New Zealand

China Hard Landing Spreads: Hong Kong GDP Tumbles At Fastest Pace Since Financial Crisis

In the latest indication of contracting global growth, overnight Hong Kong reported that its Q1 GDP fell off a cliff 0.4% qoq, widly missing estimates of 0.1% growth as retail sales plummeted and the property market continued its collapse. On a y/y basis, the economy grew only 0.8% when compared to the same period last year, less than half the 1.9% y/y growth reflected in Q4.

Finance + Stress = Suicide (Or Trump)

The mortality rate for whites 45 to 54 years old with no more than a high school education increased by 134 deaths per 100,000 people from 1999 to 2014. For the first time in history the life expectancy of white American women had decreased, due primarily to drug overdose, suicide and alcoholism. The demographic groups that are experiencing the highest rates of drug overdose, suicide and alcoholism are also the most likely to be supporters of Donald Trump in his campaign for the U.S. Presidency. It does not take a Nobel Laureate to observe a high level of distress among white middle-class Americans. Trump simply taps into that angst.

"Unexpected" Australian Rate Cut To Record Low Unleashes FX Havoc, Global "Risk Off"

Overnight Australia finally admitted it has succumbed to the global economic weakness plaguing the rest of the world when in a "surprise" move, Australia’s central bank cut its benchmark interest rate for the first time in a year to a record low and left the door open for further easing to counter a wave of disinflation that’s swept over the developed world. The move sent the local currency tumbling and local stocks climbing. Reserve Bank of Australia Governor Glenn Stevens and his board lowered the cash rate by 25 basis points to 1.75 percent Tuesday, a move predicted by just 12 of 27 economists surveyed by Bloomberg. The announcement has, not surprisingly unleashed havoc across FX markets and broadly pushed global mood into its latest "risk off" phase.

Aussie Dollar Plunges As Inflation Slumps To Record Low

Despite surging commodity prices in China - which must be real and represent demand growth and price increases, right? - Aussie core inflation slowed to the weakest on record as headline prices unexpectedly fell last quarter (CPI -0.2%). RBA Rate-cut odds tripled instantly sending AUD down over 1.2% (its biggest drop in 2 months). Perhaps, just perhaps, that collossal credit injection in Q1 via China did not make it into the AsiaPac economy after all and merely fueled a speculative frenzy in commodities that merely "looks" like a recovery?

Japan's Keynesian Death Spiral - How Central Planners Crippled An Economy

The greatest tragedy of the 2008–2009 financial meltdown was not that it happened. The collapse of asset prices was the necessary result of near zero interest rates. No, the most devastating aspect of the financial meltdown is that central planning alchemy lost no credibility. Policymakers around the world are still turning to Keynesian and socialist interventionism to address problems caused by Keynesians and socialists. The twin sledgehammers of central banking and almost unlimited state power have so distorted global markets (again) that some economies are now terminal. The latest victim of the interventionists and micromanagers is the nation of Japan. A once genuinely productive and innovative nation has, over the years, slowly succumbed to the cancerous rot of interventionism.

Crude Slides After Kuwait Strikes Ends; China Markets Tumble

The biggest catalyst for overnight markets, first reported on this site, was the announcement by Kuwait that its oil workers had ended their strike which disrupted oil production in the 4th largest OPEC producer for 3 days cutting it by as much as 1.7 mmb/d, and had served to offset the negative news from the Doha debacle. Kuwait Petroleum also added that it would boost output to 3m b/d within 3 days, which in turn has pressured the price of oil overnight, and the May WTI contract was back to just over $40 at last check, sliding 2%. Not helping things was a very dejected Venezuela oil minister Eulogio Del Pino who said at a conference in Moscow that he sees oil prices returning to lows in 3-4 weeks if oil producers can't make a deal. For now the algos - and central banks - disagree.

Netflix Crashes After Forecasting Slower Subscriber Growth, Despite Burning $1BN In Last 12 Months

The reason why NFLX stock is crashing in the afterhours session is (mostly) because of the company's guidance of its widely followed international expansion. Here, instead of guiding to or above the consensus estimate of 3.45 million subs, Netflix disappointed dramatically and now anticipates only 2 million international streaming net adds, down from both the 2.37 mm a year ago, and certainly from the 4.51mm net adds last quarter.

Singapore Unexpectedly Eases Monetary Policy After "Economy Grinds To A Halt"

After a brief hiatus during which central banks refrained from stimulating their economies by the only way they know how, i.e., devaluing their currency through monetary policy, moments ago Singapore broke ranks when its central bank, the Monetary Authority of Singapore, unexpectedly eased monetary policy and drew a line against further appreciation when it announced that it would move to zero-percent appreciation in its currency.