Month: September 2014

As Scotland prepares to vote for or against Independence from the Union on Thursday, it appears everyone has an opinion on what may, what should and what will happen. At the basis of every such opinion is some basis in fact, misguided as it may be in most cases, about who has all the leverage, with the dominant one being that Scotland would make a horrendous mistake if it says goodbye to the UK and puts a border around what is currently a third of UK’s landmass.

Some, such as Deutsche Bank, the bank that has the single greatest derivative exposure in the world and is therefore most leveraged to maintaining the status quo, saw its “Chief Economist & Member, Group Executive Committee, Deutsche Bank AG” David Folkerts-Landau personally put pen to paper on Friday and in rambling, demagogic terms, explain why it would be a “Wrong Turn” for Scotland to seek self-determination.

He says that, “A “Yes” vote for Scottish independence on Thursday would go down in history as a political and economic mistake as large as Winston Churchill’s decision in 1925 to return the pound to the Gold Standard or the failure of the Federal Reserve to provide sufficient liquidity to the US banking system, which we now know brought on the Great Depression in the US. These decisions – well-intentioned as they were – contributed to years of depression and suffering and could have been avoided had alternative decisions been taken.” Sure, there could have been no gold standard and the Fed could have gone full-Bernanke, and it would only have kicked the can a few years leading to an even greater depression, as the recent paradigm of “bubble to bubble” transitions, described by none other than Deutsche Bank, is where the world finds itself. In fact, it is DB that admitted last week that without a bubble, the western financial way of life is finished.

DB’s Landau concludes with the following outright propaganda:

Most importantly, the world as it is evolving in the 21st century is a highly uncertain place with unstable geopolitics and a stressed economic and financial outlook. Why anyone would want to exit a successful economic and political union with a G-5 country – a union which another part of Europe so desperately seeks to emulate – to go it alone for the benefit of… what exactly, is incomprehensible to this author.

Well, maybe let’s ask what is increasingly a majority of Europeans across the ill-fated and artificial Eurozone, whose fixed currency means the only devaluation possible is internal, read crashing wages. But of course, the head of something or another at Deutsche Bank has nothing to worry about in this regard.

And yet, as always, the bottom line is about leverage and bargaining power. It is here that, miraculously, things once again devolve back to, drumroll, oil, and the fact that an independent Scotland would keep 90% of the oil revenues! As we showed several days ago, Scotland’s oil may be the single biggest wildcard in the entire Independence movement.

It is this oil, and its interconnectedness within the UK economy, that as SocGen’s Albert Edwards shows earlier this morning, is what gives Scotland all the leverage.

From Edwards:

it is increasingly likely that it too it will be joining Scotland in permanently exiting the EU club. First of all, consider the vulnerability of sterling after a Yes vote for Scottish independence. Even without North Sea oil revenues, the UK current account situation is a mess. The left-hand chart below is one I put up at the end of our flagship conference in January this year. The point I made was it is absolutely extraordinary for the UK to be beginning an economic cycle with a current account deficit of around 5-6% of GDP. Normally this is a level the UK or any other developed countries get to at a height of a boom after years of overspending on consumer imports. I think I described the UK position as an economic abomination of the highest order and that this economic cycle was likely to end some years from now in a calamitous sterling crisis – just like we used to have in the past.

 

 

Our specialist macro salesperson, Richard Walker, thinks that it is in the rUK’s economic interest to retain some sort of currency union with Scotland after independence as he points out Ireland did after its own independence in 1922 until 1979. He believes the maths for the rUK just don’t add up – on the basis of an independent Scotland keeping 90% of the oil revenues the rUK current account deficit for the full year would have been around 7% of GDP instead of 4½% (also see right-hand chart above).

There’s that pesky “mathematics” again. Here is what the math reveals:

Personally I don’t believe that the rUK will conceive it possible that any continued currency union is feasible after independence having observed the eurozone mess. That means the yawning fault line in the UK’s economic situation will be revealed for all to see. Indeed since we used that chart of the UK’s current account mess in January this year, the deficit in Q3 last year was revised from 5% to 6% of GDP! That horrendous deficit persisted in Q4 at just under 6% of GDP but improved somewhat in Q1 of this year to 4.4% of GDP. That improvement though to me looks erratic and liable to reverse, most especially as the trade deficit through July continued to deteriorate. So, if rather than the 2013 full-year UK current account  deficit of 4½% of GDP; the underlying situation is more reflective of the almost 6% deficit seen in H2, then the rUK current deficit will be nearer to 8 1/2% of GDP! The UK is due to release its 2014 Q2 Current Account data on 30 Sept.

 

For the UK as a whole the current account deficit is awful. For the rUK it is simply untenable. If investors are selling sterling in anticipation of a Yes vote, the economic reality of a rump rUK will see sterling quite rightly plunge into the abyss way before the end of the economic cycle (where we previously expected the turmoil would come).

Which also means that contrary to the UK’s fire and brimstone, it is the UK that has much more to lose in a world in which Scottish oil output is suddenly unavailable to plug current account deficit gaps, something the US has been able to do in the past 5 years courtesy of the transitory shale boom.

The vulnerability of sterling in a rUk world is made much worse as investors come to grips with the increasing prospect that the rUK will be leaving the EU. Capital will not be moving from north of the Scottish border to the south. It will be moving out of the UK altogether. And, with the rUK needing to attract capital at an unprecedented avaricious rate for this point in the cycle, this ain’t going to be pretty. Interest rates, which are probably set to rise next year anyway, may be set to rise a whole lot faster than anticipated if we get a good old-fashioned sterling crisis, with the good old-fashioned inevitable recessionary consequences thrown in.

The bottom line, at least to Edwards, is that Thursday’s vote will set in motion the independence not only for Scotland, but for the UK from the EU club:

So in the event of a Yes vote in the imminent Scottish referendum I
would expect both Scotland (involuntarily) and the rUK (voluntarily) to find themselves outside of the EU club.

And should that happen, all bets are off for the continued existence of the greatest “unionization” experiment in modern history: Europe itself.

We saw similar trends towards political extremes to a greater or lesser extent in the beleaguered GIIPS (Greece, Italy, Ireland, Portugal and Spain) during the crisis. As Dylan has previously explained, political extremism becomes a very attractive proposition when a country comes under stress. Europe has a long history of such tendencies. Separatist and nationalist movements throughout Europe are gaining a stronger foothold with nationalist fault lines previously thought dormant awakening in unison right across Europe – see for example this interesting article from Ambrose Evans-Pritchard – link. The outcome of a Yes vote in Scotland may have as unpredictable consequences as did events in Eastern Europe in the late 1980s. A yes vote will send the EU bicycle (or if you prefer, shark) into reverse for the first time since the 1957 Treaty of Rome, with wholly unpredictable consequences.

