Markets Are Rising In The Calm Before The Storm
Tomorrow is the big day, when we might get clues about whether the Fed will begin to pull back a bit on monetary easing.
Today is the calm before the storm, and it’s pretty quiet.
Futures are up in the US and markets are higher in Europe.
Japan ended down merely 0.2%, which is super-quiet.
China gained 0.4%.
Today we get CPI and housing starts.
Both should be interesting, especially CPI given the disinflation trend.
Inflation protests erupt in Brazil, E.U. and U.S. launch largest bilateral trade deal in history, and China’s biggest banks are turning up the pressure
ANALYST: Now That The Cheap Money Is Coming To An End, We Can See The Bubble To End All Bubbles
Lovely chart of Russian Ruble. Devaluation in progress. Next stop @ 33.–
Guindos Says Spanish Banks May Need EU2b of New Capital
Why is Draghi again talking about “doing whatever it takes to save euro” if Gollum said yesterday the existential crisis of the EUR is over
G-8 Draft Says Growth, Jobs Are Urgent Priority. No problem: the chairman can just print both
Spain bad loan ratio rises from 10.47% in March to 1.87% in April, European car sales drop to 20 year low but at least Germans are confident
Russian Market‏@russian_market21 min
CAPITAL OUTFLOW FROM RUSSIA LIKELY TO EXCEED $30 BLN FORECAST IN 2013 – KLEPACH
“Berlusconi: Let’s breach EU deficit rules. Who would throw us out?” $EURUSD
Everyone now mocking poor Abe – Russia deputy min says FinMin intent to buy FX not aimed at weakening Ruble
Schizomarket On Edge As FOMC Meeting Begins
And while all this posturing was going on, Spain’s economy cratered once again with the bad loan ratio rising from 10.47% in March to a record 10.87% in April, and since this is a coincident unemployment reading of unemployment look for the real, not manipulated and misreported, Spanish economy to continue deteriorating as rapidly as it has been to date.
But all of the above is meaningless with the market continuing to act like a teenage primadonna with the June FOMC meeting starting today. We can’t help but wonder how much the market would plunge, or soar, if Amanda Bynes has a tweet commenting on what Bernanke may (or may not) do. Remember: it is a centrally planned world and we are all merely collateral whose every communication is intercepted and recorded by the authorities. And speaking of, it is quite likely that the next Fed Chairman is coming, following the release of Obama’s Charlie Rose interview contents in which the president said that “he’s already stayed a lot longer than he wanted or he was supposed to.” Bring on the Geithner, Summers, Yellen, Krugman rumors.
All the news headlines in bulletin format courtesy of Bloomberg:
- Treasuries steady as Fed’s two-day meeting begins, with rate decision and Bernanke press conference tomorrow; investors weighing whether economy strong enough for Fed to begin tapering asset purchases.
- ECB’s Draghi said the central bank is considering further non- standard monetary policy tools and will deploy them if circumstances warrant
- German investor confidence rose in June, with the ZEW index of investor and analyst expectations increasinf to 38.5 from 36.4 in May, est. 38.1
- U.K. inflation accelerated 2.7% in May, more than economists forecast, as a record jump in air fares for the month helped extend its persistence above the Bank of England’s 2% target
- European car sales fell to a 20-year low in May as rising joblessness caused by a recession in the euro region reduced demand at PSA Peugeot Citroen, Renault SA and General Motors Co.
- Obama said Bernanke has stayed in his post “longer than he wanted,” one of the clearest signals the Fed chief will leave when his current term expires next year
- Currency strategists from Barclays Plc to Deutsche Bank AG are advising investors to sell the yuan, this year’s best-performing emerging-market currency, as growth slows in the world’s second-largest economy and inflows wane
- Sovereign yields mostly higher. Nikkei falls 0.2%, most Asian equity markets gain. European stocks mixed, U.S. equity index futures mixed. WTI crude and metals lower
The biggest bond bubble in history is turning into carnage