Business

Last night's surprisingly large inventory build reported by API (+2.9mm vs expectations of -2.5mm) sent hopeful crude prices reeling (not helped by comments from Iran and Saudi this morning). Following last week's huge 5.9mm draw, DOE reports a 2.63mm build (confirming API's data). Cushing (which API reported as a 923k build) also saw DOE report a 0.9mm barrel build (pushing closer to its limits). As we have detailed previously, December typically sees major drawdowns in inventory as energy firms attempt to minimize tax burdens into year-end.

Over the past six or so months, the OECD, the WTO, and the ADB have all come out with rather grim assessments of global growth and trade. 

Back in September for instance, the WTO warned that the rate of growth in global trade is set to trail the expansion of the worldwide economy for the third year running. As WSJ noted at the time, “before the recent slump, the last time trade growth underperformed the rate of an economic expansion was 1985.”

America Is Being Destroyed By Problems That Are Unaddressed

Paul Craig Roberts

One hundred years ago European civilization, as it had been known, was ending its life in the Great War, later renamed World War I. Millions of soldiers ordered by mindless generals into the hostile arms of barbed wire and machine gun fire had left the armies stalemated in trenches. A reasonable peace could have been reached, but US President Woodrow Wilson kept the carnage going by sending fresh American soldiers to try to turn the tide against Germany in favor of the English and French.

Having seen New Home Sales disappoint and Existing Home Sales crash in November, Pending Home Sales plunged 0.9% MoM (against expectations of a 0.7% MoM rise). Having plateaued in October near 8-month lows, today's huge miss was driven by a plunge in sales in The West (-5.5%) and NorthEast (-3.0%). Home sales rose just 2.6% YoY - the weakest since October 2014.

In mid-August we warned that Noble Group's downgrade to junk by one or more rating agencies, was inevitable, a downgrade which finally took place yesterday when Moody's downgraded the firm from Baa3 to Ba1, keeping it on outlook negative (we expect S&P to follow suit in the next few days).