Some British newspapers have declared that “the dream is over” for Scottish independence. That seems hardly likely, unless by “over,” the newspapers mean “over for the next few years.” Europe-wide, the drive for more regional independence and autonomy will only continue to grow as economies stagnate, and as elites from Brussels or Rome or Madrid continue to maintain that they know best. Eventually, the promises of the centralizers will fall on very deaf ears. Even without a majority vote for secession, the campaign for separation from the United Kingdom has already provided numerous insights into the future of secession movements and those who defend the status quo.
Behold Obama’s dream project – a global infrastructure fund. This idea was floated and endorsed at The G-20 in Cairns this weekend. “We have agreed to come away from government-financed growth measures to more private investment,” said Australia’s Finance Minister Joe Hockey. These are being called Public Private Partnerships (PPP), and will be extremely critical in the future for here lies the final destruction of the pension funds precisely as Japan bankrupted the Japanese Postal Saving Fund using that private money for political purposes to try to stimulate the economy, which failed. With PPP, public funds will be sold to the public as being a highly professional long-term investment that will further shrink economic growth and liquidity. They cannot possibly work.
Curious what happens when Goldman writes the script for its central banker alums? This.
- DRAGHI SAYS EXCHANGE RATE IS IMPORTANT, NOT A POLICY OBJECTIVE
- DUDLEY SAYS VALUE OF DOLLAR CAN IMPACT APPROPRIATENESS OF MONETARY POLICY, NOT A POLICY GOAL
At this point one should just laugh.
The exuberant images this weekend of lines-around-the-block at Apple stores were met with triumphant flashing red headlines this morning when Apple announced the sale of more than 10 million iPhone 6 and 6 Plus models (more than expected). Typically, new product launches do not move the needle on aggregate US economic data. Apple’s iPhone has been the most notable exception, with past launches occasionally having a substantial effect on core retail sales. However, Goldman notes, with the launch of the new iPhone 6/6+ this month, estimates (based on historical data) of a 0.1 to 0.7ppt boost to September core retail sales is highly uncertain due to seasonal adjustments that have been highly erratic, and could easily take a big bite out of the Apple effect.
Just two short months ago, Goldman Sachs was exuberant over the 'expansion' signals that the firm's Global Leading Indicator Swirlogram was exhibiting as it confirmed their 'economists' expectations that the Keynesian hockey-stick of hope would once again re-appear majestically in H2 2014 and lift America (and the world) to escape velocity. That dream is over. Confirming the collapse of world GDP expectations, Goldman's GLI has plunged into 'slowdown' with momentum starting to slow. Perhaps, just perhaps, as we noted previously, this time is not different and the annual cycle of extrapolating early-year hope is rapidly turning to late-year disappointment.
Following a plant tour to TSLA, Goldman is confident that the company will meet its 2014 production objectives. However, what keeps them more guarded is the aggressive timetable of the gigafactory as well as a potential escalation of capital needs given the planned capacity ramp, model and derivative expansion, service expansion as well as other undisclosed projects. Simply put, Goldman warns, at the low end of our three disruptive scenarios for TSLA, they see the need for an additional $6bn in capital - and 18% dilution to the current market cap around $33bn. With 3Q likely to be a noisy quarter and shares seemingly baking in flawless execution at present, Goldman remains sidelined for now with a $210 target.
In modern times, war is never what it seems. Mainstream historians preach endlessly about grand conflicts over territory, resources, political impasse, and revenge, but the cold hard reality is that all of these “motivations” are actually secondary, if they are relevant at all. If you really want to understand the past, or the intricacies of war, you will be lost unless you accept that most conflicts are designed; they are not random or natural. They are not the product of too much national sovereignty or individual liberty. No; traditional war is a tool for the organized ruling class. It always has been and always will be.
