Quote:
‘These capitalists generally act harmoniously, and in concert, to fleece the people, and now that they have got into a quarrel with themselves, we are called upon to appropriate the people’s money to settle the quarrel.’ Abraham Lincoln (11th January 1837)
The News:
French president Sarkozy to lead talks this weekend on the financial crisis as Germany and the UK pour cold water on speculation of a €300B bank bail-out fund.
The Numbers:
British Summer Time, with expectations and previous figures in brackets.
06:45 CH September CPI +0.1% M/M, +2.9% Y/Y, versus –0.3% and +2.9% August.
09:30 GB September Services PMI (47.5 to 48.8 versus 49.2 August).
09:30 GB Q2 Housing Equity Withdrawl (-£1.6B to +£4.0B versus +£5.0B Q1).
10:00 EZ15 August Retail Sales (-0.6% to +0.4% M/M, -3.3% to –0.4% Y/Y, versus –0.1% and –2.3% July).
13:30 US September Non-Farm Payrolls (-175K to -75K, Unemployment 6.0% to 6.2%, versus -84K and 6.1% August).
13:30 US September Average Earnings (+3.5% to +3.7% Y/Y, Workweek 33.6 to 33.7 hours, vs +3.6% and 33.7 Aug).
15:00 US September Non-Manufacturing ISM (48.5 to 51.5 versus 50.6 August).
The Psychology:
Holidays in China, Indonesia, Pakistan and South Korea. Monday holiday in Australia & Egypt.
The Risk:
One-month at-the-money implied volatility in FX versus USD at or close to record highs. CBOE VIX Indicator also close to highs of 1998-2002.
Today’s most interesting chart: Dow Jones Transportation Average
Down 8.7%, second biggest daily fall.
