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Market Wrap: Evans' "Catastrophe" Comment Blasts Overnight Futures Into Overdrive, 10-Year Rises To 2%

Tyler Durden's picture




 

After subdued trading in the overnight session until a little after 8pm Eastern, algos went into overdrive just around the time the Fed's 2015 voting member and uberdove Charlie Evans told reporters that "raising rates would be a catastrophe", hinting that the first rate hike would likely be - as usual - pushed back from market expectations of a mid-2015 liftoff cycle into 2016 or beyond (but don't blame the US, it is the "international situation's" fault), in the process punking the latest generation of Eurodollar traders yet again. Whatever the thinking, S&P futures soared on the comments and were higher by just under 20 points at last check even as Crude has failed to pick up and the 10Y is barely changed at 2.00%.

European equities (Eurostoxx50 +1.6%) trade in positive territory after overnight gains in Asia (Nikkei +1.7%) following post-FOMC Minutes remarks from Fed’s Evans in which the market perceived as dovish. However, since the open equities have slowly drifted lower as markets remain on the back foot given the ongoing man hunt and continued troubles in France.

In stock related news, UK retailer Tesco (+6.4%) maintained its profit guidance after four consecutive profit warnings and Marks & Spencer (-3%) trading update missed expectations. Firmer equities have in turn weighed on Bunds and T-notes (-10 ticks), where both French and Spanish supply was smoothly absorbed into the market. The GE/GR 10yr spread (-11bp) is seen tighter after two polls further indicated the SYRIZA’s lead narrowed ahead of the 25th January snap election and reports that Germany are open to Greek debt talks after election, according to lawmakers, citing possible easing of Greek repayment terms. However, they are not open to a Greek debt write-off.

Heading into the US entrance the USD (+0.41%) trades near session highs as EUR/USD hit 9 year lows on the break below 1.1800. Reported hedge fund selling of EUR/GBP also weighed on the pair. Elsewhere, GBP/USD traded at its lowest levels since July 2013 after tripping stops through 1.5050 as the USD weighed on the pair.

In the energy complex, Brent and WTI have traded sideways and have held onto gains. Brent trading above $51, holding rebound after price drop yday under $50 to lowest for front-mo. since 2009. WTI gains, narrows discount to Brent to $2.16, tightest spread since Oct. Brent futures “recovered from its 1st test below the $50 level since April 2009 to settle at $51.15/b, up $0.05 from the prior close,” says Citi Futures energy futures specialist Tim Evans. “The recovery suggests that the mkt has fallen enough to reflect its weak fundamental prospects, at least for now.” Citibank analyst Fitzpatrick sees WTI bottoming nr ~$45.50. Feb. Brent +20c at $51.35, range $50.71-$51.91; yesterday fell to $49.66 intraday. February WTI +26c at $48.91, fell to $46.83 yesterday lowest since April 21, 2009.

Meanwhile, NatGas futures slid to a two year low overnight as US temperatures appear to be turning milder. Separately, Precious metals slide with Silver underperforming (-1%) alongside the USD strength. Copper saw marginal gains overnight and is on course for its first increase for 2015 amid an increased appetite for riskier assets, while China’s iron futures declined as investors declined on continued underlying weak demand.

HSBC says they are raising their average gold price forecast for 2015 to USD 1,234.00 from USD 1,175.00, leaves 2016 unchanged at USD 1,275 and say raising 2015 gold forecast based on the possibility that further USD strength could trigger safe haven demand for bullion.

In Summary: European shares rise close to intraday highs with the retail and health care sectors outperforming and tech, real estate underperforming. German factory orders fall more than expected in November, which in turn pushed the plunging EURUSD to fresh multi-year lows just above 1.176. The French and Italian markets are the best-performing larger bourses, Swedish the worst. The euro is weaker against the dollar. Irish 10yr bond yields rise; Japanese yields decline. Commodities gain, with natural gas, silver underperforming and zinc outperforming. U.S. jobless claims, consumer credit, Challenger job cuts due later.

