Macro Afternoon

A bad end to the week here in Asia, with the Australian dollar looking like the worst casualty, selling off quite smartly against USD, Yen, even Kiwi in reaction to the RBA’s monetary policy statement. Chinese stocks continue to fall in light of ongoing trade war tensions while emerging currencies like the Turkish Lira are also feeling the heat.

The Shanghai Composite is off slightly, down 0.2% going into the close, currently at 2788 points, unable to finish the week above previous support at 2800. The Hang Seng Index is off nearly 1% to 28349 points, still just above previous terminal support at 28000 point but unable to make any headway as we close out the week:

S&P futures are down 0.5% alongside Eurostoxx as USD volatility weighs on equities. This is a quick retracment to support at 2840 points that could have legs if the USD surge continues:

Japanese stocks are the worst in the region as Yen safe haven buying outweighs the return to USD strength. The Nikkei 225 closed 1.1% lower at 22345 points, still unable  trying to get out of its sideways move on the daily chart. The USDJPY pair has come back slightly in the late Asian session, briefly touching the 111 handle. This still looks weak, with the high moving average not under any pressure here and the downtrend line still respected:

The ASX200 fell back slightly, closing 0.3% lower to close at 6278 points, still unable to breach overhead resistance at 6300 as buying support below starts to wane. The Aussie dollar is  getting slaughtered here on the SOMP, heading straight down to the 73 handle, wiping all of the last month’s tentative buying support:

The economic calendar finishes the week with a busy schedule, with Q2 UK GDP first up, then Canadian unemployment, followed by the latest US CPI print.

Have a good weekend and manage that risk!


    • Mining BoganMEMBER

      It’s like one of those nice evil spirits that keep on reappearing whenever you mention its name.

      • Indeed. Pls explain the thinking Gramus! Our commodities are priced in USD so it isn’t that. And if they want to “buy up the rest of the country” they want the AUD as low as possible…

  1. Good to see Channel 9’s influence in the Fairfax newspapers is up and running early with a story about Channel 9’s new tennis coverage this upcoming summer receiving a blurb on page 3 of the Financial Review.

  2. interested party

    “Let’s begin in the realm of the fanciful.”

    “Strategies would encompass politics, the courts, opposition research and the media.”

    This media??????
    There are more names to add to that list…but you get the idea.

    Opposition research = mueller investigation.
    media = cia/mockingbird ( they are here in Aust as well )

    Bigger than watergate. Who hangs first?

    • For over 100 years it was a crime in the United States for the government to engage in deliberate propaganda against the people of the United States.

      To circumnavigate this ban there were many paths – primarily using British / Australian news papers to print propaganda and then to repeat those claims in domestic press. Things like the aluminium tubes in the lead up to the Iraq war and reporting on the Iraqi National Congress a CIA front group in London which was used to push propaganda.

      The method was to use left leaning publications to push propaganda (Britain has powerful propaganda laws which allow them to compel media outlets to carry propaganda which are secret and revealing or discussing those laws is a crime – same laws are in Australia, now America – more on this in moment). The Guardian and Observer were the preferred targets and were using sparingly but effectively. These types of publications were more likely to be trusted by the Left wing and progressives while the right wing generally needs little persuasion.

      It should be noted the CIA started their “Magazine Operation” as early as the 1970’s investing in magazines and push their own off book propaganda. The most famous of these were Time and Vice Mag which later received funding and operational directions via InQtel. (InQtel was rumoured to have sponsored early days of Facebook as well).

      The US then moved onto using senior military figures at arms length in the early 2000’s as part of the “outsourcing” of private military companies and placed them directly on all the major news outlets pushing direct propaganda but at arms length as private contractors or “press” briefings. The US then moved to control the FULL NARRATIVE in the “War on Hearts and Minds” as it became to known and refused access to all media in the Iraq War outside of Embedded Journalists whose entire narrative was controlled and vetted.

      Journalists outside of this were deliberately targeted by the US military culminating in the repeated bombing of Al Jazeera killing three journalists, and foreign journalists in the Palestine hotel in Baghdad killing two more.

      The story from there only ramps up to today with the US state war on “Fake News” of independent journalism, facebook, blogs, etc, the NSA recording of any and all digital correspondence domestic and global, Snowdens leaks etc, etc – and the end of the Obama reign where his last and probably the single most powerful act ever legislated by a US President mid term or in caretaker mode (Obama was in caretaker) – the Countering Foreign Propaganda and Disinformation Act.

