"It's a F**king Bloodbath" - Emerging Markets Collapse As Turkey Tantrum Spread

Throughout July, many sell-side analysts saw the 'stability' in EM assets as a sign that the worst was over and urged investors to pile back in to take advantage of 'blood on the streets' in EM at these cheap levels.

But, as one veteran EM trader in Brazil exclaimed to us this morning "this is a fucking bloodbath," adding that "liquidity has disappeared" and as spooked retail investors pile out of ETFs (that their advisers said were no brainers), the pressure in real markets is explosive.

Emerging Market FX is indeed a bloodbath...

While Turkey's Lira is the biggest loser on the week (and day), no matter where you look, it's carnage...

 

The moves are massive but dwarved by Lira...

How much longer can "they" support Emerging Market stocks? Debt and FX have already got the message...

And how long before US stocks catch down to the global stress?

For now Globally Systemic Banks are seeing risk pressures once again...

Offshore yuan is starting to crack again...

And EURUSD has broken the 1.15 shoulder...

Comments

matermaker Fri, 08/10/2018 - 09:40 Permalink

    Now, watch the Turks get attacked near Idlib.  as the Syrians are making 'final preparations' and the Kurds have been quietly getting ready.

Jaymorpheus macholatte Fri, 08/10/2018 - 10:26 Permalink

Merkel, Junker and the rest of the EC and NATO are right now, on their own. How does it feel to be a big boy, kicked out of your parent's basement? I think i hear Bob Dylan right now....

"Once upon a time you dressed so fine
Threw the bums a dime in your prime, didn't you?

People call, say "Beware doll, you're bound to fall"
You thought they were all a'kiddin' you
 

You used to laugh about
Everybody that was hangin' out

Now you don't talk so loud
Now you don't seem so proud
About having to be scrounging your next meal

 

They will beg Trump. It will cost them.

In reply to by macholatte

BigJim Jaymorpheus Fri, 08/10/2018 - 12:21 Permalink

What are they going to be begging Trump for, exactly? Europeans aren't in any danger from anyone except themselves and their idiotic leaders inviting millions of Islamists into their countries.

I suppose they might have a hard time getting hold of dollars to pay off debt denominated in USD... in which case they'll be begging the Fed, not the White House. Bernanke gave them $27T at 0% last time round.... why would the latest incumbent do the same? Ultimately, it's US institutions that will fail if the Europeons can't pay them their USD back.

Of course, if Europe's monetary system weren't owned by the usual suspects, EU countries could just let banks that were exposed to USD loans go to the wall and use their own central banks to bail out depositors. But that will never happen... because the banks own the EU's "leaders" as much as they own US "leaders".

In reply to by Jaymorpheus

Buck Johnson macholatte Fri, 08/10/2018 - 11:02 Permalink

Something else also.  You have to remember the big money is in emerging markets.  The people who are in the know or have a connect or guess right can make big money.  So a lot of non emerging markets (first world nations) are heavily invested in some form in emerging markets.  That is the only way they can get good returns in their Funds and such.  These fund managers of every fund there is have to play the emerging markets to get returns they promised.  If not they wouldn't be able to attract investors who want more than a savings account interest rate.

 

In reply to by macholatte

BigJim macholatte Fri, 08/10/2018 - 12:13 Permalink

Is that what happens when those stalwart economies begin to have to come to grips with the idea that the American Tax Payer is not going to subsidize them anymore?

You've been here how long?

The rest of the world is subsidising the American taxpayer via the petrodollar, chum.

In reply to by macholatte

Free This asiya789 Fri, 08/10/2018 - 09:43 Permalink

Dems be da times...can you say monkey hammered? Going to be an interesting day in the casino called life. Can't wait.

Do we get to do the capitulation thingy today? I doubt it, but things are getting frothy...grand latte anyone?

Let's get medievil bitchezzzzz

I am gonna put on order a suit of armor and lance! Where is my trusted steed? Collapse indeed.

Court jesters everywhere. Serf, fetch my slippers.

Dow, Dow, Down 178 pts and counting, it's early yet, plungers to the ready!

In reply to by asiya789

BigJim tmosley Fri, 08/10/2018 - 12:26 Permalink

This shit is inevitable once you nationalise the money supply and create a monetary "system" where all (well, 97%) of all money is endogenous to the banking system; the entire economy - and thus the whole country - can be held to ransom by the banks' lending.

What did Henry Ford say? If people understood the monetary system, there'd be a revolution before tomorrow morning?

In reply to by tmosley

BigJim Justin Case Fri, 08/10/2018 - 12:29 Permalink

Free market existing with the doctrines of Socialism like limited regulation of prices by the government to protect the poor...

One of the few iron laws of economics is that price regulation ALWAYS leads to shortages. It's been tried over and over since Diocletian and always the same thing - shortages, and then the "leaders" blame "speculators/hoarders/capitalists".

Before you go and vote in the next election, do yourself (and everyone else a favour) and read an economics textbook.

In reply to by Justin Case