Stocks Falling Substantially into Afternoon on China Bubble-Bursting Fears, Global Growth Worries, Emerging Markets Currency Concerns, Energy/Transport Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Heavy

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 23.64 +23.56%

• Euro/Yen Carry Return Index 144.96 +.06%

• Emerging Markets Currency Volatility(VXY) 11.38 +1.97%

• S&P 500 Implied Correlation 56.51 -1.96%

• ISE Sentiment Index 63.0 -10.0%

• Total Put/Call 1.73 +33.08%

• NYSE Arms 1.77 +30.50% 

Credit Investor Angst:

• North American Investment Grade CDS Index 81.87 +1.53%

• America Energy Sector High-Yield CDS Index 1,868.0 +.77%

• European Financial Sector CDS Index 83.56 +4.44%

• Western Europe Sovereign Debt CDS Index 23.66 +4.74%

• Asia Pacific Sovereign Debt CDS Index 80.51 +4.29%

• Emerging Market CDS Index 363.98 +4.96%
  

• iBoxx Offshore RMB China Corporates High Yield Index 118.51 -.37%

• 2-Year Swap Spread 22.75 unch.

• TED Spread 31.25 +2.0 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -18.0 +.25 basis point

Economic Gauges:

• 3-Month T-Bill Yield .02% unch.

• Yield Curve 143.0 +2.0 basis points

• China Import Iron Ore Spot $56.10/Metric Tonne +.47%

• Citi US Economic Surprise Index -18.2 -1.1 points

• Citi Eurozone Economic Surprise Index 16.9 +6.8 points

• Citi Emerging Markets Economic Surprise Index -8.6 -2.2 points

• 10-Year TIPS Spread 1.5 -4.0 basis points
• # of Months to 1st Fed Rate Hike(Morgan Stanley) 4.02 -.03

Overseas Futures:

• Nikkei 225 Futures: Indicating -346 open in Japan 
• China A50 Futures: Indicating -114 open in China

• DAX Futures: Indicating -54 open in Germany

Portfolio: 

• Slightly Higher: On gains in my index hedges and emerging markets shorts

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 50% Net Long