      This extraordinary piece of legislation framed as countering foreign propaganda with domestically produced propaganda allowed the US to create and disseminate propaganda and to compel media outlets to carry and broadcast the propaganda under secrecy.

      The act was the last piece of legislation Obama signed – and it was immediately put to use to generate a tsunami of propaganda against Hillary’s opponents and in support of Hillary herself – right now to this very day this is STILL going on.

      Trumps penchant for using the word “Fake News” is no accident and no simple byword.

      A great example of this type of propaganda leaking into Australian media can be seen with “by words”, “catch-phrases” all being used to in synchronicity from out of the blue with a clear global coordinated mandate.

      An EXCELLENT example of this was the sudden attempt at countering China’s One Belt One Road project which culminated last month. The primary motif used by media outlets around the western alliance was the exact same phrase – “Debt Trap”.

      To any lay person the west has been offering loans to developing nations for decades – almost a century. We even had Bob Geldoff in the 1980’s trying to raise funds via “Live Aid” specifically for “Debt Relief” – that debt was to the west.

      But all of a sudden, over night, a new term was coined – and every single media outlet in the entire Anglo-sphere was running with it within literally hours.

      But probably the best most obvious example of media manipulation on a massive scale came out mid way through this year –

      Similar montages been put together for the “left wing” media as well as for other countries including France, UK, Spain, Italy and Germany.

      Literally – the level of state sanctioned mandated propaganda aimed and leveled at the west is completely mind blowing.

      When I was studying in Europe in politics the one thing that was always pressed upon me was the most effective propaganda and powerful propaganda is when people do not believe that it is propaganda. The citizens and residents of Soviet nations all knew and understood that their news was propaganda – it was known and accepted. Most Westeners will deny to their back teeth that their news, what they know, believe and think about the world is not informed by propaganda – their political system is honest, truthful – its the “others” the “enemy” the foolish foreigners who are being lied to – but never us.

      • Just to add to this :

        The Countering Foreign Propaganda and Disinformation Act set up their agency within the State Department – it was the largest ever single agency ever created with the single largest financial outlay for a new agency EVER.

        A fantastic example of “Magazine Propaganda” is the White Helmet controversy – it was revealed over the course of several years the links between the White Helmets and the British / American secret service, their funding and their direction from London. Within months a global -coordinated campaign to discredit the “CONSPIRACY NUTTERS” was in full swing – and as ALWAYS it was the Russians who were behind it.

        Unfortunately the links and evidence was so beyond all question that the White Helmets were very quickly withdrawn – the chemical weapons attack earlier this year which they broadcast wast he final straw as actual dead and surviving victims of that chemical weapons attack turned up IN PERSON at the United Nations with video evidence of what had actually happened – including many children – to reveal the propaganda operations of the White Helmets.

        It was VERY uncomfortable for the UN and of course the western alliance.

        Here are some of the Guardians and Wired frantic efforts to prop up the front organisation – do your own research on this – its absolutely fascinating.

      • interested party

        Thanks for the expansion…notable.
        “and every single media outlet in the entire Anglo-sphere was running with it within literally hours.”….

        and the reason for that is the media are given a narrative to push at 4:00 am (est?) us time to co-ordinate the message for maximum effect. Who guides/designs the narrative is the trillion dollar question.
        but I suspect you already know of this…somehow

    • No no no nope… the GFC was not caused by anything other than aggressive mercenary shorts, otherwise you would have only had a S&L event. Sure localized asset valuations would need to settle in line with historical norms, but not a free fall of mania – not unless the stone age is attractive and dawgs will rules.

      But then again this gets right back to the whole running government as a business that’s income is market driven, e.g. they have to invest in the casino and trust private advisors about due diligence. Not to mention wonky incentives for corruption for short term seekers.

      • Shorters had absolutely nothing to do with the unsustainable build-up of bad debts within the US mortgage market, and by default (+1 pun), it’s banking system. A process that happened over decades and is probably well outside the timeframe of your mere mortal, the humble shorter.

      • The way you are talking you have skin in this game so being educated makes no difference west coast boys LA boys won’t cast a shadow on local Logistics’s numbers men

      • No I don’t have any skin [oxymoron] in the game and I don’t live my life by – its decree, not really a FIRE sector capitalist sort… but down with capitalism.

      • Let’s not limit our options. The collapse was given a green light when interested parties had taken up their positions, however.. the assets really had to stink in the first place.

      • Sweeper…

        Considering Hudson’s views on the IMF loan and its real purpose one would think it would be non controversial, especially considering the agents involved at the time and the historical back drop with a blind eye to endemic fraud.

