PIMCO

The 2008 global financial crisis was centered on mortgage debt. There was too much of it that couldn’t be repaid. When the value of the collateral – homes – headed down, the bubble popped. Today, consumers have about the same amount of debt. But now the excesses are in auto loans and student debt... and again, the collateral is falling in value.

• Jobs Report Could Seal the Deal on Rates (WSJ)
• The Jobs Report and the August Curse: Jobs Day Guide (BBG)
• Migrants hold out on Hungarian 'freedom train'; Orban says millions coming (Reuters)
• Migrant Crisis Divides Europe (WSJ)
• German industry orders fall in July on weak foreign demand (Reuters)
• Alibaba’s Jack Ma, Joe Tsai to Borrow $2 Billion Against Shares (WSJ)
• U.K. Retailers Post Worst Sales Decline Since Financial Crisis (BBG)

In the event you were becoming concerned that the U.S. government might be backing away from its longstanding policy of endless violence, militarism and bloodshed, fear not. If we know one thing for sure, it’s that defense contractors and the military-intelligence-industrial complex must earn. And continue to earn it will.

"The future is unknown and we are not dealing with markets that are free markets anymore...now we have government interventions everywhere. [But] in the last say twelve months, I have observed an increasing number of academics who are questioning monetary policies. That's why I think they will take the gold away and go back to some gold standard by revaluing the gold say from now $1000/oz to say $10,000 dollars. An individual should definitely own some physical gold. The bigger question is where should he store it? because... the failure of monetary policies will not be admitted by the professors that are at central banks, they will then go and blame someone else for it and then an easy target would be to blame it on people that own physical gold because - they can argue - well these are the ones that do take money out of circulation and then the velocity of money goes down - we have to take it away from them... That has happened in 1933 in the US."

• July job gains may favor September interest rate rise (Reuters)
• It's all about Trump at raucous Republican debate (Reuters)
• The 5 Most Important Takeaways From the First Debate of 2016 (BBG)
• Republican presidential candidate Carly Fiorina wins the Web (Reuters)
• Hedge Fund Losses From Commodity Slump Sparking Investor Exodus (BBG)
• Winners and losers from the first Republican presidential debate (WaPo)
• Bush turns in workmanlike debate performance, but will it be enough? (Reuters)

What the data does suggest is while the BEA can change the methodology for calculating economic growth, a change in the "math" does not change the "reality."

Reuters has taken an in depth look at Illinois' sprawling bureaucracy and discovered that the state "is home to nearly 8,500 local government units" which helps to explain why "the average homeowner pays taxes to six layers of government, and in Wauconda and many other places a lot more." The story also sheds quite a bit of light on why the state's fiscal crisis may ultimately prove to be intractable. 

• Unhappy Voters Shake Up Presidential Race (WSJ)
• China stock exchanges step up crackdown on short-selling (Reuters)
• China Dethroned as World’s Most Liquid Stock Market After Curbs (BBG)
• Xiaomi retakes the smartphone lead in China as Apple slips (Engadget)
• Impact of EPA’s Emissions Rule on Industry to Vary (WSJ)
• Citadel’s Ken Griffin Leaves 2008 Tumble Far Behind (WSJ)
• Greece says expects bailout deal by Aug 18 (Reuters)

Junk-rated Chicago is paying nearly 8% to issue debt these days and although the city's fiscal woes are set to persist, some asset managers are taking the plunge ahead of a key court ruling scheduled for Friday.

As the following chart shows, with $203 billion in investible dry powder which is probably the best way of calling AAPL's cash the Cupertino-based company is more than $30 billion larger than what is generally accepted to be the largest hedge fund in the world, Ray Dalio's Bridgewater, which however "only" managed some $171 billion as of May 2015.

"Mr. Jain created an environment by the physical and functional restructuring of the business GFFX division in the year 2005, involving also a change in the seating order of the trading floor in London which he initiated in which conflicts of interest between traders and submitters arose or were strengthened. There is suspicion that Mr. Jain might have knowingly made incorrect statements in his IBOR related Interview with the Deutsche Bundesbank."

"Mr. Jain created an environment by the physical and functional restructuring of the business GFFX division in the year 2005, involving also a change in the seating order of the trading floor in London which he initiated in which conflicts of interest between traders and submitters arose or were strengthened. There is suspicion that Mr. Jain might have knowingly made incorrect statements in his IBOR related Interview with the Deutsche Bundesbank."

You might be tempted to suspect that the inevitable unwind of a completely unsustainable margin mania is to blame for the brutal selling that has cost Chinese shares some $3.5 trillion in market value over the last three weeks. But you’d be wrong, according to several Chinese newspapers. 

Germany’s financial regulator says departing Deutsche Bank co-CEO Anshu Jain may have lied to the Bundesbank about LIBOR manipulation when he apparently denied having any knowledge of rumors that the fixes may have been fixed (so to speak) even as his inbox told a different story.

Chaos reigns, with contradictory headlines pushing and pulling futures in any one direction, only for the next headline to undo the previous one. And only headline scanning frontrunning algos have any chance of trading any of this...