Brazil

Just a day after a dismal read on GDP, the latest data out of Brazil shows a spike in both inflation and unemployment, as the country's economic outlook continues to deteriorate at an alarming pace.

The Fed has created a dead end street for everyone not in their .1% clientele... We’re all muppets to the banking cabal running this morally and financially bankrupt military empire of debt.

Today’s financial world is a tough place for the average person but paradise for rich guys. As easy money raises asset prices, the owners of those assets make effortless profits. Then they buy expensive toys and trophy properties. Hence the recent boom in fine art, high-end real estate, yachts and private jets. But like all financial trends, this one has a limit, and that limit is now in sight. The 1%, it seems, is rolling over...

Well, we got a look at the IBC-Br monthly real GDP indicator on Wednesday and as you can probably imagine given the stagflationary nightmare currently unfolding in Brazil, the picture was not pretty. If fact, we just witnessed the largest Y/Y contraction in series history.

"The equilibrium, for now, is QE infinity – but political risk could be the breaking point"...

Amid souring bets on Brazil and the general malaise across EM, PIMCO has been dethroned as the king of emerging market bonds. A fund run by Ireland-incorporated Stone Harbor has overtaken PIMCO's EM Local Bond Fund as the world's largest emerging market fixed income fund by AUM as rollercoaster bets on Brazil and the departure of both El-Erian and Gross weighs on investor sentiment.

BlackRock Inc., the world’s largest asset manager, is winding down a global macro hedge fund after losses and investor redemptions eroded assets. The reason for the liquidation: losses of 9.4% this year, cited by Bloomberg according to an October investor document, leading to the worst year for the asset manager since inception in 2003. The fund, which had $4.6 billion in assets just two years ago, has shrunk to less than $1 billion as of Nov. 1.

Bombing wont stop them; it will just make more of them. Ironically, what can stop them is the Assad government and the ground forces of its Hezbollah and the Iranian Republican Guard allies. Its time to let them settle an ancient quarrel that has never been any of America’s business anyway. But Imperial Washington is so caught up in its myths, lies and hegemonic stupidity that it can not see the obvious. And that is why a quarter century after the cold war ended peace still hasn’t been given a chance and the reason that horrific events like last week’s barbarism in Paris still keep happening.

Brazil is expected to increase oil production by 180,000 barrels per day in 2015, hitting 3.04 million barrels per day (mb/d). But 2016 is a different story. Petrobras has been embroiled in a corruption scandal since last year, which has cost the company tens of billions of dollars. Given that Petrobras was already the most indebted oil company in the world, major cut backs in spending were in order. OPEC sees Brazilian oil production plateauing as soon as next year. That is a pretty significant development considering the fact that, not too long ago, Petrobras thought output would continue rising rapidly through the rest of the decade.

The Trade-Weighted US Dollar has risen almost 19% over the past 18 months - the fastest pace of increase on record - and is now at its highest level since 2003. As we noted previously, this is not unequivocally good for American corporate profits... and if you believe The Fed's Stan Fischer - the worst effects of this soaring exchange rate are yet to come... Most of the impact of exchange rate moves come after that first year. So we’re only just getting into the business end of the impact of the dollar’s strength on the US economy. And the Fed are about to hike?

• France, Russia strike Islamic State in Syria, EU aid invoked (Reuters)
• Pressure Grows for Global Response Against Islamic State After Paris Attacks (WSJ)
• Weakened Hollande Faces Election Backlash in Wake of Attacks (BBG)
• French Official Calls for Metal Detectors at Train Stations (NYT)
• Belgium Raises Terror Threat Level, Cancels Soccer Game vs Spain (BBG)
• Foreign Companies Scrap Paris Events After Terror Attacks (BBG)

America’s leading Sunni ally is proving how easily hubris, delusion, and old-fashioned ineptitude can trump even bottomless wealth.

"We expect the economy to continue to face strong headwinds from higher interest rates, exigent financing conditions, high inflation, significant labor market deterioration, higher levels of inventory in key industrial sectors, higher public tariffs and taxes, high levels of household indebtedness, weak external demand, soft commodity prices, political uncertainty, and extremely depressed consumer and business confidence."

Brutal news is pouring in from pretty much everywhere. The world, in short, is rolling over. Debt monetization on the scale so far attempted has failed to stop the implosion of tens of trillions of dollars of bad paper, growth has stalled and geopolitics has begun to turmoil. And none of this is a surprise. It’s just what you get when you put monetary printing presses in the hands of governments and/or big banks.