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Key Events In The Week Ahead

Tyler Durden's picture




 

You mean, aside from the relentless headline barrage? Why yes, in a vivid reminder of what used to happen when actual fact-based events mattered, here is a complete summary of the key events in the coming week.

From Goldman Sachs:

Last week was a week of consolidation after the short-covering rally in the two previous weeks. Range-bound price action dominated across asset classes as investors were being kept busy following the European news, while macro data continued to stabilise at low levels.

In the week ahead, this pattern of stabilising macro data and Eurozone policy meetings will continue. Of course, the focus is on the EU summit on Wednesday, though expectations are not particularly high after weeks of continued negotiations and repeat summits. After the latest meetings this weekend, the details on bank recapitalisation, PSI involvement in the Greek bailout and a leverage scheme for the EFSF remain vague. While Eurozone leaders continue their debate, the week will also deliver a batch of interesting macro data in the Eurozone. Starting with the preliminary Eurozone PMI, we also get German consumer confidence and CPI data. Italy publishes consumer confidence as well and retail sales. Finally, Italy will try to issue EUR5-6bn in bonds on Thursday and Friday, possibly the first serious test of market confidence after the Summit on Wednesday.

The potential for a substantial Dollar sell-off and notable Euro rally is clearly there. Positioning data suggests continued stretched Dollar shorts against pretty much any currency, including the Euro. A quick and convincing solution to the Eurozone crisis could therefore lead to a sharp reduction in the Eurozone risk premium. Having said this, uncertainty remains high and our base case is for "muddling through" rather than a quick and convincing Eurozone solution. Last week's modest strengthening of the CHF and the JPY may have been a warning sign that currency markets also remain skeptical. It may therefore take a bit longer before the September risk aversion moves can be unwound further.

Beyond the focus on the Eurozone, there are a number of central bank meetings this week (HUF, CAD, NZD, SEK, JPY, INR, ILS, RUB), with only the RBI expected to tighten monetary policy in India, as inflation pressures remain high.

Finally, in the US, third-quarter GDP and durable goods orders will likely be the key focus.

Monday 24th

Euro-zone Oct flash PMIs: Consensus expects the manufacturing PMI to fall by 0.4 to 48.5.

HSBC China Flash PMI: The last reading stood at 49.9. The latest one just printed at 51.1

Also Interesting: Fed Dudley speech, Israel monetary policy meeting is expected to leave rates unchanged.

Tuesday 25th

Germany Consumer Confidence: Consensus expects a virtually unchanged reading at 5.1.

Italy consumer confidence and retail sales: Given the focus on Italian debt sustainability in the market, retail sales and consumer sentiment may provide indications about cyclical strength. Consensus expects basically unchanged numbers.

Hungary MPC meeting: We and consensus expect rates to stay on hold at 6.0%.

BoC policy meeting: Consensus expects no change from 1.00%.

US Oct Consumer Confidence: Consensus expects 46 after 45.4 in Sep. This is the monthly Conference Board survey.
India Reserve Bank meeting: Markets expect the repo and reverse repo rates to get raised by 25bp to 8.50% and 7.50%.

Wednesday 26th

Australia Q3 CPI: We expect 3.5%yoy, in line with consensus after 3.6% in Q2.

US Sep Durable goods orders: Consensus expects -0.8%mom after -0.1% in Aug.

EU Summit: According to EU Commission President Barroso, final decisions about the Euro-area debt crisis will be made at this summit.

Also Interesting: US new home sales.

Thursday 27th

US Q3 GDP: We expect 2.5%, in line with consensus after 1.3% in Q2.

RBNZ Meeting: Consensus expects no change from 2.50%.

Riksbank Meeting: Consensus expects no change from 2.00%.

BoJ Meeting: We expect no change from 0.10%, in line with consensus.

Regional German CPI data: Last month, these numbers were the first to indicate rising inflation pressures in the Eurozone core.

Also interesting: US jobless claims, Speech by Bundesbank Chef Weidmann, Turkey trade balance (Sep).

