Volatility

Global Rally Fizzles After "OPEC Shock" In "Slow Risk-Off Session"

S&P futures were fractionally lower from yesterday's record high as European stocks declined and Asian stocks were mixed, pressured by yesterday's 5% plunge in crude after OPEC unexpectedly "failed to surprise" markets, and announced the bare minimum supply cut extension that was expected by oil traders, who in turn puked long positions.

Crispin Odey: "Why Do I Remain Stubbornly Bearish?"

"When it comes to markets, we have to watch for ‘the Minsky moment’. Minsky argued that periods of low volatility, presaged crises because they encouraged excessive risk taking. Well, we are into the risk taking. But this fund truly does not demand that the end of the world comes tomorrow."

China Downgrade Forgotten As Asia Closes Higher, Futures Flat Ahead Of Fed Minutes

Not even last night's Moody's credit downgrade of China - the first since 1989 - could dent the global stock rally which has pushed global stock prices to all time highs. After initially sliding, regional stocks and emerging Asian currencies pared early losses following the unexpected downgrade of China, taking their cue from the "sudden reversal" of the Shanghai Composite Index, which some speculated saw the latest intervention of the "national team."

Yuan Tumbles As Moody's Downgrades China To A1, Warns On Worsening Debt Outlook

Offshore Yuan tumbled as Moody's cut China's credit rating to A1 from Aa3, saying that the outlook for the country’s financial strength will worsen, with debt rising and economic growth slowing. This leaves the world's hoped-for reflation engine rated below Estonia, Qatar, and South Korea and on par with Slovakia and Japan.

RBC: Welcome To "The Insanity Loop"

"It's a classic 'pennies in front of a stream-roller' / 'negative skew' return profile - a Taleb distribution...The problem is….IT KEEPS WORKING, because market expectations for rates / curves / inflation expectations remain D.O.A., which perversely keeps the major global central banks 'reflexively easy'..."