• 09/21/2014 - 14:52
    Dear Janet; If I may be so forward, as a concerned citizen of the Constitutional Republic of the United States, it is with great consternation that I feel compelled to write you this distressing...

China

China
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Jack Ma: If You're Poor At 35, You Deserve It





Jack Ma believes people lose out in life because of these 4 reasons: Being myopic to opportunity, Looking down on opportunities, Lacking understanding, or Failing to act quickly enough. "You are poor, because you have no ambition." Go big, or go home. Otherwise, you’re wasting your youth.

 
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The Geopolitical Situation In Europe





After the end of the cold war, the United States dominated world affairs for nearly twenty years. However, the situation of a unipolar world has changed since the financial crisis of 2008 to a now multipolar world that includes China, Russia, India, Brazil and South Africa. These powers are influencing and manipulating the conflict zones we have today to their advantage. By analysing and dissecting the issues concerning the major conflict zones on our world map, as well as illustrating the parties involved, this article will explain what political and strategic interests are at play and how the development in major hotspots shape the big picture. This will identify the geopolitical forces that affect the European continent and what future concerns and worries await us.

 
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Death-Crossed Russell Suffers Biggest 2-Day Plunge In 5 Months





Death crosses; Hindenburg Omens; PBOC, BOJ, and ECB hinted at removing the punchbowl; crappy US housing data; and a Chinese IPO takeout hangover weighed on stocks with Russell 2000 the biggest loser (suffering its biggest high-to-low drop from Friday in over 5 months). The Dow is the only index holding post-FOMC gains (Russell down over 2%). Homebuilders are now down 4% from last week's FOMC statement, post-FOMC high-flyer financials have tumbled red (catching down to credit), and only safe-haven healthcare is holding any gains post-FOMC (Biotech -3%). Treasury yields fell led by the short-end (3Y -3.5bps, 10Y -2bps) back under FOMC levels. The USD recovered European session losses to end almost unchanged as considerable AUD and CAD weakness outweighed GBP strength. Despite being clubbed like a baby seal in Asia, Silver rebounded through the day to end -0.3%, gold unch, oil down, and copper -1.6% as China stimulus hopes faded. S&P 500 lost 2,000; Russell is down 2.6% year-to-date (-6.8% from July highs); VIX jumped most in 2 months to ~14. BABA pinned at $90, HLF smashed -10%.

 
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They Do Ring A Bell At The Top: Alibaba Proves Wall Street Is Off Its Rocker





So with regards to BABA’s $230 billion market cap at week’s end, you can say this: None dare call it price discovery! What it shows is that Wall Street is well and truly off it rocker. The Chinese swindlers behind BABA didn’t even have to tap their home market. These preposterously over-valued shares were sold overwhelmingly to Wall Street - to the gamblers, speculators and robo-traders that have occupied what was once a reasonably honest capital market. So why did Wall Street capitalize an opaque mass merchant operating in a precarious economy at 27X sales?  The answer is that Wall Street is a momentum driven casino that is now over-valuing everything that moves and all that stands still. That’s the ultimate evil of monetary central planning. Having destroyed honest price discovery in the financial markets, the Fed now “accommodates” the speculators one meeting at a time - in deathly fear of a hissy fit.

 
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China's Economy Slams On The Brakes: 30% Of Coal Miners Unable To Pay Employees On Time





More than 70 per cent of the country’s coal miners were losing money and had cut salaries. Translated: widespread wage deflation, in a country where M2 is expected to grow at a double digit pace. And the really bad news: "About 30 per cent of the industry’s miners had not been able to pay their employees on time and a further 20 per cent had cut salaries by more than 10 per cent, the Economic Information Daily, a Xinhua-affiliated newspaper, reported on Monday."

 

 
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Albert Edwards Presents "The Most Important Chart For Investors"





Which incidentally has nothing to do with stocks or bonds, and everything to do with all-important FX. To wit: "If a clear break in the yen downwards against both the dollar and euro is occurring, not only will this spell trouble for the beleaguered Chinese economy and exacerbate deflation in the west, but it will also break the spell of German economic dominance"

 
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Mario Draghi's Lies Annotated, And A Brief Glimpse At The Truth





Moments ago, the Goldmanite in charge of the European Central Bank delivered yet another speech, this time seeking to offset some of the hawkish comments over the weekend from his comrades, all of which suggested that no more easing, or public QE, was coming any time soon. It was, as usual, full of the same lies that have pushed European stocks to highs not seen since Lehman even as Europe's economy is now slumping into a triple-dip recession. Here is a choice selection of his comments, properly annotated.

 
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Key Events In The Coming Week





With the snoozer of an FOMC meeting in the rearview mirror, as well as Scotland's predetermined independence referndum, last week's key events: the BABA IPO and the iPhone 6 release, are now history, which means the near-term catalysts are gone and the coming week will be far more relaxed, if hardly boring. Here is what to expect.