Friday 28th

Japanese Inflation and Industrial Production: consensus expects the data to paint a deflationary picture with faster-falling price indices and a notable drop in IP (-2.1% mom)

Italian Bond Auction: This could well be one of the first serious tests to see if the EU summit earlier in the week helped improve market confidence.

Russia Monetary Policy meeting: We and consensus expect unchanged rates at 3.75%.

US Sep Personal Income: Consensus expects 0.3%mom after -0.1% in Aug.

US UMich consumer sentiment: This is the final reading, which is expected to show only very marginal improvements compared to the preliminary reading.

Swiss KOF leading indicator: This is expected to drop notably to about 1.04 from 1.21, according to GS and consensus.

Also interesting: UK consumer confidence.

 

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Sun, 10/23/2011 - 23:41 | 1803360 X.inf.capt
X.inf.capt's picture

key events in the world...

so we can be lied to some more about how great things are...or not as bad as they look, even when we see it, up close, all around us...

can we get this over with, please...

Sun, 10/23/2011 - 23:51 | 1803380 dogismyth
dogismyth's picture

Well as long as there are players in the game, the game will continue.  If you want it to stop, stop playing the game.  But, I don't see that happening as the zombies continue to follow the news, the charts and prophecies of those that claim to have a clue.

Sun, 10/23/2011 - 23:59 | 1803390 Unprepared
Unprepared's picture

How many times have they been tilting this game to see the desirable outcome - against all rules - and how many times can they continue to do that before the machine freezes?

"The frustration from seeing the ball follow a path towards the gap between the flippers can lead to the player physically tilting the machine (in an attempt to guide the ball towards the flippers). However, in doing so, some games will flash the word "TILT" and freeze the flippers, causing the ball to be lost for certain. The metaphor here being over-aggression due to frustration leads to severely detrimental gameplay."

Mon, 10/24/2011 - 01:13 | 1803499 dogismyth
dogismyth's picture

Its a game only to keep the US military going strong.  We still have a few countries left in the Mideast to conquer, and most of Africa.  We are working on both simultaneously.  After strongholds are in place, they'll likely let the collapse happen here and abroad.  Funny how a muslim-related prez in elected to conquer the muslims lands abroad.  They either finish these wars in a year, or it continues beyond 2012 with Obama at the helm again.  Either way, the US military is the world's policeman and until the jobs done the charade will continue, including the levitating of the markets.  I can't believe how shortsighted people are in this regard.  Most think this is about global economic markets when nothing can be further from the truth.  Its about world domination.

Mon, 10/24/2011 - 00:01 | 1803395 doomz78
doomz78's picture

The real Westminster Kennel Dog Show is in Europe.  The other factors don't mean much.  They will move the markets a little here and there. Nothing scares the stock and bond markets like the incompetence in Europe and what it would mean if they don't throw good money after bad money.  I'm still in awe that their big plan is to recapitalise the banks to "fix" the problem.  

1.  Recap the banks and try to avoid a world explosion of contagion in the banking sector...  No guarantee this will even work.  A 2 trillion dollar backstop.  Best case scenerio.  Buying maybe a year or so until the next explosion.

2. Let Greece fail and face up to the fact that the Euro has failed.  This obviously is the best scenerio.  But there are too many politicians, the imf, the european commision who implemented the Euro.  So they won't ler er' fail. 

Both options are a joke and equate to a failed euro.  Im not even that smart and I know this.  Im shocked when economists talk this junk up and stock markets rally on this garbage.  They will at best buy themselves one year.

  

Mon, 10/24/2011 - 00:24 | 1803423 Rynak
Rynak's picture

I think they do already mostly buy themselves now. That's why the movements make no sense.

Mon, 10/24/2011 - 02:33 | 1803574 lewy14
lewy14's picture

Right this second it's risk on. Like donkey kong. Rally on Wayne. Rally on Garth.

Sun, 10/23/2011 - 23:45 | 1803364 CapitalistRock
CapitalistRock's picture

It's a good week to own gold and sleep well.

Sun, 10/23/2011 - 23:45 | 1803369 monopoly
monopoly's picture

You have that right. And a couple of miners might be a good choice. We shall see.

