Monday, January 25, 2016

China Warns "Social Stability Threatened" As 400,000 Steel Workers Are About To Lose Their Jobs

WalMart Store Closures Leave Elderly Villagers With No Grocery Stores, Pharmacies

“I was devastated when I found out. We had a pharmacy and a perfectly satisfactory grocery store. Maybe Wal-Mart sold apples for a nickel less. If you take into account what no longer having a grocery store does to property values here, it is a significant impact for us.”

Billion Dollar Baby Bye Bye - Theranos Lab Found "Deficient"

When The Fed Put Fails

These are the cheapest hedges in case central bank puts fail to deliver...

Congress Is Writing The President A Blank Check For War

President Obama has already far surpassed even his predecessor, George W. Bush, in taking the country to war without even the fig leaf of an authorization. Let’s be clear: If Senate Majority Leader McConnell succeeds in passing this open-ended war authorization, the US Constitution will be all but a dead letter.

What Buyback Slowdown: "Our Buyback Desk Is Very Busy" Admits Credit Suisse

"Do not worry," investors are told day after day, this is just a swoon because companies are blacked out from buying back their own shares and supporting the irrational valuations in stock markets. Well, Credit Suisse just smashed another leg on the 2-legged stool of equity market perma-bullishness as they explain in their daily note that "talk of seasonal oscillation in buyback activity is over-exaggerated."

Security Woes Threaten OPEC's Second Largest Producer

Iraq has been one of the key contributors to the uptick in OPEC oil production over the past year and a half. Despite the fact that the country’s crude oil output has continuously been plagued by security concerns and faltering payments to international oil companies from both the Kurdish regional government (KRG) and Baghdad and an ongoing row over oil export rights, it has still managed to ramp up production to record levels. No reason to worry about Iraq’s oil future it seems… or is there?

20 Dead, 200 Hospitalized After Reports US Lab "Leaks" Deadly Virus In Ukraine

Amid the so-called "ceasefire" in Ukraine, yet ongoing shelling in many regions, the Donbass news agency reports that more than 20 Ukrainian solders have died and over 200 soldiers are hospitalized after an apparent leak of a deadly virus called "California Flu" from a US lab near the city of Kharkov.

What Squeeze: Bets Oil Will Drop Below $25 Hit Record High

Having briefly reached bull market status (ripping 20% off last week's lows), WTI crude oil is collapsing again this morning as the reality of excess supply and dwindling demand crash on the shores of manipulated futures and ETFs. However much hope was imbued into this rally as "setting the bottom" for oil, it seems the rally was used by 'investors' to hedge the downside as bets on a bearish plunge have soared to record highs.

Bad Loans Pile Up In Alberta, As Oil Bust Weighs On State Lender

Just in case you needed another reason to fear for the worst in Alberta, Moody’s and DBRS are becoming increasingly concerned about crown corporation ATB Financial. “Alberta's debt situation was under the microscope last week, with [the] two rating agencies taking a look at the province's fiscal situation and economy and not liking what they saw,” CBC reports.

...Until The Bubble Bursts

Critics of today’s fiat currency/fractional reserve banking world have (for what seems like forever) made the common sense point that when debt rises faster than cash flow, bad things are bound to happen. In every cycle since 1980 this has been dismissed by the vast majority who benefit from inflating bubbles - until the bubble bursts. And here we go again.

Which Italian Banks Are Most Exposed To Soaring NPLs: Citi Crunches The Numbers

Total gross NPLs in Italy has increased by c160% since 2009 and now represents c18% of loans (vs c8% in 2009). Gross Sofferenze (eg the worst category of NPLs) are c60% of this or c€200bn. While new inflows of NPLs have decreased, there have been limited disposals, possibly due to pricing difference. Banks suffer in multiple ways due to the high stock of NPLs (profitability, capital, funding, lending, etc). The government implemented reforms last summer to improve recovery procedures (Government Proposes NPL Measures), but there is limited evidence so far of the benefit.

Texas Economy Collapses - Dallas Fed Survey Crashes To 6-Year Lows As "D" Word Is Uttered

For the 13th month in a row, The Dallas Fed Manufacturing Outlook was contractionary with a stunning -34.6 print following December's already disastrous collapse back to -20.1, post-crisis lows. With "hope" having plunged back into negative territory (-2.2) in December, January saw a complete collapse to -24.0 as one respondent exclaimed, "we expect the continued depression in the oil and gas industry to negatively impact our customer base and result in significant demand reduction."

Spurious Midnight Headline From Japan Sparks Brief Stock, Crude Buying Binge

It's midnight in Japan - so it makes perfect sense that this headline - SOME BOJ OFFICIALS ARE SAID TO VIEW MORE STIMULUS AS CLOSE CALL -would drop and spark a spike in USDJPY which in turn drives Crude oil and stocks surging higher...

Spain's Election Quagmire: What Wall Street Thinks

Don't look now, but Brussels’ preferred Spanish PM is about to be ousted by a coalition of leftist parties, and that, in turn, suggests that the idea of fiscal retrenchment will be thrown out, along with anything that even looks like austerity. That could trigger a showdown between Madrid and Brussels over Spain’s intention to adhere to EU deficit targets.

Ray Dalio Admits QE Won't Work, Asks For More Anyway

QE no longer works: "it is difficult to push the prices of these assets up and it is easy to have them fall. And when they fall, there is a negative impact on economic growth. When debt levels cannot be increased without reducing spending — stimulating demand is more difficult."
But do more QE anyway: "Since the dollar is the world’s most important currency, the Fed is the most important central bank for the world as well as the central bank for Americans, and as the risks are asymmetric on the downside, it is best for the world and for the US for the Fed not to tighten."

Charting the Crash – How Far Will The Bounce Get?

by Keith Weiner, GoldSeek:

The purpose of this update is to define exactly where we are on the market clock, because if we know where we are, broadly speaking we will know where we are going.
The purpose of this update is to define exactly where we are on the market clock, because if we know where we are, broadly speaking we will know where we are going.
Before going any further I want to point out that so far we have tracked this nascent market crash well, first looking for the market to cave in last Summer, in the Preparing for the Crash series, calling for the Biotech sector to plunge before Christmas in Biotech Inverse ETFs update – Perfect Entry Point for New Shorts, for China to crater at the end of December in the China update and more recently calling for a waterfall decline in the US stockmarket right at the start of the year in Broad US Stockmarket Still Perched Atop a Cliff
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by Andy Hoffman, Miles Franklin:
On Friday the markets closed out one of the most tumultuous weeks – and half months – since the 2008-09 financial crisis. Not just due to wildly “volatile” financial markets, mind you – which I put in quotes, because all the downside action was “capped,” and all the upside moves “aided.” To the contrary, news flow from all four corners of the globe is dramatically, terrifyingly deteriorating – politically, economically, and socially.
Like, for instance, the sheer desperation of the world’s richest men and women; who from their cushy Davos, Switzerland digs – where a hot dog costs $48 – lamented how the upcoming “BrExit” vote could easily, in and of itself, take down the already cratering European Union. Or Germany’s Finance Minister, Wolfgang Schaeuble, emphatically insisting that Greece will NOT be “bailed out” unless the IMF participates; whilst IMF head Christine Lagarde, on the cusp of being re-elected – insists it will NEVER fund a bailout unless Greece receives debt relief. A condition, as we know too well, Germany will NEVER agree to.
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from The Daily Sheeple:

It’s been nearly two years since the residents of Flint, Michigan were first exposed to highly polluted tap water. The financially insecure city switched its water supply from Lake Huron to the Flint River, which saved the city millions of dollars. However, residents of Flint immediately started complaining about the color and foul taste of the water, but those complaints fell on deaf ears and assurances that the water was safe.
In reality the water was loaded with high levels of lead, likely caused by corrosion of old lead pipes. Once the truth was impossible to ignore, Governor Rick Snyder was quick to apologize and asked FEMA to distribute clean water to Flint.
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Junior Resource Destruction & Three Traps to Avoid

from Outsider Club:

The junior mining sector has been decimated.
The Market Vectors Junior Gold Miners ETF (NYSE: GDXJ) — which holds companies as small as $10 million — has lost over 40% of its value in the past year. It’s lost 87% of its market capitalization over the past five years.
And some have met even more dreadful fates.
Global X launched a junior mining fund in September 2012 with the clever ticker JUNR. But you won’t find that fund exchange-traded anymore. The New York-based ETF sponsor decided to shut the fund down less than three years later.
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