Good luck, Scotland. The fate of a century of globalization and wealth-transfer efforts suddenly lies on your shoulders.

via Zero Hedge http://ift.tt/XnNg99 Tyler Durden

• Snow is coming: OECD Cuts Economic Growth Forecasts (WSJ)
• World waits for white smoke from U.S. Fed (Reuters) – Understandable error: they meant “green”
• Scots Breakaway at 45% Odds as Economists Warn of Capital Flight (BBG)
• Ukraine President Poroshenko Faces Backlash Over EU Trade Deal Delay (WSJ)
• German Anti-Euro Party Advances in Merkel Homeland Voting (BBG)
• Clinton Hints at 2016 Run as Super-PAC Packs Iowa Steak Fry (BBG)
• Air France, Lufthansa Hit by Strikes in Fight for Future (BBG)
• U.S. sees Middle East help fighting IS, Britain cautious after beheading (Reuters)
• Ex-Billionaire Charged by Brazil With Financial Crimes (BBG)
• Record S&P 500 Masks 47% of Nasdaq Mired in Bear Market (BBG)
• Heineken confirms, rebuffs SABMiller bid (Reuters)
• Alibaba Said to Plan Boosting IPO Price Amid Interest (BBG)
• A minimum-wage hike finds hope in U.S. heartland (Reuters)
• Western sanctions are testing Russia’s strength: Medvedev (Reuters)
• Phones 4u Bonds Plummet After Losing Mobile Contracts (BBG) and it was just a year ago that it did a “successful” dividend recap deal…

 

Overnight Media Digest

WSJ

* International support for the U.S.-led military campaign against Islamic State gathered strength with the United Kingdom vowing to destroy the group after it killed a British aid worker, Arab States agreeing to participate in air strikes and Australia pledging forces. (http://on.wsj.com/1tTMjj6)

* President Barack Obama plans to dramatically boost the U.S. effort to mitigate the Ebola outbreak in West Africa, including greater involvement of the U.S. military, people familiar with the proposal said. (http://on.wsj.com/1qVDFka)

* Heineken NV said Sunday that U.K.-based rival SABMiller Plc has approached it about being acquired but that Heineken’s controlling family intends to keep the company independent. (http://on.wsj.com/1BF0zkF)

* A firm run by former AIG boss Hank Greenberg is suing the U.S. government over its bailout of AIG six years ago. A trial set to start late this month poses a risk for the insurer.(http://on.wsj.com/1uD4Wtc)

* As vice chairwoman of the Federal Reserve, Janet Yellen was an unabashed advocate of easy money who pressed colleagues to embrace her view. As chairwoman she has taken a much different approach, becoming a restrained consensus seeker modeled after her predecessor, Ben Bernanke. (http://on.wsj.com/X4DpVn)

* U.S. investigators have turned multiple bank employees into informants in a far-reaching probe of possible manipulation of currency markets, and are preparing to seek criminal charges against individual traders as early as next month. (http://on.wsj.com/1qPzF5W)

* U.S. Treasury Secretary Jacob Lew warned his Chinese counterpart in a recent letter that a spate of antimonopoly investigations against foreign companies could have serious implications for relations between the two countries, according to people briefed on its contents. (http://on.wsj.com/Xl9Krm)

 

FT

Silicon Valley’s top executives and investors have agreed that the U.S. tech industry has failed to appreciate the growing global concern over its record on online privacy and security and must act immediately to prevent deeper damage to its image.

SABMiller Plc made a preliminary offer for rival brewer Heineken that was rejected by its controlling shareholders. This deal would have brought the two companies together and helped SABMiller resist a takeover bid from rival Anheuser-Busch InBev

After many years in which dealmakers have been standing firmly in the shadows of their profit-churning trading colleagues, a resurgent market for takeovers and public listings has fostered bigger pay cheques for advisory bankers.

Former chief executive of BP Plc, Tony Hayward, warned that U.S. and EU sanctions against Moscow are threatening to turn around and bite the West by hindering global oil supplies and driving up prices in coming years.

Eike Batista, a Brazilian business magnate, was accused of market manipulation, and prosecutors sought to freeze millions of dollars worth of properties that he had transferred to his family. The accusations were part of a criminal action against Batista, whose empire collapsed last year in Latin America’s largest bankruptcy, with prosecutors attempting to take hold of 1.5 billion Brazilian reais ($641.30 million) in assets.

NYT

* People keep texting when they are behind the wheel, so an engineer has found a technological solution. The problem: He can not do it on his own. (http://nyti.ms/1y4HCtc)

* An investigation by the New York Times into the National Highway Traffic Safety Administration’s handling of major safety defects over the past decade found that it frequently has been slow to identify problems, tentative to act and reluctant to employ its full legal powers against companies. (http://nyti.ms/1wlqQ4x)

* Parent groups and privacy advocates are challenging the practices of an industry built on data collection, and California has passed wide-ranging legislation protecting students’ personal information. (http://nyti.ms/1q60b6d)

* Barry Diller’s IAC/InterActiveCorp – owner of Match.com, OkCupid and other sites – has been increasing its presence in the terrain that combines technology and romance in the last 10 years, but the market has become crowded. (http://nyti.ms/1D9nztS)

* The smartphone offerings of Apple Inc, Amazon.com Inc, Microsoft Corp and Samsung Electronics Co Ltd have a lot to say about the companies’ approach to most everything. (http://nyti.ms/1D9nNB3)

* Activist investor William Ackman’s new fund, Pershing Square Holdings, is expected to be listed on the Amsterdam Stock Exchange. (http://nyti.ms/1s7ilpJ)

* Heineken, the Dutch brewer, said on Sunday it had rejected a takeover approach made by SABMiller, putting on ice what would have been a multibillion-dollar beer deal. With a valuation of about $44 billion, Heineken is one of the last big independent brewers in the world, remaining autonomous in an era of global consolidation. (http://nyti.ms/1sUL3OP)

 

Canada

THE GLOBE AND MAIL

** The newly formed British Columbia LNG Developers Alliance, representing four of the largest proponents of liquefied natural gas exports from the West Coast is lobbying Ottawa for tax relief, arguing that it is in the national interest to launch LNG sales to Asia and reduce Canada’s dependence on energy exports to the United States. The alliance’s four members are Kitimat LNG, the Pacific NorthWest LNG project led by Malaysia’s state-owned Petronas, Shell Canada Energy-led LNG Canada and BG Group’s Prince Rupert LNG. (bit.ly/XmAacc)

