Just two weeks after House speaker John Boehner dramatically announced his premature resignation without cause from his position seemingly in an attempt to difuse the tension within the GOP, there has been another just as dramatic development when moments ago we learned that Boehner's chosen successor Kevin McCarthy has withdrawn his candidacy for the speaker position: "While I am grateful for the encouragement I’ve received, I will not be a candidate." This puts in jeopardy not only any future negotiations over US government funding when the continuing resolution expires in mid-December but more importantly puts into question what happens with the US debt ceiling when the US government runs out of emergency measures some time in early November as Jack Lew has warned is the deadline for getting a deal struck.
It was supposed to be the day China's triumphantly returned to the markets from its Golden Holiday week off, and with global stocks soaring over 5% in the past 7 days, hopes were that the Shanghai Composite would close at least that much higher and then some, especially with the "National Team" cheerleading on the side and arresting any sellers. Sure enough, in early trading Chinese futures did seem willing to go with the script, and then everything fell apart when a weak Shanghai Composite open tried to stage a feeble rebound into mid-session, and then closed near the day lows even as the PBOC injected another CNY120 bn via reverse repo earlier.
- Endangering national security, leaking state secrets, subverting the government, and undermining national unity;
- Inciting ethnic hatred or ethnic discrimination, and undermining national unity;
- Spreading rumor, disturbing social orders, undermining social stability;
- Spreading obscenity, pornography, gambling, violence, murder, terrorism or instigating others to commit crimes;
- Insulting or slandering others, infringing upon the legal rights and interest of others;
"This morning from the Oval Office, President Obama spoke by telephone with Doctors Without Borders International President Dr. Joanne Liu, to apologize and express his condolences for the MSF staff and patients who were killed and injured when a US military airstrike mistakenly struck an MSF field hospital in Kunduz, Afghanistan over the weekend," Earnest said in the White House briefing.
A huge build in crude inventories started the ball rolling but a sudden "spoofer from above" sent US equities slumping this morning. The Dow and S&P have now joined the Nasdaq in the red...
- How Iranian general plotted out Syrian assault in Moscow (Reuters)
- China FX reserves post record quarterly fall as cenbank steps up yuan support (Reuters)
- MSF calls for independent inquiry into U.S. attack on Afghan hospital (Reuters)
- Yen Advances as Bank of Japan Refrains From Adding to Stimulus (Reuters)
- Abu Dhabi Said to Explore Asset Sales After Slump in Oil Price (BBG)
- U.S. Oil Approaching $50 Boosts Stocks as Emerging Markets Surge (BBG)
The Kremlin has thus far observed some semblance (and we do emphasize the word “some”) of decorum in criticizing the West’s approach to Syria. The nicetites just went out the window...
- Asian shares rise on fading Fed rate views (Reuters)
- U.S. Equity Futures Fall, Risking S&P 500 Rally as Copper Slides (BBG)
- More biotech pain, this time from the WSJ: For Prescription Drug Makers, Price Increases Drive Revenue (WSJ)
- VW Will Delay or Cancel Non-Essential Investments Due to Scandal (BBG)
- Russia Rejects No-Fly Zone Over Syria as Clerics Urge Reprisals (BBG)
- Historic Pacific trade deal faces skeptics in U.S. Congress (Reuters)
- German Factory Orders Unexpectedly Fall Amid Economic Risks (BBG)
News That Matters
While the US coast guard and search and rescue teams scour the Caribbean seas around the Bahamas for traces of debris from the missing cargo ship El Faro, which disappeared in the eye of Hurricane Joaquin with 33 mostly American crew members aboard more than three days ago, another tragedy struck moments ago when as AP reported an Amtrak train derailed in central Vermont near Northfield. It isn't immediately clear whether there are any injuries.
Following Friday's disastrous payrolls report, which confirmed all the pre-recessionary economic data and signaled that instead of approaching "lift-off" and decoupling from the rest of the world, the US economy is following the emerging markets into a slowdown in what may be the first global, synchronized recession since 2008, the market saw its biggest intraday surge since 2011 and the sharpest short covering squeeze in history, we are happy to announce that the "market" is now solidly back in "bad news is good news" mode.
The markets are beginning to show just how tall and flimsy this house of cards built on QE quicksand has grown. Entrepreneurs and ideas thrive in that type of environment. Exactly what we so desperately need. Yet, instead, all we have is this crony styled, unicorn imagined monstrosity of all that’s unholy to true business principles. "Markets right themselves with pain... That’s Capitalism. Back room manipulation to avoid that pain only increases the severity of it down the road."
Even a deflating balloon can still explode...
On Monday, a missile from a Saudi-led airstrike struck a Yemeni wedding reception in the village of Al-Wahijah, located near the Red Sea. The explosion resulted in 131 deaths, and the incident is being labeled as one of the deadliest attacks on civilians during the six-month conflict. In total, there have been 7,217 civilian casualties, including 2,355 killed and 4,862 wounded in the six months since the fighting began, according to the United Nations.