The Mess That Greenspan Made - Part 18

October is Far from Over

For obvious reasons, there hasn’t been much reason to update the chart below as it has been a virtually seamless glide higher for U.S. stocks over the last couple years. Also for obvious reasons, now there is a reason to update the chart.

I haven’t been paying much attention to markets lately (or writing much, as evidenced by those first two sentences above), but one thing should be clear to any casual observer, namely, that the sphincter factor has increased considerably in just the last couple weeks with perhaps a much bigger increase in store since October is far from over.

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Monday Morning Links

MUST READS
Can all US hospitals safely treat Ebola? – AP
CDC criticized for blaming ‘protocol breach’ as nurse gets Ebola – Reuters
War against Isis: US air strategy in tatters as militants march on – Independent
Dollar Drops as Fed Officials Warn on Slowing Growth – Bloomberg
I.M.F. Warns of Global Financial Risk From Fiscal Policies – NY Times
U.S. regulators press banks for more on auto loan risks – Reuters
China’s Zhou Says Some Countries Using Yuan in Reserves – Bloomberg
In GM bankruptcy, an ex-con and hedge funds find common ground – Reuters
Russia Spending $6B Not Enough to Stop Ruble Rout on Oil – Bloomberg
A Trip to Kuwait (on the Prairie) – Huffington Post
Air-Pockets, Free-Falls, and Crashes – Hussman Funds
Derivatives Story 2014 – Noland, Prudent Bear
How Scared Should Investors Be? – WSJ

MARKETS/INVESTING
World stocks recover in European trading – AP
It’s reality check time for stocks – CNN/Money
Investors gird for scarier days in markets – Reuters
The Dollar and the Investment Climate – Marc to Market
What the Heck just Happened in Global Stock Markets? – Wolf Street
Treasuries at 11-Month High on Global-Growth Concern – Bloomberg
Gold rises on lower dollar, Fed rate hike uncertainty – Reuters
Gold: ‘near-term uncertain…long-term prospects glorious’ – Mineweb
SGE Chairman: 2013 Chinese Gold Demand Was 2000t – Bullionstar
Making sense of Chinese gold demand – Mineweb
Asian Market Hubs Move Into Gold – WSJ

ECONOMY/WORLD/HOUSING/BANKING
Do we dare to question economic growth? – Guardian
U.S. TIPS market signals rising concerns about disinflation – Reuters
Price Deflation and Price Inflation Are Always “Optimal” – Mises
China’s Exports Buoy Growth as IPhone Inflates Imports – Bloomberg
Economists Voice Caution Over Strong China Trade Data – WSJ
Draghi Asset Plan Seen Falling Short as QE Bets Rise – Bloomberg
Germany shrugs off call for greater spending – AP
Finland is in trouble, and it blames Apple for everything – Quartz
Why retirement savers should track the housing market – MarketWatch
Will the Fed Let the Stock Market Crash Before an Election? – of two minds
Fed Can’t Keep Falling Short of Inflation Goal, Says Evans – WSJ
The Methodical Fed – Fed Watch

 

Art Cashin on the Selloff

Art Cashin, Director of floor operations at the NYSE for UBS, talks about yesterday’s huge stock sell-off following Wednesday’s fresh record highs. As is the case for most pundits, Cashin offers no clear reason for the change in market sentiment.

Cashin notes: “Rumor-mongers are out and about so viewers should be careful … it’s clearly rather heavy selling … there’s nothing narrow about this selloff.”

It’s worth pointing out that one phrase that was noticeably absent from the discussion of yesterday’s market action was “buy the dip”, though that appears to be happening today.

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Friday Morning Links

MUST READS
The Secret Goldman Sachs Tapes – Bloomberg
Hungary suspends gas supplies to Ukraine – BBC
Ukraine prime minister says Russians ‘want us to freeze’ – Reuters
After selloff, stock market in search of stability – USA Today
Winners and losers from the dollar’s recent rally – CNBC
Alibaba options set for strong demand on market debut – Reuters
The solution to Italy’s woes is quite simple – leave the euro – Telegraph
Draghi’s Trillion-Euro Pump Finds Blockage in Spain – Bloomberg
US public pension gap at least $2 trillion: Moody’s – Reuters
Gas prices headed below $3 a gallon – USA Today
Bad loans pose worsening risk – China Daily
The Show-Off Society – Krugman, NY Times
Being Wrong – Alhambra Partners

MARKETS/INVESTING
Stock markets turn higher after Wall Street drop – AP
First take: Did Alibaba IPO mark a top for stocks? – USA Today
This stock selloff has everyone talking about ‘divergence’ – MarketWatch
Correlations Revive as China’s Slowdown Beats Rates – Bloomberg
Bonds Worldwide Pull Out of Tailspin on Growth Concern – Bloomberg
Gold down on strong dollar, but set to snap 3-week losing streak – Reuters
The Workings Of The Shanghai International Gold Exchange, Part One – BullionStar
Junior miners ‘starting to disappear’ as grim market reality takes hold – FP
Gold markets waiting for the Asian festive demand – BullionStreet
Death Of ‘Safe Haven’ Gold Greatly Exaggerated – GoldCore
Falling Out of Love With Gold – Bloomberg

ECONOMY/WORLD/HOUSING/BANKING
Decelerating Money Supply Increases Risk of a Bust – Forbes
China official PMI seen steady at 51.2 in September but pressures remain – Reuters
China’s slower GDP growth worthwhile for long-term sustainability: IMF – xinhuanet
UK cuts to last five more years, ex-civil service boss says – BBC
Conflicts weighing on German consumer confidence – AP
Japan consumer inflation up 3.1% on-year in August – CNA
Singapore is top foreign investor in Australian commercial properties – CNA
London Home Prices Post First Fall Since 2012 on Demand Drop – Bloomberg
House prices have finally started to fall after two years – Telegraph
2015 Prediction: California Housing Markets Will Post Biggest Gains – HBI
PBOC official sees bright side of shadow banks – China Daily
Low inflation fuels caution at Fed over rate rises – Reuters

 
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