Bloomberg:

• ISM U.S. Manufacturing Index Decreased to 54.4 in September. Manufacturing expanded in September at the slowest pace in 10 months, underscoring the Federal Reserve’s forecast of “modest” U.S. growth in coming months. The Institute for Supply Management’s factory index dropped to 54.4 from 56.3 in August, the Tempe, Arizona-based group said today. Measures of orders and production fell to the lowest level since June 2009. Growth in European manufacturing slowed. A gauge of manufacturing in the 16-nation euro region declined to 53.7 in September from 55.1 the previous month, London-based Markit Economics said today. The ISM’s U.S. new orders measure declined to 51.1 from 53.1, while the production index dropped to 56.5 from 59.9. The employment gauge fell to 56.5 in September, the lowest in six months, from 60.4, and the index of export orders dropped to 54.5, the lowest this year. The measure of orders waiting to be filled fell to 46.5 from 51.5 and the index of prices paid jumped to 70.5 from 61.5. The inventory index increased to 55.6 in September, the highest since July 1984, while a gauge of customer stockpiles dropped to 42.5.
• Irish 'Groundhog Day' Leaves Lenihan Battling Biggest Deficit. It must feel like deja vu for taxpayers and investors in Ireland. Finance Minister Brian Lenihan said yesterday he cleaned up the mess left by “reckless” bankers. Now he has to turn back to tackling the largest budget deficit in the history of the euro region after the premium bondholders demand to buy Irish debt climbed to a record this week. “It’s a bit like groundhog day, like you’ve been on the wrong road and have to come back and start all over again,” said Alan McQuaid, chief economist at Bloxham Stockbrokers in Dublin. “It’s a long way home.”
• European Manufacturing Cools, Unemployment Stays at 12-Year High. Growth in Europe’s manufacturing industry slowed and unemployment held at a 12-year high as a cooling global recovery restrained demand. A gauge of manufacturing in the 16-nation euro region declined to 53.7 in September from 55.1 the previous month, London-based Markit Economics said today. A separate report showed that the region’s jobless rate stayed at 10.1 percent in August, the highest since June 1998.
• Corporate Bond Market Suffers 'Indigestion' in Europe After Spreads Widen. Corporate bond sales fell 51 percent in Europe this week after issues from power group Alstom SA and voucher company Edenred lost value as investors demanded higher rewards. Renault SA pulled a note issue by the second-biggest French carmaker’s financing unit as the yield investors seek to hold investment-grade company debt rose. Alstom’s 2018 notes issued Sept. 28 fell 8.6 euros per 1,000-euro ($1,400) face amount, to a bid price of 98.873, according to Bloomberg composite prices. The all-in yield buyers want to hold company bonds jumped 8 basis points to 3.264 percent this week, according to Bank of America Merrill Lynch index data. Sales slowed to 5.3 billion euros as investors became more selective after a flood of 51 billion euros of supply in the first three weeks of September. “We have been seeing some signs of indigestion in the market as the primary deals have simply not performed in secondary trading,” said Harpreet Parhar, a credit strategist at Credit Agricole SA in London.
• Barclays Capital 'Quant' Index Helps Fuel Growth in Computer-Driven Notes. Barclays Capital plans to sell notes based on a proprietary index that allocates investments according to a computer model, as the number of so-called quantitative benchmarks grows. The Multi-Alpha Equal Risk Allocation Index, or Era, is the second quantitative index released by Barclays in the past month, joining a growing list of products based on strategies where mathematical models are used to determine where to allocate assets. Era uses an algorithm developed by the London-based bank to measure historical volatility and determine how to invest across four asset classes including stocks, commodities, interest rates and currencies, according to Barclays Capital.
• Corn Futures Plunge Most Since April, Extending Slump, on U.S. Supply Gain. Corn plunged the most since April after the U.S. said supplies left from last year’s crop climbed to the highest level since 2006. Inventories on Sept. 1 rose 2 percent to 1.708 billion bushels from a year earlier, the Department of Agriculture said yesterday. That was 322 million bushels above the agency’s Sept. 10 estimate. Corn surged 33 percent in the third quarter, the most for that period since 1974, as hedge funds increased bets on higher prices to a record.
• India Insider Selling Stocks at Fastest Pace Since Sensex Peak. India’s company executives are selling shares at the fastest pace since prices peaked 2 1/2 years ago, just as foreign investors pour record amounts of money into the best-performing major emerging market. Insiders of Bombay Stock Exchange Sensitive Index companies made at least 110 stock sales last quarter for a combined $21 million, according to exchange data compiled by Bloomberg. The last time the number of sales was this high, in the fourth quarter of 2007, the Sensex sank 23 percent in three months.
• Fed's Dudley Says Further Easing Probably Warranted. Federal Reserve Bank of New York President William Dudley said the outlook for U.S. job growth and inflation is “unacceptable” and that the Fed will probably need to take action to spur the recovery and avert deflation. “We have tools that can provide additional stimulus at costs that do not appear to be prohibitive,” Dudley, who serves as vice chairman of the Fed’s policy-setting Open Market Committee, said today in a speech to business journalists in New York. “Further action is likely to be warranted unless the economic outlook evolves in a way that makes me more confident that we will see better outcomes for both employment and inflation before too long.”
• U.S. Postal Service Had $6 Billion Loss in 2010.
• Foreclosure Errors Cloud Homeownership With 'Blighted Titles'. U.S. courts are clogged with a record number of foreclosures. Next, they may be jammed with suits contesting property rights as procedural mistakes in those cases cloud titles establishing ownership. “Defective documentation has created millions of blighted titles that will plague the nation for the next decade,” said Richard Kessler, an attorney in Sarasota, Florida, who conducted a study that found errors in about three-fourths of court filings related to home repossessions.
• Ford(F) Sept. Sales Up 46%, Est. Up 40%.
  

