Business

Compared to the Wall Street Consensus, which had originally expected Q4 2015 GDP to rise as much as 3% only to admit Q4 was a total bust (and this time not even the weather was to blame) when last Friday the BEA's first estimate of Q4 growth revealed GDP had risen a minimal 0.7% - a number which will be reduced following today's big construction spending miss - the Atlanta Fed's 1.0% pre-announcement estimate seems like a bulls eye.

After having correctly called the January plunge, JPM's Croatian "duo of doom" of Kolanovic and Matejka predicted a modest bounce. This is what Matejka said in the middle of last month: Clearly, equities are unlikely to keep falling in a straight line, with periodic rebounds likely... However, we believe that one should be using any bounces as selling opportunities, adding that "one should not overstay one’s welcome in the bounce."

As we first noted last week, something absolutely astounding has happened.

Two weeks ago, the head of the Bank of Japan, Haruhiko Kuroda stated that Japan has a “potential growth rate of 0.5% or lower.”

By way of context, remember that the Bank of Japan has been at the forefront for ALL monetary policy for decades. The US Federal Reserve launched its first QE program in 2008. The European Central Bank launched its first QE program in 2015. The Bank of Japan first launched QE back in 2001.

As most market structure watchers are well aware, the biggest debate currently roiling the field of equity markets revolves around the August 21, 2015 submission by the dark pool made famous by Michael Lewis' Flash Boys, IEX, in which it seekis to become a public trading venue that will compete with the New York Stock Exchange and Nasdaq Stock Market. What makes IEX different from all other "lit" venues and markets is its embedded technology which implements a 350 microsecond order delay which makes HFT frontrunning, spoofing, and quote stuffing of orders impossible.

As DB's Jim Reid points out, it was definitely not the easiest start to the year with many global equity markets suffering from their worst January in a post-Lehman world.