In an attempt to break the now ubiquitous narrative that "its all about income tax rates", and to challenge the ridiculous new support for QEternity; 'The Bears' that brought you 'The Bernank' are back. In this cartoon, they explain how the bailouts made people like Warren Buffett far wealthier than they should be and exposes who actually benefits from all this QE. The Bears, The Buff-ate, and The Bernank - simply perfect.
We always said that the presidential race in a country in which 40% of spending on wars, entitlements, interest on said debt, etc. is funded by debt (purchased mostly by foreigners and monetized by the Fed), is moot, and is merely one big tragicomedy designed to evoke nothing but laughter (especially since it is the creditors who call the shots). Today, we see that at least Joe Biden got the memo.
The exuberant OMT-driven froth of the European equity markets appears to be fading. All major stock indices across the region ended the week red - with Spain worst down 3.3% and Italy down 2.2% (though as CNBC would say - off their lows). This looks like catching-down to European sovereign's less sanguine view of the world as Italy and Spain sovereign bond spreads end almost perfectly unchanged (having been up 15bps and 25bps respectively mid-week). Corporate and financial credit spreads outperformed equities on the week - ending unchanged also - with most of the move occurring today. Interestingly, the LTRO stigma is rising once again - as non-LTRO-encumbered bank credit spreads hit a 14-month low this week and the spread to LTRO-banks widens. Europe's VIX ended the week unchanged at 21.9% - thanks to a significant spike into today's close.
California Demands Business Insider Retract False Story On Jobless Claims Misreporting; Business Insider RefusesAfter yesterday Zero Hedge first reported the reason for the surprising plunge in the past week's initial claims, which as the BLS explained was due to "a state" (whose identity despite all tabloid speculation to the contrary is still unknown) not reporting "some" figures, assorted blogs picked up on what has since been confirmed to be an incorrect report by Business Insider's Henry Blodget claiming that "Well, we're glad to say that we've finally gotten to the bottom of what happened" and that the state in question is none other than California (supposedly as opposed to Illinois to shut up those wacky conspiracy theorists). Turns out the site known best for its slideshow presentations (which will soon double down as advertisements) may have once again fibbed just a little, following an official demand by none other than California state Employment Development Department direct, Pam Harris, that BI retract its article. To wit: "Reports that California failed to fully report data to the U.S. Department of Labor, as required, are incorrect and irresponsible... It’s unfortunate this ‘reporter’ and others who repeated the article’s erroneous statements chose to speculate rather than report, failing to confirm this information with EDD." Sure enough, the 'reporter' in question replied, and it appears that Business Insider is better informed than California when it comes to matters such as these, and has refused to retract.
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Perhaps we are finally getting somewhere, though we suspect only traversing the toilet bowl, as the Chairman of the Government Oversight Committee, Darrell Issa, just blasted the BLS over the jobs data in a conversation with Greta Van Susteren on FOX Business. Issa demands a 'Hearing' because:
We are more than happy to provide the factual data to support this Hearing - though we suspect Hilda Solis will be deeply offended that her PhDs' work could be questioned.the way it's being done with the constant revisions, significant revision, tells us that it's not as an exact a science as it needs to be and there's got to be a better way to get those numbers or don't put them out if they're going to be wrong by as much as half a point.
Ladies and gentlemen, we bring you EUtopia (and an early case of Friday humor). " The European Union has been awarded the 2012 Nobel Peace Prize in a nod to the 27-member bloc's "advancement of peace and reconciliation," and to applaud its solidarity as it continues to work to contain the debt crisis hanging over the euro zone. The head of the Norwegian committee, Thorbørn Jagland, said the committee gave the award in an effort to encourage Europe to back away from the "extremism and nationalism" that led to major conflict in years past. "This is, in a way, a message to Europe to secure everything we have achieved and move forward," he said while addressing a packed crowd at the Nobel Norwegian Institute in Oslo on Friday. "Mr. Jagland said it is "up to the European Union" to decide what to do with the approximately $1.2 million in prize money that comes with the award. He also said the EU should decide how the award is ceremonially received." Some other news: Bernard Madoff Investment Securities has not won the Nobel prize in economics yet.
For the first time since July, Turkey scrambled two F-16 fighter jets to the Syrian border following a Syrian military helicopter bombed the border town of Azmarin. The WSJ reports that the two fighters flew along the border shortly after 2pm local time following heavy fighting between rebels and Syrian government forces. Booming explosions and the rattle of machine guns around Azmarin could be heard Friday morning from the small Turkish border town of Hacipasa. One eyewitness said the Syrian attack helicopter retreated when the Turkish jets flew along the border. Turkey's move on Friday to scramble jets close to the fighting inside Syria comes amid a sharp escalation of tensions along the shared 565-mile frontier.
Back when everyone had given up on natgas in April when John Arnold was liquidating the Centaurus Master Fund and everyone thought it was an indication of the collapse in nattie end demand (it wasn't), the general peanut gallery said the time of bidless gas is coming. It didn't. Instead, as we then said expected, and as Goldman recommended, it was the time to buy natgas. We are now nearly 100% higher from those April lows. For those who listened to ZH and Goldman, the time to be greedy is over, and as David Greely from Goldman says, it is now "time to take profits." Feel free to sell to all those other banks who are once again about 6 months late to the party.