** Royal Canadian Mounted Police analysts have warned government and industry that environmental extremists pose a “clear and present criminal threat” to Canada’s energy sector, and are more likely to strike at critical infrastructure than religiously inspired terrorists. (bit.ly/1wvfa1S)

** Talks between the union representing British Columbia teachers and their employer continued through the weekend, as the two sides and a mediator work to end the bitter strike that has kept 500,000 public school students out of the classroom. Negotiators spent the weekend at a hotel near the Vancouver airport, but would not say what progress had been made. (bit.ly/X5qUZJ)

NATIONAL POST

** Days after being diagnosed with an abdominal tumour, Toronto Mayor Rob Ford withdrew his candidacy for a second term Friday, opening the door in the process for his brother Doug to take his place. (bit.ly/1qOA1ds)

** More than 400 academics are demanding the Canada Revenue Agency halt its audit of a think-tank, saying the conservative government is trying to intimidate, muzzle and silence its critics. In an open letter, the group defends the Canadian Centre for Policy Alternatives, a left-leaning think-tank that was targeted for a political-activity audit partly because it was deemed by the agency to be biased and one-sided. (bit.ly/1nVPiEp)

** While Keurig Green Mountain Inc is trying to knock competitors out of its massive single-serve coffee ring, an Ottawa startup, Single Cup Coffee is using new technology to secure a spot and, so far, it’s paying off. Single Cup Coffee, which offers nearly 100 new flavours made in so-called XBold cups re-engineered to give every hot beverage a bolder taste, is already brewing C$12 million in sales after one year of operations. (bit.ly/1y5MrTa)

 

Hong Kong

SOUTH CHINA MORNING POST

— The de facto head of Shanghai’s free-trade zone is expected to step down, five separate sources said, likely dealing another blow to the already struggling economic project ahead of its first anniversary. Dai Haibo, the zone’s executive deputy director overseeing daily operations, was suspected of disciplinary violations, said the sources. (bit.ly/1qViQFI)

— Russian money is fleeing Western sanctions and into Hong Kong, but running into obstacles at banks nervous about money laundering, analysts say. (bit.ly/1m4wgAC)

— Cathay Pacific, one of the world’s largest cargo carriers, is hoping the Christmas season will start a little earlier this year. The last quarter may signal the start of a real recovery for the sluggish global cargo market thanks to new hi-tech consumer product launches and recovery in the U.S. economy, said Cargo Director James Woodrow. (bit.ly/X3TGcY)

THE STANDARD

— Hong Kong food authorities on Sunday ordered a massive recall and ban on all 25 lard and lard products imported from Chang Guann at the centre of the “gutter oil” scandal in Taiwan, and banned all food made with the products. (bit.ly/1s2B6kd)

— The new racing season got off a golden start at the Sha Tin track in Hong Kong in more ways that one. The first-day crowd and turnover were the highest in more than 20 years. Attendance was 74,281, 12 percent higher from last year’s opener, while turnover rose more than 10 percent to HK$1,139 billion ($147 billion). (bit.ly/1AOziKm)

— Jiashili Group opens its retail book today, seeking to raise up to HK$320 million. The Guangdong-based biscuit manufacturer is offering 100 million shares at HK$3.70 each. (bit.ly/1m4zJ21)

HONG KONG ECONOMIC JOURNAL

— Some 700 staff from casino operator SJM Holdings Ltd staged a protest over the weekend demanding better pay. The workers warned that they would hold a strike in the golden week in October if the management continued to ignore their demand.

 

Britain

The Times

RBS FACES CLASS ACTION OVER ‘ABUSE’ OF SMALL BUSINESSES

Hundreds of business owners affected by Royal Bank of Scotland’s “turnaround” division for struggling companies are planning to sue the bank through a group legal action. (http://thetim.es/1pfU6Ec)

PHONES 4U CRASHES TO PUT JOBS IN JEOPARDY Nearly 6,000 jobs on the High Street were in jeopardy on Sunday as Phones 4u collapsed into administration. All 550 of its shops are to close with immediate effect, pending a decision by administrators at PricewaterhouseCoopers on whether a long-term solution can be found for the business. (http://thetim.es/1q563N5)

The Guardian

FROM BANKING TO TEACAKES: WHAT HAPPENS IF IT’S A YES IN THE REFERENDUM If Thursday’s vote is a yes, bank customers will want to know on Day One if their money is safe and what currency an independent Scotland will use – even if, in reality, it would be 18 months before any real change occurs. Bank of England Governor Mark Carney is cutting short a trip to Australia, where G20 finance ministers and central bank governors are gathering, to ensure he is in the UK in case the contingency plan he has drawn up needs to be implemented. The Treasury insists Chancellor George Osborne – who is not going to Cairns – has no contingency plan. (http://bit.ly/1uvBGpo)

2014 COULD SET RECORD FOR VALUE OF IPOS ON LONDON STOCK EXCHANGE MAIN MARKET This year could see a record amount of cash raised by companies joining the London stock exchange’s main market. By the end of August, about 7.4 billion stg ($12.01 billion) had been raised, according to Capita Asset Services, and on current trends this could reach 11.7 billion stg by the end of the year, well above the record 8.7 billion stg set in 2011. (http://bit.ly/1y3O57V)

The Telegraph QUEEN WARNS SCOTS TO THINK ‘VERY CAREFULLY’ ABOUT REFERENDUM VOTE The Queen has broken her silence about the potential break-up of the United Kingdom by warning Scots to think “very carefully about the future” before casting their votes in the independence referendum. With only four days to go to the polls and the contest on a knife edge, the monarch made a hugely significant intervention by stating she hoped Scots would consider closely what their “important” votes would mean. (http://bit.ly/1uNYtej) SAMSUNG ACCUSES RIVAL OF SABOTAGING WASHING MACHINES Samsung Electronics Co Ltd has accused the head of rival LG Electronics Inc’s home appliances business of damaging its washing machines at retail stores in Germany. The firm, in a statement on Sunday, said it had asked the Seoul Central District Prosecutors’ Office to investigate LG employees who the company says were seen deliberately destroying several of its premium washing machines on display at two stores earlier this month ahead of the IFA electronics show in Berlin. (http://bit.ly/1qVcuWL)

Sky News

MERGERS WATCHDOG PAVES WAY FOR ‘CABLE FINES’ Vince Cable, the merger watchdog, will on Monday pave the way for a crackdown on companies that break pledges on jobs and investment made during major corporate takeover deals. (http://bit.ly/1BDTroK)

