Business

Moments ago, following last week's torrid crude oil price rebound driven entirely by now-denied hopes of some production cut consensus between oil suppliers, namely Russia and Saudi Arabia, oil halted its four-day rally as weak Chinese manufacturing data added to economic demand concern.

“The risk seems to be the greatest on the downside again” and speculation of OPEC production cuts has “faded fast,” says Saxo Bank head of commodity strategy Ole Hansen. “China and South Korea are both helping the market return to fundamental focus where it is worried about demand."

• Stocks cautious after rocky China data, bonds fly high (Reuters)
• Oil falls on China data, fading prospect of OPEC action (Reuters)
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• When Trump tells supporters not to donate, they mostly listen (Reuters)
• Goldman Sachs Employees Shift to Rubio as Bush Support Fades (BBG)
• Four Theories on How Oil Has Hypnotized the Global Stock Market (BBG)
• Global Yields Hit 12-Month Low With Japan 2-Year at Minus 0.16% (BBG)

It didn't take much to fizzle Friday's Japan NIRP-driven euphoria, when first ugly Chinese manufacturing (and service) PMI data reminded the world just what the bull in the, well, China shop is...

... leading to a 1.8% drop on the first day of February after Chinese stocks slid 23% in January with the nation’s manufacturing sector faces strong galewind challenges as the government plans to reduce excess industrial capacity and unleash troubling mass unemployment, while a weakening currency is spurring capital outflows.

Following Kuroda's panic policy measures from Friday, JGB yields continue to collapse across the curve (though notably 30Y is selling off - is someone actually concerned about long-term survival risk?). 2Y Yields have collapsed all the way to BoJ's -10bps rate, 5Y is plunging - now close to -9bps, and 10Y has dropped 20bps to just over 6bps... with BofA warning a negative 10Y rate looms.

In a moment of curious serendipity, a little over 90 minutes after we showed what a dystopian, centrally-planned, cashless society unleashed in a negative interest rate world would look like ("by forcing people and companies to convert their paper money into bank deposits, the hope is that they can be persuaded (coerced?) to spend that money rather than save it because those deposits will carry considerable costs"), and briefly after we laid out the countless recent warnings from "very serious people" that cash is evil and should be banned: