Last week the number of POSITIVE developments easily exceeded NEGATIVE developments, and the stock markets increased as a result.

Positives:

1) Sept Payrolls surprise to upside but monthly ytd avg is still only 119k
2) ISM mfr’g up 1 pt from Aug and better than expected
3) ISM services hangs in a touch above estimate
4) Initial Jobless Claims rise to 401k but 9k less than thought
5) Sept retail comps above forecasts as were vehicle sales
6) Canada adds jobs in Sept 4x expectations
7) ECB as expected adds loan facilities as lender of last resort and only resort for some, euro basis swap falls below 100 bps to 2 week low and euribor/ois spread down to 5 week low
8) EU finally focusing on further Greek debt haircut and bank recap but execution and Germany and French participation extent in question
9) BoE embarks on another round of QE to help economy
10) China mfr’g in Sept up from Aug, Services PMI up by 1.7 pts to 59.3 and HSBC non state weighted services index also up
11) Japan’s Q3 Tankan mfr’g # rises to +2 from -9, although as expected

Negatives:

1) Bank of England turns printing press power back on even with CPI running north of 4%. When will this cost of money price fixing and currency debasement experiment end?
2) Dexia, Belgium’s largest bank with tentacles in many places, on financial precipice
3) Fitch downgrade of Spain’s credit rating puts them below both S&P and Moody’s. Italian downgrades by Moody’s and Fitch have them in line to notch higher vs S&P respectively (Source: The Big Picture).