SCOTLAND REFERENDUM RESULT ‘TOO CLOSE TO CALL’ The latest opinion polls show the Scottish referendum campaign is “on a knife-edge” – with the “Yes” and “No” campaigns ahead in different surveys. Three polls – all of which exclude undecided voters – give the “No” campaign the advantage on the final weekend of campaigning, but pro-Independence campaigners will be boosted by another which shows them ahead by a large margin. (http://bit.ly/1wsKHlc)

The Independent

UK FIRMS OUT OF RACE FOR 485M STG THAMES FLOOD DEFENCE PROJECT

Unions are warning of an impending British engineering skills crisis, as yet another major public sector project is set to be awarded to a huge U.S. firm. The three bids involving UK firms have been removed in the running for the 485 million stg, 10-year Environment Agency deal to shore up the River Thames’ flood defences. The contract covers an area from Teddington in west London to Sheerness and Shoeburyness in Kent and Essex. (http://ind.pn/1s2yrqG)

SCOTTISH INDEPENDENCE: STERLING ON KNIFE-EDGE AS CITY BRACES FOR SCOTS VOTE The City is bracing for “a major reaction” to sterling and shares following the Scottish independence result as the London market faces what could be its most turbulent week since the 2008 banking crisis. Bank of England Governor Mark Carney is returning early from this week’s finance meeting of G20 countries in Australia to monitor the markets in person from Thursday and Chancellor George Osborne has cancelled his trip entirely. (http://ind.pn/1qBQbYx)

 

 

Fly On The Wall Pre-Market Buzz

ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
NY Fed Empire State survey for September at 8:30–consensus 15.9
Industrial production for August at 9:15–consensus up 0.3%
Capacity utilization rate for August at 9:15–consensus 79.3%

ANALYST RESEARCH

Upgrades

AMC Entertainment (AMC) upgraded to Overweight from Equal Weight at Barclays
Abaxis (ABAX) upgraded to Buy from Hold at Canaccord
Acuity Brands (AYI) upgraded to Buy from Neutral at Goldman
Barrick Gold (ABX) upgraded to Neutral from Underweight at HSBC
CVS Health (CVS) upgraded to Outperform from Market Perform at Cowen
Chuy’s (CHUY) upgraded to Buy from Hold at KeyBanc
Conversant (CNVR) upgraded to Neutral from Sell at Goldman
Danske Bank (DNSKY) upgraded to Buy from Hold at Deutsche Bank
DigitalGlobe (DGI) upgraded to Overweight from Neutral at JPMorgan
Pebblebrook Hotel (PEB) upgraded to Buy from Hold at ISI Group
Sunstone Hotel (SHO) upgraded to Buy from Hold at ISI Group
Veeco (VECO) upgraded to Neutral from Sell at Goldman

Downgrades

Brady (BRC) downgraded to Market Perform from Outperform at Wells Fargo
Cree (CREE) downgraded to Neutral from Buy at Goldman
Douglas Dynamics (PLOW) downgraded to Neutral from Outperform at RW Baird
Marten Transport (MRTN) downgraded to Outperform from Strong Buy at Raymond James
Posco (PKX) downgraded to Neutral from Overweight at HSBC
Rackspace (RAX) downgraded to Neutral from Overweight at JPMorgan
Symantec (SYMC) downgraded to Sector Perform from Outperform at RBC Capital
TransCanada (TRP) downgraded to Sell from Neutral at Goldman

Initiations

American Realty (ARCP) initiated with an Overweight at JPMorgan
Capital Product (CPLP) initiated with a Buy at Jefferies
Continental Resources (CLR) initiated with a Buy at Canaccord
Costco (COST) initiated with a Buy at Citigroup
NRG Yield (NYLD) initiated with an Outperform at RBC Capital
PTC Therapeutics (PTCT) initiated with a Buy at Deutsche Bank
Power Solutions (PSIX) initiated with an Outperform at Northland
Target (TGT) initiated with a Neutral at Citigroup
Wal-Mart (WMT) initiated with a Neutral at Citigroup
Whiting Petroleum (WLL) initiated with a Buy at Canaccord
Winnebago (WGO) initiated with an Outperform at BMO Capital

COMPANY NEWS

Heineken (HEINY) said SABMiller (SBMRY) acquisition proposal non-actionable
Cognizant (CTSH) agreed to acquire TriZetto for $2.7B
Danaher (DHR) to acquire Nobel Biocare Holding for CHF 17.10 per share
HSBC (HSBC) confirmed $550M settlement agreement with FHFA
Oracle (ORCL) acquired Front Porch Digital, terms undisclosed
AT&T (T) said it had the ‘biggest iPhone, pre-order launch day ever’ (AAPL)
Hudson City Bancorp (HCBK) announced passing of chairman, CEO Ronald Hermance, named Denis Salamone as CEO, effective immediately

EARNINGS
No notable earnings this morning.

NEWSPAPERS/WEBSITES

Apple (AAPL) CEO says working on products that haven’t been rumored yet, Re/code reports
Amazon (AMZN) faces tax obstacle in India, FT reports
Herbalife (HLF) near settlement with former distributors, NY Post reports
Netflix (NFLX) to face competition in France from Numericable Group , WSJ reports
Citigroup (C) said to plan OneMain IPO by month-end, Bloomberg says
Home Depot (HD) took steps to up defenses, but hackers moved faster, WSJ reports
JPMorgan (JPM) could have difficulty repelling hackers, NY Times reports
Lam Research (LCRX) shares could return 20%, Barron’s says
Popular (BPOP) shares could rise 30%, Barron’s says
Pfizer (PFE) shares look cheap, Barron’s says
Starbucks (SBUX) shares could fall, Barron’s says
Don’t listen to bears about Apple (AAPL), Barron’s says

SYNDICATE

American Assets Trust (AAT) sells 400K shares at $33.76 in a private placement
InnerWorkings (INWK) files to sell 4.84M shares for holders
Marathon Patent Group (MARA) files to sell 1.32M shares for holders
Smith Micro (SMSI) files to sell 6.85M shares for holders

via Zero Hedge http://ift.tt/XnNhtB Tyler Durden

Recently, I’ve read many stories about the “strong” dollar from mainstream media financial “journalists” that are paid by pro-USD banking cartels to promote such rubbish propaganda. The strong dollar illusion is sold to the masses because the dollar is never compared against the real money of gold but only to its weak siblings of the Euro and British Pound. Stand a 95 pound weakling next to an even greater 80 pound weakling and one can produce the illusion of strength, but stand him next to a 200 pound athlete with 6% body fat and the illusion quickly disappears. Who is that 200-pound athlete? – Physical, not paper, gold.

