Recent comments by Rajesh

Hu Knows
China under mounting pressure to ease policy as economy stumbles
| Reuters

The producer price index fell 5.4 percent from a year earlier, the National Statistics Bureau said on Sunday, compared with an expected 5.0 percent drop. It was the worst reading since October 2009 and the 40th straight month of price decline.

Falling producer prices are worrying because they eat into the profits of miners and manufacturers and raise the burden of their debts. China's corporate debt stands at 160 percent of gross domestic product, twice that of the United States, according to a Thomson Reuters study of over 1,400 firms.

bearly wrote:

pitbull justice department

Is this the same Justice Department that sent all those bankers to prison?

Is it too soon to talk about government shutdown and the debt ceiling?

Hu Knows
China's July exports slump 8 percent, raises pressure for more stimulus
| Reuters

Chinese exports tumbled 8.3 percent in July, their biggest drop in four months and far worse than expected, reinforcing expectations that Beijing will be forced to roll out more stimulus to support the world's second-largest economy.

Imports also fell heavily from a year earlier, in line with market forecasts but suggesting domestic demand might be too feeble to offset the weaker global demand for China's exports.

Economists had forecast exports to fall just 1 percent, after a 2.8 percent uptick in June, but the data on Saturday showed depressed demand from Europe and the first drop in exports to the United States, China's biggest market, since March.

Exports to the European Union fell 12.3 percent in July while those to the United States dropped 1.3 percent. Demand from Japan, another big trading partner, slid 13 percent.

"A recovery in external demand remains far off and economic growth will continue to rely on domestic demand, which implies policies should continue to be relaxed in the second half," wrote Qu Hongbin, China economist at global bank HSBC.

Imports fell 8.1 percent, according to the data from the General Administration of Customs. That compared with forecasts for an 8 percent drop, after a 6.1 percent decline in June, though these falls also reflected weaker commodity prices.

China recorded a trade surplus of $43.03 billion for the month, below forecasts of $53.25 billion.

Belmont wrote:

GSEs don't handle jumbos.

Most jumbos remain on the originator's balance sheet, though there are a few Jumbo MBS issued. For the most part, they probably set the rate based on the interest rate swaps, where fixed payments (like Mortgage P&I) can be swapped for floating payments (cost of deposits.)

Mike_PNW wrote:

who sets mortgage rates?

The GSEs auction their when-issued MBS to determine the rate that investors require to hold said securities. Once they know what coupon is required they can purchase mortgages to form pools based on the the securities that they promised to issue.

Sirus wrote:

Now we need a "Democratic" Trump who has been a Republican all his life to run with the Democrats or at least act like it

Lincoln Chafee - Wikipedia, the free encyclopedia

When his father died in 1999, Governor Lincoln Almond appointed the younger Chafee to his father's seat in the U.S. Senate. He won the 2000 election to a full term, defeating Democrat Robert Weygand by 57% to 41%.
On April 9, 2015, Chafee announced that he was exploring a run for U.S. President as a Democrat in the 2016 election

Wall Street now thinks Fed hike in September will be 2015's only move: Reuters poll
| Reuters

Top Wall Street banks still expect the Federal Reserve to raise interest rates in September, but a growing number now believe the central bank is likely to only hike once this year, a Reuters poll found on Friday.

Thirteen of 19 primary dealers, or the banks that deal directly with the Fed, polled said they expect the Fed to raise rates by September but just nine now believe the Fed will hike rates twice in 2015, compared with 15 of 20 in the July Reuters poll.

The median expectation for where the federal funds rate will end the year was 0.5 percent and 1.5 percent for 2016.

I didn't realize there was a God futures trading contract. Does it trade on the CME?

Sirus wrote:

Keep on thinking finance is "fixable".

If you can fix a dog, why not finance?

sum luk wrote:

here I sit thinking it's great that we are finally getting a little volatility.

You call this volatility. Greek banking stocks: That's volatility.

The annual shutdown of the auto plants creates havoc on the seasonal adjustment for July and August. I'll take the under.

What a load of fertilizer!
Fertilizer Maker CF to Acquire OCI Assets for $8 Billion - Bloomberg Business

CF Industries Holdings Inc. agreed to acquire European and North American assets from OCI NV for about $8 billion to create what it says will be the world’s largest publicly traded producer of nitrogen fertilizer.

The cash and stock transaction will see the creation of a new holding company based in the U.K., of which CF investors will own 72 percent and OCI the rest. The merger includes the assumption of about $2 billion in debt, the companies said in a statement Thursday.
The deal is a fallback for Deerfield, Illinois-based CF after talks to merge with Norway’s Yara International ASA fell apart in October.