Looking over today’s calendar we kick off this morning in Europe with November factory orders data for Germany. This is followed up later with various prints for the Euro-area including PPI, retail sales and various confidence indicators. As well as this we also have the BoE decision this morning. This afternoon in the US, we have more employment data with the Challenger job cuts reading for December as well as the initial claims numbers. November consumer credit rounds off the releases.

Market Wrap:

  • S&P 500 futures up 0.7% to 2034.4
  • Stoxx 600 up 1.6% to 338.7
  • US 10Yr yield up 3bps to 2%
  • German 10Yr yield up 1bps to 0.49%
  • MSCI Asia Pacific up 1.2% to 136.4
  • Gold spot down 0.5% to $1205.7/oz
  • 19 out of 19 Stoxx 600 sectors rise; retail, health care outperform, tech, real estate underperform
  • 91.3% of Stoxx 600 members gain, 8% decline, Eurostoxx 50 +1.8%, FTSE
    100 +1.3%, CAC 40 +2%, DAX +1.4%, IBEX +1.7%, FTSEMIB +1.8%, SMI +1.8%
  • Asian stocks rise with the Nikkei outperforming and the Shanghai Composite underperforming. MSCI Asia Pacific up 1.2% to 136.4, Nikkei 225 up 1.7%, Hang Seng up 0.7%, Kospi up 1.1%
  • Euro down 0.57% to $1.1771
  • Dollar Index up 0.56% to 92.4
  • Italian 10Yr yield up 1bps to 1.92%
  • Spanish 10Yr yield up 2bps to 1.71%
  • French 10Yr yield up 1bps to 0.8%
  • S&P GSCI Index up 0.4% to 398.2
  • Brent Futures up 0.5% to $51.4/bbl, WTI Futures up 0.6% to $48.9/bbl

Bulletin Headline Summary:

  • European equities remain higher, although have slightly pulled off best levels, helped by dovish comments from Fed’s Evan’s
  • Looking ahead sees the BoE rate decision (1200GMT/0600CST) with analysts expecting rates to be left unchanged as well as US initial jobless claims (1330GMT/0730CST)
  • Treasuries decline, 10Y rises above 2.00% amid gains in stocks, stabilization in crude oil, nearly $32b investment-grade deals over last two days; Dec. nonfarm payrolls due tomorrow, est. +240k, unemployment rate to 5.7% from 5.8%.
  • China isn’t planning to expand fiscal spending to stimulate growth, according to the economic planning agency, as President Xi Jinping said the country is able to maintain a “medium to high growth” rate
  • Kaisa Group Holdings Ltd., the Chinese developer that defaulted on a loan last week after its chairman departed, can’t say if it plans to meet a coupon payment today as a local news website said lenders took steps to preserve assets
  • German factory orders slid 2.4% in Nov., first decline in three months, after a revised increase of 2.9% in October, data from the Economy Ministry in Berlin showed
  • German 10Y yields, already at the lowest on record, may drop to near zero, according to Royal Bank of Scotland Group
  • Paris was in a state of turmoil as a shooting south of the city today claimed the life of a policewoman and police continued to seek two of the perpetrators of yesterday’s massacre at satirical magazine Charlie Hebdo
  • The youngest suspect in the deadly attack on Charlie Hebdo has surrendered, according to the Paris prosecutor’s office, as the police named two assailants still at large
  • Cherif Kouachi, one of the suspects, was arrested by French police a decade ago for his role in a jihadist recruitment cell
  • Greek Prime Minister Antonis Samaras’s effort to overtake opposition Syriza party’s lead before elections in less than three weeks is running out of steam, polls show
  • The majority of money gathered by Bill Gross’s new fund at Janus Capital Group Inc. came from the same Morgan Stanley brokerage where his personal financial adviser works, according to the WSJ
  • Sovereign yields mostly higher. Asian stocks mostly higher; Shanghai -2.3%; European stocks, U.S. equity-index futures gain. Brent crude, WTI higher; copper gains, gold lower