 

Recently, Central Bankers have colluded to destroy other weak currencies to create the illusion of US dollar strength. The US dollar’s greatest competitors are the Euro, the British Pound and the Japanese Yen, and Rothschild controlled Central Bankers have destroyed all these currencies in recent months. Rothschild-directed Central Bankers have crashed the Euro by 7.34% in the past four months, the Japanese Yen by 5.78% in an astonishing two months, and the British Pound by an astounding 6.58% in just two months as well.

 

 

 

 

Rothschild bankers have even made a point to pound the traditionally strong Swiss Franc as well recently, collapsing the Swiss Frank by a whopping 6.75% in the past four months.

 

 

Of course, up until 1992, the Switzerland Constitution mandated that the Swiss Franc be backed by a minimum 40% of gold and this kept the Swiss Franc among the strongest currencies in all of Europe.However, after the Swiss government joined the IMF in 1992, it began debasing its domestic currency in earnest, as all government officials do once they join a morally bankrupt global banking cartel like the IMF, the BIS and the World Bank. Recall that when the global financial crisis reared its ugly head in 2008, the Rothschild Central Bankers hit the Swiss Franc hard, crashing it by nearly 20% in just one year to ensure that the Swiss Franc would not serve as a safe haven currency versus the US dollar at a time that the US dollar was struggling for its life, as you can see below.

 

 

Rothschild Central Bankers are executing the same actions they took against the Swiss Franc in 2008 today against all the USD’s major fiat currency competitors to promote a ridiculous and patently false narrative of a “strong” US dollar. The fact that Central Bankers are manipulating all fiat currencies along with alternative monies like bitcoin, gold, and silver downward at the same time actually reveals a counterintuitive conclusion – the US dollar is actually struggling for its life right now and not in a position of strength as Central Bankers want the world to believe! In fact, Rothschild Central Bankers have attacked any other monetary alternative that could possibly cause people to sell US dollars to destroy their perception as a safe haven, as you can see from the 58.46% decline in Bitcoin since its high of $1151 just nine months ago, and the 16.05% decline in silver and the 4.39% decline in gold prices in the last 7-months.

 

 

 

Though some people erroneously assume that I’m anti-bitcoin just because of past articles I’ve published on this blog in which I have declared my strong preference for gold over bitcoin as a wealth preservation asset. However, this is not true. I STRONGLY welcome open monetary competition instead of the government banker money-monopolies imposed upon all of humanity today. In a free society that embraces monetary competition, the strongest and best form of money will always rise to the top and seize dominance as the monetary form in wide use. Weaker forms of money will naturally fall by the wayside in non-Central Banker manipulated, free monetary markets with open monetary competition. Thus, a weaker, less useful form of money that does not illustrate stable purchasing power cannot replace a stronger form of money in a freely competitive environment. Though it is quite evident from the above graphs that Rothschild Central Bankers have put into motion a plan to simultaneously weaken all forms of money that can threaten the global hegemony of the US dollar, one must remember that the mainstream media always presents all price movements in fiat currencies relative to other weak fiat currencies and never relative to any form of REAL money. When Central Bankers are devaluing all fiat currencies, the one that falls at the slowest rate appears to be the strongest even when it is lacking any fundamentally sustainable strength. Below are the price movements of the US dollar charted against other fiat currencies in which the “strong” dollar narrative is always sold.

 

 

Below, is the USD charted against gold during the same time period. Note that when USD price movements are charted against real money, nearly all of the price movements higher of the USD have been wiped out and subsequently relegated to the small movement higher that I’ve circled below. In fact, the below chart illustrates USD price movements against PAPER gold. Chart USD price movements against the price of REAL, PHYSICAL gold, and that small price movement below would virtually disappear into nothingness.

 

 

 

If you believe the current narratives being sold by Goldman Sachs bankers like Jeffery Currie who says gold will keep falling the rest of the year and approach $1000 an ounce because of the “safe haven” strength of US Treasury bonds and the USD, then you may want to not only review the above charts again, but review the below advertisement by Australia and New Zealand banking group (AZN) this month that boasted of 0.00% interest rates for not one, but EIGHT different, foreign currency deposit accounts! With positive inflation rates, this means that real returns on all eight currency accounts will be negative. Consequently, AZN bank has decided to boast about offering deposit accounts in which clients are 100% guaranteed to have their savings destroyed. If you don’t think that there is a serious problem with the money being used in a global banking system in which banks brag about products that are 100% guaranteed to destroy your wealth, then perhaps you may buy into the anti-gold, pro-USD propaganda that many Central and commercial bankers are selling to the masses today.

 

 

As well, though most commodity heads for large global banks like JP Morgan, Goldman Sachs, ScotiaMocatta, et al, have been anti-gold, anti-silver every single year from the start of this gold bull at $250 an ounce to its current price of $1234 and from the start of this silver bull at $4 an ounce to its current price of $18.71 an ounce, it is not true that all pro-gold, pro-silver advocates are bullish 100% 24/7, 365 days a year. In fact, in this article here that I published earlier this month, you can see that when gold was trading at $1282 an ounce earlier this month, I was bearish for the immediate term, calling for gold to move to $1260. When gold moved to $1261.80 that same day, I called for gold to move to $1250. When gold reached this price, I called for gold prices to move even lower, but reserved the specifics of this call for clients only. Of course, as I know the bullion banks manipulate the price of gold by manipulating currency markets and commodity futures markets, it would be foolish to be gold-bullish and silver-bullish 24/7, 365 days a year. So don’t be fooled by Central Bankers “painting” charts all over the commodity and currency markets. With gold and silver, it is absolutely necessary to keep your eye on the big picture, and not short-term movements, as understanding the big picture is a 100% necessity if one is to avoid the impending disastrous end to these Central Banker currency wars.

 

To discover the answers to these questions and more, read our Crisis Investment Opportunities membership fact sheet and join our Crisis Investment Opportunities membership here. For updates regarding our thoughts on PM markets and stock markets, sign up for our free newsletter on our homepage. Follow us on Twitter and on YouTube.

 

 

About the Author: JS Kim is the Founder & Managing Director of SmartKnowledgeU, a fiercely independent investment research, education and consulting firm that focuses on digging well below the surface of mainstream analysis to provide objective and intelligent wealth preservation strategies.

via Zero Hedge http://ift.tt/1q6WsoZ smartknowledgeu

Recently, I’ve read many stories about the “strong” dollar from mainstream media financial “journalists” that are paid by pro-USD banking cartels to promote such rubbish propaganda. The strong dollar illusion is sold to the masses because the dollar is never compared against the real money of gold but only to its weak siblings of the Euro and British Pound. Stand a 95 pound weakling next to an even greater 80 pound weakling and one can produce the illusion of strength, but stand him next to a 200 pound athlete with 6% body fat and the illusion quickly disappears. Who is that 200-pound athlete? – Physical, not paper, gold.