See ya in the morning.

Sun, 10/23/2011 - 23:48 | 1803375 Fish Gone Bad
Fish Gone Bad's picture

For those who still find the ongoing number of bank failures interesting, here is the link (reports on Fridays, after everyone has gone home).  http://www.fdic.gov/bank/individual/failed/banklist.html

 

Sun, 10/23/2011 - 23:55 | 1803378 Yen Cross
Yen Cross's picture

Troika?  Are percentiles, open for discussion?

Sun, 10/23/2011 - 23:56 | 1803385 1fortheroad
1fortheroad's picture

Meltup in -4 3 2 oh nevermind

 

Sun, 10/23/2011 - 23:57 | 1803388 CrashisOptimistic
CrashisOptimistic's picture

Q3 2.5% eh.

Q1 0.4.  Q2 1.3.  What changed?

Mon, 10/24/2011 - 00:57 | 1803478 Yen Cross
Yen Cross's picture

 Not funny Q.?

Sun, 10/23/2011 - 23:59 | 1803391 Missiondweller
Missiondweller's picture

"US Q3 GDP: We expect 2.5%"

 

That sounds a bit optimistic.

Mon, 10/24/2011 - 00:25 | 1803426 Rynak
Rynak's picture

Everything in that list sounds optimistic, even the "no change" "consensus".

Mon, 10/24/2011 - 00:33 | 1803436 slewie the pi-rat
slewie the pi-rat's picture

the chairsatan ordered it for the europeon halloween punch

Mon, 10/24/2011 - 01:00 | 1803481 Yen Cross
Yen Cross's picture

 Ben opened nothing...  That is the Question...?>  Did you read the two Fed statements last week?

 

       I call every one out!

Mon, 10/24/2011 - 01:14 | 1803500 slewie the pi-rat
slewie the pi-rat's picture

everyone!

you R o-u-t, BiCheZ!

Mon, 10/24/2011 - 00:01 | 1803394 LeonardoFibonacci
LeonardoFibonacci's picture

Market will be up 5% tomorrow

Mon, 10/24/2011 - 00:08 | 1803410 i root for that...
i root for that fat jersey governor's picture

although we konw the bias of this web site already, i am  still amazed by how the site focuses solely on negtive news - it seems that it thinks it can talk the market down. saw the posting about EURUSD opeing lower and posted something against it. Now please someone post the future is up big???

CNBC disgusts me because it wants to talk the market up but dude this site is just as biased -- kind of funny.

I do enjoy some postings though.

Mon, 10/24/2011 - 00:42 | 1803454 jomama
jomama's picture

you seem like a dude who likes to take things at face value.  

live and let live.

Mon, 10/24/2011 - 00:29 | 1803432 Yen Cross
Yen Cross's picture

 I have a lot o respect, for some good people.

 

     No Names.  Let's trade this week right!

Mon, 10/24/2011 - 00:40 | 1803435 hyper-critical
hyper-critical's picture

Most significant news item the last few weeks is the Hegelian dialectic being employed by the Fed. Hawks out first, exclaiming that further easing is susceptible to 'pushing-on-a-string syndrome' and is potentially inflationary, doves out later making the case for massive unsterilized MBS purchases. Though in August I thought QE3 was coming, I'm beginning to think the 'synthesis' the Bernank is looking for is actually fiscal in nature, with Operation Twist being the monetary facility that makes it possible.

Tarullo is right about one thing - housing is the albatross hanging around the U.S. economy's neck. And so far, QE and HARP haven't done much to get it going.

I think the Bazooka will be here shortly, in the form of an unprecedented home loan modification program. The exact details no one can know, but I think it will allow underwater homeowners who cannot currently refinance their homes to do so, perhaps without having to shorten the duration of their mortgages. For argument's sake, say it's up to the value of the underwater part of their mortgage.

The Twist then takes on a considerably more important role than lowering long-term rates (allowing those who benefit least from refinancing to do so, more importantly buoying the still MASSIVE amount of toxic MBS held by FANNIE/FREDDIE/Countrywide), effectively monetizing the underwater part of peoples' mortgages. From the Fed's perspective, this could be THE panacea.