US Event Calendar

  • 7:30am: Challenger Job Cuts, y/y, Dec. (prior -20.7%)
  • 8:30am: Initial Jobless Claims, Jan. 3, est. 290k (prior 298k)
  • Continuing Claims, Dec. 27, est. 2.36m (prior 2.353m)
  • 9:45am: Bloomberg Consumer Comfort, Jan. 4 (prior 42.7)
  • 3:00pm: Consumer Credit, Nov., est. $15b (prior $13.226b)

Central Banks

  • 7:00am: Bank of England seen keeping bank rate at 0.50%
  • 12:00pm: Fed’s Rosengren speaks in Madison, Wisc.
  • 8:00pm: Fed’s Kocherlakota speaks in Minneapolis

As is customary, DB's Jim Reid concludes the overnight summary

After marking the start of 2015 with 3-consecutive days of losses, markets rebounded yesterday with equities rallying across the board. As well as the release of the FOMC minutes, there was plenty for the market to focus on with softer European inflation data lifting hopes of ECB QE and stronger US employment perhaps the highlights. The S&P 500 closed +1.16%, snapping 5 sessions of consecutive losses whilst the Dow recovered +1.23%. Energy stocks (+0.34%) and US HY energy names (-10bps) rallied following a rebound in WTI (+1.50%) although that masks what was another volatile day for oil markets which we’ll touch upon later. Credit markets also firmed with CDX IG finishing around 1.5bps tighter. With a better tone in the market US Treasuries weakened, the benchmark 10y yield failed to hold a brief move back above 2% but still finished the day 2.8bps higher at 1.968% - bouncing off the recent lows in yield. One theme which continues however is the stronger Dollar. The DXY index strengthened +0.43% yesterday and supported in part by what was a strong ADP employment report. The +241k reading came in ahead of +225k consensus and improved from the upwardly revised +227k in November. The print was also the strongest since June and comes before the ever-important payrolls numbers tomorrow. Elsewhere, a narrowing of the trade deficit (-$39bn from -$43.4bn) was the other notable release. Our US colleagues noted that the print benefited from an 11.9% decline in petroleum imports and highlights the fact that falling energy prices will provide a meaningful tailwind for consumer spending.

In terms of the FOMC minutes yesterday, the release was largely seen as a non-event with nothing of great surprise in the details. The minutes confirmed that we are unlikely to see ‘lift-off’ before April this year, specifically noting that ‘most participants thought the reference to patience indicated that the committee was unlikely to begin the normalization process for at least the next couple of meetings’. With regards to inflation, the Fed made reference to concern that some members noted the risk of inflation running below the 2% target, however the minutes also mentioned that ‘it was noted that the committee might begin normalization at a time when core inflation was near current levels, although in that circumstance participants would want to be reasonably confident that inflation will move back towards 2% over time’ – signaling that the drop in inflation itself will not necessarily stop the Fed from moving. Perhaps of more interest was discussion over the difference between pricing for market-based measures of expected Fed Funds rate and the Fed’s SEP projections. The minutes noted that one possibility could be that market-based measures could be assigning greater weight to less favorable outcomes for the US economy relative to the Fed itself, and therefore suggest the Feds Funds rate would remain low for some time. In terms of the overall minutes however, there was little for the market to react to.

Coming back to oil markets yesterday, both WTI and Brent (+0.10%) closed firmer at $48.65/bbl and $51.15/bbl respectively, recovering somewhat from 4-days of consecutive losses – although both traded as much as 2-3% lower intraday before recovering post the EIA inventories report. The recovery appeared to be as a result of data showing crude inventories decreasing by 3.1m barrels in the week ending January 2nd (relative to the previous week) – although we note inventories still remain at the high end of the seasonal range. The data appeared to make for mixed reading however with the WSJ noting that US stockpiles of crude, along with refined oil and other types of petroleum rose nearly 1% to 1.149bn barrels over the week. The earlier news from Saudi could be a more interesting story longer-term. Crown Prince Salman (stepping in for the ill King) yesterday seemed to emphasise more demand side causes for the slide in oil rather than the previously emphasised supply side explanations that they have generally been holding responsible. This could matter as it may eventually give the Saudis and other GCC states an excuse to change tact on production sooner than the next OPEC meeting in June on the basis that if the facts have changed so might their policies. This is perhaps 2+2=5 but with Oil continuing its slide one has to watch OPEC's reaction carefully as they could create the basis for a snap back if they decide to alter their stance.