 

Recently, Central Bankers have colluded to destroy other weak currencies to create the illusion of US dollar strength. The US dollar’s greatest competitors are the Euro, the British Pound and the Japanese Yen, and Rothschild controlled Central Bankers have destroyed all these currencies in recent months. Rothschild-directed Central Bankers have crashed the Euro by 7.34% in the past four months, the Japanese Yen by 5.78% in an astonishing two months, and the British Pound by an astounding 6.58% in just two months as well.

 

 

 

 

Rothschild bankers have even made a point to pound the traditionally strong Swiss Franc as well recently, collapsing the Swiss Frank by a whopping 6.75% in the past four months.

 

 

Of course, up until 1992, the Switzerland Constitution mandated that the Swiss Franc be backed by a minimum 40% of gold and this kept the Swiss Franc among the strongest currencies in all of Europe.However, after the Swiss government joined the IMF in 1992, it began debasing its domestic currency in earnest, as all government officials do once they join a morally bankrupt global banking cartel like the IMF, the BIS and the World Bank. Recall that when the global financial crisis reared its ugly head in 2008, the Rothschild Central Bankers hit the Swiss Franc hard, crashing it by nearly 20% in just one year to ensure that the Swiss Franc would not serve as a safe haven currency versus the US dollar at a time that the US dollar was struggling for its life, as you can see below.

 

 

Rothschild Central Bankers are executing the same actions they took against the Swiss Franc in 2008 today against all the USD’s major fiat currency competitors to promote a ridiculous and patently false narrative of a “strong” US dollar. The fact that Central Bankers are manipulating all fiat currencies along with alternative monies like bitcoin, gold, and silver downward at the same time actually reveals a counterintuitive conclusion – the US dollar is actually struggling for its life right now and not in a position of strength as Central Bankers want the world to believe! In fact, Rothschild Central Bankers have attacked any other monetary alternative that could possibly cause people to sell US dollars to destroy their perception as a safe haven, as you can see from the 58.46% decline in Bitcoin since its high of $1151 just nine months ago, and the 16.05% decline in silver and the 4.39% decline in gold prices in the last 7-months.

 

 

 

Though some people erroneously assume that I’m anti-bitcoin just because of past articles I’ve published on this blog in which I have declared my strong preference for gold over bitcoin as a wealth preservation asset. However, this is not true. I STRONGLY welcome open monetary competition instead of the government banker money-monopolies imposed upon all of humanity today. In a free society that embraces monetary competition, the strongest and best form of money will always rise to the top and seize dominance as the monetary form in wide use. Weaker forms of money will naturally fall by the wayside in non-Central Banker manipulated, free monetary markets with open monetary competition. Thus, a weaker, less useful form of money that does not illustrate stable purchasing power cannot replace a stronger form of money in a freely competitive environment. Though it is quite evident from the above graphs that Rothschild Central Bankers have put into motion a plan to simultaneously weaken all forms of money that can threaten the global hegemony of the US dollar, one must remember that the mainstream media always presents all price movements in fiat currencies relative to other weak fiat currencies and never relative to any form of REAL money. When Central Bankers are devaluing all fiat currencies, the one that falls at the slowest rate appears to be the strongest even when it is lacking any fundamentally sustainable strength. Below are the price movements of the US dollar charted against other fiat currencies in which the “strong” dollar narrative is always sold.

 

 

Below, is the USD charted against gold during the same time period. Note that when USD price movements are charted against real money, nearly all of the price movements higher of the USD have been wiped out and subsequently relegated to the small movement higher that I’ve circled below. In fact, the below chart illustrates USD price movements against PAPER gold. Chart USD price movements against the price of REAL, PHYSICAL gold, and that small price movement below would virtually disappear into nothingness.

 

 

 

If you believe the current narratives being sold by Goldman Sachs bankers like Jeffery Currie who says gold will keep falling the rest of the year and approach $1000 an ounce because of the “safe haven” strength of US Treasury bonds and the USD, then you may want to not only review the above charts again, but review the below advertisement by Australia and New Zealand banking group (AZN) this month that boasted of 0.00% interest rates for not one, but EIGHT different, foreign currency deposit accounts! With positive inflation rates, this means that real returns on all eight currency accounts will be negative. Consequently, AZN bank has decided to boast about offering deposit accounts in which clients are 100% guaranteed to have their savings destroyed. If you don’t think that there is a serious problem with the money being us
ed in a global banking system in which banks brag about products that are 100% guaranteed to destroy your wealth, then perhaps you may buy into the anti-gold, pro-USD propaganda that many Central and commercial bankers are selling to the masses today.

 

 

As well, though most commodity heads for large global banks like JP Morgan, Goldman Sachs, ScotiaMocatta, et al, have been anti-gold, anti-silver every single year from the start of this gold bull at $250 an ounce to its current price of $1234 and from the start of this silver bull at $4 an ounce to its current price of $18.71 an ounce, it is not true that all pro-gold, pro-silver advocates are bullish 100% 24/7, 365 days a year. In fact, in this article here that I published earlier this month, you can see that when gold was trading at $1282 an ounce earlier this month, I was bearish for the immediate term, calling for gold to move to $1260. When gold moved to $1261.80 that same day, I called for gold to move to $1250. When gold reached this price, I called for gold prices to move even lower, but reserved the specifics of this call for clients only. Of course, as I know the bullion banks manipulate the price of gold by manipulating currency markets and commodity futures markets, it would be foolish to be gold-bullish and silver-bullish 24/7, 365 days a year. So don’t be fooled by Central Bankers “painting” charts all over the commodity and currency markets. With gold and silver, it is absolutely necessary to keep your eye on the big picture, and not short-term movements, as understanding the big picture is a 100% necessity if one is to avoid the impending disastrous end to these Central Banker currency wars.

 

To discover the answers to these questions and more, read our Crisis Investment Opportunities membership fact sheet and join our Crisis Investment Opportunities membership here. For updates regarding our thoughts on PM markets and stock markets, sign up for our free newsletter on our homepage. Follow us on Twitter and on YouTube.