Geithner Reiterates Refusal to Talk About Monetary Policy. Or which floor of Blackrock his cubicle will be on
— zerohedge (@zerohedge) September 25, 2012
Today, it seems, the FT has finally got the memo as they note that Mr. Fink (Geithner's new boss?) trumped Mr. Rubin (Geithner's old boss?) as the most frequent 'can-I-phone-a-friend' call - speaking 49 times over 18 months (once every 11 days). We wonder if this is simply a 'rotation' discussion/interview process as Fink transitions to Geithner's little seat at Treasury and Geithner slides into his capacity as official guard of the Blackrock Stapler in the 3rd sub-basement.
Producer Price Inflation Higher On Spiking Food And Energy; Those Who Don't Eat Or Drive See No Price Increase
In a country in which nobody eats or drives any more, the Fed construct as September core PPI came in 0.0%, on expectations of a 0.2% increase. Of course, for those lucky few who still eat, or drive, or in rare cases eat and drive, saw Producer Prices rise by 1.1% on expectations of a 0.8% increase, which despite dropping from August's 1.7%, this was still the second highest monthly increase in the past year. Also, for those few who actually care about such trivia as food and energy prices, this was the 4th month in a row of higher than expected headline PPI. Luckily, in America, eating has now been hedonically adjusted to the functional equivalent of playing Apple's bestselling $0.99 iFood app.
Augason Farms Emergency Food Storage All-in-One Pails Kit - 1 year - (Google Affiliate Ad)
The last time a Primary Dealer decided to go all in on the Italian "recovery", MF Global went bankrupt. This time around the bank that apparently can't get enough of Italy (and to a smaller extent Spain) and its glorious taxpayer funded, bailed out future is none other than JPM, which according to its earnings presentation has seen its net exposure to Europe double from $6,3 billion to $11.7 billion, following a surge in Italian trading exposure. Surely this will end very well for the bank that only 5 months ago had to reshuffle every executive in its internal $300 billion hedge fund for massive IG9 CDX losses.
- OECD: Japan Public Debt in 'Uncharted Territory' (WSJ)
- Germany holds firm on Greece as IMF pressure mounts (Reuters)
- Schäuble and Lagarde clash over austerity (FT) - it would be great if someone actually implemented austerity...
- Merkel hints at tax cuts for growth boost (FT)
- Hollande Robbed of Growth Engine as Companies Cut Investment (BBG)
- Romney Narrows Gap With Obama in Swing State Polling (BBG)
- Sluggish Growth Seen Into Next Year (WSJ)
- Softbank Founder Has 300-Year Plan in Wooing Sprint Nextel (BBG)
- Singapore Forgoes Currency Stimulus on Inflation Risk (Bloomberg) - as does China day after day
- Sharp Jabs Dominate Combative Vice-Presidential Debate (WSJ)
- Japan and China Agree to Hold Talks on Rift After Noda Call (Bloomberg)
JPM Beats On Loan Loss Reserve Release Despite Drop In Trading Revenues And NIM, Surge In Non-Performing LoansThere is a lot of verbiage in the official JPM Q3 Earnings press release which directs to a bottom line number of $1.40, or $5.7 billion on expectations of $1.24, with revenue of $25.9 billion on expectations of $24.53 billion. The primary reason for the lack of disappointment: no major losses in Corporate from CIO, with corporate generating $221 million in Q3, up from a loss of $(1.777) billion in Q2. And then come the adjustments: $900 million pretax benefit ($0.14 per share after-tax increase in earnings) from reduced mortgage loan loss reserves in Real Estate Portfolios; $825 million pretax incremental charge-offs ($0.13 per share after-tax decrease in earnings) due to regulatory guidance on certain residential loans in Real Estate Portfolios; $888 million pretax benefit ($0.14 per share after-tax increase in earnings) due to extinguishment gains on redeemed trust preferred capital debt securities in Corporate; $684 million pretax expense ($0.11 per share after-tax decrease in earnings) for additional litigation reserves in Corporate; Then there is a DVA loss of $211 MM in banking. Net-net, after taking into account all one-off adjustments, the Q3EPS was really $1.26. But for all the data fudging, and attempts to make the reported EPS non-comparable to the expected one, following an avalanche of one-time adjustments, the bottom line is this: revenues from trading dropped both sequentially and Q/Q while banking expenses rose, Net Interest Margin dropped to a new record low, even as the firm too a major $967 million loan loss reserve release on its loans to $22.8 billion, even as its total Non-Performing Loans rose by a whopping $1.3 billion to $11.370 billion, the largest quarterly jump in years! Just how JPM can justify such a major contribution to earnings coming from loan losses when NPLs have soared is unclear to anyone with a frontal lobe.
Pressure on Madrid to Accept Bailout
Molotov Cocktails In Greece
Gold’s Final Move
GMOs and Pesticides Create Super-Pests
ATF Whistleblower Vince Cefalu Fired
BLS Data Shows Labor Report is BS
1. The drop in the percentage of workers in the labor force relative to the population.
2. The relative correlation between GDP and unemployment. They should be negatively correlated.
3. Since 2010, GDP growth rate is higher than the productivity growth rate. It should be the opposite.
What’s In Obama’s Pocket?
The VP Debate
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