Turning our attention to this side of the pond, risk assets in Europe also had a strong day with the Stoxx 600 closing +0.48% and Crossover rallying 16bps. The better tone was supported by a soft Euro-area inflation print, lending support to the hopes of imminent ECB QE with inflation now running well below target. The headline reading of -0.2%yoy for December came in a touch below consensus (-0.1%yoy) but was significantly down from November’s +0.3% print. The negative reading also marked the first sub-zero print since 2009. Core inflation was, however, more encouraging with the +0.8% ahead of the +0.7% consensus – emphasizing the disinflationary effects of energy prices. 5y5y breakeven levels initially dropped to a low of 1.504%, around 6bps lower, although it closed nearly 2bps up at the end of play (1.585%). Rounding off yesterday’s data, unemployment for the Euro-area remained unchanged at 11.5% although the reading declined modestly in Germany (6.5% from 6.6%). Retail sales in the latter also improved during November rising 1%mom (vs. +0.2% expected).

Elsewhere, Greek equity markets were open again yesterday although the ASE (-1.46%) extended its recent lows. Greek bonds fared little better. 3y (+160bps) and 10y yields (+94bps) climbed to 15.65% and 10.69% respectively – the latter breaking through 10% for the first time since mid-2013. The moves come following the latest opinion polls (GPO) which showed SYRIZA maintaining its 3% lead over its nearest rivals the New Democracy party Our resident expert George Saravelos noted that the figures showed something of a collapse in support for smaller parties and that due to polling technicalities in Greece, this means a greater number of seats to the first party thus potentially favoring a SYRIZA outright win. Staying on Greece, a report from French newspaper Le Monde noted European Economic Affairs Commissioner Moscovici favoring keeping Greece in the Euro-zone, stating that ‘it’s important for monetary union’. In the same report however, when questioned over any potential negotiation of a new schedule for Greek debt with SYRIZA, Moscovici commented that ‘this question is not on the agenda any more than that of a Grexit’. Additionally, a Reuters report yesterday cited German newspaper Bild as saying that Germany has started running scenarios for the Greek elections at the end of the month in case of a SYRIZA victory. The article suggests that Germany is making contingency plans for a possible ‘Grexit’.

Quickly refreshing our screens this morning, bourses in Asia are following the lead from the US and generally trading stronger. The Nikkei (+1.76%), Hang-Seng (+0.48%) and Kospi (+1.11%) are all firmer. Chinese equities are the notable underperformer however with both the Shanghai Composite (-1.67%) and CSI 300 (-1.80%) lower – although it appears the weaker sentiment is more profit taking than anything else. Just on China, in response to the Bloomberg article regarding the reported $1tn stimulus package our DB China colleagues noted this morning that they do expect aggressive policy easing to happen in 2015, and see March as a more likely start date given their view that activity data over the first two months of this year will likely surprise to the downside.

Before we look at the day ahead please note that our European Corporate Credit Analyst team will be presenting their best trade ideas at the Annual European Leveraged Finance Research Outlook presentation here at Deutsche Bank offices in London next Friday, January 16. Registration begins at 7:30am with the presentation starting at 8am. Pre-registration is required to attend (contact laurion.burrow@db.com). The team will be covering trade ideas across the European High Yield Industrials and Manufacturing (Richard Phelan); Telecom and Cable (Vivek Khanna and Neyla Velimoukhametova) and Retail and Consumer (Ronan Clarke and Jennifer Halliwell) sectors. In addition, Nick Burns will finish with a presentation covering our European High Yield Strategy Outlook.

Looking over today’s calendar we kick off this morning in Europe with November factory orders data for Germany. This is followed up later with various prints for the Euro-area including PPI, retail sales and various confidence indicators. As well as this we also have the BoE decision this morning. This afternoon in the US, we have more employment data with the Challenger job cuts reading for December as well as the initial claims numbers. November consumer credit rounds off the releases.

