On the 7th anniversary of entering ZIRP, and for the first time since June 29th 2006, The Federal Reserve announced today that it will try and raise interest rates:
*FED RAISES INTEREST RATES 0.25 POINT IN UNANIMOUS VOTE
Of course, the flowery language and dots are as dovish as possible while maintaining some semblance of credibility with regard growth expectations as The Fed unleashes a tightening cycle for the first time in over 11 years. Pre-FOMC: S&P Futs 2050, 2Y 98bps, 10Y 2.29%, Gold $1072, Oil $36, EURUSD 1.0960
Market Confidence In The Fed's Policy Error (Summed Up In 1 Chart)
Submitted by Tyler Durden on 12/16/2015 - 14:59 While The Fed is confidently rising rates, the market is signalling its belief that this is a policy error. Not only are longer-dated bond yields lower but short-term money-market expectations for January now see a higher chance of a rate-cut, than a rate-hike.
Janet Yellen Explains Why Rate-Hikes Are Bullish - Live Feed
Submitted by Tyler Durden on 12/16/2015 - 14:57 In her first post-rate-hike press conference, Janet Yellen is about to go to extreme lengths to explain just how dovishly bullish raising interest rates is, despite leaving the Fed Funds forecast unchanged since September (i.,e. not dovish). We look forward to her explaining why she is raising rates now - as opposed to September - as economic data has nosedived and the market has done a significant job on contracting credit already. We also look forward to her explaining how, if rate hikes on the path to normalization are so awesome, why is the willingness to do it so low?
Fed Mouthpiece Reads Liftoff Tea Leaves
Submitted by Tyler Durden on 12/16/2015 - 14:57 "When the Fed moves next will depend importantly on how inflation evolves. The Fed’s preferred measure of inflation has run below its 2% objective for more than three years. The central bank focused extra attention on the inflation outlook in its statement, saying it would “carefully monitor” actual and expected progress toward the goal. This point implied the Fed will be reluctant to raise rates again unless it sees inflation actually moving up. For now, officials said they were “reasonably confident” inflation would rise."The Complete Fed Decision Preview: All You Need To Know
At 2 p.m. EST, the only thing the financial world will care about and discuss will be the Fed's [first rate hike in 9 years|epic disappointment]. So for those who still haven't made up their mind about what the Fed's [dovish|non-dovish] rate hike means, here is all you need to know.
Today Will Be A Watershed Moment For Financial Markets
Submitted by Tyler Durden on 12/16/2015 - 11:30 We have reached the apogee of history’s greatest credit inflation. Now we’re hurtling into a prolonged worldwide deflation. You can already see this deflation in the plunge of oil, iron ore, copper and other commodity prices. We are in uncharted waters after nearly 20 years of madcap money printing by the Fed and other central banks. The world’s central banks are finally out of dry powder. They no longer have the means to inflate the global credit and financial bubble. That’s why today’s FOMC meeting is the most crucial inflection point since 1929.
How Traders Are Preparing For The Rate Hike: "It's A Good Time To Beat The Crap Out Of A Punchbag"
Submitted by Tyler Durden on 12/16/2015 - 13:25 Summing up the anxiety ahead of today's Fed decision - which talking heads just this morning explained is "priced in" and is a "non-event... been so telegraphed" - market professionals believe "it seems a good time just to go and beat the crap out of a punchbag." As Bloomberg reports, real traders say they "just don't want to do any damage today," as they trade around the events, "I think we're going to see a lot of volatility," and Treasury risk is already spiking to 5-month highs.
Financial Instability & The Fed
Submitted by Tyler Durden on 12/16/2015 - 13:05 The argument that the Fed should do nothing - for it will be harder to correct a rate rise than to do nothing - because there is no bubble anywhere, demonstrates that we have the most serious BUBBLE in history. The FED is between a rock and a hard place. It will be blamed no matter it does. Nobody seems to understand the dynamics of the trend in motion.
