- Snow is coming: OECD Cuts Economic Growth Forecasts (WSJ)
- World waits for white smoke from U.S. Fed (Reuters) - Understandable error: they meant "green"
- Scots Breakaway at 45% Odds as Economists Warn of Capital Flight (BBG)
- Ukraine President Poroshenko Faces Backlash Over EU Trade Deal Delay (WSJ)
- German Anti-Euro Party Advances in Merkel Homeland Voting (BBG)
- Clinton Hints at 2016 Run as Super-PAC Packs Iowa Steak Fry (BBG)
- Air France, Lufthansa Hit by Strikes in Fight for Future (BBG)
- U.S. sees Middle East help fighting IS, Britain cautious after beheading (Reuters)
- Ex-Billionaire Charged by Brazil With Financial Crimes (BBG)
Something appears to have changed not only because the USDJPY is not some 100 pips higher overnight on, well, nothing but because the S&P, which is treading water, has yet to spike on no volume reasons unknown. That something may be algos which are too confused to buy ahead of this week's Fed announcement which may or may not have some notable changes in language or the Scottish referendum on the 18th. Or it could simply be that algos are no longer allowed to openly manipulate and rig the market on the CME as of today now that "disruptive market practices" are banned (why weren't they before)? In any case, keep a close eye on the market today: not all is at it has been for a while, unless of course it is still just a little early and the rigging algos (which haven't gotten the Rule 575 memo of course) haven't woken up just yet.
So why does it matter if the gold price is rigged? A freely-determined gold price is central to ensuring that reality and not financial bubbles guides us in our financial and economic activities. Suppressing the gold price is rather like turning off a fire alarm because you can’t stand the noise.
When you see the headlines touting strong retail sales, you need to consider what you are actually seeing in the real world. RadioShack will be filing for bankruptcy within months. Wet Seal will follow. Sears is about two years from a bankruptcy filing. JC Penney’s turnaround is a sham. They continue to lose hundreds of millions every quarter and will be filing for bankruptcy within the next couple years. Target and Wal-Mart continue to post awful sales results and have stopped expanding. And as you drive around in your leased BMW, you see more Space Available signs than operating outlets in every strip center in America.
Why The Collapse Of Abenomics Is Important: It's A Large-Scale Failure Of Keynesian Stimulus In Real TimeSubmitted by Tyler Durden on 09/14/2014 21:07 -0400
We have frequently discussed the nonsensical attempt by Japanese prime minister Shinzo Abe and BoJ governor Haruhiko Kuroda to print and spend Japan back to prosperity. By now it is well known that devaluing the yen has not achieved the desired effect, but rather the opposite. Not only have exports not really received the expected boost, but Japan’s trade and current account surplus have decreased markedly, even posting negative numbers for the first time in decades. Of course, currency debasement never works: it cannot work. This is Keynesian logic and brilliance in all it splendor.
There is another "broad coalition" in The Middle East. With fighter from Sudan and Sweden to Spain and Switzerland, the following map shows where all the foreign fighters in Syria and Iraq's 'new crusades' are from...
While USDJPY is not moving much, no clear news from Scotland (GBP is modestly weaker) and an opposition win in Sweden (Krone weaker) along with China's dismal data (and Securities Journal note that no rate cut is coming anytime soon from the PBOC) sparked some significant selling in US stock futures at the open (-13 points). Treasury futures are modestly higher as S&P future are stabilizing around -7 points for now extending losses from Friday as AUDJPY slides...
The S&P’s rally has been sustained through near-zero-cost money used to: (1) buy back stock to enrich insiders and please activist hedge funds which have borrowed big to buy big; and (2) prop up the overall market because investors have learned that buying on margin when the costs are minimal - and below dividend yields - just keeps paying off. Stein’s law says, “If something cannot go on forever, it will stop.” Too bad it doesn’t say when. Gold loses its luster when: (1) inflation seems to be as remote as a pot of gold at the end of the rainbow; and (2) even a concatenation of crises fails to send investors rushing into the time-tested crisis consoler. We see geopolitical risks expanding from here - not contracting - and stick to our investment advice that the broad stock market is precariously valued. A range of options is available for those who wish to hedge themselves against even worse news. Gold is part of any such risk mitigation. So are long government bonds. Most importantly, we have entered an era when wise investors will devote as much time to reading the foreign news as they allocate to reading the investment section.
Friday saw the largest demonstration in the history of Barcelona with 1.8 million people showing up, exceeding all previous records, calling for Catalan independence... and as Deutsche Bank warns "Catalonia matters!" seeing four key scenarios.
Following ISIS blitzkrieg in which it took over nearly half of Iraq and a third of Syria in the blink of an eye, at which point it created its own Islamic State Caliphate resulting in Obama's own personal war against the jihadists, some have wondered what is ISIS' next step: surely its leadership will not merely stagnatte as one after another US predator drone bomb away the capital Reqqa until ISIS figurehead leader al-Baghdadi is killed or gravely wounded. To be sure, the one thing ISIS, which stunned the world with the speed of its ascent, can not afford is to stand still. So what is next on the strategic timeline for the Islamic State? According to one source, Al Arabiya, which cites Egyptian experts, the answer is none other than the Suez Canal, and the country it is located in: Egypt.
The depression that followed the stock-market crash of 1929 took a turn for the worse eight years later, and recovery came only with the enormous economic stimulus provided by the second world war, a conflict that cost more than 60 million lives. By the time recovery finally arrived, much of Europe and Asia lay in ruins. The current world situation is not nearly so dire, but there are parallels, particularly to 1937. Now, as then, people have been disappointed for a long time, and many are despairing. They are becoming more fearful for their long-term economic future. And such fears can have severe consequences.