 

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Thu, 01/08/2015 - 08:03 | 5636196 Arius
Arius's picture

Evans blast ... please give us some better excuse ... like the Pi calculations or something ...

 

come to think of it, here is what my model states:

- september 2001 Add number 7

- september 2008 Add number 7

- september 2015 ... ready or not

 

Gamble accordingly.  simple isnt it?  for about Evans and Bullard ... these guys dont even know what they are talking about besides managing muppets communications

 

 

Thu, 01/08/2015 - 08:04 | 5636205 stocktivity
stocktivity's picture

It's all Bullshit!!!! Just buy the fucking dip as always.

Thu, 01/08/2015 - 08:21 | 5636227 GetZeeGold
GetZeeGold's picture

 

 

raising rates would be a catastrophe

 

Captain Obvious.......to the rescue.

Thu, 01/08/2015 - 08:28 | 5636239 Took Red Pill
Took Red Pill's picture

Markets going down? All the Fed has to do is make some comments to make it go back up! Fundamentals don't matter anymore

Thu, 01/08/2015 - 08:45 | 5636294 negative rates
negative rates's picture

Fundementals, the fed is always wrong but never in doubt, how could comments make the mkt go up since we know the truth.

Thu, 01/08/2015 - 09:53 | 5636519 Took Red Pill
Took Red Pill's picture

We here know the truth but many don't and buy into the BS

Thu, 01/08/2015 - 08:56 | 5636334 max2205
max2205's picture

And 2016 is an election year so no rate increases till.....never

Old people are starving to death

Thu, 01/08/2015 - 10:38 | 5636716 madcows
madcows's picture

Old people are old, and they cost a lot of money.  So, .Gov has to get rid of them, in order to support the "productive" class in the FSA.  Seriously, them fatties are a threat to national security.  If their rent/food/other handouts stop coming, Fergusson is going to look like a day at the park.

Thu, 01/08/2015 - 08:36 | 5636268 Rubbish
Rubbish's picture

HSBC says: raising 2015 gold forecast based on the possibility that further USD strength could trigger safe haven demand for bullion.

 

 So GOLD does fine up down or all around market.

 

Take that to the BOAT BITCHEZ....

Thu, 01/08/2015 - 13:09 | 5637496 ZomBiEHiGH
ZomBiEHiGH's picture

"Raising rates would be a catastrophe"

 

So when pigs fly?

Thu, 01/08/2015 - 08:33 | 5636262 Vylahkinnen
Vylahkinnen's picture

Exactly. The Future is bright. Nothing can stop us now! NOTHING! I am the first who calls for DOW 40,000 by the end of the year! Dow 40,000!

Thu, 01/08/2015 - 09:05 | 5636362 Arius
Arius's picture

slow down ... if I recall i correctly Glassman called for DOW 36000 in early 2000 ... a few months before the crash.  He even published a book about it ... time to revisit it, better later than never right?  come to think of it Nasdaq is almost at 5000 exactly where it collapsed in 2000.

Thu, 01/08/2015 - 10:11 | 5636587 Vylahkinnen
Vylahkinnen's picture

2000? Talking about the fucking past, dude! 15 years ago - that's ancient shit. These days - a crash like that would never, never, never happen again, okay? Baramabama told me so. We have advanced so much since then - as a society - as people of true integrity - you know what, I actually believe that we will never see a crash in our lifetime again. Kudos to the FED. They single-handedly have solved mankinds problems.

And now you excuse me. My 3D Printer is about to print me a tasty and healthy burger.

Thu, 01/08/2015 - 10:45 | 5636741 DavidC
DavidC's picture

Your last sentence made me laugh! Very good!

DavidC

Thu, 01/08/2015 - 08:06 | 5636211 XAU XAG
XAU XAG's picture

 "raising rates would be a catastrophe"

 

No Shit sherlock

 

Just look at Japan

 

While .GOV dept is increasing not a chance unless they default or raise taxes to 99% and leave 1% for bread and water.

 

It;s going to be years and years of this shit show untill something blows and it has nothing to do with hookers!