Combining with Amsterdam-based OCI marks a strategy shift for CF, which until now has thrived as a North American supplier of nitrogen fertilizer using cheap raw-materials provided by the nation’s shale gas industry. OCI, part-owned and run by Nassef Sawiris, has production assets in the Netherlands and the U.S.

The combination is one of several multibillion-dollar deals to emerge this year among agriculture-focused companies. Monsanto Co., the world’s largest seedmaker, is pursuing a takeover of Swiss pesticide giant Syngenta AG, while Canadian fertilizer company Potash Corp. of Saskatchewan Inc. is seeking to acquire German rival K+S AG.

tg wrote:

any reason for the low?

Chinese stop drinking milk.

Television debates have too much content in them. The Republican candidates need to agree to a tweet-off.

bearly wrote:

At least as many as Hillary.

I'm sure some of the superdelegates are already in the Hilary camp but haven't announced yet. I doubt Trump has any superdelegates on the Republican side.

How many delegates has Trump won so far?

josap wrote:

At some point the price crashes into the "affordability wall".

I think that was in 2010. Still going.

josap wrote:

at $249K.

He needs to triple the price, because houses in the $750K range are in demand.

KarmaPolice linked:

Shots Fired, Gunman Dead In Nashville Movie Theater

Was there an Armadillo involved?

KidPsych wrote:

I would just prefer they not rampage near me.

No rampage in my neighborhood (NRIMN?)

Nemo wrote:

I don't see why they would do that unless they are serious.

They are serious. But you have to believe their forecast of a very strong economy in order to believe in a Sept rate hike. The market is simply pricing in a moderate economy with mild dis-inflation.

Nemo wrote:

Sure that's not cash sales and distressed buyers?

I'm pretty sure it's houses that are being sold and the sellers that are distressed.

Mook wrote:

meme without an icon

You have overlooked Brown Pants . Which actually predates the newsletter (but not the meme.)

Outsider wrote:

It would be "interesting" if the Greek markets brought down Germany's.

Germany is going to lend the Greeks 25 billion Euros to restructure the banking system, which the Greek can't afford to repay. But the Greeks may need 100 billion Euros to restructure the banking system, which the Greek can't afford to repay.

Greek bank shares plunge for third day, drag down broader market
| Reuters

Greek bank shares sold off sharply for the third day in a row on Wednesday with buyers yet to emerge on a scale large enough to counter continued dumping of the stocks.

The losses follow a 50 percent plunge in the bank sub-index over the previous two sessions and dragged down the wider Athens market, where non-financials were generally outperforming banks.

The bank sector share index .FTATBNK was down 27.5 percent, closing in on the near 30 percent dives seen on both Monday and Tuesday, with millions of shares offered and no bids after early deals.

Shares of Alpha Bank (ACBr.AT) and Piraeus (BOPr.AT) effectively hit the daily loss limit of 30 percent, with peer Eurobank (EURBr.AT) down 26.7 percent and National Bank (NBGr.AT) falling 26.6 percent.

More than 8 million shares in Alpha and 2.6 million shares in Piraeus were being offered for sale, with no bids seen.

Mortgage interest rates are too high!

Clearly an absence of healthy growth can only be cured by raising interest rates.

arthur_dent wrote:

capacity utilization

Average 1972-2014: 80.1
June 2015: 78.4

Clearly signs of economy overheating!

arthur_dent wrote:

all the data is screaming, rate hike now.

Especially the 0.3% y/y rise in the PCE price index.

CME Group FedWatch

Market is pricing in a 0% chance of a rate hike in September, 39% chance in October and a 64% chance in December.

Exclusive: Boeing loses large satellite deal due to trade credit woes - sources
| Reuters

Boeing Co (BA.N) is scrambling to find alternate financing for a satellite contract worth "several hundred million dollars" that was scuttled by privately held commercial satellite provider ABS due to uncertainty about the future of the U.S. Export-Import Bank, three sources familiar with the matter said on Tuesday.

ABS, based in Bermuda and Hong Kong, terminated its order for the satellite in mid-July, citing the expiration of the trade bank's charter on June 30, according to the sources, who asked not to be named given the sensitivity of the issue.

The termination marks the first known casualty of the ongoing congressional debate over the future of the trade bank, which lends money to U.S. exporters and their foreign customers.

ZIRP fatigue is strong in this one.

poicv2.0 wrote:

It might tip over during tight turns.

It's OK. It only makes right turns.

yuan wrote:

Other than Jeb! everyone in the top 5 is either a joke and/or a TPer.

One minute. Jeb! isn't a joke?

It won't be long before mortgage lenders start qualifying buyers by what they intend to earn in five years. Then the Millennials will snap up houses.

