Submitted by Tyler Durden on 03/08/2016 - 12:11
Submitted by Tyler Durden on 03/08/2016 - 13:22 "JP Morgan is raising equity in a company with questionable prospects and using the funds to repay debt the company owes JP Morgan. The arrangement allows JP Morgan to get its money out prior to lenders subordinated to it get their $401 million payment."
Submitted by Tyler Durden on 03/08/2016 - 13:41 While conventional wisdom suggests that US government bond yields have nowhere to go but up, we believe the economic fundamentals will continue to weigh on interest rates for the foreseeable future.
Over the last three weeks, U.S. equity markets have recovered and are now more overbought than any time since 2009. While this is the case with equities, it is not the case with high yield debt. As I have said many times before, credit analysts actually look under the hood to discern the real situation and credit at this point is not buying the equity bounce/short squeeze. In fact, high yield credit spreads are rivalling the dark days of 2008.
The other area of interest since January is gold and silver. Gold and to a lesser extent silver are quite overbought short term. Many analysts in the “alternative” space have been recently cautioning that gold and the mining shares are about to be monkey hammered. Other than being overbought, we also have COT numbers showing the commercials very net short and the same setup as prior to previous waterfall events. So where do we go from here?
Submitted by Tyler Durden on 03/08/2016 - 13:11 While there may be a massive shortage and potential short squeeze forming at both the 10Y and 30Y part of the curve, there is far less euphoria when it comes to the short end, as confirmed moments ago when the Treasury sold $24 billion in 3 Year paper at a yield of 1.039%, a 0.3bps tail to the 1.036% When Issued, and higher compared to last month's stellar 0.844%. The internals were likewise lackluster, with the Bid to Cover of 2.710 coming at the lowest level since July 2009. Indirects of 46.2% were slightly above last month's 41.5%, but below the TTM average of 50%. Directs also pulled back taking down 9.1% of the auction and leaving 44.7% to Dealers, their largest allotment since December 2014.
Submitted by Tyler Durden on 03/08/2016 - 12:51 Just two days ago, everything was awesome - oil was up, stocks were up, financials were 'winning' - and then question started about why credit risk hadn't rallied like stocks. But today we get our slap back to reality as Citi CFO unleashes the following: CITIGROUP SEES INVESTMENT BANKING REVENUE DOWN 25%, FIXED INCOME, EQUITY TRADING REV DOWN 15% YOY. The stock is rapidly giving up its "everything's fine" gains as Citi "hopes" for more rate hikes... but does not expect them.
Submitted by Tyler Durden on 03/08/2016 - 12:36 Amid a strong 30 year auction overnight, long-dated Japanese Government Bond yields utterly collapsed. 30Y yields dropped 21bps - the biggest absolute drop in over 3 years and biggest percentage drop ever - to a record low 47bps. Since Kuroda unleashed NIRP, the entire JGB has been crushed and last night's rush for long duration debt (well at least there is some yield there?) has flattened the curve to record lows. For context, Japan's 30Y yield is now below US 2Y yield...
Submitted by Tyler Durden on 03/08/2016 - 11:45 Indeed, what party other than the BOJ could be buying negative coupon debt? The answer is exactly why the coming financial crash will be so severe and long-lasting. To wit, it is front-runners expecting to cop a capital gain, and then get out before the house of cards collapses. That’s what might otherwise be called an ambush. The trillions of speculator dollars crowded into trades of this type throughout the global financial markets will never get through the narrow door of liquidity that remains in the casinos. The dotcom and the post-Lehman meltdowns were only the rehearsal.
Submitted by Tyler Durden on 03/08/2016 - 11:21 it is one thing to note the obvious, it is different to have proof that Fed members have a clear ideological bias. Thanks to recent Fed appointee Lael Brainard, we have just that.According to Bloomberg, recent Treasury staffer and current Fed Governor Lael Brainard gave $750 in three contributions to Clinton’s campaign between November and January, according to Federal Election Commission records.
Submitted by Tyler Durden on 03/08/2016 - 11:10
Submitted by Tyler Durden on 03/08/2016 - 10:57 The last 14 months have seen the biggest slump in small business confidence since the financial crisis. Despite being told about how great the recovery is by authorities, at 92.9, NFIB's optimism index has collapsed to its lowest in 2 years with weakness across the board - from hiring plans to capex spending to real sales expectation. There are two 'people' to blame for this according to NFIB's chief economist - The Fed ("dithering") and Obama ("disinclined to act favorably to small business.")
Submitted by Tyler Durden on 03/08/2016 - 10:41
Submitted by Tyler Durden on 03/08/2016 - 10:34 The country’s social mood is apparently ripe and it finally seems actually possible for a perceived outsider to win by challenging the established order. Our main regret is that it wasn’t yet ripe at the time Ron Paul tried his hand at winning the nomination. Everything Trump is saying and doing should probably be seen in the context of his strategy. It’s quite Machiavellian actually. The alleged lack of discernible policy stances, the occasional contradictions and often hair-raising statements are all in pursuit of the same goal: to win the nomination. Other than that, we mainly enjoy the growing discomfort of assorted cronies and professional politicians.
Submitted by Tyler Durden on 03/08/2016 - 09:42 Oil prices should fall, possibly hard, in coming weeks. That is because fundamentals do not support the present price.
Submitted by Tyler Durden on 03/08/2016 - 09:41 By late January, Tim Leissner was irritated. So was Goldman. And so was the FBI.
The French colonial green, white, and black banner of Syria adapted by the West’s proxy “Free Syrian Army” (FSA) had long been forgotten in the sea of black banners held aloft by Washington and Riyadh’s more extreme ploy to gain leverage upon and more direct access to the battlefield.
However, as Syrian forces backed by its regional allies and Russian airpower overwhelm these forces while building alliances with other factions, including the Kurds, the West’s entire regime change enterprise faces ignominious collapse.
It appears that – having exhausted all other options – the West has decided to change as many of those black banners back to the “rebel” green, white, and black as possible, before the conflict draws to a close, giving the West the most favorable position achievable ahead of “peace talks.”
I am inspired by the very definition of self-reliance: to be reliant on one’s own capabilities, judgment, or resources. Ultimately, it is the epitome of independence and lays the groundwork of what we are all striving for – to live a life based on our personal principles and beliefs.
It is a concept rooted in the groundwork that made America great. Being dependent on our own capabilities and resources helped create a strong, plentiful country for so long. That said, the existing country as it is now is entirely different than when it began.
Marco Rubio isn’t just the final, fading hope of the GOP establishment. He’s also the last torch-bearer of neoconservative foreign policy left in the 2016 race. So it’s no surprise that Rubio’s just-announced foreign policy team features some of the big-name neocons who have shaped his hawkish views for years.
Among the 18 members of Rubio’s new “National Security Advisory Council,” which his campaign announced on Monday, are Elliott Abrams, a former special assistant to President George W. Bush who’s best known for lying to Congress about the Reagan administration’s role in the Iran-Contra scandal; Eliot Cohen, a historian, Iraq war supporter, and lawyer at the State Department during the Bush administration; Michael Chertoff, the secretary of homeland security during Bush’s second term; and Michael Mukasey, a Bush administration attorney general.
The quickening has begun in earnest. The end game might have begun in November with events picking up speed, remedy engaged in progressive steps, and geopolitical balance of power shifting in serious manner. The following are major events and factors in the Global Currency RESET IN PROGRESS.
The sequence of future events might become frightening, as the new financial structure comes into view.
The potential for disruption to the USDollar- based supply chain and inventory system remains a high risk.