Thu, 01/08/2015 - 10:44 | 5636744 DavidC
DavidC's picture

"raising rates would be a catastrophe"

AKA

"We're crapping ourselves because we know what will happen if rates ever go up again - we're toast'

DavidC

Thu, 01/08/2015 - 08:01 | 5636201 Brazen Heist
Brazen Heist's picture

Premature ejaculation in the markets.

Thu, 01/08/2015 - 08:03 | 5636204 JustObserving
JustObserving's picture

Just when you think that the markets could not get more farcical, a comment from Evans rockets the markets higher - fundamentals never matter in fake, manipulated markets.

Thu, 01/08/2015 - 08:09 | 5636213 Brazen Heist
Brazen Heist's picture

Equity markets are getting desperate like a fat chick looking for a compliment. Evans must have provided it for the day, give em some hope that the rate rise may be delayed and the manipulation can continue a bit longer, squeezing a few more drops out out of it. Where would we without more optimism for the Ponzi? Confidence games run by confidence tricks.

Thu, 01/08/2015 - 08:14 | 5636219 valley chick
valley chick's picture

Add to it the manipulated numbers at 8:30. Turbo Thursday!

Thu, 01/08/2015 - 08:21 | 5636230 Brazen Heist
Brazen Heist's picture

CHeck out the discounts as well! Only if you have a balance sheet as big as a CB that is.

http://www.cmegroup.com/company/membership/files/CBIPFAQ.pdf

Thu, 01/08/2015 - 08:04 | 5636207 Ribeye
Ribeye's picture

France Bitchez...... France....

Thu, 01/08/2015 - 08:10 | 5636216 sidiji
sidiji's picture

So does this mean euro's fall about to end?  Is it time to cover my euro/usd short??

Thu, 01/08/2015 - 08:17 | 5636221 Arius
Arius's picture

Yes and No ... you gamble at your own risk.

 

on Evans comments please ... none had heard of the guy before this statement

Thu, 01/08/2015 - 08:14 | 5636220 El Hosel
El Hosel's picture

Fed minutes / Friday jobs report =  ATH ....Bitchez

there is no other option, must restore confidence. Nothing says confidence like a big green candle in the morning.

Thu, 01/08/2015 - 08:20 | 5636226 El Hosel
El Hosel's picture

Bloomberg reporting that "Oil has recovered"... which is nice.

Thu, 01/08/2015 - 08:21 | 5636229 Crazy Canuck
Crazy Canuck's picture

SNAFU has never been more appropriate to the markets 

Thu, 01/08/2015 - 08:31 | 5636233 Bernoulli
Bernoulli's picture

October 2014 Bullard: "May want to extend bond-buying program"

2 months later

December 2014 Yellen: "Be patient with interest rate hikes"

3 weeks later (with Christmas in between)

January 2015 Evans: "Raising rates would be a catastrophe"

More and more drastic rhetoric with shorter and shorter periods of time in between. They are running out of ammo.

Crash will happen soon.

Thu, 01/08/2015 - 09:08 | 5636376 Arius
Arius's picture

Listen to when Stanley Fischer talks .. all these are guys are worthless.  Even then got to be careful, because the guy doesnt have exactly your interests at heart ... understably.

Thu, 01/08/2015 - 08:31 | 5636246 RSDallas
RSDallas's picture

You better read his statements a bit closer. He is only 1 of 2 that is ultra dovish. He spoke out of both sides of his mouth, contidicting what he was saying. People like him should be banned from holding positions of any power.

Thu, 01/08/2015 - 10:41 | 5636724 Osmium
Osmium's picture

Hmm, I thought he was talking out of his ass.

Thu, 01/08/2015 - 08:31 | 5636249 kahunabear
kahunabear's picture

Gotta hand it to 'em, they are very dependable. Like clockwork the rigged pumping chimes in again.

Thu, 01/08/2015 - 08:32 | 5636251 buzzsaw99
buzzsaw99's picture

oh i'm so whipsawed, i mean, who could have seen this coming? my trading volume has been way up lately with all the conflicting messages coming from the fed and they always seem to catch me by surprise and i... [/SARCASM]

Thu, 01/08/2015 - 08:32 | 5636257 jubber
jubber's picture

Europe on total drugs

 

From the lows :-

 

Dax futures up 200

 

Cac up 110

 

ibex up 270 !!!

