This state of delusion would be amusing if it wasn't so tragic. The acid will wear off soon enough, and a mega-dose of vitamin C will not be enough to restore the shattered health of a manic, drugged-out market careening between euphoria and fear.
While JPM's eligible gold holdings are nowhere near the record lows hit in the summer of 2013, when they dropped to a tiny 46K ounces, sparking concerns of a potential deliverable default, yesterday according to the daily CME gold depository report, JPM saw a whopping 321,500 ounces, or about 10 tons of gold, withdrawn. This was the biggest outflow since the August 5 rebalance when nearly 1.5 million ounces were withdrawn and added, and was the biggest, and is tied with two identical 321,500 oz outflows recorded in early January. As of yesterday, JPM's eligible gold tumbled by 40% in one day, declining to 485.K ounces from over 800K the day before: the lowest eligible gold inventory since almost exactly a year ago.
France's President Francois Hollande states confidently that "everyone should respeoct treaties," then 'Junckers' it with this stunningly hypocritical bullshit, "budget rules must be adapted" to support growth and France "has done what it has to do" on its deficit... one glance at the following chart suggests that Hollande has done nothing and has been enabled by Draghi... What a farce!!
Recapping the tenets we presented here, here, and here, once an economy is subjected to a bout of monetary inflation, whether that be via direct central bank money creation or via money (and credit) creation by the fractional reserve banking system, an unsustainable, artificial economic boom is born, whereby malinvestments (bubbles if you like) are created that sooner or later must be liquidated. And whether that bust takes the form of a hyperinflationary bust or a deflationary bust, bust we will get.
Having worked extremely hard on their coordinated talking points last night - "Ebola is hard to catch", "Doctor self-isolated", "been preparing for months" - we await NYC Mayor Bill De Blasio's public update on the state of Ebola in New York this morning... Keep Calm and Go Ebowla-ing?
*NYC MAYOR DE BLASIO SAYS 'THERE'S NO CAUSE FOR ALARM'
DRAGHI CALLS FOR STIMULUS: CNBC
DRAGHI SAYS JOINT EFFORT NEEDED TO AVOID RECESSION: CNBC
DRAGHI SAYS INFLATION TO REMAIN LOW IN THE NEAR TERM
The summer, thankfully, has been largely bereft of the dismal trend of bankers committing suicide, but as Bloomberg reports, Thierry Leyne, a French-Israeli banker and partner of Dominique Strauss-Kahn, the disgraced former chief of the IMF, was found dead Thursday after apparently taking his own life by jumping off the 23rd floor of one of the Yoo towers, a prestigious residential complex in Tel Aviv. This is the 16th financial services executive death this year.
It is now beyond stupid: the euphoric, consensus-beating data for every single month since May has been revised lower, by on average 6% and as much as 9%. Perhaps finally people will realize that there is only one number that matters in the Census bureau's monthly new home sales report: the ±15.7 90% confidence interval. Well, people maybe, but not algos, who only care about one thing: whether the data beat or missed.
Having exploded 18% higher in August (driven by, um, record high prices), September's new home sales printed at 467k (against expectations of 470k) and August's surge to 504k was revised lower to just 466k (busting the biggest beat since 2005 meme) revised 7.5% lower. After August's reported 50% MoM rise in The West, the region saw the rate of sales slow in September. The median new home sales price (at record highs last month) fell 4% YoY to $259,000.
The bell has rung for Pavlov’s dogs twice before, but the meat of higher inflation has not been delivered. Now the bell is ringing for the third time. With the key driver of inflation events well beyond US shores, the inability of the Fed to generate the meat of inflation will be much more apparent on this occasion. After five and a half years of QE there is still no meat for the dogs: real rates of interest are rising rapidly and almost all financial market instruments are overvalued. If you believe that the correct price for financial market instruments is the price decreed by the Federal Reserve, you need to look at the chart above and ask yourself a simple question, ‘With inflation expectations back at 4Q 2009 levels, what evidence is there that QE works?’
- 25 BANKS SHOWN WITH CAPITAL SHORTFALL IN ECB TEST: DRAFT TEXT
- ABOUT 10 BANKS SAID TO BE IN TALKS ON CAPITAL SHORTFALL
- 105 EURO-AREA BANKS PASS THE ECB'S ASSESSMENT: DRAFT DOCUMENT
- ECB PRELIMINARY ASSESSMENT RESULTS SEEN BY BLOOMBERG NEWS
Many have recently drifted toward believing the Fed will be ‘lower for longer’. My view is that the Fed will be ‘sooner, but slower’. In other words, I expect the Fed to hike in March or sooner, but then run into problems that will slow the pace (and make it difficult to get to 1% by the end of 2015). Moreover, today’s equity market ‘melt-up’ should be a warning sign to the Fed of the moral hazard, one-way, bubble-like conditions it has instigated.
Burst Chinese Housing Bubble Leads To First Annual Price Decline Since 2012; Prices Drop In Record 69 CitiesSubmitted by Tyler Durden on 10/24/2014 - 08:04
It has been over six months since the Chinese housing bubble has popped. What's worse, as overnight housing numbers out of China confirmed, the government has so far failed to contain the fallout, and according to the National Bureau of Statistics, which is anything but, after a fifth straight monthly decline, Chinese home prices have now wiped out all price gains in the past year. This was immediately spun as bullish by media outlets and sellside experts as "raising expectations the government will have to implement more economic support measures to cushion the blow." I.e., buy stocks because central banks will push risk prices artificially higher yet again. In other words, bad is still good and failure continues to be success.