This Is How The Algos Trade The Fed Announcement
Submitted by Tyler Durden on 12/16/2015 - 12:45 With Treasury volatility spiking in "panic" mode but equity volatility in "everything will be fine" mode, there is plenty of room for the algos to go wild around this afternoon's decision. As Nanex shows, the last few years has seen lower and lower liquidity on Fed days as the pattern of liquidity collapse intraday provides just the ammunition for the instant buying-panic in the first 2 minutes after the decision.
There's No Upside Left
The upside is ephemeral, illusory or wishful thinking; the downside is real and lasting.
After The BOJ And ECB, Will Yellen Disappoint Next? SocGen Warns There Is "Risk The Market Will Be Wrong-Footed"
Submitted by Tyler Durden on 12/16/2015 - 11:42 According to ScGen, the Fed is widely expected to start tightening policy on Wednesday and adds that "after the BoJ and ECB, we see a risk that the market will be wrong-footed for a third time, and that extreme positions built ahead of tightening will be reversed.... In particular, we are short US small cap equities vs large via being short Russell 2000 vs S&P 500.... As the Fed tightens and the market enters into a lower-liquidity environment (and higher-volatility regime), we think the premium on small caps is no longer justified."
Dow Drops 170 Points From Open As 2Y Yield Surges To Highest Since May 2010
But... "priced in"? "Non-Event"?
Baltic Dry Crashes To New Record Low As China "Demand Is Collapsing"
Submitted by Tyler Durden on 12/16/2015 - 11:17 Despite a brief dead-cat-bounce late November, which Jim Cramer heralded as evidence of stabilization in China, the world's best known freight index has collapsed to new all-time record lows this morning. Amid a persistent glut of ships and ongoing concerns about Chinese steel imports, The Baltic Dry has tumbled to 471 - the lowest level in at least 30 years.
Fed May Have To Drain As Much As $1 Trillion In Liquidity To Push Rates 25 bps Higher
Submitted by Tyler Durden on 12/16/2015 - 10:56 "Of primary interest will be the size of the overnight reverse repo facility that the Fed will put in place to pull short rates higher. We don’t think it will be unlimited, but a size large enough that will keep short rates from falling below the 25bp floor – and the size could be as high as $1tn."
“We Don’t Remember How To Raise Interest Rates. None Of Us Worked Here The Last Time We Did It”
Submitted by Tyler Durden on 12/16/2015 - 10:46 ... I found myself seeking refuge in the tiramisu staring back at me, a bit uncomfortable that I was only hearing the wah wahs of Charlie Brown’s adult voices. Until this, during the back and forth of Q&A: (Laughter around the room…) “We don’t remember how to raise interest rates. None of us worked here the last time we did it.”Keep trusting your government...Dumb Sheep...
State Of Emergency Declared In Michigan City After Lead Found In Children's Blood
"The City of Flint has experienced a Manmade disaster," said the city’s mayor Monday evening, as she declared a state of emergency over evidently staggering levels of lead in the city’s tap water. Mayor Karen M. Weaver has requested federal assistance to deal with the fallout from over a year’s worth of tainted water delivered to Flint residents and, allegedly, falsely declared safe by government officials.
Crude Crashes To $35 Handle After Biggest December Inventory Build In 22 Years
Submitted by Tyler Durden on 12/16/2015 - 10:35 Following last night's surprising 2.3mm barrel inventory build, reported by API, DOE reports a massive 4.8mm build against expectations of a 1.5mm barrel draw and way above the highest estimate of a 2.6mm draw. This is the biggest build in 2 months at a seasonally 'weak' time of year (and biggest December build since 1993). Crude ramped overnight to regain the losses from the API dump, but dropped back to lows (under $37) before the DOE data, then crashed below $36. Furthermore, production was up in the lower 48.