 

ftsemib up 480

 

ftse up 125

 

smi up 200

 

Dow up 190

 

S&P up 21

 

Naz up 48

 

Russ up 14

 

Is this insanity or what??????????

 

Thu, 01/08/2015 - 08:39 | 5636275 Vylahkinnen
Vylahkinnen's picture

Relax. By the end of 2015 we will see the DOW rise to 40,000. And it is not insanity, boy. If you would have studied economy, you would understand that this is absolutely not insane. Okay? Any questions? Now btfd, goddamit.

Thu, 01/08/2015 - 09:21 | 5636293 Bernoulli
Bernoulli's picture

Not insanity. "Fundamentals".

Thu, 01/08/2015 - 08:43 | 5636289 Quinvarius
Quinvarius's picture

Was there ever a doubt?  Peter Schiff is right again.  However, this time he is not alone.  It is pretty obvious that not only will rates be held low, but QE will have to restart in order to buy the items required to keep them low.  And, of course, when you subsidize gov debt, you get more of it.

Thu, 01/08/2015 - 08:43 | 5636291 firstdivision
firstdivision's picture

Metals have morning wood today.

Thu, 01/08/2015 - 08:46 | 5636299 buzzsaw99
buzzsaw99's picture

we may never again see 2% on the 10y. i know, it's only 5 bps below from just yesterday, lighten up francis.

Thu, 01/08/2015 - 08:50 | 5636303 rsnoble
rsnoble's picture

Back to the top of the trading range trendline for another new high at this rate.  Pretty consistent with only one breakdown in the past 3 years and of course it failed also lol. The silver and gold charts are trying to break out for a bit of a run perhaps that's the problem lol.

Thu, 01/08/2015 - 08:50 | 5636305 wmbz
wmbz's picture

The un-fed will buy the DOW right back to 18,000 and beyound in no time.

No smoke, no mirrors, just plain out in the open.

MOAR is always their answer. They will drive this financial express train full throttle straight into a granite wall in the end.

As to when that will be? It seems endless, however what goes up must come down at some point in time.

It will be a doozy!

Thu, 01/08/2015 - 08:51 | 5636313 Keltner Channel Surf
Keltner Channel Surf's picture

Hmm.  Evans says increased rates would be bad and . . . the 10YR rate rises.  

Rovio should release a game called Angry Feds in which enraged FOMC governors launch themselves at jackals disguised as bond traders, who are threatening to steal their ammunition.   In a bit of a role-reversal, Rovio could depict the Hawks as creamy-white, bumbling and slow to react, talons filed off to mere stubs, clownishly dropping “aerial surprises” onto their foes; while the Doves would be fleet & svelte, dark & deadly – damn near Hitchcockian -- able to accelerate (and/or inflate) quickly when gamers tap the “Q” and “E’ keys sequentially.

Thu, 01/08/2015 - 08:51 | 5636314 fiftybagger
fiftybagger's picture

There's no way they let the longs out of this without skinning them.  Here's my prediction: Out of the blue we get a 4 to 5 thousand point down day.  Then the FED surprises everyone by saying "rate increases will begin soon" and "high stock prices are not part of our mandate".  From there the market just keeps sinking all the way back to the old lows and all the longs are trapped.  That's how I'd do it if I were them.

Thu, 01/08/2015 - 08:53 | 5636316 WTFUD
WTFUD's picture

Where's Ghordo und Hans? Was enjoying their to and fro on another Z/H thread. Tyler your posts are coming through spater und spater lately, wake up please! Give us our daily MEDICINE, i'm experiencing withdrawal sympthoms.

Thu, 01/08/2015 - 09:06 | 5636336 TeethVillage88s
TeethVillage88s's picture

Ja, Spater. Vier haben Spater.

Sie kommen Zaruck Spater.

