“A rebound in U.S. auto sales has been buoyed by the return of easy lending, even to borrowers with flawed credit histories. Some economists question whether the gains can be sustained without a boost in hiring.

Auto loans were up 5.5 percent in the second quarter from the same time last year, with riskier buyers accounting for 43.9 percent of the total, up from 42 percent in 2008, according toExperian Plc. (EXPGY) By contrast, hourly wages for non-managers climbed 1.1 percent on average over the past 12 months, the least since records began in 1965, Labor Department figures show.”

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“For many of the wealthy, 2012 is becoming a good year to sell.

They’re worried about the “fiscal cliff,” which is when tax cuts expire and spending cuts are set to go into effect at the end of the year.

Fearing an increase in capital gains and dividend taxes, many of the rich are unloading stocks, businesses and homes before the end of the year.

Wealth advisors say that with capital-gains taxes potentially going to 25 percent from 15 percent, and other possible increases in the dividend tax, estate tax and other taxes, many clients are selling now to save millions in taxes.

“Under almost any scenario, it makes sense to take the gains this year,” said Gregory Curtis, chairman and managing director of Greycourt & Co. “Clients aren’t selling willy nilly. But if they can and they have a huge gain, they’re selling now.”

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“NICOSIA, Cyprus (AP) — Cyprus’ Central Bank chief says “it’s very important” to sign a bailout agreement with potential creditors by next month in order to calm jittery investors.

Panicos Demetriades says investment firm PIMCO and auditors Deloitte will come up with a preliminary figure toward the end of this month, or early December, on how much money the country’s ailing banks will need to recover from their huge exposure to Greece.”

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“Japanese consumers are closing their wallets as the economy’s outlook darkens, making it harder for Prime Minister Yoshihiko Noda to stave off the nation’s third recession in four years.

Households are holding the most cash since 2005, shunning risk as they grow gloomier, Bank of Japan data shows. Sliding private consumption contributed to an annualized 3.5 percent decline in gross domestic product in the past quarter, a Cabinet Office report showed yesterday.

While Noda may have avoided a fiscal cliff as the opposition agreed to a deal on deficit-financing legislation, the consumer malaise highlights the challenge of reviving growth in the world’s third-largest economy. At the same time as he tries to rebuild relations with China to support exports, Noda may need to come up with more incentives for consumer purchases at home.”

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“Spanish bonds fell, pushing the 10- year yield to a six-week high, after the International Monetary Fund failed to agree with euro-area finance ministers on a strategy to help Greece bring down its debt load.

Germany’s 10-year bonds erased an advance after Bild Zeitung reported that the nation favored combining aid payments intended for Greece into a single installment of 44 billion euros ($55.9 billion). European policy makers gave Greece two extra years to reduce its budget deficit without saying how the additional funding needs would be covered. The yields on Austrian and Belgian securities declined to records and French bonds rose for a ninth day, the longest run since 1997.

“There’s clearly big disagreement between the IMF and Eurogroup,” said Lyn Graham-Taylor, a fixed-income strategist at Rabobank International in London. “The public nature of the spat has resulted in risk-off sentiment, which is affectingSpain.”

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“China’s new yuan loans unexpectedly fell in October from a year earlier and money supply rose less than forecast, damping signs the world’s second-biggest economy is recovering after a seven-quarter slowdown.

Banks extended 505.2 billion yuan ($81.1 billion) of local- currency loans, down 14 percent from a year earlier, data from the Beijing-based People’s Bank of China showed today. The median estimate was 590 billion yuan in a Bloomberg News survey. M2, the broadest measure of money supply, increased 14.1 percent, compared with a median forecast of 14.5 percent.

Today’s reports show weaker-than-forecast credit expansion may limit a rebound in economic growth as the ruling Communist Party holds a congress in Beijing to anoint new leaders. Central bank Governor Zhou Xiaochuan said yesterday the nation is still dealing with the effects of five years of financial crisis abroad, adding to official cautions on the outlook even after gains in exports and industrial output.”

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Mario Draghi’s bond-buying plan has become the European Central Bank’s weapon of choice to reduce interest rates even before it has been activated.

ECB President Draghi yesterday praised the impact of the so-called OMT program in lowering borrowing costs, while playing down the prospect of further ECB rate cuts. “Market confidence has visibly improved on the back of our decisions as regards Outright Monetary Transactions,” he said. The announcement “by itself produced an easing of financial-market conditions.”

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“European governments will find a way of tiding Greece past next week’s bill redemption as the pieces of an updated aid package take longer than planned to fall into place, a European official said.

While finance ministers on Nov. 12 are unlikely to sign off on 31.5 billion euros ($40 billion) of fresh loans, the result won’t be an “accidental default” for Greece when 5 billion euros of bills mature on Nov. 16, the official told reporters in Brussels today on condition of anonymity.”

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“Russia, the largest emerging economy to raise interest rates this year, refrained from increasing borrowing costs after inflation unexpectedly slowed in October for the first time in six months.

Bank Rossii left the refinancing rate at 8.25 percent at a meeting in Moscow, half a percentage point above the record low, the regulator said in a statement on its website today. The move was forecast by 21 of 23 economists in a Bloomberg survey. Policy makers held their main short-term lending and deposit rates at 5.5 percent and 4.25 percent.

The decision follows a surprise increase in September that policy makers today credited for tamping down inflation expectations. The central bank also cited a stabilization in food costs that pushed price-growth beyond this year’s target range. The statement’s wording suggests an end to the “mini- cycle” of rate increases, according to Vladimir Kolychev, chief economist at Societe Generale SA’s OAO Rosbank (ROSB) unit in Moscow.”