      • Sweeper…

        I would add that Bill Blacks recent post also highlights the events leading up to both the asset inflation and its subsequent deflation. I mentioned years ago on this blog that Calif was the epicenter wrt this model, but then at that time many still had rather doctrinaire attitudes about market anything and “freedom” [tm] where it was perceived an attack on capitalism itself. Hence knee jerk socialist – commie retorts.

        Did you see the information about the shadow sector size increase [manifold] in correlation to credit creation and its relationship to banking. With no Madoff or Stamford around this time it will be interesting methinks…. will Trump do one better than Obama? Largest wealth transfer upwards in modernity, but yeah, markets.

    • Making sausage that would blow up and then betting on it thing…. then others dawg pile in for a buck… yeah Crapitalim….

  3. NZD raced down to catch up to the GBP toward the bottom side on their respective baskets. Ozzie just noticing & rolling into the negative today. EUR about half way between GBP & AUD. CHF, YEN & USD getting some comparative levitation……. CAD half riding the US coattail up? US10 yields heading down. Maybe a general edging toward the exits? Except BTC & Gold inert, or maybe they don’t work anymore? Baskets have been relatively millpond for the last couple of weeks while the techtonics pressure up beneath…… Hands have been tipped unless the US session whiplashes them all back toward equilibrium. If not those exits might see extra traffic early next week.

      • Neutral? Zeroline? Centred? Balanced? Singularity on overshoot of contraction? Pray tell Skip.

        Oh & NZD move more symmetrically divergent to YEN, although USD not far behind.

      • Some indies aren’t so clear but a few are. My bias is drawn from objective measurement & ranking. Are you punching above your weight regarding Quant & TA Skip?

      • No because Quant & TA are the reflection of above numerical mechanics detached from the human condition.

      • Having trouble resolving – nothing of the sort occurs outside the participants bias loop & reflection of above numerical mechanics detached from the human condition. Really, WTF do you hope to achieve?

      • The axioms that establish a preference which through dominance become truth, followed by the participants interaction creates a feed back loop via those conditions. Anywho I thought Hudson’s latest missive would pretty much sort that all out.

    • I enjoyed your post Colin. I also thought the last two weeks AUD / USD was strangely calm. US CPI tonight will be really interesting.

      • Wow how many missed Hudson’s last post at NC e.g. the whole idea of non agency markets is a sham…

        Thank you for playing….

      • Maybe I should’ve pointed to the quietude on ~ 27th to claim some special insight 😉 Now it’s obvious to everyone I’ll wait for the pullbacks before sizing my bets. Gotta be time to go big soon surely.

      • I didn’t come here for this! Can’t say anything without some contrarian nitpicking twat popping up. Too late for this shit!

      • Yeah Sorry Skip. I was very tired. It feels like you take a pop at me every time I stick my head up & I’m over it! As much as I’m open to checking my biases, I don’t need the proselytizing mate & I don’t have the wherewithall to debate this stuff at the best of times let alone at night. Maybe I’m too much of a Flat Earther for you, so be it. So if I ignore you in the future please understand it’s more about not wanting to be bogged down when I should be shutting down.

        I don’t believe in EMH but when there are announced high noon shootouts perhaps it can happen for that moment – or perhaps it’s just an excuse for the MM’s to adjust their books. I trust my eyes more than my head!

      • interested party

        Gavin, first up. WL has 100% accuracy….Assange assumed clean.
        Once your head is around that article…..put twitter/facebook/amazon in the same camp.

        it is rumoured…
        E Schmidt (google) was in north korea prior to Trumps meeting… several times…..something about a private network set up for cia/obama/clinton/jon ung/ect out of prying eyes of US intel (nsa) This was found and cleaned out…hence the de-nuke talks and peace chance.

    • The Traveling Wilbur

      Remember a couple of years ago when all the posted comments looked like a deranged cockatoo had escaped its cage and randomly pecked his keyboard to death?

      Those were the days. Nothing beats bourbon and coke at 11. AM.

      • I am tempted to give it a go and let you know how it goes.

        I’m sure the missus and 6yo daughter will be grateful.

      • Good to see some dealing with topics and not endlessly engaging in emotive stuff. The latter tends to say more about the state of the those issuing it than it does about who they are talking about. I mean Timmeh could not even make a specific case to underpin his opinion, attempts to state fact straight out of a vacuum. Then were treated to the reinforcement posse giving it some group think gravitas.