The Humiliation Is Complete: Assad Can Stay, Kerry Concedes After Meeting With Putin
"The United States and our partners are not seeking so-called regime change [and] there is no policy of the United States, per se, to isolate Russia."This Is What The World Looked Like The Last Time The Fed Hiked
Submitted by Tyler Durden on 12/16/2015 - 10:06
US Manufacturing PMI Plunges To Lowest Since 2012 As Factory Orders Collapse To 2009 Lows
Submitted by Tyler Durden on 12/16/2015 - 09:56 Following the collapse in industrial production, it is no surprise that Markit's Manufacturing PMI has plunged to 51.3, its lowest since October 2012. Under the surface it is a disaster with production volume growth the softest since October 2013, and new orders crashed to worst since September 2009. Finally, don't shurg this off, although manufacturing only accounts for around one-tenth of the economy, the Manufacturing PMI exhibits a high correlation of 77% with GDP as industrial activity has an important cyclical impact on other parts of the economy.
Brazil Stocks, Currency Tumble After Fitch Downgrade To Junk
Submitted by Tyler Durden on 12/16/2015 - 09:48 The writing has been on the wall since the S&P "junking" in September, and now Fitch has jumped on the bandwagon, cutting Brazil to BB+, outlook negative.
Horrific Breadth For A "Rally"
Submitted by Tyler Durden on 12/16/2015 - 09:40 While the S&P 500 closed the day higher by nearly a half of a percent, there were just 810 Advancing Issues on the NYSE vs. 2326 Declining Issues. As a percentage of the total, the Advancing Issues equated to just 25.8% of issues. If that sounds low, you are correct. Going back to 1965, it is in fact the 3rd lowest percentage of Advancing stocks of ANY day that the S&P 500 closed higher. In other words, out of 6,702 Up days since 1965, yesterday ranked 6,699th in terms of breadth.
Industrial Production Crashes Most Since 2009, Weather Blamed
Submitted by Tyler Durden on 12/16/2015 - 09:22 For the third month in a row US Industrial Production dropped MoM, crashing 0.6% in November (against expectations of a mere 0.2% drop). This is the 9th month of 2015 with no MoM increase in industrial production and is the biggest MoM drop since March 2012. However, for the first time since Dec 2009, Industrial Production fell YoY (down 1.2%) signalling America is deep in recession. The excuse, blame, is "unusually warm weather" which sent the utilities index down 4.3% as demand for heating tumbled. Meanwhile, Oil & Gas Well Drilling Output is the lowest this century...
When nobody thought it could get any crazier (or more obvious) than the fake Sandy Hook massacre, along comes San Bernardino. It certainly doesn’t take a Columbo to realize that the San Bernardino false flag is one screwed up case. Just how complicated and confounding this false flag ‘shooting’ is can be better comprehended by the many articles posted at the link below.
The official FBI statements and their unusual posturing from the very beginning have left everyone scratching their heads. Obama’s pronouncements and strange responses have been particularly curious and puzzling. While Obama would have been very happy to see the 3 white American militiamen carry out the ‘mass execution’, he seemed too unhappy that the false flag was ultimately pinned on ISIS sympathizers.
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from Baltimore Sun:
Police officers from neighboring jurisdictions have begun staging in Baltimore in preparation for unrest that local commanders hope never materializes.
On Tuesday afternoon, Anne Arundel County Police officers were photographed staging in Druid Hill Park with an armored vehicle, helmets and shields by local photographer Devin Allen, who was made famous after one of his images from April’s unrest landed on the cover of Time magazine. Allen posted his images on Twitter, where he has about 12,500 followers — including many journalists. A Baltimore Sun reporter who responded to the park also observed dozens of officers and protective gear, though the officers were no longer wearing the gear.
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Police officers from neighboring jurisdictions have begun staging in Baltimore in preparation for unrest that local commanders hope never materializes.
On Tuesday afternoon, Anne Arundel County Police officers were photographed staging in Druid Hill Park with an armored vehicle, helmets and shields by local photographer Devin Allen, who was made famous after one of his images from April’s unrest landed on the cover of Time magazine. Allen posted his images on Twitter, where he has about 12,500 followers — including many journalists. A Baltimore Sun reporter who responded to the park also observed dozens of officers and protective gear, though the officers were no longer wearing the gear.
Read More
By now you have probably heard the big news.
196 nations voted to adopt the agreement crafted at the latest climate meeting Saturday. The entire world is on board with this global climate deal.
This is big, and the mainstream news sources are all over it.
The focus they are putting on it only has two dimensions, though. There is the political aspect, and the specific targets involved.
