<Click on graphic for larger image> Arbor Quantitative Analytics – The death of long swap spread trades… GCF repo activity in USTs remains elevated after an explosion in Yuan implied volatility (leading to potential China/EM selling). This shift beginning on August 12th coincided with USD swap spread tightening. As for now, no one seems ready… Continue reading Swap Spreads
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Comment In her September 17 post-announcement press conference, Fed Chairwoman Janet Yellen said the Federal Open Market Committee discussed a potential rate hike at its most recent meeting, but that inflation is still not close to where the Fed needs to see it before rates can rise. In the following days Fed officials voiced their… Continue reading The Fed’s Hike Is Messing Things Up!
Business Insider – Bill Ackman’s biggest stock holding is getting hammered Activist investor Bill Ackman’s biggest stock holding is getting demolished. Shares of Valeant Pharmaceuticals plummeted on Monday after Democrats on the House Oversight and Government Reform Committee sent a letter to the committee’s chairman, Jason Chaffetz (R-UT), asking him to subpoena the pharmaceutical company… Continue reading Managed Money’s Bloodbath
<Click on chart for larger image> <Click on chart for larger image> Comment The two charts above show that both high yield and investment grade spreads are making new multi-year wides. As we detailed near the end of our conference call last week (transcript, handout, webcast), credit leads the stock market. So new wides suggest… Continue reading Updating Credit Market Stress
<Click on graphic for larger image> The Wall Street Journal – Investors Fall Out of Love With Deals The stocks of a number of acquirers have suffered big losses following the announcement of a takeover Corporate executives earlier this year were feeling the love from investors when they announced acquisitions. Now, some buyers are getting… Continue reading Is The Market Souring On Deal-Mania?
Zero Hedge (Blog) – Carl Icahn Says Market “Way Overpriced”, Warns “God Knows Where This Is Going” Over the course of 15 minutes, Icahn lays out his concerns about many of the issues we’ve been warning about for years and while none of what he says will come as a surprise (especially to those who… Continue reading Icahn Is Worried, The Video
<Click on chart for larger image> Comment The chart above is current through July 31. The bulk of OPEC’s U.S. Treasury holdings belong to Saudi Arabia. In the next two weeks August data will be released. If they were selling, it would show in that data. The Financial Times – Saudi Arabia withdraws overseas funds… Continue reading Are The Saudis Selling Treasuries?
<Click on graphic for larger image> The Wall Street Journal – U.S. Oil Output Finally Falls, But It Isn’t Helping Prices Muted price reaction to declining U.S. oil output underscores how the market’s focus has shifted to production gains elsewhere Oil bulls can’t catch a break. The long-awaited decline in U.S. oil output has begun,… Continue reading Crude Oil
The Wall Street Journal – Glencore Stock Rallies Amid Market Talk of Taking Group Private Some analysts see value in stock despite worries about industrial commodity prices Glencore PLC shares staged a small recovery on Tuesday as some analysts defended the value of the debt-laden company and suggested it could be taken private. The Swiss… Continue reading More On Hedge Funds Hurting
Finanz und Wirtschaft (Switzerland) – The Next Thing Might Be Helicopter Money James Grant, Wall Street expert and editor of the investment journal «Grant’s Interest Rate Observer», warns of ever more extreme central bank policies and bets on the comeback of gold. The global financial markets are under severe stress. The postponed interest rate hike… Continue reading Jim Grant Speaks
The Straits Times (Singapore) – China industrial profits fall most since 2011 as economy slumps Chinese industrial companies’ profits declined the most in at least four years, as the pillars of China’s infrastructure-led growth model suffered from a devalued yuan, a tumbling stock market and weak demand. Industrial profits tumbled 8.8 per cent in August… Continue reading China’s Struggles