 
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Despite 'Record' Opening Weekend, Goldman Fears "The iPhone Effect" On Retail Sales May Disappoint





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.

 
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G-20 Post Mortem: Hopes, Fears, & Dashed Exepctations





We, like Bloomberg's Richard Breslow, were bemused this weekend by the communiques from the wisest men in the room at the G-20 meeting. On one side of their mouths they warned of "excessive risk-taking," in markets noting that there were "mounting economic risks" also. On the other hand, stories continue to print of US equity strength implying optimism over global growth - despite the ongoing collapse in consensus GDP expectations. However, away from this hope and fear, it was the almost coordinated responses of the PBOC (Chinese Finmin Lou Jiwei signaling not to get carried away with stimulus expectations), ECB (Visco saying may not need additional QE step since EUR had dropped 'enough'), and finally the BOJ (Iwata saying Abenomics misunderstood, USDJPY 90-100 'fair); all dashing market expectations of a smooth hand over from a feckless Fed to a free-printing rest-of-the-world. Stocks (and carry) responded by selling off.

 
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Frontrunning: September 22





  • Quid pro quo Clarice: Iran seeks give and take on Islamic State militants, nuclear program (Reuters)
  • Alibaba’s Banks Said to Boost IPO Size to Record $25 Billion (BBG)
  • European Stocks Fall Amid China Concern as Tesco Slides (BBG)
  • Tesco Suspends Executives, Probes Error That Triggers New Profit Warning (WSJ)
  • Kurds say they have halted Islamic State advance on Syrian town (Reuters)
  • Because luck and managing money is genetic: Financial Elite's Offspring Start Their Own Hedge Funds (WSJ)
  • Islamic State Onslaught Spurs Mass Exodus of Syrian Kurds (BBG)
  • Rockefellers, Heirs to an Oil Fortune, Will Divest Charity From Fossil Fuels (NYT)
 
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US Equity Futures Slide Under 2000, Recover Losses After USDJPY Tractor Beam Reactivated





While some were wondering if last night's sudden, commodity-liquidation driven selloff would last, most were not, expecting that the perfectly predictable levitation in the USDJPY around a round "tractor beam" number would provide a floor under the market .Sure enough, starting around midnight eastern, the USDJPY BTFDers emerged, oblivious to comments from former BOJ deputy governor Iwata who late last night said the obvious, and what we have been saying since January 2013, namely that a weak yen puts Japan at recession risk, and that a USDJPY in the 90-100 range reflects Japan fundamentals. And, as expected, the 109 level is where the algos have hone in today as a strange FX attractor, which also means that ES has reverse sharper overnight losses and was down just 7 points at last check even as the poundage in the commodity sector continues over rising fears of a sharp Chinese slowdown driven by its imploding housing sector (most recently observed here) without an offsetting stimulus program, following several comments by high-ranked Chinese individuals who poured cold water on any hopes of an imminent Chinese mega-QE or even modest rate cut.

 
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Liquidations Continue: Stocks, Dollar Slide, Precious Metals Pounded In Asia Trading





Markets are very active in the early Asian trading session (following the G-20-'s warnings over excess risk-taking). Precious metal liquidations continue with silver bearing the brunt (back below pre-Lehman levels) and gold down modestly. Stocks from China to US are all down notably too. The USD is weakening as EUR strengthens on the back of ECB comments about the possibility of no more stimulus and chatter that the PBOC may be selling USDs. Treasury yields are down (having retraced all FOMC losses). Iron Ore futures in Singapore just hit a record low below $80.

 
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The PetroYuan Cometh: China Docks Navy Destroyer In Iran's Strait Of Hormuz Port





Since China fired its first 'official' shot across the Petrodollar bow a year ago, there has been an increasing groundswell of de-dollarization across the world's energy trade (despite Washington's exclamations of 'isolated' non-dollar transactors). The rise of the PetroYuan has not been far from our headlines in the last year, with China increasingly leveraging its rise as an economic power and as the most important incremental market for hydrocarbon exporters, in the Persian Gulf and the former Soviet Union, to circumscribe dollar dominance in global energy - with potentially profound ramifications for America’s strategic position. And now, as AP reports, for the first time in history, China has docked a Navy Destroyer in the Southern Iranian port of Bandar-Abbas - right across the Straits of Hormuz from 'US stronghold-for-now' Bahrain and UAE.

 
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The US Ponzi Economy





When the most persistent, most aggressive, and most sizeable actions of policymakers are those that discourage saving, promote debt-financed consumption, and encourage the diversion of scarce savings to yield-seeking financial speculation rather than productive investment, the backbone that supports a rising standard of living is broken.

 
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