What is not being discussed is how this is going to profoundly alter the nature of electrical generation as we know it. In several decades, the energy sector as we know it will be gone.
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America has a notorious record of indiscriminately killing civilians in all its wars of aggression – from aerial attacks and ground operations, including special ops.
Since US warplanes began bombing Syrian infrastructure and government targets last year on the phony pretext of combating ISIS, nearly a thousand civilian deaths were reported, likely many more ignored or forgotten in the fog of war.
A September UN report alone said the US-led coalition’s continued “airstrikes against ISIL in Syria on a near-daily basis with reports of some 865 people killed, including 50 civilians, in Aleppo, Deir ez-Zor, Hasakeh, Idlib and Raqqa since strikes began” in September 2014.
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from Western Journalism:
President Obama plans to meet with Muslim leaders later this week to discuss how his administration is working to combat discrimination and acts of hatred against those who practice that faith.
Young Conservatives highlighted the seeming incongruity of concerns the president has about potential backlash towards Muslims versus the real world violence radical Islamists visited on San Bernardino less than two weeks ago.
“What’s truly disgusting about this is how the president hasn’t personally met with victims’ families from the San Bernardino attack, who are dead because a Muslim terrorist decided to go beyond ‘hateful talk’ and end the lives of 14 innocent individuals,” writes Michael Cantrell for Young Cons.
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President Obama plans to meet with Muslim leaders later this week to discuss how his administration is working to combat discrimination and acts of hatred against those who practice that faith.
Young Conservatives highlighted the seeming incongruity of concerns the president has about potential backlash towards Muslims versus the real world violence radical Islamists visited on San Bernardino less than two weeks ago.
“What’s truly disgusting about this is how the president hasn’t personally met with victims’ families from the San Bernardino attack, who are dead because a Muslim terrorist decided to go beyond ‘hateful talk’ and end the lives of 14 innocent individuals,” writes Michael Cantrell for Young Cons.
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from Washington’s Blog:
Congress Votes to Override State Law and Block Americans’ Right to Know If Our Food Has Been Genetically Modified.
All Americans – conservatives and liberals – want their families to have access to safe food.
Polls by ABC news, Associated Press and other major organizations show that Americans overwhelmingly want genetically modified foods (“GMOs”) labeled … and don’t believe that GMOs are safe.
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Congress Votes to Override State Law and Block Americans’ Right to Know If Our Food Has Been Genetically Modified.
All Americans – conservatives and liberals – want their families to have access to safe food.
Polls by ABC news, Associated Press and other major organizations show that Americans overwhelmingly want genetically modified foods (“GMOs”) labeled … and don’t believe that GMOs are safe.
Read More
from Align Life:
One of the most important responsibilities of the Food and Drug Administration (FDA) in protecting public health is to conduct regular inspections of clinical trial sites to ensure that good clinical practices are being followed. But a recent study published in the peer-reviewed journal JAMA Internal Medicine has found that nearly half of all clinical trials are based on false information, and the FDA typically does nothing to address this widespread problem.
Charles Seife, M.S., from the Institute of Journalism at New York University conducted a cross-sectional analysis of publicly available documents that describe FDA inspections of clinical trial sites where significant evidence of objectionable conditions or practices was found. Narrowing down the pool to only those documents that contained enough information to fully identify the violations described, Seife came up with 57 trials for which evidence of “significant departures” was abundant.
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One of the most important responsibilities of the Food and Drug Administration (FDA) in protecting public health is to conduct regular inspections of clinical trial sites to ensure that good clinical practices are being followed. But a recent study published in the peer-reviewed journal JAMA Internal Medicine has found that nearly half of all clinical trials are based on false information, and the FDA typically does nothing to address this widespread problem.
Charles Seife, M.S., from the Institute of Journalism at New York University conducted a cross-sectional analysis of publicly available documents that describe FDA inspections of clinical trial sites where significant evidence of objectionable conditions or practices was found. Narrowing down the pool to only those documents that contained enough information to fully identify the violations described, Seife came up with 57 trials for which evidence of “significant departures” was abundant.
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