Just hours after Spiegel penned its infamous "Germany is taking aim at the ECB" article, Schauble went on the record to deny that the Geran finmin would consider taking legal action if the European Central Bank resorts to "helicopter money" but the damage was already done. As Reuters follows up today, "almost a month after stoking a divisive debate about how far it should go in pumping money into the flagging euro zone economy, the European Central Bank is trying to soothe relations with Germany after unusually strong criticism from Berlin."
Hot on the heels of Wells Fargo's $1.2 billion settlement, Bloomberg reports that Goldman Sachs will pay $5.1 billion to settle a U.S. probe into its handling of mortgage-backed securities involving allegations that loans weren’t properly vetted before being sold to investors as high-quality bonds. “This resolution holds Goldman Sachs accountable for its serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail,” said Acting Associate Attorney General Stuart Delery.
“Oil producers don’t want to cut their output. We have already asked for the decrease of production, but some countries have refused, including non-OPEC members, especially Russia,” Khebri says, according to APS
After growing pressure from an increasingly angry populous, Prime Minister David Cameron of Britain speaks to parliament on measures to curb tax evasion after admitting last week that he had profited from an offshore account. Of course, he "did nothing wrong," but opposition leaders smell the blood in the water so close to the Brexit decision... pushing for an Icelandic end to this controversy.
Business as usual this morning. In order to sustain the dream into the US Open, USDJPY was ramped - running stops to 108.50 to ensure the smoke-and-mirrors gains on another Italian bank bailout rumor enable just the right amount of reytail traders to get muppeted. Once the open struck, USDJPY dumped sending Gold soaring back above $1250.
This morning's 160 point spike in Dow Futures - out of nowhere - was predicated on hopes of an Italian bank bailout. While this may seem like an odd reason to "buy buy buy" US equities, in the new normal, it really is not.. and when put in context, the 'bounce' in EU banks should do more to scare than soften investors' concerns...
"I must take an indefinite medical leave of absence. The proximate cause is that for over a year I have been gutting it out through a Stage IV diagnosis of Hepatitis C, contracted (to save awkward questions) in 1984 in Xinjiang when a barefoot doctor sewed up a head wound under less-than-ideal conditions. I have finished treatment and think I have it beat but only time will tell. Your firm is doing and will do well: I believe that in 2016 we will make $40 million GAAP Net Income (pre-tax) excluding net effect of blockchain efforts and the risk of declared recession."
Early USD weakness has suddenly been erased on JPY weakness pushing USD index back to unch. However, the chaos in the currency markets is seemingly sending investors fleeing for silver, gold, and crude as the latter tops $40 and the former hits 3-week highs...
As Iranian media reported overnight, Russia has delivered the first part of an advanced missile defense system to Iran, starting to equip Tehran with technology that was blocked before it signed a deal with world powers on its nuclear program.
While the market is still enjoying the post-NFP weekly data lull, economic data starts to pick up again in the coming days, alongside the start of the reporting season. Below are this week's key events.
... consider mom and pop and other people who read Barron’s. They are saving for retirement and to put their kids through college. They might have depended on a historic 8%-like return from stocks and bonds. Well, sorry. When interest rates get to zero—and that isn’t the endpoint; they could go negative—savers are destroyed. And savers are the bedrock of capitalism. Savers allow investment, and investment produces growth.
"We continue to live in a low default world for now though. Even though defaults picked up in 2015, B/BB default rates were still comfortably below their long-term average which they have been for well over a decade now with 2009 being the only exception. Indeed last year’s default rate for global Bs (up from 0.9% to 2.7%) was still lower than all of the first two decades of the modern era of leveraged finance up to 2003. So in spite of all the challenges we face this era has been characterized by astonishingly low default rates. There are clear signs the cycle is turning though, especially in the US."
"We do not expect the meeting to deliver a bullish surprise as we believe production cuts make little sense given it has taken 18 months for the rebalancing to finally start. In addition, any resolute agreement that would support prices from current levels would prove self-defeating, in our view, as we believe that sustained low prices are required for the nascent non-OPEC supply adjustments to deliver a deficit in 2H16. Finally, a production freeze at recent production levels would not accelerate the rebalancing of the oil market as OPEC (ex. Iran) and Russia production levels have this year remained close to our 2016 average annual forecast of 40.5 mb/d." - Goldman
it has been a rather quiet session, which saw Japan modestly lower dragged again by a lower USDJPY which hit fresh 17 month lows around 170.6 before staging another modest rebound and halting a six-day run of gains; China bounced after a slightly disappointing CPI print gave hope there is more space for the PBOC to ease; European equities rose, led by Italian banks which surged ahead of a meeting to discuss the rescue of various insolvent Italian banks, while mining stocks jumped buoyed by rising metal prices with signs of a pick-up in Chinese industrial demand.
"In the afternoon, the president will meet with Federal Reserve Chair Janet Yellen to discuss the state of the American and global economy, Wall Street reform, and the long-term economic outlook; the vice president will also attend."
"Now things are worse than ever," says Yuli Sánchez. "They kill people and no one is punished while families have to keep their pain to themselves."... "This is now wilder than the wild west."... “Venezuela is pure chaos now. It seems to me there is no way back,” the former policeman says.
Do Americans have the right to learn whether a foreign government helped finance the 9/11 attacks? A growing number of congressmen and senators are demanding that a 28-page portion of a 2002 congressional report finally be declassified. The Obama administration appears to be resisting, and the stakes are huge. What is contained in those pages could radically change Americans’ perspective on the war on terror.