Business

Kuroda, we have a problem. Following rumors overnight, USDJPY is obedinetly being bid (Yen weaker), with its biggest day since January and pushing above 111 (highest in 3 weeks). Normally this would be all the US equity needed to spike ignorantly to new highs... but it's not...

Standard 200 pip vertical ram on nothing but rumors... but stocks ain't buying it...

Not even the power of Central Bank  visible hand can trump a collapse in earnings from US mega caps.

Submitted by David Stockman via Contra Corner blog,

Mario had a bee in his bonnet yesterday morning. Apparently, the chorus of German voices pointing to the obvious—- that his policies are killing savers, insurance companies, pension funds and banks—-got his dander up:

“We have a mandate to preserve price stability for the whole of the euro zone, not only for Germany,” he said. “We obey the law, not the politicians, because we are independent.”

Greece was supposed to finalize a deal today with its lenders whereby in exchange for an "agreement" to implement already agreed upon budget cuts it would receive more funds from the Troika. However, as Reuters reports, "there will be no deal between Greece and its lenders on Friday that would unlock loans and enable vital debt relief talks, despite some progress on the reforms Athens must implement in exchange, euro zone and IMF officials said on Friday."

The markets are prepping for the next massive round of QE.

As I noted earlier this week, NIRP has been entirely ineffective at generating Central Bankers’ desired “inflation.” The ECB has cut rates into NIRP four separate times only to find itself with 0% inflation. In contrast, the Bank of Japan has cut rates into zero once and immediately fallen back into a deflationary collapse.

Indeed, NIRP has even been a dud when it comes to pushing stocks higher.

One of the most striking recoveries in the first quarter was that of Caterpillar stock, which despite reporting what is now a record 40 consecutive months of declining annual retail sales ...

... had soared from below $60 at the February lows, to over $80/share a few days ago as the market bet that China's massive credit-deluge would benefit the heavy industrial company.