Submitted by Tyler Durden on 01/21/2016 - 13:35
On Thursday, we got the latest bad news out of Deutsche as Cryan reported what he called “sobering” results for 2015. In short, the bank is staring down a net loss of €6.7 billion for the year, the first annual loss since 2008. "We see further downside risk on litigation – we model another €3.6bn in 2016 - which is likely to necessitate a capital raise."
Submitted by Tyler Durden on 01/21/2016 - 10:55 "At this point we think that the negative feedback loop between market performance, volatility and the real economy (wealth effect) is becoming a significant risk for the S&P 500... as some assets are near the top and others near the bottom of their historical ranges, we are obviously not experiencing an asset bubble of all risky assets, but rather a bubble in relative performance: we call it a Macro-Momentum bubble."
Submitted by Tyler Durden on 01/21/2016 - 13:19 Once a central bank program fails to generate a self-reinforcing rally, the mind-trick's power is broken. No one knows precisely how and when the global unraveling will impact their corner of the planet, but we do know one thing with absolute certainty: central banks are out of tricks.
Submitted by Tyler Durden on 01/21/2016 - 12:55 "I don't think China's economic slowdown is that severe to threaten the global economy."
"China has managed debt restructurings superbly."
Submitted by Tyler Durden on 01/21/2016 - 12:33 Today, none other than railroad titan Canadian Pacific (whose stock is down 4% despite the torrid surge higher in risk assets) confirmed that not only are things "worse", but the bottom may have fallen out from what until recently was one of Warren Buffett's favorite industries, after missing on both the top and bottom line, but especially during its conference call in which the management team admitted to "tremendous pressure" on the top line, "challenging times" for revenue growth, strong headwinds for the US economy in 2016 and warned another 1,000 workers are about to get the pink slip.
Submitted by Tyler Durden on 01/21/2016 - 12:22 Earlier today, we highlighted a dramatic plunge in the Russian ruble which has crashed to record lows against the dollar after staging its steepest two-day decline in nine months. Now, amid the carnage, The Bank of Russia is set to hold an emergency meeting with banks to discuss the FX bloodbath.
Submitted by Tyler Durden on 01/21/2016 - 12:12 The machines are in control. On the day when inventories surge, demand tumbles, production surges, and credit risk spikes, "traders" are panic-buying crude oil with both hands and feet... except they just ran the stops to the post-Iran open...
Submitted by Tyler Durden on 01/21/2016 - 11:42
Submitted by Tyler Durden on 01/21/2016 - 11:20 The good news for bulls is that some signs of capitulation are beginning pop up. Thus, we would not be terribly surprised to see the pendulum swing to the bulls favor, at least over the short to intermediate-term. However, beyond that, the troubling longer-term warning signs remain, including perhaps an ominous 1973 analog.
Submitted by Tyler Durden on 01/21/2016 - 11:07 WTI Crude has ramped into this morning's DOE data back to the scene of the crime from last night's API ugly data dump. With API reporting a build that doubled expectations, DOE reports a 3.6mm build but worse still yet another major (4.6mm barrel) build in gasoline stocks for the largest 3-week build in history. Crude initially tumbled but the algos took over and ramped to yesterday's highs...running stops (but how long will that last?)
Submitted by Tyler Durden on 01/21/2016 - 10:30 In the most blatant and open admission of direct manipulation, China's Vice President Li told a room full of Davosian elites that China is willing to keep intervening in the stock market to make sure that a few speculators don’t benefit at the expense of regular investors. Following last night's largest liquidty injection in over 3 years (and subsequent plunge in Chinese stocks), it appears the Chinese economic/market "bucket" has more holes than the intervention 'hose pipe' can handle.
Submitted by Tyler Durden on 01/21/2016 - 10:10 One thing is clear: banks are not only not telling the full story, but the story they are telling is compromised. Still one has to start somewhere with whatever data is publicly available, so courtesy of Reuters, here is a summary of what the big U.S. banks who have reported Q4 earnings so far, say about their energy exposure.
Submitted by Tyler Durden on 01/21/2016 - 10:08 “It’s falling faster than any other currency as we see panic selling in the ruble after it breached the 80 per USD level. Some investors are selling at any price,”
from The Wealth Watchman:
Well folks, the Global Stock Market Trade Equity Energy Credit rout that began with the start of 2016 has continued. Everywhere you look, asset valuations are getting completely monkey-hammered.
