Today one of the greats in the business sent King World News a fantastic piece that includes a shocker from David Rosenberg as well as Bill Gross discussing why stocks are headed much lower.

October 6 (King World News) – From Art Cashin’s notes: The Number Was Actually Worse Than It Looked – Friday’s weak headline number and the accompanying downward revisions were enough to spark major moves in a variety of assets. But things were even weaker than the headline indicated.

My sharp-eyed friend, David Rosenberg, of Gluskin Sheff fame did a little further drilling down. Here’s what he noted:

Adding insult to injury and revealing an even softer underbelly to this report was the contraction in the workweek to 34.5 hours from 34.6 hours in August, which is effectively equivalent to an added 348,000 in job losses.

So take the headline number, tack on the downward revisions and the loss of labour input from the decline in the workweek, and the “real” payroll number was -265,000. You read that right.

That’s an absolutely stunning revelation, produced only with the kind of digging that David is famous for. We trust it was passed along to Janet Yellen.

A Skeptic On The Rally? Bill Gross of Janus doesn’t sound like he’s convinced we’ve turned around. Here’s a bit of a Bloomberg piece on his comments:

Bill Gross, who in January predicted that many asset classes would end the year lower, said U.S. equities have another 10 percent to fall and investors should sit out the current volatility in cash.

The whipsaw market reaction to the lackluster U.S. jobs report last week shows that markets, especially stocks, high-yield bonds and some emerging market debt, are trading like a casino, Gross said in an interview on Friday. He was speaking from a cruise ship which had taken shelter near New York City amid stormy weather over the Atlantic.

Gross, who earlier made prescient calls on German bunds and Chinese equities, said U.S. stocks will drop another 10 percent because economic conditions don’t support a rally like in 2013, when corporate profits were going up. Today they are flat-lining and low commodity prices are hurting energy companies, said the manager of the $1.4 billion Janus Global Unconstrained Bond Fund.

“More negative numbers lie ahead and if you define a bear market by a 20 percent correction, at some point — that’s six to 12 months — we’ll have a classic definition of a bear market, meaning another 10 percent downside,” he said.

Overnight And Overseas – Shanghai remains closed. Tokyo was up 1% and most other Asian markets were equally buoyant except Hong Kong.

Europe opened softer but quickly regrouped with most markets now mixed to mildly better except London, where Glencore and some mining stocks weigh negative.

The yen and the euro are firmer against the dollar. Commodities are softer led by copper. U.S. futures are down a smidge and the biotechs were under pressure overnight.

Consensus – Futures are lower but only slightly so. I think we should keep an eye on crude and the biotechs. Bulls need to hold these gains and avoid the zigzag reversals that followed recent rallies. Stick with the drill – stay wary, alert and very, very nimble. 

***KWN has now released the incredible audio interview with Dr. Paul Craig Roberts, where he covers the chaos in global markets, what to expect next for gold and the U.S. dollar, the war in Syria, and what will cause the collapse of the global financial system and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.

KWN Roberts II 10:4:2015

***KWN has also now released the extraordinary audio interview with legendary Robert Arnott, where the legend tells KWN listeners a fantastic investment that is available right now.  He also discuss the unprecedented chaos, turmoil and instability in the global financial system, what investors should be doing with their money to protect themselves from the turmoil in Western stock markets and much more, and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.

***ALSO JUST RELEASED:  Richard Russell – Warren Buffett, The Fed, A Huge Plus For Gold And Man’s Greatest Invention For Frustration CLICK HERE.

KWN Arnott mp3 10:3:2015

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