Goldman Warns “Much More Downside” To Come For Pound Sterling

As the pound resumes its post-flash-crash, post-May-Brexit-debate bounce, Goldman’s Silvia Ardagna warns of much more downside pressure to come for Sterling with a cumulative depreciation of as much as 25% by year-end.
How Much More Sterling Downside? (via Goldman Sachs)
1. With the prospect of a ‘hard Brexit’ becoming a reality, investors who were previously expecting a ‘soft’ Brexit, or no Brexit at all, have updated their priors, and Sterling has depreciated about 5 percent over the space of a week against G10 currencies. GBP/$ is about 1.5 percent above 1.20, which is our 3-months forecast published on 5 July 2016. In a recent Global Markets Daily (“How Much Sterling Downside?, 6 Oct 2016), we highlighted that risks to our Sterling forecast were to the downside. In this FX Views, we quantify the magnitude of a potential further fall in the Pound. Based on our benchmark model that assesses the impact of political uncertainty on currencies, the cumulative depreciation of Cable could be as large as 25 percent by year-end, an additional 7 percent decline from its current value.
2. While this estimate is subject to the usual degree of model uncertainty (see below) and should be viewed with a degree of caution, the following additional considerations lead us to think that such a downside move in Sterling is quite likely to materialize over the next couple of months.
First, while difficulties and hostilities around the process of negotiating Brexit have come to the forefront in the past week, in our view, the negative news has not yet been fully reflected in FX. Second, we expect data to deteriorate over the next year, surprising more to the downside than it has done so far, also weighing negatively on the currency.

This post was published at Zero Hedge on Oct 13, 2016.

OCT 13/GOLD RISES $3.00 BUT SILVER FALLS 5 CENTS/CHINA DEVALUES HUGELY LAST NIGHT TO OVER 6.723 YUAN/DOLLAR/CHINESE EXPORTS SINK/WELL OVER 25 TONNES OF GOLD STANDING IN OCTOBER (COMEX)/ANOTHER 2….

Gold $1255.00 up $3.10
Silver 17.41 DOWN 5 cent
In the access market 5:15 pm
Gold: 1258.00
Silver: 17.50
THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON
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The Shanghai fix is at 10:15 pm est and 2:15 am est
The fix for London is at 5:30 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.

This post was published at Harvey Organ Blog on October 13, 2016.

Subprime Auto Securitizations Show Signs Of Cracking As Delinquencies Rise

It will come as no surprise to our readers that sales of automobiles in the U. S. have bubbled over in recent years and stood at a SAAR of 17.7mm units at the end of September. To put that number in context, a 15-year useful life would imply that’s more than 1 car for every driving age person in the United States. Obviously that’s likely not sustainable which is probably why Ford executives admitted on a recent conference call that U. S. auto sales have likely reached a “plateau.”

This post was published at Zero Hedge on Oct 13, 2016.

Ending a Taking Economy and Creating a Giving Economy (Part 1)

I am proud to have published essays by Zeus Y. since 2008. Part 2 will be published tomorrow.
Ending a Taking Economy and Creating a Giving Economy: Confronting the Zero Interest Rate Policy (ZIRP) and Taking Effective Action by Zeus Yiamouyiannis (guest essay)
Introduction
The world can no longer afford a taking economy, where ‘make a killing’ is the motto. Together we need to create a giving and sharing economy that helps us all ‘make a living.’ This essay will unveil the present unjust and unworkable economic system that punishes responsibility and rewards fraud. It then outlines the implications for the average person, and ends with new, powerful, and practical principles and visions driven by the emergence of connected communities. This 2-part essay brings together many of the ideas I will be discussing in a new series on Transforming Economy on Gaia TV.
First, we need to become factually aware of ‘where we are now.’ This allows us to take active responsibility as aware citizens without simply blaming ourselves for our personal and collective situation. In doing this we have to be courageous enough to learn about the unfair realities that surround us without capitulating to helplessness.