ECB's First TLTRO A "Failure": European Banks Take Less "Free" ECB Loans Than Worst Case ExpectationSubmitted by Tyler Durden on 09/18/2014 07:01 -0400
As part of Draghi's attempt to reflate the ECB's balance sheet by €1 trillion, a key variable was the extension of the LTRO (1&2) program, in the form of the Targeted LTRO, or TLTRO aka LTRO 3 & 4, whose initial take up results were announced earlier today. It was, in a world, a flop. Because while the consensus was for European banks to take anywhere between €100 and €300 billion in nearly zero-cost credit from the ECB (at 0.15%) to engage in carry trades in today's first round TLTRO operation (ahead of the second TLTRO in December), moments ago the ECB announced that banks, which head already been actively paying down the first two LTRO carry programs, of which only €385 billion had been left of over a €1 trillion total at inception, were allotted a tiny €82.6 billion across 255 counterparties.
When a former Goldman executive and the prior head of its housing research team comes out with a shocking analysis so contrary to what the same individual would do in his "former life" when he would be extolling the "inevitable" rise of home prices from here to eternity and beyond, and also throw in an open letter to none other than president Obama, predicting at least a 15% crash in home prices in the next three years, a move which would without debt catalyze the next US recession, it is time to pay attention. Meet Joshua Pollard, who in February 2009 took over coverage of US Housing at Goldman Sachs. His point, in short: "House prices are 12% overvalued today. They have already started to decline. Today’s misvaluation matches the excess of 2006-07, just before the Great Recession... 5 of the last 7 US recessions were led by a weakening housing market... I am lamentably confident that home prices will fall by 15% within three years." Or, as some may call it, crash.
“It’s a questionably unquestionable situation... Are the markets prepared for a shocking answer... Will Janet Yellen announce the final end to QE? Or electrify the bulls with more accommodation? Can Yellen’s eloquent elocution energize the markets…or will she magnetize the bears? Tune in next time Fed fans... Same Fed time... Same Fed channel”
The financial media has no concern of negative outcomes, Wall Street has growth priced in that has never occurred in history, and there is NO expectation of a recession built into any forward assumptions. We have indeed discovered financial “Utopia,” or at least that is what is currently believe.
The Death Of The Indian and Chinese Gold Markets Has Been Greatly Exaggerated ...
It has been a story of central banks, as overnight Asian stocks reversed nearly two weeks of consecutive declines - the longest stretch since 2001 - and closed higher as the same catalysts that drove US equities higher buoyed the global tide: a combination of Chinese liquidity injection (for the paltry amount of just under $90 billion; "paltry" considering Chinese banks create over $1 trillion in inside money/loans every quarter) and Hilsenrath leaking that despite all the "recovery" rhetoric, the Fed will not be turning hawkish and there will be no change in the Fed language today (perhaps not on the redline but Yellen's news conference at 2:30pm will certainly be interesting), pushed risk higher, if not benefiting US equities much which remains largely unchanged.
The good news is that the rigging of the FX markets - now conspiracy fact, not conspiracy theory - has, according to Bloomberg, forced the world’s biggest banks to overhaul how they trade currencies to regain the trust of customers and preempt regulators’ efforts to force changes on an industry tarnished by allegations of manipulation with the "modernization of processes that probably should have been brought in 15 or 20 years ago." However, the FX market is far from 'clean' as Bloomberg notes, while banks can limit access to details about client orders on their computer systems, they can’t keep employees from talking to one another. Some traders also are still communicating with clients and counterparts at other firms via Snapchat, circumventing their company’s controls right under the nose of the SEC. As one trader commented, "these [reform] changes look like fig leaves."
What if it had gone differently? What if, six years ago, in the throes of the financial crisis, the political leaders in D.C. had decided that enough was enough, and they were going to seize the opportunity to make real and meaningful positive changes?
US Industrial Production and the NY Fed Empire State Manufacturing survey are the two main releases for the US. In Europe, the euro area trade balance will be the notable print. Beyond today, US PPI, German ZEW and UK CPI are the main economic reports tomorrow. Wednesday will see the release of BOE’s meeting minutes, the US CPI, and the Euro area inflation report. On Thursday, President Obama will host Poroshenko and on the data front we have Philly Fed, initial claims, and building permits to watch out for, but the biggest market moving event will surely be the Scottish independence referendum. German PPI will be the key release on what will otherwise be a relatively quiet Friday.