From Marc to Market:
Overview: The dollar is mostly firmer against the G10 currencies and has been confined to tight ranges through the European morning. Outside of the China's deflation and Japan's monthly portfolio flow data that showed Japanese investors bought the most amount of US Treasuries (~$22 bln) in six months in September, the news stream is light. Most emerging market currencies are trading with a softer bias today. The Philippine peso is the strongest among the emerging market currencies after Q3 GDP rose nearly twice as much as expected (3.3% quarter-over-quarter vs. 1.8% median forecast in Bloomberg's survey.
Benchmark 10-year yields up mostly a couple of basis points in Europe, while the 10-year US Treasury yield has popped up by five basis points to 4.53%. The two-year Treasury yield is flattish near 4.94%. Meanwhile, equities are mostly higher. In Asia Pacific, Hong Kong and India were the exceptions, with modest losses. Europe's Stoxx 600 is extending yesterday's gains after falling Monday and Tuesday to snap last week's five-day advance. US index futures are narrowly mixed after the late recovery yesterday allowed the S&P 500 to extend its gain to eight consecutive sessions and the NASDAQ to streak to nine sessions. Gold briefly dipped below $1950 yesterday and its losses have been extended slightly through $1945 today. Support is seen now in the $1925-$1935. December WTI frayed the $75-level yesterday but remains above there today. A move back above $76.70-$78.00 may help steady the technical tone.
Asia Pacific
China's October CPI fell to -0.2% year-over-year after a flat September. While consumer price pressures are soft, the headline overstates the case. Pork prices plunged 30.1% and fresh vegetable prices fell by 3.8%. Excluding food and energy, China's core CPI stands at 0.6%, down from 0.8% where it spent Q3. Commodity prices fell in October, and this arrested the recovery in producer prices seen every month in Q3. Producer prices fell 2.6% from a year ago after a 2.5% decline in September. On a month-over-month basis, producer prices were unchanged after rising 0.4% in September. Even though the decline in consumer prices was driven by food prices, today's report boosts speculation that the PBOC may cut the one-year Medium-Term Lending Facility rate (2.50%) next week....
....MUCH MORE
Related, November 7: "Falling Chinese Pork Prices To Spur Deflation While U.S. Wheat Exports Collapse"
The hope for speculators in Chinese stocks, October 10:"China Considers Stimulus, Higher Deficit Spending To Counter Property Bust"
I smell Oscar Cantillon.
In which case the thing to do is determine who will get the money first and be that person. If it is not possible for you to quickly become a member of the Chinese nomenklatura, determine how to make a portfolio bet on those who are already members of the privileged class. As noted a few years ago:
One of the rules of politics is "if your country goes communist you want to be as far up the apparatchik totem pole as you can get."
Preferably a commissar or above, putting you and yours closer to the commissary.
In a socialist paradise all pigs are equal but Hugo Chavez's daughter is a billionaire.
(actually $4.2 billion)