This post was published at Charles Hugh Smith on THURSDAY, OCTOBER 13, 2016.

Singapore Economy Crashes In Q3

After two quarters of lacklustre nothingness, Singapore’s economy finally collapased in Q3. Against expectations of no change, GDP QoQ SAAR crashed 4.1% – the worst quarter since Q3 2012. MAS added that it did not expect GDP growth to pick up “significantly” in 2017.

This post was published at Zero Hedge on Oct 13, 2016.

An Inside Look At Two “Unrelated” Banker Suicides Reveals A Fascinating Rabbit Hole

It has been nearly four years since one of the most infamous, and still largely unexplained, banker “suicides” took place, the first in a series of many: we are talking about the death of the director of communications at Monte dei Paschi di Siena, David Rossi, who allegedly jumped to his death on March 6, 2013.
Since this event has largely faded away from the public consciousness here is a quick recap: David Rossi, who was the head of communications for Monte dei Paschi di Siena bank, which was founded in 1472 and which is currently seeking to finalize its third bailout since the financial crisis, died after falling – or being pushed – from a third floor window of the bank’s headquarters in a 14th century palazzo in the Tuscan city of Siena.

This post was published at Zero Hedge on Oct 13, 2016.

There’s No Plateau in a Housing Bubble, Not Even in Canada

Vancouver in turmoil, Toronto spikes.
Canadian house prices jumped 11.7% in September from a year ago, according to The Teranet – National Bank National Composite House Price Index released today. But the index papers beautifully over the dynamics in each metro.
In six of the 11 metro markets of the index, prices have been languishing or even declining over the past couple of years, as they’ve hit the wall of reality after often stupendous price gains in the prior decade: Montreal, Calgary, Edmonton, Quebec City, Halifax, and Ottawa-Gatineau.
In the two largest markets – Toronto and Vancouver, which combined account for 54% of the index – prices have blown through the roof. Both markets are among the hottest, most over-priced housing bubbles in the world. UBS recently ranked Vancouver Number 1 globally on that honor roll.

This post was published at Wolf Street by Wolf Richter ‘ October 13, 2016.

While media obsesses over Pu**ygate, US debt soars to $19.7 trillion

First of all, I want to say thanks for all the well-wishes. I’ve been flat on my back for the past several days with a particularly nasty case of the flu that I likely contracted en route to Los Angeles last week. Picking up the occasional bug is one of the hazards of spending a lot of time on planes… plus I have some special luck with airlines for always being seated next to a guy who sneezes with the explosiveness and ferocity of a biological terrorist. But, now that I’m better and getting brought up to speed, one of the things that caught my attention this morning was that the US government’s debt level has soared to just a hair under $19.7 trillion. To give it some context, that’s up over $120 billion in just six business days. It’s almost as if Barack Obama is intentionally and desperately trying to breach the $20 trillion mark before he leaves office in January. Of course, this hasn’t been reported anywhere because the media is too busy pretending to be shocked that Donald Trump is a womanizer.

This post was published at Sovereign Man on October 13, 2016.

Remember Ray Dalio’s “Depression” Warning: This Is Where We Stand Now

In recent weeks, Ray Dalio – a vocal proponent of QE4 and certainly against any form of monetary tightening – has been about as doom and gloomy as we have ever heard the head of the world’s biggest hedge fund. Just last week, we reported that the founder of Birdgewater, when speaking before the New York Fed, voiced his latest warning about the potential losses that would befall asset holders if interest rates rose by just 1%. Recall from his speechthat “if interest rates rise just a little bit more than is discounted in the curve it will have a big negative effect on bonds and all asset prices, as they are all very sensitive to the discount rate used to calculate the present value of their future cash flows. That is because with interest rates having declined, the effective durations of all assets have lengthened, so they are more price-sensitive.”
And the punchline:
… it would only take a 100 basis point rise in Treasury bond yields to trigger the worst price decline in bonds since the 1981 bond market crash. And since those interest rates are embedded in the pricing of all investment assets, that would send them all much lower.

