USDJPY (And Nikkei) Surge Higher as Japanese Car Sales Collapse To 3-Year Lows

20140901_Japan_0

And for tonight’s menu of disastrous Japanese economic data, we have (drum roll please)… Auto sales. Overall auto sales fell 9.1% YoY to 333,471 – the lowest in 3 years. Minicars dropped a stunning 15.1% YoY according to the Japanese auto dealers association. The response – rather obvious by now – to this terrible news… a 35 pip vertial ramp in USDJPY which can mean only one thing – the Nikkei 225 rallied 150 points… On a side note, following disappointing PMIs, China fixed the Yuan at 4-month lows.   Car Sales collapse….   So buy stocks and sell JPY….... Read full article

Asian Property Prices Are Falling "As If There's A Global Financial Crisis"

20140901_sing1_0

With China’s property developers slashing prices, piling on incentives, and still seeing sales slump; it is no surprise that demand from the top to the bottom across Asia is falling. As Reuters reports, even Singapore’s Sentosa Cove (the man-made island resort billed as Asia’s Monte Carlo) is eerily silent as the billionaires seem to be staying away with prices down over 20-30% in the past year. New mortgage business is down over 40% as “the rential can’t even cover the mortgage anymore.” As one analyst notes, “the tables have turned,” adding rather ominously that, “The way prices have fallen, it’s.... Read full article

US Futures Levitate To New All Time High As USDJPY Surges Above 105; Gold Slammed

mf68

Just when we thought centrally-planned markets could no longer surprise us, here comes last night’s superspike in the USDJPY which has moved nearly 100 pips higher in the past few trading days and moments ago crossed 105.000. The reason for the surprise is that while there was no economic news that would justify such a move: certainly not an improving Japanese economy, nor, for that matter, a new and improved collapse, what the move was attributed to was news that Yasuhisa Shiozaki, who has been advocating for the GPIF to reduce allocation to domestic bonds, may be appointed the Health.... Read full article

Frontrunning: September 2

mf67

Ukraine Shifts to Defense Against Russian Incursion (WSJ) U.S. forces carry out operation against al-Shabaab in Somalia (Reuters) Bond Markets Tilt Toward Frankfurt as Draghi Negates Fed (BBG) Another “unexpectedly” – Swiss Economy Unexpectedly Stalls as Euro Area Takes Toll (BBG) Japan’s ‘Abenomics’ feared in trouble as challenges build (Reuters) Germany Imposes Nationwide Ban on Uber’s Cab-Hailing Service (WSJ) Japan’s ‘forward guidance’, the GPIF, has “already begun a highly anticipated portfolio reshuffle” (WSJ) Detroit Brings Bankruptcy Plan to Court With Billionaires (BBG) Burger King has maneuvered to cut U.S. tax bill for years (Reuters) JPMorgan Operating Risk Rises With Past.... Read full article

Eric Cantor Sold For $3.4 Million: Former Head Republican Joins M&A Investment Bank As Vice Chairman

Cantor-top-20-donors_0

Back in June, when the political career of Eric Cantor came to a sudden, stunning end at the hands of an unknown “tea-partier”, we commented that the biggest losers from Cantor’s ignoble fall from Congressional grace were his biggest donors. As showed back then, these were as follows:   Less than three months later, their loss is Cantor’s gain, who after a long auction process has finally, and very expectedly, sold himself off to the highest bidder which as the WSJ reported overnight was none other than boutique M&A advisory firm, Moelis & Co. Per the WSJ, “Mr. Cantor, 51.... Read full article

British Pound Volatility Surges Most Since 2008 As Scottish Referendum "Yes" Vote Looms

20140802_gbp_0

As we explained previously, the market appeared woefully under-priced for the potential risk of a Scottish “yes” vote. However, this weekend saw the margin between ‘yes’ and ‘no’ voters narrowed dramatically (53% “No” vs 47% “Yes” – a 6-point spread now versus a 14 point spread just 2 weeks ago). UK Gilt yields are higher, GBP is falling (its lowest since March) and implied volatility has spiked by the most since 2008 as hedgers pile in, now suddenly fearful.   GBP vol spikes on narrowing “Yes” vote…     *  *  * As we concluded previously, Some Possible Implications Of.... Read full article