China

Why are the worlds’ most successful investors having so much trouble lately? The short answer is that the markets they used to understand have been replaced by something very different. In this new, post-market world, money managers can’t separate signal from noise and end up on the wrong end of wild swings in commodities, currencies and interest rates. And now their clients are figuring this out.

Eighty-five years after the birth of French filmmaker Jean-Luc Godard, and the crude complex is acting suitably surreal today. As expected, rhetoric is ratcheting up out of Vienna ahead of tomorrow’s OPEC meeting, with the crude market shaken up like a snowglobe.

“Was there a link to terror?” That’s the question Americans are asking themselves the morning after a husband and wife opened fire with assault rifles killing 14 and wounding 17 at a San Bernardino County employee holiday party. The shooters, Syed Rizwan Farook, 28, and Tashfeen Malik, 27, left their young child with Farook’s mother in nearby Redlands on Wednesday morning before dressing in “assault clothing,” and crashing the party (literally).

"Given the surge back towards the all-time highs in the S&P 500, we think that the best might be over for US equities and that indices might range trade more in 2016. We have downgraded US equities to neutral. This takes our overall equity weighting down to neutral, in many respects an extension of what we’ve been doing for most of this year as richer and richer asset markets, against a global background of economic risks, have made us more cautious."

Having ramped its way up to the cliff's edge of China devaluation and Black Monday's free-fall, Germany's DAX has come unbuttoned rapidly with a 480-plus point droip today. Down over 5.5% in the last 3 days, crushed back under 11,000 today with a 3.75% crash - the most since August 24th - all thanks to Draghi over-selling his "whatever-it-takes"-ness... after the Paris Terror attacks.

• Mario Draghi Is About to Become the World's Market Risk Manager (BBG)
• Five Things to Ask Mario Draghi From Negative Rates to QE (BBG)
• Leaving behind baby and bombs, couple sows panic in California (Reuters)
• Couple's motive in California rampage a mystery for police, family (Reuters)
• In Grim Ritual, Barack Obama Again Calls for Stricter Gun Control After Mass Shooting (WSJ)
• Islamic State Defeat Impossible Without Ground Force, Kerry Says (BBG)
• OPEC States Push for Output Cuts in Face of Saudi Opposition (BBG)

Yesterday's market swoon which unwound all of Tuesday's gains on concerns about a hawkish Fed and fears about terrorism in the US, are now completely forgotten, and have been replaced with the latest daily round of pre-ECB euphoria, driven by hopes that Mario Draghi will announce even more dovish details to Europe's Q€ 2 than just a 10 bps rate cut and a boost to QE more than €10 billion, both of which have been already priced in.

There isn’t much as far as confirmation, but it increasingly appears as if “something” just hit the triple hooks (CCC) in the junk bond bubble. At least as far as one view of it, Bank of America ML’s CCC implied yield, there was a huge selloff that brought the yield to a new cycle high (low in price) above even the 2011 crisis peak.

Again, the globalists at the BIS and the IMF require a diminished U.S. dollar, greatly reduced U.S. living standards and a much smaller U.S. geopolitical footprint before they can establish and finalize a single publicly accepted global elitist oligarchy. If you cannot understand why it seems that the Federal Reserve and U.S. government appear hell-bent on self-destruction, then perhaps you should consider the facts and motivations at hand. Then, you’ll realize it is THEIR JOB to destroy America, not save America. When you are finally willing to accept this reality, every disastrous development since the inception of the Fed a century ago, as well as all that is about to happen in the next few years, makes perfect sense. As the U.S. destabilizes, we are not escaping the clutches of the Federal Reserve system, only trading out one totalitarian management model for another.

After days of hazardous pollution forced people to wear masks and huddle indoors, residents of Beijing turned their attention to the mayor, Wang Anshun, and his bold vow last year to clear the air. As JapanTimes reports, Wang said, if pollution wasn’t brought under control by 2017, he would cut off his own head and present it to the country’s leadership. So, imagine his relief, when after pollution levels hit 20x WHO's risk limit, a cold front - as caught on tape below -  swept away the choking smog (and saved his neck).

Just like Chinese Manufacturing, the Services PMI surveys from official sources and Caixin contradict each other. Providng hope for every bull, bear, and greater fool, official government data suggests the services economy is doing great and stimulus is working as it jumps to 4-month highs. However, Caixin's Services PMI shows a sudden drop near 2015 lows suggesting the need for moar stimulus now... take your pick, it's all farce!

The very first major economic collapse in recorded history occurred in 218-202 BC when the Roman Empire experienced money troubles after the Second Punic War. As a result, bronze and silver currencies were devalued. As HowMuch.net depicts in the video below economic collapses date back thousands of years. While many countries today still feel the effects of the most recent Global Financial Crisis, it is important to note that economic troubles are not unique to the present-day, but rather date back to some of the oldest civilizations.

The resistance to such an awakening is understandable if still lamentable. If recession is truly the looming assurance, as it increasingly appears, that would mean not just the end of the recovery but the end of “accommodation” as a given force. In other words, Janet Yellen and the OECD start backwards from their endpoint because of their unshakable faith in monetarism, a faith that actually defines how they think an economy does work (and how they produce the core assumptions in their models); should that path from here to there completely unravel, so, too, does their assumed power and philosophy.

"The US Security Council is requested to form committees to put in effect the previously adopted resolutions on smuggling. According to said resolutions, all involved in these activities, be they individuals, companies or states, will be branded as criminals."