This post was published at Zero Hedge on Oct 13, 2016.

Green Party’s Jill Stein: Trump is less dangerous than Clinton; she will start nuclear war with Russia

October 2016 – WASHINGTON – Green party presidential candidate Jill Stein: Donald Trump is less scary on foreign wars, because he wants to work with Russia.
JILL STEIN: It’s important to look at where we are going. It’s not just a moment in time, but where has the strategy of voting for the lesser evil you will taken us? All these times you have been told to but for the lesser evil because you didn’t want the wars, or the meltdown of the climate, or the off-shoring of our jobs, or the attack on immigrants or the massive bailout for Wall Street, that is actually what we have gotten. By the droves.


This post was published at UtopiatheCollapse on October 13, 2016.

Huge Crude Inventory Build Sees Oil Fall Below $50

The Energy Information Administration tipped markets towards bear territory when it reported that US crude oil inventories had jumped by 4.9 million barrels in the week to October 7. The total of 474 million barrels remains higher than the average for this time of year.
Yesterday, the American Petroleum Institute was the first to spread oil doom and gloom by estimating that crude inventories had gone up by 2.7 million barrels in the same week. This immediately weighed on international oil prices, as it came amid a temporary pause to the news flow about OPEC and Russia’s freeze plans. It also suggested that inventories may be building for the first time in the last six weeks.

This post was published at FinancialSense on 10/13/2016.

SP 500 and NDX Futures Daily Charts – Mixed Messages

Stocks took a dive this morning on data showing that Chinese exports fell by 10% year over year in September.
This plays into the notion that the demand from their trading partners, like the US, is slowing.
However, unemployment claims came in lighter than expected, allowing the acolytes of The Recovery to continue bubbling on.
Financials were also leaders to the downside, as they open their earnings reporting tomorrow, and the CEO of Wells Fargo steps down after the massive fraud scandal.

This post was published at Jesses Crossroads Cafe on 13 OCTOBER 2016.

The Good Ole Days Aren’t Coming Back

The US economy has slowed, and the reasons for the sluggish growth cause heated arguments among market participants and economists alike. There are two outspoken camps: ‘the good ole days are coming back’ and ‘this is normal.’ The camps have little in common, except yelling at one another.
Good Ole Days
Regardless of whether or not the good ole days will return, they are a long way off. There are a number of reasons for this, but as this recent paper pointed out, demographics are destiny. Sure, Millennials could create a baby boom, but it’s doubtful. Even if they were up to the task, it would take decades for the effects to trickle through the US economy.
Everyone loves to harp on Millennials. But their predecessors had a few key demographic traits handed to them that boosted economic growth. The Boomer generation had the benefit of astounding population growth and labor force gains. As women joined the labor force in greater and greater numbers, the growth accelerated the Boomer boost. All of this made an unrepeatable economy to grow and thrive in.

This post was published at Mauldin Economics on OCTOBER 13, 2016.

While media obsesses over Pussygate, US debt soars to $19.7 trillion

First of all, I want to say thanks for all the well-wishes. I’ve been flat on my back for the past several days with a particularly nasty case of the flu that I likely contracted en route to Los Angeles last week. Picking up the occasional bug is one of the hazards of spending a lot of time on planes… plus I have some special luck with airlines for always being seated next to a guy who sneezes with the explosiveness and ferocity of a biological terrorist. But, now that I’m better and getting brought up to speed, one of the things that caught my attention this morning was that the US government’s debt level has soared to just a hair under $19.7 trillion. To give it some context, that’s up over $120 billion in just six business days. It’s almost as if Barack Obama is intentionally and desperately trying to breach the $20 trillion mark before he leaves office in January. Of course, this hasn’t been reported anywhere because the media is too busy pretending to be shocked that Donald Trump is a womanizer.

This post was published at Sovereign Man on October 13, 2016.