On the subject of High Frequency Trading, our respondents are thus far unimpressed with the argument that HFT helps U.S. equity market participants. Fully half answered that it is “Harmful” or “Very Harmful”. Only 19% said it was “Helpful” or “Very Helpful” to participants. ... In short, the survey seems to tell a very clear story. Most professional investors and institutional brokers do not feel that markets treat all participants fairly. They worry about how fragile markets might become during periods of abnormally high volume. At the same time, they are cautiously picking their way through the minefield in which they find themselves and are unsure what role regulators should play. How the landscape will change as a result of their unease is still unclear. What is certain is that change is coming.
A ‘Perfect Storm’ of demography and debt will economically and financially doom almost every country on earth. It will be TEOTWAWKI – ‘The End Of The World As We Know It’. No, it’s not the end of life or even the end of civilization. However, when it’s all over, nothing will ever be the same and that includes the disappearance of much of the middle class. The good news - The storm won’t last forever. The bad news is there will be much more pain before it ends unless you make an effort to understand what’s happening and why.
Since the centrally-planned market is so broken it no longer has the capacity to evaluate and respond to any geopolitical threats and shocks, here - lest anyone think that with the S&P a hair away from all time highs there is nothing to worry about - is a summary of all the simmering, and in some cases, searing and/or scorching geopolitical conflicts and other tensions around the world including Ukraine, Hamas, the US-Japan defense treaty, Syria, South Sudan, Catalonia, Scotland, Thailand, Nigeria, Turkey, Venezuela, Ivory Coast, Bolivia, South Africa, Argentina, Brazil, Tunisia, Yemen, Libya, Iraq, Lebanon, Bahrain, Algeria, Pakistan, Moldova, Cyprus, Bosnia and Herzegovina, Greece and more.
The figures are out and it looks like the United States exported a record amount of gold to Hong Kong in January. Not only is this 3 times more gold exported than January 2013 (17 mt), it was 84% more gold than the record month set in August (31 mt). As we can see, gold bullion is fleeing the U.S. and heading to the East. Again... that 57 mt figure is just gold bullion. As the West continues to play games with Monopoly money and Derivatives manufacturing, the East accumulates as much gold as it possibly can. While Main Stream Media and its Banker cohorts release bearish $1,050 price targets for gold, the Asians and Indians smile as they build the largest amount of gold stocks in the world.
If this evening's data from Tokyo on April's Consumer Price Inflation is any guage on the national inflation picture, those hoping for moar stimulus had better start praying for war. Thanks to favorable comps and the April 1st tax rise, Tokyo CPI jumped to 2.9% YoY - its highest since 1992 - and well above the BoJ's 2% inflation goal. Mission accomplished (almost)... except that the economy just won't play ball and now stocks are fading too (along with Abe's approval ratings).
Who can forget the amazing story of Alex Hope which was all the rage two years ago? Probably everyone. So here is a timely reminder because as it turns out young master Hope, who struck the proverbial gold at the tender age of 23, was nothing more than the latest Ponzi schemer whose only success in life was finding the absolute, and quite rich, idiots who believed his lies. Well, that, and being able to transform himself from a catering manager working at Wembley Stadium into an FX trader.... even if a fake, criminal and absolutely terrible FX trader.
This should be good... how will Kerry explain the 2nd warship in the Black Sea and Poland troops as non-escalation but Russia military exercises as escalation when Ukraine has now re-launched its anti-terrorist operations...
Andrew Haldane, who is well known among readers as being one of the most outspoken and truthy central bankers in the world, will become Bank of England's Chief Economist in June. That fact is what makes his comments - however factually honest - extremely uncomfortable for the Keynesian status quo DSGE modelers alive and well in every central bank in the world. To summarize his thoughts in the following letter - the models are useless and it's time to rethink everything...
You just can’t make this stuff up. A few days ago the President of the United States signed into public law bill S. 2195, now known as Pub.L. 113-100. The law aims to “deny admission to the United States to any representative to the United Nations who has been found to have been engaged in espionage activities or a terrorist activity against the United States and poses a threat to United States national security interests.” In other words, if the US government thinks that if you have been spying on the United States, then they won’t let you in the country. Gee, let’s think for a moment - who has been engaging in espionage against the United States? Anyone? Ah, right. The US government. Mr. Obama himself.
Euphoria over Apple channel-stuffing and non-GAAP magic for Facebook quickly turned into the HFT-liqudity-providers nightmare as rumors of an emergency Putin press conference sent USDJPY tumbling lower (and therefore US equities). Once the rumor passed - and despite all the facts on the escalation - stocks bounced (especially Nasdaq) to close mixed. S&P and Dow unchish, Nasdaq +0.5%, Russell -0.5%. VIX was in charge in general once the ramp was under-way but even that went into crazy mode as algos lost the plot. Credit markets are "deniers" of the exuberance as are long-end Treasuries which rallied another 2bps and near 10-month lows. Gold was monkey-0hammered early but rallied on Putin's comments and closed unchanged for the week above $1290. Copper rallied notbaly eback above its 50DMA and Oil limped higher as the USD flatlined.
In the last few months, the yield curve spread between 5Y Treasuries and 30Y has collapsed almost 80bps - this is the fastest relative drop since February 2007. The yield curve is down further today - at its flattest since September 2009. As BofAML's Macneil Curry warns, the flattenin trend is ongoing and sees medium-term targets down to 143bps (over 30bps below current levels) which would raise a number of eyebrows among the excuberant equity crowd (and the Spanish bond-buyers).
In an SEC filing today, GM, it appears, has been forced to admit that:
- *GM SAYS FACING RECALL INQUIRES FROM MULTIPLE GOV'T AGENCIES
As WSJ reports, government filing that it is under investigation by federal prosecutors, the Securities and Exchange Commission, a state attorney general, Congress and the National Highway Traffic Safety Administration for its handling of a recent rash of recalls. And furthermore,
- *60 PUTATIVE CLASS ACTIONS SUITS FILED OVER SWITCH RECALL
The company says in the filing it isn't currently able to estimate the potential costs of lawsuits or investigations tied to the ignition recall, but adds resolving the probes could have a "material adverse impact" on the company's finances.
With the "truce deal" laying torn asunder by un-de-escalation by each and every side in this dangerous game of chicken, it now seems even diplomacy is off the table. The Russian foreign ministry reports that the planned on April 23 and 24 telephone conversations between, Minister of Foreign Affairs of the Russian Federation Sergey Lavrov and U.S. Secretary of State John Kerry , unfortunately did not take place for reasons beyond Moscow's control, adding that
- *UKRAINE GETTING DEEPER AND DEEPER INTO CRISIS: RUSSIA
- *U.S. MUST FORCE UKRAINE TO STOP MILITARY PUSH IN EAST: RUSSIA
Ukraine's 48-hour red-line is getting closer and with the UN warning that "the situation could quickly spin out of control with unpredictable consequences," it is perhaps time to derisk a little.