When did the Torygraph become a bunch of Welfare Queens?

Everybody off the American engine. She's gonna blow!

Hu Knows
China Limits Stock Market Short Selling to Curb Volatility - Bloomberg Business

Chinese regulators restricted short selling of stocks, freezing out day traders, in their latest step aimed at stabilizing the world’s second-largest equity market.

Investors who borrow shares must now wait one day to pay back the loans, according to statements from the Shanghai and Shenzhen stock exchanges issued after the close of trading on Monday. This prevents investors from selling and buying back stocks on the same day, a practice that may “increase abnormal fluctuations in stock prices and affect market stability,” the Shenzhen exchange said.

Under the old T+0 rule, “you can go short in the morning and cover your shorts before market close the same day and lock in your profit, if your bet is right,” Xian Liang, a San Antonio, Texas-based portfolio manager at U.S. Global Investors Inc., said in an e-mail.

“Now with T+1, you can’t cover your short position in the same day, and have to wait till next day at the earliest. This new rule should discourage speculative short sellers -- day traders -- and help mitigate intraday volatility.”

China is taking unprecedented measures to stem a stock rout that has wiped out almost $4 trillion in market value since mid-June.

Earlier on Monday, the Shanghai Stock Exchange warned two trading accounts for making a “large amount of sell orders affecting security prices or volume.”

Those dastardly minions!
Giant '40-foot' Minion balloon causes traffic chaos in Dublin -

There was traffic chaos in the Santry area of Dublin today after a giant inflatable Minion flew loose onto the Old Swords Road.

Whiskey wrote:

ethics in debate journalism.

Ethics? Fox news? Puzzled

Whiskey wrote:

It's really more of a mass debate.

Not a weapon of mass diversion?

Outsider wrote:

There are going to be 15 very disappointed people in the primaries.

Not counting the voters, you mean.

Mary wrote:

will anyone pay back the loan?

What can't be paid, won't be paid. The only question is who will be left holding the bag?

Take this drone to Cuba?

U.S. Dept of Justice initiates criminal probe against Deutsche Bank: Bloomberg
| Reuters

The United States Department of Justice is investigating trades worth billions of dollars that Germany's Deutsche Bank AG made on behalf of its Russian clients, Bloomberg reported, citing people familiar with the matter.

The probe investigates so-called mirror trades, where the bank's Russian clients bought stocks in rubles, and through simultaneous transactions in London, bought the same stocks in U.S. dollars, thereby moving funds out of Russia without informing authorities, Bloomberg reported.

Last month, The New York State Department of Financial Services (DFS) sought detailed information from Deutsche Bank on possible money-laundering transactions by some of its clients in Russia that could exceed $6 billion in total, a source familiar with the matter told Reuters.

Antipodes wrote:

Nothing quite like gun oil in your food.

No trans-fats!

ResistanceIsFeudal wrote:

Can't we just leave them to their own devices?

Peace. Love. And Strict Conformity.

Napolean wrote:

Does ZIRP have an exit that isn't a world war?

There's a total extinction option.

Oil sinks to six-month low amid weak data, slump in gasoline
| Reuters

Oil sank to six-month lows on Monday with Brent crude falling below $50 a barrel on sluggish U.S. and Chinese economic data and bets for weaker gasoline consumption in the United States after tearaway demand earlier in the summer.

Evidence of growing global oversupply and a stock market collapse in China, the world's largest energy consumer, have weighed on oil for weeks, leading in July to U.S. crude futures' largest monthly decline since the 2008 financial crisis.

On Monday, the rout deepened as U.S. gasoline fell its most in a day in 10 months.

Supply worries aside, traders pinned the latest losses on sluggish U.S. and Chinese data.

U.S. consumer spending advanced at its slowest pace in four months in June as demand for automobiles softened. Growth in Chinese manufacturing, meanwhile, unexpectedly stalled in July.

"Economic weakness has set the tone," said Matt Smith, director of commodity research at ClipperData, a New York-based energy database.

"But the gasoline crack spread is also unraveling," Smith said, referring to the difference between gasoline and U.S. crude prices, which sets the profit margin for refiners.

Brent LCOc1, the global benchmark for crude, was down $2.35, or 4.5 percent, at $49.86 a barrel by 2:05 p.m. EDT. Brent's session bottom of $49.52 was the lowest since Jan. 30.

U.S. crude CLc1 was down $1.75, or 3.7 percent, $45.37.

"The chart is looking anything but constructive," said Fawad Razaqzada, technical analyst in London for, who expects U.S. crude to test its March low of $42.03 and Brent its January bottom of $45.19.