 

 

About the Author: JS Kim is the Founder & Managing Director of SmartKnowledgeU, a fiercely independent investment research, education and consulting firm that focuses on digging well below the surface of mainstream analysis to provide objective and intelligent wealth preservation strategies.

via Zero Hedge http://ift.tt/1q6WsoZ smartknowledgeu

Any other Monday and futures would be scorching higher. After all it was a nearly perfect storm of bad news: from China’s disastrous economic news, the worst since Lehman, to the Scottish vote where the latest poll tally had the Yes between 46% and 54%, to the dispatch of a second Russian humanitarian convoy into Ukraine, an event which a month ago sent the S&P 500 crashing, to ISIS openly defying the US by signing a non-agression pact with the “moderate” Syrian rebels to launching a new splinter group in Algeria and threatening to take over the Suez Canal, to the BIS once again warning about bubbles and complacency, and culminating with the Pope himself warning that World War III may have started, surely the S&P would be well over 2000 on any new normal day if not at new record highs.

Yet something appears to have changed not only because the USDJPY is not some 100 pips higher overnight on, well, nothing but because the S&P, which is treading water, has yet to spike on no volume reasons unknown. That something may be algos which are too confused to buy ahead of this week’s Fed announcement which may or may not have some notable changes in language or the Scottish referendum on the 18th. Or it could simply be that algos are no longer allowed to openly manipulate and rig the market on the CME as of today now that “disruptive market practices” are banned (why weren’t they before)?

In any case, keep a close eye on the market today: not all is at it has been for a while, unless of course it is still just a little early and the rigging algos (which haven’t gotten the Rule 575 memo of course) haven’t woken up just yet.

European equity markets trade little changed, with poor performance in Italian banks countered by a much stronger consumer staples sector, as consolidation hopes in food & beverage rose on reports that Heineken have rejected a big from SABMiller, who in turn were looking to shrug off an approach from AB InBev. Italian banks and those with high exposure to southern Europe (notably, Commerzbank) trade softer ahead of this Thursday’s ECB TLTRO allotment (the second of which comes in December).  7 out of 19 Stoxx 600 sectors rise; food & beverage, retail outperform, oil & gas, real estate underperform. 29% of Stoxx 600 members gain, 68.2% decline. Eurostoxx 50 -0.1%, FTSE 100 -0.2%, CAC 40 -0.2%, DAX +0.1%, IBEX -0.3%, FTSEMIB -0.8%, SMI -0.1%

Asian equity markets are generally softer overnight with the CSI 300, Hang Seng and ASX 200 down 0.5%, 0.8% and 0.7%, respectively. This seems to be a continuation of the softer session in US equities last Friday but in reality Chinese data over the weekend was also on the weak side. Chinese data over the weekend was overall on the weak side. Industrial Production came in at 6.9% yoy in August versus consensus of 8.8%. Retail sales rose 11.9% yoy in August, short of consensus of 12.1%. FAI investment came in at 16.5% YTD yoy, weaker than 16.9% expected. Growth commodities were also weaker overnight in Asian trading with Brent and Copper down -0.56% and -1.19%, respectively. The AUD has weakened to more than 5-month low at around 0.901 against the Dollar as we type. US Treasuries are closed overnight on the back of Japan’s holiday although the 10yr yield has risen by about 15bps over the past week to around 2.61% at the end of the US close on Friday.

Asian stocks fall with the Shanghai Composite outperforming and the ASX underperforming. MSCI Asia Pacific down 0.6% to 145. Nikkei 225 closed, Hang Seng down 1%, Kospi down 0.3%, Shanghai Composite up 0.3%, ASX down 1%, Sensex down 0.9%. None of 10 sectors rise with health care, consumer outperforming and energy, financials underperforming.

Market Wrap

The euro is weaker against the dollar. German 10yr bond yields fall;
Spanish yields decline. Commodities decline, with wheat, WTI crude
underperforming and natural gas outperforming. U.S. Empire manufacturing, industrial production due later.

• S&P 500 futures down 0.2% to 1973.5
• Stoxx 600 down 0.1% to 343.9
• US 10Yr yield down 1bps to 2.6%
• German 10Yr yield down 1bps to 1.07%
• MSCI Asia Pacific down 0.6% to 145
• Gold spot up 0.5% to $1235.3/oz

Bulletin Headline Summary from Bloomberg and RanSquawk

• European equity markets tread water ahead of key central bank releases from the Fed, BoE and ECB as well as political risk events (Scottish Independence) due to culminate later this week
• AUD/USD slumped to fresh six-month lows as Chinese Industrial Production slowed to levels not seen since the global financial crisis
• US Empire Manufacturing and Industrial Production
• Treasuries steady, yields 5Y and longer higher by ~1bps-1.2bps as markets wait for FOMC rate decision on Sept. 17, Scottish independence vote Sept. 18.
• Last week JPMorgan and BofAML changed forecasts for Fed’s first rate increase to June 2015; both previously expected 3Q 2015
• U.K. Prime Minister David Cameron returns to Scotland today for the second time in a week to ask voters not to “rip” the nation from the rest of U.K. as campaigning ahead of the Sept. 18 referendum on independence reaches its climax
• While Cameron pledged yesterday to take “whatever steps are necessary” to confront Islamic State after the beheading of a U.K. hostage, no decisions are likely until after Scotland’s independence referendum
• China’s weakest industrial-output expansion since the global financial crisis, and moderating investment and retail sales growth shown in data released Sept. 13, underscore the risks of a deepening economic slowdown led by a slumping property market
• U.S. Secretary of State John Kerry will meet Russian Foreign Minister Sergei Lavrov today after pro-Russian rebels continued to clash with Ukraine troops in several locations including the Donetsk airport
• U.S. allies signaled readiness to step up the fight against Islamic State under a coalition formed by Obama as the beheading of a British aid worker sparked further outrage 
• While no Arab states have publicly committed to military action, several have told the U.S. privately they are willing to join in airstrikes in Iraq and in Syria: U.S. State Department official
• Sweden’s election threw the nation’s political establishment into turmoil as backing for the anti-immigration Sweden Democrats more than doubled, leaving the largest Nordic economy facing a hung parliament
• North Korea sentenced an American detainee to six years of hard labor for what it termed “hostile” acts, putting pressure on the State Department to send an envoy to negotiate the release of three U.S. citizens
• Sovereign yields mostly lower; yields in Asia (Singapore, Hong Kong, Australia) increase. Asian stocks mixed, European stocks, U.S. equity-index futures decline. WTI crude and copper lower, gold higher

US Event Calendar

• 8:30am: Empire Manufacturing, Sept., est. 16.00 (prior 14.69)
• 9:15am: Industrial Production m/m, Aug., est. 0.3% (prior 0.4%)
• Capacity Utilization, Aug., est. 79.3% (prior 79.2%)
• Manufacturing (SIC) Production, Aug., est. 0.2% (prior 1%)
• 11:00am: POMO Fed to purchase $950m-$1.15b notes in 2036-2044 sector

FIXED INCOME

Bund futures trade flat, as markets get off to a quiet start to the week. Fixed income volumes are relatively light, with traders declining to commit to positions ahead of the slew of risk events beginning on Wednesday with the BoE minutes. French bonds underp
erform the broader European market, with domestic banks selling OATs ahead of France’s sovereign rating update on Friday, where France’s recent poor economic performance has raised the risk of a downgrade. Elsewhere, the IR/GE spread trades wider by as much as 3.5bps, after tightening significantly last week on reports that Dublin are to repay their IMF debt ahead of schedule.