Business Insider:

• CNN's Rick Sanchez Calls Jon Stewart a Bigot and Suggests That Jews Control the Media.
• 20 Key Charts From the Flash Crash Report.
• Chart of the Day: Americans Just Added More Money to Emerging Markets Than from 1995-2005.
  

Zero Hedge:

• SEC Releases Final Flash Crash Report - Waddell and Reed Blamed as Selling Catalyst. 100+ pages of garbage, and yes, Waddell and Reed, and their destructive hedging trade of 75,000 e-minis is the culprit that apparently set everything off: "At 2:32 p.m., against this backdrop of unusually high volatility and thinning liquidity, a large fundamental trader (a mutual fund complex) [ZH: Waddell and Reed] initiated a sell program to sell a total of 75,000 E-Mini contracts (valued at approximately $4.1 billion) as a hedge to an existing equity position."
• Questioning the Competency of the SEC Report's Authors.
  

New York Times:

• Fiorina Calls for More Hedge Fund Transparency. Carly Fiorina, campaigning to be California’s first Republican senator elected in two decades, said hedge funds should be subject to greater transparency requirements and the financial regulatory overhaul known as the Dodd-Frank Act doesn’t go far enough, Bloomberg News reported. The lightly regulated businesses that engaged in some of the riskiest activities, the so-called shadow financial system targeted by the legislation, still exist, the former Hewlett-Packard chief executive officer told Bloomberg in an interview. The Dodd-Frank Act “punishes hedge funds, but it’s not clear to me we’ve created transparency in hedge funds,” Ms. Fiorina said.

ABC News:

• Big Banks Face Even Stricter Capital Rules: Sources. Banks considered too big to fail could soon be held to even stricter capital requirements than those in the global Basel III package, sources told Reuters on Friday. As part of new rules mooted by central bank governors and regulators, large international lenders would have to retain an equity buffer of up to 3 percentage points above the minimum rates agreed last month, regulatory and financial sources said. Disagreement remains over which banks would plunge global markets into turbulence if they folded and should therefore set aside more equity capital and the plans are at an early stage. While the inclusion of Germany's biggest lender Deutsche Bank is all but certain there are doubts whether the country's No.2, Commerzbank , would fit the criteria, sources in Germany said. A main concern is that the fewer institutions that fall under the stricter rules, the bigger the risk of putting them at a competitive disadvantage against smaller rivals.

Reason.com:

• How ObamaCare's Exchanges Undermine Quality Health Care.

NY Post:

• D.E. Shaw Drops Off Fund List. After laying off 10 percent of its staff this week, D.E. Shaw suffered another black eye yesterday when it was bumped from AR Magazine's top 10 list of the biggest hedge funds. The previous list, which surveyed assets as of 2009, put D.E. Shaw in fifth place, with $23.6 billion of assets. In the first half of 2010, D.E. Shaw dropped out of the top 10 entirely after its assets fell to $17.8 billion.

Politico:

• What to Watch as Rahm Emanuel Leaves.

Rasmussen Reports:

• Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Friday shows that 28% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-six percent (46%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -18 (see trends).
• For Second Straight Month, Number of Democrats in U.S. Falls to Record Low.
  

Reuters:

• India Has Access to BlackBerry Messenger Service - Govt. The Indian government has manual access to Canadian Research in Motion's(RIMM) BlackBerry messenger services and is hopeful of getting automated access from January 1, a top official said on Friday. India, which along with several other countries has expressed concerns that BlackBerry services could be used to stir political or social instability, had threatened RIM with a ban if it were denied access to data. "We have manual access to the messenger services. We want automated access and we are hopeful of getting that from January 1," G.K. Pillai, home secretary, told Reuters.

Financial Times:

• Almost half of Britain's main commercial property companies expect no market improvement in the next six months and more than a quarter foresee a further drop, citing research by Lloyds Banking Group Plc.

Telegraph:

• UK Manufacturing Recovery Fades as Export Orders Fall for First Time in 14 Months. (graph) Britain's manufacturing recovery faded further in September with export orders falling for the first time in more than a year as global demand weakened.

Sky News:

• Exclusive: Goldman(GS) Partners' Secret Shares Windfall. Goldman Sachs has secretly handed its top London-based employees tens of millions of pounds-worth of free shares following a decision to cap their pay in the wake of this year's Labour Government tax on bank bonuses. I have learned that Goldman made the share awards to its London-based partners towards the end of August.

Xinhua:

• Foxconn Hikes Salaries Again in South China Factory After Suicides. Foxconn, the world's largest electronics contractor, which has been plagued by a string of worker suicides, has again raised monthly salaries for employees in a south China factory. The rise, which will start from October, is the second this year for Foxconn workers at its production base in Shenzhen. Assembly workers would get a pay rise of about 66 percent to bring salaries to 2,000 yuan (298.5 U.S. dollars) per month, said company spokesman Liu Kun. In June, Foxconn increased salaries by 30 percent, from 900 yuan to 1,200 yuan, for its Shenzhen employees. "I cannot believe the company will raise salaries for a second time within a year. It means my monthly salary will double," said Wang Xuchu, a Foxconn worker from the central Henan Province, Friday.