Thu, 01/08/2015 - 08:51 | 5636317 the not so migh...
the not so mighty maximiza's picture

But interest rates must rise in a RECOVERY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Thu, 01/08/2015 - 08:57 | 5636331 papaswamp
papaswamp's picture

Need to graph the Bullard, Yellen and now Evans ramps. Markets operating on words and nothing else...classic. Low rates Fo'eva! Thus can keep ramping up the debt.

Thu, 01/08/2015 - 09:01 | 5636353 Peter Pan
Peter Pan's picture

I am beginning to wonder whether this surreal market continues for long enough so as to cause a paradigm shift in reality, that will endure long enough to make it feel normal.

The current generation going through school really has no mature memory of a more normal and free market and I fear that they will embrace this madness as some kind of normality.

Thu, 01/08/2015 - 09:03 | 5636360 papaswamp
papaswamp's picture

Been working in Japan for almost 2 decades now...

Thu, 01/08/2015 - 13:48 | 5636388 El Hosel
El Hosel's picture

Embrace the Ponzi... by Peter Pan, catchy.

Thu, 01/08/2015 - 09:26 | 5636421 Bernoulli
Bernoulli's picture

They are certainly trying to make this the new normal. Additionally, internet and iphones are helping to reduce attention spans of the masses (who still fully reads printed textbooks with fundamental knowledge in it??).

And if it lasts long enough, the few remaining old-school-educated "bears" will end up in the mental home sooner or later.

As for me: Not sure if I can take this crap another year...

Thu, 01/08/2015 - 09:04 | 5636356 NoWayJose
NoWayJose's picture

Bought moar phyzz last night on the little dip in gold. It will be interesting to see if gold can head higher post-Evans, as that would start to fulfill Schiff's forecast for 2015 and indicate that (some of) the markets are losing faith in the Fed...

Thu, 01/08/2015 - 09:07 | 5636375 gatorengineer
gatorengineer's picture

Fade the open........

Thu, 01/08/2015 - 09:11 | 5636386 blown income
blown income's picture

Yup , keep it at .25% and give it to the sheep at 12.99%

 

fucking joke

Thu, 01/08/2015 - 09:23 | 5636401 yogibear
yogibear's picture

Ultra money printer Evans knows they cannot raise rates.

Guess they'll have to announce QE 4 soon. This time at least $125 billion/month.

QE has to larger each time. It's Zimbabwe economics.

 

 

Thu, 01/08/2015 - 10:07 | 5636402 TeethVillage88s
TeethVillage88s's picture

Son of Bit*ch, this guy has totally blown me away with bullets.

- I am a bullet guy
- This guy has won micro and owns my ass...

If I wasn't drinking I would respond. But the world is shit so... no one wants to hear my words.

Thu, 01/08/2015 - 09:51 | 5636509 thismarketisrigged
thismarketisrigged's picture

how fucking scary that all it takes to fucking move these fucking ''markets'' is some douchebag repeating the same thing over and over again.

 

why dosent every fed member just come out and say rate hikes would be catastrophic and we can go up every day

Thu, 01/08/2015 - 10:11 | 5636591 Racer
Racer's picture

Low interest rates HAS BEEN and still IS

CATASTROPHIC to savers for YEARS.

If things are improving as they say they are why haven't they raised rates? Yeah, liars the lot of them.

Thu, 01/08/2015 - 10:41 | 5636681 khakuda
khakuda's picture

Catastrophic is leaving rates too low for a decade causing an epic asset price bubble which then implodes when, as a central bank, you have already used all the conventional stimulus and the tank is empty.  Catastrophic is following Japan down the road to the point where all the national revenue will be consumed by even a 3% interest rate on the national debt.

This must be the 7000th instance of the Fed responding to a 2% stock market decline by promising the further extension of free money.  Not allowing even small corrections virtually guarantees a massive one at some point down the road which will then be met by the most unconventional intervention we have ever seen.

Thu, 01/08/2015 - 10:47 | 5636751 Mike Honcho
Mike Honcho's picture

Telling the truth as a talking-head is catastrophic to your career.

Thu, 01/08/2015 - 10:47 | 5636762 JustAboutThatAc...
JustAboutThatActionBoss's picture

What a Fucking Ass-Hole!

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