EQUITIES

European equity markets trade little changed, with poor performance in Italian banks countered by a much stronger consumer staples sector, as consolidation hopes in food & beverage rose on reports that Heineken have rejected a big from SABMiller, who in turn were looking to shrug off an approach from AB InBev. Italian banks and those with high exposure to southern Europe (notably, Commerzbank) trade softer ahead of this Thursday’s ECB TLTRO allotment (the second of which comes in December).

FX

AUD was weighed on by disappointing Chinese data which showed industrial production (6.9% vs. Exp. 8.8% (Prev. 9.0%) expanding at the slowest pace since August 2008. AUD/USD broke below the 0.9000 handle for the first time since March 20th led by selling from Asia based banks while AUD/JPY printed a fresh month low near the 96.50 level. SEK fell sharply after the latest exit polls show the left-leaning Swedish opposition party gaining leading the current pro-market reform government after the vote last week.

GBP trades relatively flat as the slew of Scottish Independence opinion polls released over the weekend give no clear lead to either the ‘No’ or ‘Yes’ camp – keeping real money out of the market for the coming days.

COMMODITIES

WTI and Brent crude futures have extended last week’s fall as the poor Chinese numbers added further weight to the theory of slowing global growth. In the metals markets, gold trades slightly firmer as short-covering allows the metal to recover from the multimonth lows seen last week, however palladium outperforms, with further reports of violence surrounding Donetsk airport in Ukraine heightening fears that Russia’s large palladium production could be cut off from the global market. September Brent crude futures are set to expire at today’s pit close.

* * *

DB’s Jim Reid concludes the overnight recap:

The four polls released over the weekend suggest that whilst the ‘No’ campaign is still mostly ahead it appears to be a close call still. Indeed only the ICM online poll for The Sunday Telegraph showed the ‘Yes’ vote ahead (54% vs 46%). This does though mark the second poll that puts the Yes campaign ahead after the YouGov poll last week. However the smaller sample size of this online ICM poll of (705 respondents) and the fact that it was conducted during the same period as a telephone poll by ICM for the Guardian, which showed a 2pt lead for the ‘No’ campaign, probably means we should read the online poll with extra caution. The other 3 polls were in favour of the ‘No’ campaign. The Survation poll, the Opinium poll for The Observer and the Panelbase survey for The Sunday Times showed the ‘No’ votes leading the ‘Yes’ votes by a margin of 8ppts, 6ppts, 2ppts, respectively. So all to play for still but as for the actual logistics of the vote, polling booths will open at 7am UKT on Thursday and continues to 10pm, with results declared on a district by district basis in early hours of the following morning. Our base case here at DB remains of a No vote however a high turnout, participation of 16-17 year olds in the referendum and the closeness of the current polls all inject an additional degree of uncertainty to the final outcome.

If that wasn’t enough, the Scottish movement has increased market’s attention on the possibility of a similar referendum in Catalonia on 9th November. In an interview with El Mundo over the weekend, the leader of separatist party, Oriol Junqueras said that Catalan President Artur Mas must deliver a referendum despite its illegality. He also added that the time has come to break Spanish law in order to submit to a new Catalan rule of law. On this, DB’s Marco Stringa has published his thoughts and outlined several future scenarios. In sum although the Spanish Constitutional Court will reject Catalonia’s request for a self-determination referendum, we see a non-negligible possibility that some sort of non-binding referendum will take place in November. In any case, a permanent solution does not look forthcoming. The Scottish result as well as the EU, business and market reactions could have relevant repercussions for Catalonia. 

In terms of the Fed, the two-day FOMC meeting concluding on Wednesday will be another key event for the week. In addition to the post-meeting statement (released at 2:00 pm NYT), the Fed update its economic and interest rate forecasts, which will include new information on the Committee’s 2017 estimates. As always Yellen’s press conference at 2.30pm will be a key focus. In terms of what to expect our US economists noted that in the meeting statement, the Fed is expected to taper asset purchases by another $10bn. However, there could be some tweaks to the forward guidance language, specifically with respect to the time frame in which interest rates will remain at the zero bound following the end of asset purchases (ie ‘considerable time’ phrase). Market participants will also likely focus on the 2017 forecasts, particularly with respect to the ‚dot plot?.

Back to the present day, Asian equity markets are generally softer overnight with the CSI 300, Hang Seng and ASX 200 down 0.5%, 0.8% and 0.7%, respectively. This seems to be a continuation of the softer session in US equities (S&P 500 -0.6%) last Friday but in reality Chinese data over the weekend was also on the weak side. Chinese data over the weekend was overall on the weak side. Industrial Production came in at 6.9% yoy in August versus consensus of 8.8%. Retail sales rose 11.9% yoy in August, short of consensus of 12.1%. FAI investment came in at 16.5% YTD yoy, weaker than 16.9% expected. Growth commodities were also weaker overnight in Asian trading with Brent and Copper down -0.56% and -1.19%, respectively. The AUD has weakened to more than 5-month low at around 0.901 against the Dollar as we type. US Treasuries are closed overnight on the back of Japan’s holiday although the 10yr yield has risen by about 15bps over the past week to around 2.61% at the end of the US close on Friday.

Looking at today, US Industrial Production and the NY Fed Empire State Manufacturing survey are the two main releases for the US. In Europe, the euro area trade balance will be the notable print. Beyond today, US PPI, German ZEW and UK CPI are the main economic reports tomorrow. Wednesday will see the release of BOE’s meeting minutes, the US CPI, and the Euro area inflation report. On Thursday, President Obama will host Poroshenko and on the data front we have Philly Fed, initial claims, and building permits to watch out for. German PPI will be the key release on what will otherwise be a relatively quiet Friday.

via Zero Hedge http://ift.tt/1q6WrRN Tyler Durden