Business

Is the Bank of Japan is trying to crash the markets?

This is not conspiracy theory. In the last month the BoJ has devalued the Yen 14% against the $USD.

By any other measure this is a crash as far as currencies go. And it could lead to MAJOR issues for the financial system.

The last time the BoJ collapsed the Yen this aggressively the ENTIRE commodity markets imploded collapsing over 40%. Oil ended up collapsing from $60 to sub $48 in a matter of weeks.

After spiking to 2016 highs in September/October, the US Services economy slipped lower in November according to Markit with signs of margin squeezes appearing as input cost inflation hits a 15-month high, but prices charged remained flat, and payrolls growth remains weak (well below average). However, ISM reported a big beat, with Services at the highest since Oct 2015 (despite a drop in new orders).

The key economic releases this week are ISM non-manufacturing on Monday and University of Michigan consumer sentiment index on Friday. There are a few scheduled speaking engagements from Fed officials this week.

Away from the US economic calendar, initially focus will be on the Italian referendum result, which already appears to have been largely digested by the market, despite a variety of unknown consequences still to emerge. It will then shift quickly to a critical ECB meeting.

Submitted by Michael Shedlock via MishTalk.com,

Axel Weber, former head of Germany’s central bank says the ECB is going to halt QE soon and hike rates by September.

Weber warns Markets Unprepared for Central Bank Shifts.

Investors are dangerously unprepared for a sharp rise in eurozone bond yields when US interest rates march higher and European quantitative easing ends, Axel Weber, chairman of UBS and the former head of the Bundesbank, has warned.

Italy Votes No, Renzi Resigns - Potential "Systemic Crisis In Eurozone"

Italy’s Prime Minister Matteo Renzi has said he will officially resign Monday, after voters apparently rejected his proposals for constitutional reform. What should investors keep an eye out for after his defeat?