I intend to survey the damage, and focus on the weak link in the system here that I’ve been watching carefully. Firstly though, let’s take a gander at a laundry list of absolutely horrifying data points around the world. Let’s start with a very revealing chart, which should tell everyone with eyes to see, precisely what they need to know:
Submitted by Tyler Durden on 01/21/2016 - 09:47 From omnipotence to impotence... in 90 minutes
Submitted by Tyler Durden on 01/21/2016 - 09:46 "The market is having a temper tantrum, nothing more, so I view this turmoil as a buying opportunity," said Whitney Tilson, who runs hedge fund Kase Capital. She noted, however, that prices are still not as cheap as they were in 2008 or 2011.
by Brett Arends, Market Watch:
Investors in gold bullion have been suffering brutal losses for more than four years.
The price of gold has nearly halved since its 2011 peak, falling from $1,891 an ounce to just $1,094 today. But last week, for the first time in a long time, there was a bit of good news. Thanks to Donald Trump.
In a remarkable, but little-noticed, exchange during Thursday’s GOP debate, the Republican front-runner opened the door to wider currency wars against America’s main trading partners if he is elected president. And although Trump’s preferred means of retaliating against the likes of China and Japan is apparently through a tariff, similar ends can be achieved far more easily by driving down the value of the U.S. dollar.
Why Central Bank Independence Matters … In India, the independence of the Reserve Bank of India (RBI) and its respected governor, Professor Raghuram Rajan, was recently perceived to be under threat when the Indian government proposed through its Ministry of Finance that its nominees should form the majority in a new, formal Monetary Policy Committee of the RBI. Domestic and international concern about what was seen as an attempt to subordinate the decision-making process of the Indian reserve bank to political interference quickly mounted. The matter was ultimately resolved with agreement on the establishment of a committee with equal representation from the RBI and the Indian government, but with the RBI governor to have a deciding vote in case of a deadlock. This ensures, of course, that the ultimate judgment on Indian monetary policy still rests with the country’s reserve bank. –ThisDayLive
Dominant Social Theme: Central banks – just leave them alone to do their good.
Free-Market Analysis: This article, appearing in Nigeria’s biggest newspaper, is by Professor Moghalu, a former Deputy Governor of the Central Bank of Nigeria.
filed under "white trash"
When it comes to watching the Hillary Clinton campaign, you need to be prepared for increasingly suicidal and irrational acts of desperation. While the most pathetic of all her shameless acts was saying she is sponsored by Wall Street as a result of the terror attacks on 9/11, the hits just keep on coming.
In her latest scheme, the Clinton campaign released a letter signed by former national security officials warning the American public that Bernie Sanders isn’t ready to be Commander in Chief (i.e., he will not sufficiently defend the status quo). While obviously absurd to any thinking person, most Hillary Clinton supporters are not thinking people.
Moreover, her move brings up a key point that I mentioned repeatedly on Twitter during Sunday night’s debate, which is that Sanders wasn’t hitting Clinton hard enough on her unabashed militarism and string of debacles while Secretary of State.
It’s official – global stocks have entered a bear market. On Wednesday, we learned that the MSCI All-Country World Index has fallen a total of more than 20 percent from the peak of the market. So that means that roughly one-fifth of all the stock market wealth in the entire world has already been wiped out. How much more is it going to take before everyone will finally admit that we have a major financial crisis on our hands? 30 percent? 40 percent? This new round of chaos began last night in Asia. Japanese stocks were down more than 600 points and Hong Kong was down more than 700 points. The nightmare continued to roll on when Europe opened, and European stocks ended up down about 3.2 percent when the markets over there finally closed. In the U.S., it looked like it was going to be a truly historic day for a while there. At one point the Dow had fallen 566 points, but a curious rebound resulted in a loss of only 249 points for the day.
by Christina Sarich, Natural Society:
During President Obama’s most recent State of The Union Address, he vowed to utilize the full spectrum of the U.S. government’s resources to create a “Moonshot-like” effort geared toward finding a cure for cancer. Why then, is Round Up, a ‘likely carcinogen,’ still being sold on markets across the United States and sprayed on our food?
President Obama also broke a 2007 campaign promise to label GMOs, but he can make things right before leaving office by acting on a highly-prevalent toxic chemical compound used today – glyphosate. Glyphosate is the active compound used in herbicides like Round Up – Monsanto’s best-selling herbicide.
If you still own stocks and mutual fund shares, you still aren’t grasping the systemic risk in the stock market. No matter what you claim to BELIEVE, it is your ACTIONS that actually determine your true grasp of reality. Failing to sell all your stock holdings right now could result in massive losses as the world’s bubble markets continue with an implosion that could wipe out 50% of current valuations for many stocks.
The massive market bubble currently in place has been propped up by a steady stream of fiat money being printed by the Federal Reserve and handed out to banksters who have ties to Washington. This, combined with near-zero interest rates, is the only thing propping up the bubble market (and creating the illusion of economic prosperity).