Business

Submitted by Marc Cohodes And @DonutShorts

Following this morning's flash crash in gold, in which a "fat finger" - usually a euphemism for any trade that can not be logically explained yet one which reprices a given asset class substantially lower as happened with gold - suddenly sold $2.2 billion worth of gold in under a minute, taking out the entire bidside stack, we were expecting banks to immediately come out with bearish reports on gold, piggybacking on the latest central bank-facilitiated smackdown, and allegedly allowing their prop desks to load up on the yellow metal on the cheap.

With the Fed continuing to hike rates, it should come as no surprise that today's 2Y auction printed at a high yield of 1.348%, the highest stop out since October 2008. And perhaps because the yield was so high, it invited significant buyside demand, mostly from foreign central banks, with the auction stopping through the When Issued of 1.354% by 0.6 bps, the same as last month, and demonstrating surprising demand for the short end of the curve.

Two years after correctly abandoning his long-held bullish perspective on the US economy's growth prospects, Deutsche Bank's chief economist Joe LaVorgna has reportedly left the bank, "planning to work elsewhere in financial services."

Some may recall, that back in 2013, we noted that when it comes to forecasting the future, even one Groundhog Phil has a success rate of 71%, or over a standard deviation more accurate compared to Joe "Coin Toss" LaVorgna's 51%.

Authored by Kevin Muir via The Macro Tourist blog,

There has been a whole lot of ink spilled on the reason for the Fed’s recent break from data dependence. Many pundits believe the Federal Reserve’s hawkish guidance, even in the face of low inflation readings, is a partisan attempt by Yellen & Co. to derail the weak recovery. I don’t buy that argument. To think the FOMC board would leave rates easy for Obama or Hillary, but raise them for Trump is just foolish. The Fed might be incompetent, but they aren’t so blatantly biased.