Barclays

There’s a potential black swan event taking place in Turkey on Sunday and no one seems to care. That is, the media isn’t devoting nearly enough coverage to Turkish elections considering the impact the outcome will invariably have on the situation in Syria, on the fate of the lira, and on the Pentagon’s strategy with regard to embedding spec ops with the YPG.

• World stocks on course for best month in four years (Reuters)
• Global Stocks Up Amid Stimulus Hopes (WSJ)
• BOJ Refrains From Adding Stimulus Even as Inflation, Growth Wane (BBG)
• U.S. Avoids Debt Default as Congress Passes Fiscal Plan (BBG)
• China naval chief says minor incident could spark war in South China Sea (Reuters)
• Exclusive Club: No High-Frequency Traders Allowed at Luminex (WSJ)

Venezuela has two immediate bond payments due this and next week amounting to $3.5 billion. Where did the near-insolvent country obtain the funds needed to make these debt payments? The answer: it has been dumping its gold, which its former ruler Chavez worked hard in 2011 to repatriate from London, and which its current president Maduro, just four short years later, is busy sending back to its creditors.

• Fed puts December rate hike firmly on the agenda (Reuters)
• Charting the Markets: A More Hawkish Fed Rattles Investors (BBG)
• China to modernize and improve fiscal and tax systems (Reuters)
• Deutsche Bank to Cut 35,000 Jobs in Overhaul (WSJ)
• Deutsche Bank Said to Near $200 Million Sanctions Settlement (BBG)
• Barclays profits drop as it abandons cost-cutting targets (FT)

Based on the overnight market prints which are an oddly reddish shade of green, it took algos about 12 hours to realize that the reason they soared for most of October, namely hopes of an easier Fed which were launched with the terrible September jobs report and continued with increasingly worse US economic report in the past month, can not be the same reason they also soared yesterday after the announcement of a more hawkish than expected Fed statement which envisioned a stronger US economy and a removal of foreign considerations, which even more curiously took place on even worse data than the Fed's far more dovish September statement.

• Global shares rise as Riksbank helps ease Fed wait (Reuters)
• Asian Stocks Retreat Before Fed as Material Shares Lead Losses (BBG)
• For Fed, a Rates Puzzle Looms (WSJ)
• What the Superforecasters Say About When the Fed Will Lift Rates (BBG)
• U.S. Looks at Proposals to Step Up Fight Against Islamic State (WSJ)
• China Steel Head Says Demand Slumping at Unprecedented Speed (BBG)
• VW slumps to first quarterly loss in at least 15 years (Reuters)

• China's central bank cuts rates for sixth time since November (Reuters)
• Global stocks hit two-month high on dovish Draghi message (Reuters)
• $6.5 Billion in Energy Writedowns and We're Just Getting Started (BBG)
• Alphabet, formerly Google, sets share buyback, shares jump (Reuters)
• Hurricane Patricia, Stronger Than Katrina, Nears Mexico (BBG)
• TVA Cleared to Start First New U.S. Nuclear Power Plant in Nearly 20 Years (WSJ)

If you thought we'd seen the depths of NIRP, think again because as Deutsche Bank notes, the ECB, Riksbank, SNB, and Nationalbank will likely dive further into the monetary Twilight Zone in the months ahead. Only when rates become negative enough to spark a depositor revolt will we have reached the "real" lower bound, but at that point, it will be far too late...

As always happens after shocking events like yesterday which "nobody could have possibly predicted", watching the Penguin gallery reel in its humiliation is absolutely worth the price of admission.

Tomorrow morning Mario Draghi is widely expected to if not announce an extension, or expansion, of the ECB's QE program, than to at least jawbone sufficiently, and push the EURUSD lower from its recently anchored level in the 1.10-1.20 range. But what are the specifics of Draghi's announcement: will he merely expand the monetization limit per security, as he did in early September, will he increase the universe of eligibile securities, or will he simply extend the maturity of the non-open ended QE from September 2016 to some indefinite date? The following list, courtesy of Bloomberg, summarizes what the sellside universe believes Draghi will unveil in just under 12 hours.

"The decline of fixed income liquidity in 2015 can be seen as a gap between supply and demand. Banks are supplying less liquidity, yet investors are still demanding more of it. The result? Potentially severe losses in fixed income."

• Global Stock Markets Edge Higher Though Global Growth Concerns Weigh (WSJ)
• Nikkei up 1.9% because Japan export growth slows sharply, raising fears of recession (Reuters)
• Saudis Risk Draining Financial Assets in 5 Years, IMF Says (BBG)
• Syria's Assad flies to Moscow to thank Russia's Putin for air strikes (Reuters)
• US Prosecutor Preet Bharara Probing Daily Fantasy-Sports Business (WSJ)
• Syrian army denies Russian ground forces fighting in Syria (Reuters)

• Canada's Trudeau topples PM Harper in shock election win (Reuters)
• Where Canada’s Harper Hit Hurdles (WSJ)
• Pugnacious Trudeau Steps Out of Father's Shadow and Into Power (BBG)
• European Stocks Decline, Euro Rallies as ECB QE Optimism Fades (BBG)
• Valeant, Under Pressure About Price Increases, Plans Changes (WSJ)
• Syrian rebels say they receive more weapons for Aleppo battle (Reuters)

"Anxiety and distress prevail throughout the land... Indeed, hope seems to have deserted the minds of the people... we are not a match to the crisis before us. These days are like the last days... We need more prayers."