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“A vintage Harley. An 18-carat Patek Philippe watch. A guitar once owned by the legendary Les Paul.

Now that’s diversifying a portfolio.

With stocks and bonds prone to big swings lately, many investors are devoting a corner of their portfolio to art, antiques and other rarities. For these buyers, such items aren’t just a hedge against the shocks of the larger market—they also offer some relief from the head-spinning complexity of many more “regular” investments.”

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“European Central Bank President Mario Draghi said the economic outlook is worsening and the bank stands ready to activate its bond-purchase program if governments fulfil the necessary conditions.

“We are ready to undertake” Outright Monetary Transactions, “which will help to avoid extreme scenarios,” Draghi said today at a press conference in Frankfurt after policy makers left thebenchmark interest rate at a historic low of 0.75 percent. “The risks surrounding the economic outlook remain on the downside” and underlying inflation pressures “should remain moderate,” he said.”

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“Indonesia kept its benchmark interest rate unchanged for a ninth straight meeting as economic growth exceeding 6 percent reduced the need for monetary stimulus.

Bank Indonesia Governor Darmin Nasution and his board held the reference rate at a record-low 5.75 percent, the central bank said in Jakarta today. The decision was predicted by all 16 economists surveyed by Bloomberg News.

Indonesia’s growth has outperformed every major Asian economy after China this year as the world’s fourth-most populous nation lures investment, helping gross domestic product expand 6.17 percent last quarter from a year earlier. The country has avoided adding to a February rate cut while neighbors from Thailand to the Philippines extended monetary easing to counter faltering global growth, as the region’s worst-performing currency this year boosted inflation pressure.”

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“The European Central Bank kept interest rates on hold today as the economic outlook worsens and Spain resists asking for a bailout that would open the door to ECB bond purchases.

Policy makers meeting in Frankfurt left the benchmark rate at its historic low of 0.75 percent, as predicted by 62 of 63 economists in a Bloomberg News survey. One forecast a cut to 0.5 percent. ECB President Mario Draghi will brief reporters on the decision at 2:30 p.m.

Draghi yesterday fueled speculation that the ECB might put rate reductions back on the agenda, saying the debt crisis is starting to hurt Germany — the pillar of economic strength in the euro area — and inflation risks are “very low.” Still, Draghi has acknowledged in the past that rate moves are less effective than they should be because distorted financial markets are interrupting the transmission of ECB policy.

“In normal times, with the economic outlook in Europe, a rate cut would probably be justified,” said Nick Kounis, head of macro research at ABN Amro Bank NV in Amsterdam. “But we’re not in normal times and a rate cut won’t achieve anything.”

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Haim Bodek has published a white paper on his website that you should all read, titled HFT Scalping Strategies. It outlines in a somewhat general way the concept of HFT Scalping Strategies, which serve as a cornerstone of the overwhelming majority of HFT strategies deployed in the market place, including but not limited to rebate arbitrage.

The scalping strategies are “alpha-less”, meaning that they are microstructure oriented – they use features such as the multitude of order types and the low-latency sold by the exchanges in order to gain queue position in the limit order books, as well as the “insurance” against  being adversely selected. According to Bodek:

Read the rest here.

Some chart porn from Doubleline Capital…

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“* Big banks get more time to write “living wills”

* G20 sets deadline to reduce reliance on credit ratings

* New “shadow banks” rules ready by Sept. 2013

MEXICO CITY/LONDON, Nov 5 (Reuters) – International watchdogs, working to tighten-up global regulation after the financial crisis, are moving ahead with plans to extend their reach to “shadow banks” such as money-market funds that handle trillions of dollars in short-term investments.

Policymakers have already tightened regulation for mainstream banks but are keen to stop higher-risk activities shifting to less supervised areas such as off-balance sheet units, hedge funds and money-market funds, which contributed to the crisis.

This is a clear signal there will be no let up for the financial sector despite warnings that introducing too many rules could hinder global economic recovery.”

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Greece is on strike and EU leaders, central banks, and pundits alike continue to disagree on how to help Greece. Never mind Spain and Italy for the moment.

A cluster fuck indeud….

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“U.S. public pensions ended the third quarter with a median gain of 4.67 percent as bond managers beat their benchmarks by buying riskier debt and fixed-income securities with longer maturities, Wilshire Associates said.

The gains raised returns for state- and local-government pensions with assets of more than $1 billion to 8.2 percent for the 10-year period through Sept. 30, the first quarter since 2007 that funds of that size surpassed 8 percent over a decade.

“It gives that strong message to stay the course and look to the long term,” because the returns came near projected results, said Robert Waid, a managing director at Wilshire, a consultant to investors and pensions. “The 10-year numbers are pretty close to what the actuaries give for a 10-year target.”

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No matter who wins Tuesday’s presidential elections, taxes will rise on investment income, Goldman Sachs equities analysts have concluded.

“At the end of this year, the Bush-era tax cuts and other tax breaks expire at the same time automatic cuts to government spending kick in, a combination known as a fiscal cliff that could send the country sliding back into recession next year if left unchecked by Congress.

Tax hikes include those applied to investment income.”

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“Whereas it is relatively easy to track the progression of the “developed world” deep into the twilight rabbit zone hole (in bizarro metaphore-land speak) of no total debt/GDP return as defined by Reinhart and Rogoff (where anything above 80% sovereign leverage is more or less the game over line for one country, let along the entire Western world) courtesy of day to day updates of total debt in the US (103% debt/GDP) and its comparably indebted peers, when it comes to world’s growth dynamo – China – it is next to impossible to get a sense of just how big the debt hole is for a country whose economic data has been and continues to be one massive goalseeked, G.I.G.O. blackbox.”

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