MONDAY 10/12/15; Columbus Day; US Markets are Open; Bond Markets Closed; Banks Closed; Fed Speak; Oil Collapses

US futures are negative as Asia prepares for a new week of trading ahead. S&P -4. Dow -32. Nasdaq -9. Australia stocks begin the week marginally higher. The Aussie dollar is at 0.7321 a seven-week high.  New Zealand stocks trade up +0.7%. Japan is not trading today due to the Sports (Health and Sports) Day holiday.

Euro 1.1263. Dollar/yen 120.23. Pound 1.5320 USD 94.863. Dollar/yuan 6.3542. WTIC 49.82. Brent oil 52.81. Natty gas 2.53. Gold 1155. Silver 15.79. Copper 2.413.

Treasury yields are; 2-year 0.64%, 5-year 1.40%, 10-year 2.09%, 30-year 2.92%. Bond markets are closed due to the Columbus Day holiday. German 10-year yield 0.612%. German 2-year yield -0.26%. Japan 10-year yield 0.332%.

China Golden Week spending data is very 














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drop in oil prices is the big story today. WTIC is down over -4% to 47.44. West Texas crude was testing the 200-day MA resistance at 51 one day ago. Brent oil is beaten down to 50.70 from above 54.00 only one day ago. Energy stocks are slapped hard. XLE -1.3%.

After the closing bell, Fed’s Brainard warns about the slowing global economy and its potential negative impact on the United States. She advises colleagues to watch the economic data. Brainard is concerned about the lack of wage growth (since inflation that the Fed desires cannot exist without higher wages). She expects inflation to remain subdued. Brainard had been leaning hawkish over the last few weeks but is clearly more dovish in her statements and speech. Brainard does not rule out a rate hike this year but her comments state the case for the Federal Reserve to delay the first hike until 2016.

The Federal Reserve continues to send mixed messages one member stating the case for a rate hike and another does not. The constant Fed speak only serves to create confusion and angst among global traders. It appears more and more that the Fed is simply making it all up as they go along. Traders and investors are losing confidence in the central banker Keynesian money printers that are controlling the world’s markets and economies for the last six years.

S&P rating agency downgrades Volkswagen credit rating one notch to A-. S&P blames the emissions scandal for the lower rating and says further cuts may be warranted. VW may have to sell assets to build cash reserves.