In a dramatic example of the unprecedented collusion between predatory (HFT) client and predator-enabling (and HFT-pandering) exchange, in which the prey is any naive, witless order block that makes its way onto the exchange only to be frontrun with impunity and assure Virtu even more flawless trading days, we now see just who calls the shots for America's exchanges. "Virtu Financial LLC executive Chris Concannon will be appointed as president of BATS Global Trading Inc., an upstart Kansas City, Mo., firm that has grown into one of the country’s top stock-exchange operators, BATS said."
In just one month, St.Louis Fed President Jim Bullard has eviscerated what little credibility he had with his desperate pleadings to the Dow-Data-Dependent Federal Reserve gods.... today we find out that there is "no need for more QE for now, the economy is in good shape" and 1400 Dow points higher than when it was crucial to "delay the end of QE." What is more worrying is the fact that in the last 2 weeks of total market melt-up since Bullard spoke, earnings outlooks for Q4 have collapsed and macro data has done nothing but disappoint.
As the chart below shows, US trade excluding Petroleum, just tumbled to $48.3 billion, essentially matching the worst print in the history of the series, suggesting that portrayals of the US as a resurgent export powerhouse are completely erroneous, and that instead the US is as big a net importer of goods and services, aside from the Shale revolution of course, as ever.
This could be a problem for the escape velocity believers... The US trade balance printed its biggest deficit since April at -$43.0bn (missing expectations of -$40.2bn) bn. This mainly reflected a decrease in exports (but, but decoupling!?) though imports also slid.
Overnight saw the weakness in the crude complex continue with WTI dumping to its lowest since October 2011 at $75.84. Treasury yields tracked crude lower and 30Y yields are now down 4bps on the week (having been up 5bps at their peak yesterday before Saudi Arabia's pricing decision). Stocks are sliding in the pre-market but have room to fall to catch down to oil/bonds implied weakness. Gold, silver, and copper are also lower even as the dollar slides lower.
- Republicans expect gains, but many races close on election day (Reuters)
- Ahead of tough election, White House blames dismay with Washington (Reuters)
- On Election Day, a Tale of the Young and the Old (WSJ)
- Because the recovery: Sprint to Cut 2,000 Jobs as Mobile Customers Keep Leaving (BBG)
- Ukraine's rebel leader is sworn in, crisis deepens (Reuters)
- Brilliant: Burkina Faso Army Promises Religious Leaders It Will Step Down (BBG)
- More Unknowns Leave Central Banks Facing Greater Internal Strife (BBG)
- Scapegoat found: IBM to Change Leadership at Global Services Unit (WSJ)
- Explains why Europe just slashed its GDP forecast: Don’t Be Fooled by Warm Spell as Cold Air About to Return (BBG)
what is strange is that while traditionally such a major downward growth revision would have been sufficient to send futures soaring - why: because in a world where only central banks are left, it means more central bank global bailouts of course - this time the adverse update actually had the impact of sending futures to their lows of the session, granted just a few tiny points since the market is clearly disconnected with even the most pro forma, non-GAAP version of reality, but the reaction direction was clearly unexpected. Perhaps this is explained by the ongoing devastation in both WTI and Brent, which were trading at $76.70 and $82.50 at last check, both down almost 3% as the plan to use Saudi Arabia to crush Russia has instead backfired and the Saudi princes are now openly looking at destroying the US shale infrastructure, as we forecast in the worst, for Obama, scenario.
The Petrodollar, long serving as the US leverage to encourage and facilitate USD recycling, and a steady reinvestment in US-denominated assets by the Oil exporting nations, and thus a means to steadily increase the nominal price of all USD-priced assets, just drove itself into irrelevance. A consequence of this year's dramatic drop in oil prices, the shift is likely to cause global market liquidity to fall. This decline follows years of windfalls for oil exporters such as Russia, Angola, Saudi Arabia and Nigeria. Much of that money found its way into financial markets, helping to boost asset prices and keep the cost of borrowing down, through so-called petrodollar recycling. But no more: "this year the oil producers will effectively import capital amounting to $7.6 billion.
Japanese Stocks Tumble 500 Points From Highs; Nikkei Futures Back Below 17,000; Bond Yields CrashingSubmitted by Tyler Durden on 11/03/2014 20:42 -0400
One word - seppuku
"I was on a panel with Alan Greenspan a week ago... I said, you mean to say that the Federal Reserve is not independent? He immediately said, Marc, I never said the Fed was independent. In other words, the Fed and the Treasury and the government is basically one and the same."
"Japan is engaged in a Ponzi scheme"
"The oil price decline is not necessarily very good for the US - if oil prices went lower, it may actually have an adverse impact on the US economy"
"As a father, I want to raise responsible adults, which is why my wife and I will not be heading to the polls this election. Previously, I would have seen this stance as many people do: as an irresponsible act. Both Democrats and Republicans support militarism, taxation, spying on us, inflation, redistribution of wealth, Keynesian economics and corporatism once they get in office. My children need not to identify with this group of sociopaths, so to vote would be a bad example for them." Simply put, The lesser of two evils is still evil.
Spot the free-money, wealth-effect-pumping, inequality-driven difference...