Thing One: Synchronized Sinking: Sometimes togetherness is not such a good thing.
A bunch of downbeat economic data on Thursday all at once caused many to realize what some in the financial markets have spotted already: Growth is slowing around the world, sparked at least in part by the ongoing clown show in Europe. The European economy is already in recession, as manufacturing and confidence data on Thursday reinforced. China's been in a slowdown for months, as evidenced by fresh manufacturing data there. And the U.S. economy has hit something of a rough patch, as demonstrated by a report on Thursday of weaker than expected demand for capital goods, like computers and machinery, made in U.S. factories. Meanwhile, U.S. bank lending fell in the first quarter for the first time in a year, the WSJ writes, "deepening questions about the recovery and confidence of borrowers and bankers."
The risk, as the Wall Street Journal writes, is that when the world's biggest economies start moving in tandem like this, they can reinforce each other. Europe, China and the U.S. are all shipping goods back and forth to each other, so it is not good when they all slow down together. Of course, it's also worth noting that what's happening now still doesn't necessarily feel like a full-fledged recession. That could come later this year or early 2013, if there's a messy Greek exit from the euro zone, or maybe following another boneheaded budget showdown in the U.S. Congress.
Thing Two: Europeans Continue Dithering: Meanwhile, in Europe, the source of much of world's economic worries these days, leaders are still hemming and hawing about what they should do about their roiling debt crisis. Angela Merkel was forced by some of her fellow Germans to maybe consider the idea of issuing joint European debt, Bloomberg writes, and Italian premier Mario Monti did some cheerleading for the idea this morning. Those developments have financial markets cheering this morning. But it's not like the crisis has abated. Spain's Bankia may be about to ask the government for more assistance, the Financial Times writes, as Spanish people slowly take their money out of Spanish banks The New York Times reports. Meanwhile, European money managers are dumping European assets, the FT writes. Move faster, please, European leaders.
Thing Three: Sad-Sack Regulators: New York Attorney General Eric Schneiderman, who is helping to run a federal task force looking into crimes during the financial crisis four years ago, complained a little to the Wall Street Journal yesterday that he could use a bit more in the way of resources for the job. This news came just after a report that the crackerjack Securities and Exchange Commission is maybe going to close the books on the Lehman Brothers collapse with an official finding of "nothing to see here, move along, folks." And it came a few days after the heads of the SEC and Commodity Futures Trading Commission said they were "outgunned" by Wall Street in terms of resources. Here's just a wild guess, folks: Nobody important is ever going to go to jail for the financial crisis. Our financial-market regulators are like Barney Fife fumbling to put his one bullet into his gun. That's the way the financial industry likes it, and that's the way it will stay.
Thing Four: JPMorgan's Big Lie: Speaking of which, regulation hater JPMorgan Chase was using its chief investment office, which is supposed to do nothing more than hedge the bank's risks, to take big risky bets on distressed companies, the Wall Street Journal reports. "The investments underscore the kinds of questions banks will be wrestling with when the so-called Volcker rule takes effect later this year. The provision will restrict the investments and trades federally insured banks can undertake with their own money."
Thing Five: Facebook Fiasco, One Week Later: A week ago today, Wall Street could barely contain its excitement about the Facebook IPO. Now it is still busy cleaning up the wreckage of that debacle. Some retail investors who tried to buy Facebook shares last Friday still don't know if they actually bought shares or not, and their brokerage firms are being complete tools about it, charging them fees even if their Facebook shares disappeared into the vortex, The New York Times reports. Meanwhile, in one of those perfectly legal but also perfectly infuriating Wall Street practices, some of the same investment banks that over-priced and over-hyped the Facebook IPO are also benefiting from helping traders bet against Facebook stock, the Wall Street Journal writes. And Wall Street still wonders why people hate it!
Thing Six: Japan Wants Our Gas: In the wake of the Fukushima nuclear disaster, Japan shut down all its nuclear plants and now needs other sources of energy, and it's looking to U.S. shale gas for help, the Wall Street Journal writes: "Even if some reactors eventually restart, demand for natural gas to fire power plants is likely to remain strong for years in Japan, which imports almost all the natural gas it uses." Critics worry that exporting gas will raise prices in the U.S. And then there's the small matter of whether we should be further encouraging a practice, fracking, that pollutes our air, land and water.
Thing Seven: Another Paper Down: As you may have read on the Internet, this is not a good century to be a newspaper. The venerable New Orleans Times-Picayune is cutting back dramatically on its print editions, limiting them to just three days per week, the also-struggling Washington Post writes.
Thing Seven And One Half: Too Short Stories: Do you enjoy Twitter? And do you enjoy short stories? Well, then you should absolutely love reading a new 8,500-word Jennifer Egan short story divided up into a series of tweets spread out over 10 nights, right? Doesn't that sound, as The Cajun Boy wrote at Uproxx, "about as fun as getting punched in the face by Mike Tyson in 1987?" Sure it does. You can follow the whole thing, if you dare, at the New Yorker's Twitter feed, @NYerFiction.
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Calendar Du Jour:
Economic Data:
9:55 a.m. ET: Michigan Sentiment - Final for May
Corporate Earnings:
Nothing much.
Heard On The Tweets:
@sm_sears: FB IPO fiasco shows, once more, how same stuff essentially happens again+again on Wall Street and few people rarely learn or adjust.
@zerohedge: 10 minutes ago, Monti says Greece will NOT leave, stocks soar, then Monti says Greece MAY leave Euro.
@GoldmanSachs: We are now live on Twitter (finally) Follow us here for updates on our work, our research, and our people.
@carney: RUMOR: @GoldmanSachs has a twitter feed that lets it read your tweets five seconds before you send them.
@EpicureanDeal: People who follow @GoldmanSachs expecting interesting info are the same ones who read cereal boxes for nutrition advice.
@LaMonicaBuzz: $FB down again. Sorry! I couldn't resist. But I did make it to almost noon without tweeting about the stock price! #ihaveaproblem
-- Calendar and tweets rounded up by Khadeeja Safdar.
And you can follow us on Twitter, too: @markgongloff and @byKhadeeja