocks in Europe rallied while US equity futures were fractionally in the green.

RBI Unexpectedly Cuts Its Benchmark Rate By 25bps To 6.25%: 102nd Central Bank Cut Of 2016

The Reserve Bank of India unexpectedly cut interest rates Tuesday, lowering its benchmark repurchase rate by 25bps from 6.50% to 6.25% the lowest in more than 5 years, with all 11 economists polled by the WSJ predicting rates would remain unchanged. The central bank cited a marked slowdown in global growth and a benign inflation outlook, in the first decision made by the recently-appointed committee headed by the new governor, Urjit Patel.