JPMorgan Slides On “Deal” Breakdown Chatter

JPMorgan shares have dropped modestly (though any drop is notable in the new normal) as the WSJ reports that the $13bn deal with the Department of Justuice may be at risk:

  • *JPMORGAN FALLS 0.6% AS DOW JONES SAYS DOJ DEAL AT RISK

It appears the ‘breakdown’ is over JPMorgan’s demands that they offset payments to the DoJ from the FDIC fund (i.e. they wanted to use FDIC to fund this penalty on the basis of som epossible indemnification from the WaMu deal). DoJ lawyers are not amused (for now)…

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ZAkcG6rZja4/story01.htm Tyler Durden

JPMorgan Slides On "Deal" Breakdown Chatter

JPMorgan shares have dropped modestly (though any drop is notable in the new normal) as the WSJ reports that the $13bn deal with the Department of Justuice may be at risk:

  • *JPMORGAN FALLS 0.6% AS DOW JONES SAYS DOJ DEAL AT RISK

It appears the ‘breakdown’ is over JPMorgan’s demands that they offset payments to the DoJ from the FDIC fund (i.e. they wanted to use FDIC to fund this penalty on the basis of som epossible indemnification from the WaMu deal). DoJ lawyers are not amused (for now)…

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ZAkcG6rZja4/story01.htm Tyler Durden

Spot The Spanish Reality

Having recently pointed out Draghi’s worst nightmare, we thought the anti-thesis of hope over reality that is occurring in European “markets” was worth pointing out. Spanish sovereign bond spreads have collapsed this week to their lowest (least risky) in 30 months at a mere 229bps. The total and utter disconnect of this supposed ‘free market’ based measure in the face of nothing but terrible Spanish data is entirely without precedent…

 

 

Today’s retail sales beat is the latest ‘outlier’ being heralded as supporting the disconnect – of course, that is until seasonal adjustments remove all the gains and reality sets back in.

 

While many expect Spain to emerge from recession in Q3 2013 (and we assume that is the ‘hope’ trend being extraploated), it is clear, as SocGen notes, that internal consumption is expected to stall through H2 2013 and push Spain back into recession in Q1 2014…

 

Via SocGen,

…despite the small improvement in unemployment in Q3, to 25% vs. a previous 26%, the labour market situation is still too poor to stimulate domestic demand in the short term. As before, we see the 2013 real GDP in negative territory at -1.0%, with more amendments to government expenditure items expected.

 

 

 

As the Bank of Spain pinpointed in its latest economic report, government consumption and specifically employee compensation is yet to be adjusted. We thus expect the impact on GDP to kick in early 2014 and bring Spain back to recession.

Chart: Bloomberg


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/oOJbhXh7Cm4/story01.htm Tyler Durden

Santelli Stunned As Nobel Winner Fama Explains Fed Unwind “Is No Big Deal”

If ever there was a few minutes of television to confirm the deep-seated disconnect between reality and the ivory-tower academics pulling the levers behind the curtain, CNBC’s Rick Santelli just exposed it. For once, simple questions were enough to allow none other than Nobel-Prize-winning economist Eugene Fama to show Santelli (who did his best not to explode in incredulity) that the “smartest people in the room” just don’t get it (just as they didn’t get it in 2007). Santelli was gracious and polite as he asked what the great professor’s thoughts were on QE… (and the entire brief clip is worth watching in its entirety) but his conclusion is perhaps the most stunning (and left Santelli almost silent)… when asked the impact of the Fed ‘Tapering’ or even selling down its $4 trillion in assets, Fama calmly says “it’s basically a neutral event… It’s No Big Deal!” Indeed, professor, that is so clear…

 

“What the Fed is doing now… is kind of a nothing activity.”

 

 

Or the Hollywood version…


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/E5kNzBDKNg4/story01.htm Tyler Durden

Santelli Stunned As Nobel Winner Fama Explains Fed Unwind "Is No Big Deal"

If ever there was a few minutes of television to confirm the deep-seated disconnect between reality and the ivory-tower academics pulling the levers behind the curtain, CNBC’s Rick Santelli just exposed it. For once, simple questions were enough to allow none other than Nobel-Prize-winning economist Eugene Fama to show Santelli (who did his best not to explode in incredulity) that the “smartest people in the room” just don’t get it (just as they didn’t get it in 2007). Santelli was gracious and polite as he asked what the great professor’s thoughts were on QE… (and the entire brief clip is worth watching in its entirety) but his conclusion is perhaps the most stunning (and left Santelli almost silent)… when asked the impact of the Fed ‘Tapering’ or even selling down its $4 trillion in assets, Fama calmly says “it’s basically a neutral event… It’s No Big Deal!” Indeed, professor, that is so clear…

 

“What the Fed is doing now… is kind of a nothing activity.”

 

 

Or the Hollywood version…


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/E5kNzBDKNg4/story01.htm Tyler Durden

Spot The Difference

As the investing public looks around for reasons why US equities are rallying, the harsh reality is highlighted in the following chart… all that matters is what JPY carry is doing. While correlation is not causation, we suspect you’d be hard-pressed to suggest we are not on to something here…

 

 

What is perhaps most worrisome is that the vertical ramp in both USDJPY and S&P 500 both began as NASDAQ imploded… at 1253ET


    



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Head Of World’s Largest Asset Manager Says “Imperative” For Taper To End “Bubble-Like Markets”

JPMorgan, Pimco, and now BlackRock, the world’s largest asset manager, all join the bubble warning chorus. From Bloomberg:

  • FINK SAYS IT’S “IMPERATIVE” THAT THE FED BEGIN TO TAPER
  • FINK CALLS MARKET `OVER-ZEALOUS’ 
  • FINK SAYS THERE ARE “REAL BUBBLE-LIKE MARKETS AGAIN”

So… when the three largest banks/asset managers in the US say that Ben Bernanke has blown the largest asset bubble in history and that the time to taper has come, will Janet Yellen once again turn a blind ear to warnings that come not just from the blogosphere but the respected legacy financial institutions, and afterward admit that, just like last time, she “never saw it coming?”


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/4hD4Ar_6Y-8/story01.htm Tyler Durden

Head Of World's Largest Asset Manager Says "Imperative" For Taper To End "Bubble-Like Markets"

JPMorgan, Pimco, and now BlackRock, the world’s largest asset manager, all join the bubble warning chorus. From Bloomberg:

  • FINK SAYS IT’S “IMPERATIVE” THAT THE FED BEGIN TO TAPER
  • FINK CALLS MARKET `OVER-ZEALOUS’ 
  • FINK SAYS THERE ARE “REAL BUBBLE-LIKE MARKETS AGAIN”

So… when the three largest banks/asset managers in the US say that Ben Bernanke has blown the largest asset bubble in history and that the time to taper has come, will Janet Yellen once again turn a blind ear to warnings that come not just from the blogosphere but the respected legacy financial institutions, and afterward admit that, just like last time, she “never saw it coming?”


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/4hD4Ar_6Y-8/story01.htm Tyler Durden

Bill Gross: “All Risk Asset Prices Artificially High”

First it was JPMorgan, now it is PIMCO’s turn.

Alas, by now everyone but the Fed realizes there is a bubble in practically every asset class. As such, Gross’ tweeter time may be better spent engaging in smack talk with Carl Icahn: it is far more entertaining and engaging.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/-0mAdwwkDrs/story01.htm Tyler Durden