Frontrunning: September 1

Tyler Durden's picture
  • Obama to address Congress on September 8 (Reuters)
  • China Says Fighting Inflation Is Priority (WSJ)
  • Katia a hurricane; another storm likely in Gulf (Reuters)
  • IMF and eurozone clash over estimates (FT)
  • Japan’s New Leader Oversaw Biggest Intervention Since 2004 (WaPo)
  • Asia feels impact of global slowdown (FT)
  • Germany's Resiliency Buoys Europe (WSJ)
  • EU Reaches Deal to Expand Syria Sanctions (WSJ)
  • Goldman Takes Dark View in Private Note (WSJ) or is the European bailout really $1 trillion?

European Economic Recap:

  • Eurozone PMI Manufacturing for August 49 - lower than expected. Consensus 49.7. Previous 49.7.
  • Germany GDP s.a. for Q2 0.1% q/q 2.7% y/y – in line with expectations. Consensus 0.1% q/q 2.7% y/y. Previous 0.1% q/q 2.7% y/y.
  • Germany PMI Manufacturing for August 50.9 - lower than expected.Consensus 52.0. Previous 52.0.
  • France PMI Manufacturing for August 49.1 - lower than expected. Consensus 49.3. Previous 49.3.
  • Italy PMI Manufacturing for August 47.0 - lower than expected. Consensus 49.0. Previous 50.1.
  • UK Nationwide House prices for August -0.6% m/m -0.4% y/y - lower than expected. Consensus 0.0% m/m 0.4% y/y. Previous 0.2% m/m -0.4% y/y.
  • UK PMI Manufacturing for August 49 – in line with expectations. Consensus 49. Previous 49.1.


Global economic highlights courtesy of Egan-Jones

  • Asian stocks climbed, with regional indices set for its longest streak of gains since Jan.
  • China PMI at 50.9 in August vs. July's 50.7 which is a 29-month low.
  • China’s top priority is stabilizing prices - Premier Wen Jiabao said.
  • Oil trades near two-day low as crude stockpiles rise; Brent premium widens.
  • Tropical storm Katia, moving west- northwest across Atlantic to grow into a Hurricane. 
  • Bank of NY Mellon said its CEO stepped down because of differences with the board.
  • BofA may sell or shut correspondent mortgage-lending operations.
  • Brown-Forman Corp.'s Q1 net rose 6% to $118.1M. Revs jumped 13% to $840.3M.
  • CIT announces plans to redeem an additional $1B of Series A notes.
  • Clorox dismisses Icahn's revised proposal; says proposal is not credible.
  • Coldwater Creek Inc. posts Q2 loss of $27.7M as revs slipped 40% to $181.4M.
  • Cooper Cos reported Q3 EPS of $1.15 (cons $1.09); revenues rose 17.8% to $351.4M.
  • CSC wins contract worth up to $291M from US Citizenship and Immigration Services.
  • Greek bank, Piraeus Bank, to take a $1.44B impairment on its bond holding.
  • Greif misses by $0.15, beats on revs; lowered FY11 EPS below consensus.
  • IBM buys security analysts software co., i2 from PE seller, terms not disclosed.
  • Jos. A. Bank Clothiers' Q2 net rose 25% to $20.6M. Revs up 22% at $230.7M.
  • Joy Global's Q3 net jumps 49% to $163.5M helped by 28.6% higher sales of $1.09B.
  • Marsh & McLennan subsidiary buys Africa brokerage for $160M.
  • Medtronic completes acquisitions of Peak Surgical and Salient Surgical for $585M.
  • NGL Energy Partners will buy natural gas liquids assets from SemStream L.P. for $283M.
  • OneBeacon Insurance to sell AutoOne biz; expects $18M charge in Q3, reflecting loss.
  • Oxford Industries beats by $0.04, posts Q2 EPS of $0.57. Revs rose 26.3% to $180.6M. 
  • Saab Auto forecast substantial loss for 2011 and withdrew its sales, profit targets.
  • SAIC Inc. cuts its 2012 rev view to not more than $11B from prev view of $11.5B.
  • Stryker Corp. to buy Concentric Medical for $135M cash.
  • Timken to acquire Drives LLC for $92M in cash, expects addition to boost earnings.
  • Zale Corp.'s Q4 loss widened to $32.6M, absent a large tax benefit. Revs up 9.4%.
  • Zumiez Inc. swings to Q2 profit as revs rose 15% to $112.2M. Guides Q3 below f'cast.
  • Economic Calendar: Initial & Continuing Claims, Productivity-Rev. Q2, ISM Index, Construction Spending, Auto Sales to be released.
    Earnings Calendar: CASC, CIEN, FLOW, FNSR, HRB, MOV, ZQK.

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HelluvaEngineer's picture

My fellow Americans, there is absolutely no way I could have known about the suitcase nuke attack next Sunday.

bill1102inf's picture

Wow, that is about as funny as a barrel full of dead babies.

slaughterer's picture

The Alan Brazil report mentioned in the WSJ article above is about as close to ZH GS gets.   The tendency amongst recipients I have talked to is that we are not going to fade this report (as was the tendency earlier) but increase shorts on the sensitive regions, assets classes and instruments mentioned by Alan Brazil. 

The Real Fake Economy's picture

do you know how to get the full alan brazil report?

tsx500's picture

5000 comedians out of work, and you're givin it away for free !

SheepDog-One's picture

Yep total world economic monetary and banking collapse is apparently highly bullish, 'cuz then someone will do something or other....'animal spirits' sense the logical conclusion is being handed more free money so the worse the news is the better.

cranky-old-geezer's picture



Economies are grinding down because no "central planners" anywhere are doing anything to boost manufacturing & economic production ...except China, Germany, and Brazil.

