Russia “received no answer” when it asked its international partners to provide information on terrorist targets in Syria, or to say at least where its planes shouldn’t bomb, Putin said. “It’s not a joke, I’m not making any of this up,” he said.
The elephant donkey in the room...
Now What: How Should One Trade In A World Where "Most Indicators Have Lost Their Informational Value"Submitted by Tyler Durden on 10/13/2015 - 13:37
A market which trades day to day on historic "whiplashes", record short squeezes, broken trendlines, and of course, $13 trillion in excess liquidity, got you shaking your head (and burning old Finance 101 textbooks)? Don't despair: here is Macquarie with a guide of how to trade in world where "most leading indicators have lost their informational value."
"Global trade is also declining at an alarming pace. According to the latest data available in June the year on year change is -8.4%. To find periods of equivalent declines we only really find recessionary periods. This is an interesting point. On one metric we are already in a recession."
Global central banks have made a Faustian bargain with our economic soul selling our future for a false stability today. At this stage, absent continuous intervention, a large deflationary crash in the global economy is inevitable. The next Lehman brothers will be a country. The real ‘shadow convexity’ will not come from markets but political unrest or war. Peace is not the absence of conflict. Global Central Banks have set up the greatest long volatility trade in history. Buy the fear and you will be protected from the horror.
In the face of stubbornly low crude prices, it's starting to look like the end of the road in the O&G space. As WSJ reports, all of the proverbial fat that can be trimmed has already been trimmed in terms of layoffs and capex. This means further cost savings will have to come from salary cuts because going forward, cutting jobs altogether would imperil companies’ ability to operate.
We think the market may have gotten ahead of itself, accepting the narrative that the Fed will raise rates as many other countries ease. We believe the market is gradually realizing that the Fed is far less flexible than it hoped it would be, thus causing a re-pricing of expectations. We don't think this will necessarily change the Fed's "desire" to pursue an exit. This re-pricing of expectations may have profound implications for the U.S. dollar, and with it, the price of gold.
With VIX collapsing 10 days straight (for the first time since October 2010), one might be forgiven for thinking "everything is awesome." However, as always, the real news is in the nuance that the mainstream often misses. As VIX has plunged (complacency about 'normal' risk), Skew (which measures extreme tail risk) has exploded to its highest ever...
Credit Suisse is out with the latest edition of its Global Wealth report and although the results are not entirely surprising, they are worth highlighting. Three standouts: i) the rise in the value of financial assets is most certainly contributing to an increase in global inequality, ii) dollar strength led to the first decline in total global wealth (which fell by $12.4 trillion to $250.1 trillion) since 2007-2008, iii) 0.7% of the world's population own nearly half of the world's wealth while the bottom 71% of the population own just 3%.
Some things you CAN see coming, in life and certainly in finance. Quite a few things, actually. Once you understand we’re on a long term downward path, also both in life and in finance, and you’re not exclusively looking at short term gains, it all sort of falls into place. Of course, the entire global economy has been hanging together with strands of duct tape for decades now, but hey, it looks good as long as you don’t take a peek behind the facade, right?
“After careful consideration and analysis, we have decided to close the Fortress Macro Funds and return cash to our investors... But we have had an extremely challenging two years, and I do not believe the current environment is conducive to achieving our best results."
With December rate-hike odds already plumbing record lows, today's data from The NY Fed's Consumer Expectatiopns Survey hamers the nail home that all is not well in America. Away from inflation expectations dropping and earnings expectations tumbling, household spending growth expectations have plunged to record lows.
Investors Are Terrified Of An EM Debt Crisis, But Are Bullish Because They Think Everyone Else Is TooSubmitted by Tyler Durden on 10/13/2015 - 11:09
Welcome to Reflexivity 101.
No professional or successful investor every bought and held for the long-term without regard, or respect, for the risks that are undertaken. If the professionals are looking at "risk" and planning on how to protect their capital from losses when things go wrong - then why aren't you? Exactly how many warnings do you need?