Toyota

Futures Fizzle, Europe Red As Markets Ask: "What Do Central Banks Do Now?"

In our Chinese stock market wrap following Friday's unexpected rate cut, which saw the Shanghai Composite storm out of the gate, we said that "we would not be surprised to see China's stocks sliding back into the red very shortly as "sell the news" concerns return, and as the increasingly more addicted "markets" demand even more liquidity from central banks just to stay unchanged, let alone rise to new all time highs." Sure enough, with just minutes to go before the close, the SHCOMP wiped out all its daily gains and was set for a red close had it not been for the "national team" miraculous last minute intervention which was inevitable after Friday's PBOC rate cut, and which lifted the composite 0.5% into the green as the euphoria was rapidly evaporating.

World's Largest Leveraged ETF Halts Orders, Citing "Liquidity Constraints"

First The Bank of Japan destroyed the Japanese bond market, and then, back in May we warned that The Bank of Japan had 'broken' the stock market. Now, it appears the all too obvious consequences of being the sole provider of buying power in an antirely false market are coming home to roost as Nomura reports the "temporary suspension" of new orders for 3 leveraged ETFs - the largest in the world - citing "liquidity of the underlying Nikkei 225 futures market."

Volkswagen: A Decade Of Deception - Full Chronology

The scandal swirling around Germany's largest listed company had its beginnings in an attempt to crack the U.S. market, the missing link in VW's global footprint. But, as Handelsblatt details, what began as expansion ended in deception (piecing together the events that led up to the scandal, based on the facts as they are currently known).

Bailout World: Volkswagen "Cheating" Fine Is 20 Times Higher Than GM's For 'Killing 174 People'

When bailout-darling GM 'fessed up to an intentional ignition-switch defect, tied to at least 174 deaths, The Justice Department fined them $900 million (and no employees faced criminal charges). So, in this consequence-less world in which we live, when Volkswagen admits to literally cheating emissions-standards tests, it faces up to $18 billion in fines from The EPA, one has to wonder whether "we" have our priorities right?

Does Capitalism Cause Poverty?

The world’s poorest countries are not characterized by naive trust in capitalism, but by utter distrust, which leads to heavy government intervention and regulation of business. Under such conditions, capitalism does not thrive and economies remain poor. Pope Francis is right to focus attention on the plight of the world’s poorest. Their misery, however, is not the consequence of unbridled capitalism, but of a capitalism that has been bridled in just the wrong way.

Chinese Stock Short Squeeze Stalls After IMF Delays Decision On Yuan SDR Inclusion

Yesterday afternoon's meltup short-squeeze in China - after regulators announced their latest restrictions on short-selling - has stalled in the early trading tonight following The IMF's decision to delay inclusion of Yuan in the SDR pending a review in September 2016. Though this will be a disappointment to the Chinese, the door is still open though given waringse from BMW and Toyota over "normalizing" auto sales, the market problems may be morphing quickly into economic problems.

Frontrunning: July 29

  • Fed expected to push ahead with rate hike plan (Reuters)
  • Upbeat earnings lift European stocks ahead of Fed (Reuters)
  • Chevron to Cut 1,500 Jobs (Rigzone)
  • Can Windows 10 Revive PC Sales? (WSJ)
  • U.S. Junk-Bond Buyers Left in Dark as Private Deals Become Norm (BBG)
  • Jeb Bush Drawing Big Bucks From GOP Establishment (WSJ)
  • Myriad of Greek Risks Means Money Managers in No Hurry to Return (BBG)
  • Gas production at Gazprom set to hit post-Soviet low (FT)

Frontrunning: July 2

  • Chinese stocks tumble again, ignoring Beijing's blandishments (Reuters)
  • Plight of Greek pensioners heaps pressure on Tsipras (Reuters)
  • Cash Crunch Hits Everyday Life in Greece (WSJ)
  • Souvlakis Tell a Story Well Beyond Today's Greek Crisis (BBG)
  • Greek Referendum on Bailout Too Close to Call, Poll Shows (BBG)
  • Move Over Greece: For Treasuries Traders, Today Is About the Fed (BBG)
  • ECB adds corporate names to QE-eligible bonds (FT)
  • Special Report: How Greece went bust (Reuters)
  • Puerto Rico’s Pain Is Tied to U.S. Wages (WSJ)

Obamatrade Passes, The Corporations Win Again... And Now They Gloat

"Washington broke arms and heads to get that 60th vote—not one to spare—to impose on the American people a plan which imperils their jobs, wages, and control over their own affairs. It is remarkable that so much energy has been expended on advancing the things Americans oppose, and preventing the things Americans want. The same routine plays out over and again. We are told a massive bill must be passed, all the business lobbyists and leaders tell how grand it will be, but that it must be rushed through before the voters spoil the plan. And when ordinary Americans who never asked for the plan, who don’t want the plan, who want no part of the plan, resist, they are scorned, mocked, and heaped with condescension."

Frontrunning: June 19

  • Greek PM optimistic on debt deal as banks bleed (Reuters)
  • Greek central bank chief says banking system stable (Kathimerini)
  • ECB Said to Confer on Emergency Greek Aid Amid Cash Flight (BBG)
  • More tax "avoidance": Citigroup to shift European retail banking HQ to Dublin (Reuters)
  • Florist's tip led police to Charleston shooting suspect (USAToday)
  • Asian shares edge higher on Fed caution, China sell-off intensifies (Reuters)
  • Toyota in damage control mode after American exec arrested (Reuters)
  • Venezuela Oil Loans Go Awry for China (WSJ)