The kicker is we have 40-50k troops coming home, many of whom have been away for a long time and are in relatively good financial positions (rel good meaning net credit better than -100%...). Really interesting....potential game changer and could spark a paradigm shift in markets and even the real economy over the short to intermediate term (though costs will surely outweigh benefits in LR. I'm an Austrian economist, please see note below...). The day after Tarullo's comments, markets acted in a very QE-fashion. But QE as we've known it is not coming. Could be the ultimate wolf in sheep's clothing.

Would love to hear peoples' thoughts on this. Think it could be done without legislation (i.e. through FHFA mandated relaxing of refi standards)? If not, could congress get something like this through?

For the love of Science though, please don't comment on how this will expedite the implosion of the U.S., effects of a discontinuous rate increases, generally crazy conspiracy theory talk. I'm aware and agree with most of it, but am firmly of the belief that when it comes to markets, what everybody's looking for doesn't tend to materialzie. And, for better or worse, we're a long way off from our day of reckoning. USD doesn't lose reserve status for years thanks to the EUR crisis, which will take as much time to truly 'resolve' itself to the point of EM CBs' liking. 

Mon, 10/24/2011 - 00:41 | 1803453 jomama
jomama's picture

astute observations, but i can't help but wonder what the actual percentage of people underwater still paying the mortgage on their loans can be? 

additionally, troops coming home with good credit doesn't mean much if there are no jobs.  my cousion who served two tours in the army still hasn't found a job, and it's been over a year.

there is still the issue that housing is grossly overpriced, and with millions of homes in shadow inventory, the only ultimate solution that i can see is for the prices to correct. big time.

p.s. i wouldn't bet the farm on not losing reserve status simply due to europe's woes.

 

Mon, 10/24/2011 - 10:14 | 1804128 El Yunque
El Yunque's picture

I know more than a few folks with credit scores in the 800+ range that can't get banks to call them back on refi's right about now, and I have a few friends returning from foreign wars that ain't any where close to that: They can even go into the banks.

Seems the banking business has the same problem as the insurance business, as the average redneck; "Yes, we have no banana's, our gorillas ate them all..."

How high can you stack a nine-deck shoe in a light breeze?

Mon, 10/24/2011 - 00:47 | 1803459 CitizenPete
CitizenPete's picture

Housing issue: Refer to Demographics. 

Mon, 10/24/2011 - 06:01 | 1803652 Shylockracy
Shylockracy's picture

The dialectic used is not "Hegelian" in the least. Rather, it is yeshivan pilpulism. Know the technique, hedge accordingly.

Mon, 10/24/2011 - 01:41 | 1803485 hyper-critical
hyper-critical's picture

@jomama - completely agree that troops returning doesn't help the jobs issue in a direct way, but injecting the kind of equity into lower/lower-middle/middle class households that this program would could have a huge impact on the jobs market (reduced slack, increased mobility, and an actual wealth effect). And a bail out for Main Street might be the only legislation that has the chance of passing this ridiculously divisive congress.

Re shadow inventory, again, completely agree. Market needs to clear (most efficient way would be a deflationary contraction, but come on, we all know that's not going to be allowed to happen...), and perhaps artificially suppressing rates like this manipulates the NPV of projects to buy up and destroy/repurpose some of that inventory to a meaningful extent. We have a pledge on s-t rates, and it looks like l-t rates will be incredibly low for some time as well. Interesting to see GE Capital made a substantial commercial real estate loan ($800B) for the first time since '08. That, Bill Gross' activity (I can't imagine him making a potentially career-ending bet if he had any doubt the gov't was going to act after his horrendous short treasury trade), and still enormous reserves of sovereign wealth funds leaves open at least the possbibility for progress on this front. But yea, vacant 80,000 units off Rt. 80 in FL definitely pose a huge problem...and I'm not convinced gov't has the cojones to burn it down...

Hadn't really considered the impact of your first point. Not sure how this kind of a program would deal with them.

