Eurozone

For those unaware, a fifth of Spain's GDP is voting on whether to secede from the country on Sunday. Here is everything you need to know about the Catalan black swan.

With deflationary pressures rising in the Eurozone, Japan and China, the Affordable Care Act levying higher taxes on individuals, and labor slack remaining stubbornly high, a continuation of a "struggle" through economy is the most likely outcome. This puts overly optimistic earnings estimates in jeopardy of being lowered further in the coming months ahead as stock buybacks slow and corporate cost cutting becomes less effective.

News That Matters

In the aftermath of Yellen's "hung hold" decision, which left the world confused if the economy is getting better or worse, global equity markets proceeded to take both Europe and Japan to task, trying to push one of the last two remaining central banks to boost their QE. And until this morning it was unclear who was going to take the lead. Then, following comments over the past several hours from ECB governing council members Ewald Nowotny and Bostjan Jazbec, as well as a well-directed leak via Market News, we got confirmation that anyone hoping for Mario Draghi to blink first may be disappointed this time around.

In many ways, the overnight market has so far been a reversal of yesterday, when a stable Asia session (with China stocks rising) gave way to a European tumble which in turn dragged the US lower.

While Asian trading overnight started off on the right foot, chasing US momentum higher, things rapidly shifted once Europe opened as attention moved back to global growth fears, global central banks losing credibility, as well as miners and the ongoing Volkswagen fiasco.

Having accurately foreseen the current events instead of just levering up on even more beta and praying the BTFDers return and bail out his underwater positions, John Burbank's opinion actually matters as does his outlook on what happens next. What he foresees is not pleasant.

• Fed is out so...BOJ brainstorms stimulus overhaul as options dwindle (Reuters)
• And... Yellen Pause Ups Pressure on Draghi as Global Pessimism Mounts (BBG)
• But... Eurozone Nears Limits of What Monetary Policy Can Do (WSJ)
• Global shares struggle on global growth concerns (Reuters)
• VW's Emissions Cheating Found by Curious Clean-Air Group (BBG)
• David Cameron allegedly fucked a dead pig's head (Mirror)

After sliding early in Sunday pre-market trade, overnight US equity futures managed to rebound on the now traditional low-volume levitation from a low of 1938 to just over 1950 at last check, ignoring the biggest single-name blowup story this morning which is the 23% collapse in Volkswagen shares, and instead have piggybacked on what we said was the last Hail Mary for the market: the hope of more QE from either the ECB or the BOJ. Tonight, it was the latter and while Japan's market are closed until Thursday for public holidays, its currency which is the world's preferred carry trade and the primary driver alongside VIX manipulation of the S&P500, has jumped from a low of just over 119 on Friday morning to a high of 120.4, pushing the entire US stock market with it.

Greece went to the polls on Sunday with a choice that really wasn't a choice and even as Alexis Tsipras looks set to prevail the most shocking electoral outcome is this: neo-Nazi Golden Dawn is set to come in third and garnered the most support of any party among Greece's unemployed.

Europeans are caught between being compelled to help - on what is truly a humanitarian catastrophe - and dealing with the uncertain consequences of bringing in such a large number of people. Part of that anxiety relates to the fact that the majority of those migrants adhere to Islam, where its relationship with Europe has been uneasy for many centuries. However, framing the debate in religious terms is too simplistic and overlooks some important facts. Whatever your view is, one thing is clear: Europe will never be the same again.

"Asia banks indicate in coming weeks markets at early stage of crisis; Q3 EPS shows recessionary global economy. Crowded Discretionary, Banks, Tech & Eurozone most at risk should peak liquidity coincide with EPS recession, SPX<1870, GT30<2.8%, DXY<93...at least until new extreme policies introduced (Fed QE4, China QE1 or a G7 shift toward fiscal policy stimulus)."

Don't look now but Greece (remember them?) is headed back to the polls on Sunday in an election that pits a watered down version of Alex Tsipras and Syriza against the conservative New Democracy. With Syriza's original vision relegated to the realm of "wishful thinking", Greeks face a choice that really is no choice at all.

What was one "one and done", just became "none and done" as the Fed will no longer hike in 2015 and will certainly think twice before hiking ahead of the presidential election in 2016. By then the inventory liquidation-driven recession will be upon the US and the Fed will be looking at either NIRP or QE4. Worse, the Fed just admitted it is as, if not more concerned, with the market than with the economy. Worst, suddenly the market no longer wants a... dovish Fed?