Thursday, February 11, 2016

Why Markets Are Crashing: "Faith In Central Banks Fails"

Lines Around The Block To Buy Gold In London; Banks Placing "Unusually Large Orders For Physical"

This is the best quarterly performance for Gold in 30 years... "It’s been crazy – it’s been the best week since 2012. We’ve had people queuing round the block..."

Yellen Explains To The Senate Why She Isn't "Dovish Enough" - Live Webcast

Following remarks that are identical to those from yesterday, today Yellen will conclude her semi-annual testimony, this time by presenting her vision about the economy and the path of future rate hikes to the Senate Banking Committee. Surprises, if any, will come during the Q&A.

The Most Ominous Warning That Oil Storage Is About To Overflow Has Arrived

Speculators are now "making the leap to Cushing storage never being more full... will actually overfill, or even stop taking crude oil deliveries outright..."

Euro PIIGS Starting To Squeal Again

The stock markets of the so-called PIIGS are breaking down on an absolute and relative basis – not a positive development for global markets.

BNP Pulls Plug On US Energy Sector, Will Exit RBL Lending

“Given the current environment in the oil and gas market and the poor outlook for future fundamentals in the short to medium term, BNP Paribas has had to make adjustments to some of its businesses and has decided to stop the redevelopment of its reserve-based lending business."

It's Not Just Deutsche Bank...

While broad-based contagion from Deustche Bank's disintegration is clear in European, US, and Asian bank risk, there is another major financial institution whose counterparty risk concerns just went vertical...

Everyone Jumping On The Bandwagon: BofA Says To Stay Long Gold Until $1,375, "$1,550 A Possibility"

Gold prices are breaking above triple resistance forming a technical bottom and channel breakout. This projects gold higher to 1,315 and 1,375. The gap in the distribution on the left shows 1,550 is a possibility,

Boeing Stock Nose-Dives On News Of SEC Probe

Just when you thought The BoJ would save the day with its miraculous intervention in carry trades, this happens:
And just like that, Boeing's stocks crashes 10% dragging the major US equity markets with it. So, just as a reminder, this is a firm which the US government (via Ex-Im Bank) lends billions of US taxpayer dollars... and now the SEC is accusing them of fraud.

Saudi Arabia Makes "Final" Decision To Send Troops To Syria As US, Russia Spar Over Aleppo Strikes

As Saudi Arabia readies a Syrian ground invasion, there are competing accounts of just who destroyed 9 targets in Aleppo on Wednesday. While The Pentagon says Moscow hit the city's two main hospitals, The Kremlin claims two US Air Force A-10 attack planes carried out the strikes which raises the following question: is the US set to conduct airstrikes in support of the rebels, thus marking a fresh and exceptionally dangerous escalation of hostilities in the country? 

WTI Crude Pumps'n'Dumps Back To $26 Handle After Saudi Headlines

In a replay of yesterday's idiotic opening action, WTI crude spiked on Saudi troops headlines - running stops to yesterday's close - only to dump back below $27 once again...

Treasury Bears Briefly Rescued After Massive Short Squeeze Collapses Yields

2Y yields crashed 10bps overnight - the biggest plunge in yields since September's FOMC fold on rate-hikes. The rest of the Treasury bond complex also saw yields crash with 10Y flash-crashing 20bps - amid collapsing liquidity - at its deepest. Then - as if by magic - a sudden crazed Yen seller appeared and lifted all risk boats (and bond yields) "off the lows." One wonders how long this 'intervention' will last...

Scope For Gold To Extend Much Higher Than $1200 Over Time, Goldman Says

Gold has reached, and so far held, notable resistance around $1200. However, as Goldman notes, there’s scope to extend much higher over time.

A Detailed Look At This Morning's Major Market Moves

Here is, courtesy of Nanex, a forensic market-level look at the key events that took place so far this morning:

Initial Claims Drop But Goldman Warns "Recent Jobless Increase Is More Than Just Noise"

Initial jobless claims dropped notably last week (from 285 to 269k) but the overall trend (away from the noise) appears in tact. The smoother4-week average remains near 12-month highs and as Goldman notes weakness is widespread - "there is only limited evidence that the rise in claims is due to distress in the energy sector." Continuing claims dropped modestly to 2.239mm but, as Goldman adds, "the persistence of the recent move suggests more might be going on, and we are treating the increase as more than just noise."

6 Dead After Gunman Storms Saudi Education Department

Disgruntled employee (maybe he was mad that the kingdom rolled back fuel subsidies) or excuse to invade Syria? We'll see.

European Sovereign Risk Soars As Systemic Fears Mount

"Whatever it takes" is not enough, it would appear as the fragility and interconnectedness forced upon the European banking/sovereign finance ponzi has rapidly come home to roost for Draghi and his followers. Peripheral bond risk has flipped from "hold your nose" buys to panic sells with Portugal risk exploding 200bps in the last week. As the European banking system's credit risk rises 2012-crisis-like, it seems belief in a bigger bazooka is fading fast.

Nestle accused of carrying out ‘food terrorism’ in India … Still pumping U.S. aquifers dry without a license

by Daniel Barker, Natural News:

If you were asked to make a list of the most evil corporations in existence, which names would first come to mind?
Monsanto? Philip Morris? Union Carbide? Those are all great examples, but if you neglected to include Nestle, the list would remain incomplete.
Nestle has a long history of dirty dealings and putting profits before people’s health. Their sordid past and current misdeeds make them one of the top contenders for the scummiest corporation prize.
Right now, the company is faced with a Rs 640 crore ($94.6 million) class action lawsuit filed by the Indian government for Nestle’s “unfair trade practices, false labelling and misleading advertisements,” as reported by Reuters and cited by Legally India.
Read More

Here Come the Money Helicopters!

from Bonner and Partners:
The sky in South Florida is gray. A cold wind blows across the sand.…
Since the start of the year, the Dow is down about 7%. But certain stock market sectors have undergone a much harder pruning.
First, energy… then the tech… and now banks.
Shares in too-big-to-fail bank Citigroup are down almost 28% so far this year. And shares in Europe’s biggest bank, Deutsche Bank, are down by more than 36%. (More about the carnage in bank stocks… and what it means… in today’s Market Insight.)
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It’s Official: Cash is Now Public Enemy Number One

from Wolf Street:

Terrorists are no longer public enemy number one. Nor are drug lords, people traffickers, arms dealers, cyber terrorists, or any other unsavory do-badder. Today, the biggest threat to global peace and security is physical cash, a means of exchange that has flourished for over 4,000 years but which now stands accused of being the world’s biggest enabler of criminality.
A Criminal’s Accomplice
The latest person to publicly highlight the deadly threat posed by cash is Peter Sands, the former CEO of the British bank Standard Chartered, who just published a report for Harvard Kennedy School of Government imploring central banks around the world to stop issuing high-denomination notes and bills. They include the €500 note, the $100 bill, the CHF1,000 note and the £50 note.
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