My position on reserve status is one of timing...I agree that it's a matter of when, not if. Shouldn't have included that in the post, but as it pertains to this, I bet it's a serious consideration for the Fed, as in their opinion the European sovereign mayhem makes it less of an acute threat. In the l-r, I bet they're counting on Europe eventually resolving itself (even if through Civil War...lol), and the dollar devaluing precipitously, to help the 'global re-balancing' and bring manufacturing to America. Having the arrogance to think you can fine-tune the economy is truly priceless...

Mon, 10/24/2011 - 03:33 | 1803596 Belarus
Belarus's picture

Markets all around the world LOVIN' Summit details. Melt-up continues. 

Mon, 10/24/2011 - 05:14 | 1803640 nah
nah's picture

next week the world gets a basic math lesson... anything that costs alot of money

.

is very good

Mon, 10/24/2011 - 05:33 | 1803645 falak pema
falak pema's picture

Here is a nice trend to follow in the future :

Cheap Solar Panels Are Bad For Solar Panel Companies But Great For U.S. Energy

Read more: http://www.businessinsider.com/cheap-solar-panels-boom-2011-10#ixzz1bgpeQNUY

The high costs that for years made it impractical as a mainstream source of energy are plummeting. Real estate companies are racing to install solar panels on office buildings. 

Read more: http://www.businessinsider.com/cheap-solar-panels-boom-2011-10#ixzz1bgpzxhIX

@NAH : is this an example of your thesis or a response as we move down the cost curve? Time frame is essential to understand capital and return on investment. And getting out of the Mid-East peak cheap oil stranglehold. MEGA strategic challenge to western world; as to the new developing world.

Mon, 10/24/2011 - 07:56 | 1803738 Mr. Lucky
Mr. Lucky's picture

Australia Q3 CPI: We expect 3.5%yoy, in line with consensus after 3.6% in Q2.

Lets see what impact their new carbon tax has.

Mon, 10/24/2011 - 10:54 | 1804292 El Yunque
El Yunque's picture

I really don't know a hell of a lot about all of this, but as I look at Operation "Twist" as floated by our banking and political "elite," and I use the term loosely, in trading short bonds fer long'uns' (I'm a redneck from Texas, and a long bond is usually a marriage that lasts through four double-wide foreclosures, a domestic disturbance call and at least two instances of perforating said home with .38 holes), I see that perhaps HeloBen is just greasing the skids with low long term interest hold down as a way to drop dollars from the heavens over the continent on the other side of the pond when the rotted pig being readied for the spit, complete with lipstick and a nice brown sugar glaze, falls off said spit into the inferno of debt financed countries that have more zero's in wealth on computer screens than actaully exists on terra firma.

It would be sweet if the Laffer curve really worked here: Lowering taxes, increases revenue, which would imply that zero taxes would mean inifinte supplies of money for governments to pay out in mob-based interest rates, which in turn made more zero's appear on their terminals.

As Ann Richards used to say, "That dog won't hunt..."

I'm sure someone out there is going to find yet another interesting way to spin dog turds into gold here. It's just a short trip in verbage here from "debt" to "equity."

And as I think about that, I'm reminded of the picture I've seen of a giant earth mover: "Fuck the harpoons, Man the giant fuckin' saw thing."

Dig baby, dig. First rule of holes; when you're in one, quit digging. But for these "elite," it's always looking for the bottom, while staring at the upside.

Meanwhile, I'll be patching some holes in my double-wide and having some Jack. I'm pretty sure it will look good through my Jack goggles on any station that's "print to fit" news.

Huzaa and clink. Where'd I put my gun...

Mon, 10/24/2011 - 11:11 | 1804368 El Yunque
El Yunque's picture

I forgot to mention in my post previous, a Texas rule for guys like me standing around with shovels: If you're holding one, you're probably standing on someone else's hole, albeit you'll be the one removing it's contents.

Cool Hand Luke, I love you brother; and I have a large pipe cutter, in case anyone wants to go to Chicago and start cutting down parking meters.

Huzaa, and take that you frigging SWF's, I'll have my day in your hole.

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