Eveyone else is trying to keep economies and financial systems afloat with central bank cash infusions.

But they can't do it forever. Central bank cash infusions steadily weaken the currency as money supply outgrows GDP (which is shrinking in many cases, like here in America).

The future is clear to see. Steadily creeping inflation, steadily diluting citizens' purchasing power, streadily pushing commodity prices higher, steadily pushing citizens toward poverty, while governments & banks party on, swimming in money from those central bank cash infusions (which never go to the citizens).

It's like governments & banks have given up on their economies, hoping to party on a while longer until their currency collapses,  government collapses, banks collapse, and the nation collapses.

j0nx's picture

Really? You don't say. I think you're on to something here...

Flakmeister's picture

Katia could be *very* interesting.... been following it since it was near the Cape Verdes, it is a "classic" Hurricane along the lines of Ivan

The best place to follow Katia is

Excellent discussion of the modelling and forecasts on the attached blog.

For those interested in history


Pants McPants's picture

I've been fascinated with hurricanes since Katrina coverage.  Kinda got sucked into it & haven't been able to stop.  Thanks for the links!

On a cynical and off-topic note, the conspiratorial side of me wonders what would happen if Katia wreaks havoc around Galveston, TX....Ron Paul's district.  The weather controllers could steer the big one into Paul's district after his comments about FEMA, thereby derailing his campaign.

Long shot and totally unrelated, I know, but it makes me think.


Flakmeister's picture

Katia, if it makes landfall, will hit the US Northeast... even if just grazes the coast, any more rainfall could be serious.

There is a little something brewing in the GOM that has to potential to suprise...Lots of very warm water there. Galveston may well get dinged.

Pants McPants's picture

You're right, sorry.  I misspoke.  I watched some CNN yesterday, and they focused on a tropical depression in the GOM (not Katia).  The track was towards New Orleans, but they admitted it was a rough guess.  That's what got me thinking.

Salah's picture

RE: the GS lugubrious assessment (it's all going in the shitter);  America needs a truly "big picture" concept, not more monetary stimulus (now impotent), but a real balls-to-the-wall 'technology stimulus'.  Dr. Harrison 'Jack' Schmitt, former US Senator from NM, last man to set foot on the Moon (we know of) and now at the University of Wisconsin Fusion Technology Institute, recently hinted at when he told a major Canadian mining industry conference, "it's time to go back" ( ).

But we cannot do any of this until we get out of that specious, Cold War sop to Soviet paranoia, the Outer Space Treaty of 1967.  Nobody can, because it disallows property rights, by disallowing any extensions of national sovereignty that would recognize and protect those property rights.  Moreover, it's simply foolish to believe the international regimen that perpetrated this fraud to begin with would craft a subsequent treaty, in a timely manner, to help spur on economic recovery.  They already tried that after we landed in 1969, with an even more proscriptive one, the Moon Treaty of 1972, which Nixon shit-canned in the Senate. 

The United States should use its legal rights, per Treaty article #16, to unilaterally withdraw, and then declare we'd use national sovereign powers to recognize anyone's lunar discoveries (minerals, rare earths, He-3, etc) or unique lunar processes developed (metals, nano, drugs, etc) back on Earth (thus protecting them from decades of international litigation & theft).  It could easily have the same effect the Pacific Railroad Acts (1863-69) had on the American economy for a good 65-70 years, or a helluva lot longer.


overmedicatedundersexed's picture

you need the space elevator theres a project that will soup up the tip of the hat to mr a clarke.


Are you kidding's picture

Why don't you just mine the sea floor?  It's right here.  Mining outer space is a fucking dream!  Do you know how expensive it is to lift a ton?  Do you know how heavy MINING equipment is?  Don't even think about's a waste of your thoughts.

spanish inquisition's picture

OT -

Transporting prisoners for torture. Aren't the pilots and the employees eligible for war crimes charges?

Cathartes Aura's picture

As the 10th anniversary of 9/11 approaches, the mass of invoices, receipts, contracts and email correspondence – submitted as evidence to a court in upstate New York – provides a unique glimpse into a world in which the "war on terror" became just another charter opportunity for American businesses

it's really not much of a stretch to acknowledge the private contractors who spray the amrkn (and other NATO countries) daily for "weather modification" when one realises pretty much anything can be done to other humans, for money.

j0nx's picture

Not the solution. Helium 3 is a finite resource just like oil, moreso since it is only available on a body located 225,000 miles from us. Eventually we would be in the same or worse condition we are in now as it started to run out or we destroyed the moon and then fucked ourselves in the process ala The Time Machine. HE3 fusion is a joke. Made for an interesting novel though.

Quadlet's picture

Gulf depression currently forecast to strengthen and persist in the gulf until next Wednesday.  This will pound the oil & gas producing region!  Go long oil!

Grand Supercycle's picture

S&P500 big picture remains bearish and this will ALWAYS exert the most influence. The only thing GUARANTEED is that the bearish medium/long term cycle will have the upper hand.

FX medium to long term outlook continues: Euro bearish and USD bullish.

As mentioned many times - bring on the OVERDUE USD rally.


Die Weiße Rose's picture

you forgot the FED 2.74 billion QE POMO for today:

 Operation - RESULTS   Operation Date:   09/01/2011 Operation Type:   Outright Coupon Purchase Release Time:   10:15 AM Close Time:   11:00 AM Settlement Date:   09/02/2011 Maturity/Call Date Range:   03/15/2014 - 08/31/2015 Total Par Amt Accepted (mlns) :   $2,740 Total Par Amt Submitted (mlns) :   $16,694
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