• Tim Knight from...
    02/06/2016 - 00:25
    What we must remember is this: we are in a bear market, and the risk of a countertrend rally is present, but confined. The opportunity on the downside movement dwarfs the risk of a push higher, as...
  • Phoenix Capital...
    02/06/2016 - 10:15
    2008 was caused by derivatives based on consumer-focused assets (houses). The next crisis will be driven by derivatives on government-focused assets (bonds).

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How Low Can The Bank Of Japan Cut Rates? Ask Gold

When people hold cash out of aversion to negative interest rates, they risk losses due to theft and the like. The cost of avoiding this risk could be a key determinant of negative interest rates' lower bound, but it is hard to directly quantify. As a proxy for the cost of holding physical currency, we estimated the cost of storing gold based on gold futures prices. This cost has averaged an annualized 2.4% over the past 20 years, though it has varied widely over this timeframe.


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Is The Saudi's Market Share Strategy Still Feasible?

Oil markets have been largely assuming that OPEC producers could go on producing at these levels for years, but what if that’s not the case?


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Trading Desks Stunned By 'Brutal' Selling: "The Crowded Trades Have Come Unglued On Obvious Unwinds"

"Yest was one of the largest global net sell days over the past year and the largest sell day of 2016 so far, a 2.5 standard deviation (SD) event L/S funds were the main sellers as they BOTH sold longs AND added shorts."


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Central Bank Currency Wars Have Engaged The "Nuclear Option"

An enduring curse of this financial crisis is the inability of markets to disengage from the clutches of the correlation of one. We see it ad seriatim, often day to day: everything is wonderful, all hail the central bank (Friday); the world is crashing, these empty suits are running us over the cliff (Tuesday).  Having gone on long enough, this phenomenon has turned traders into inveterate cynics who know the price of everything, and the value of nothing.


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Is A New Era Upon Us?

Populism, patriotism, nationalism, defying political correctness and dissing the establishment and the elites that monitor PC are where it’s at. There are reasons for such populist rage...Put bluntly, the nation seems almost everywhere on an unsustainable path.


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Is The PBOC Intervening Now? Yuan Is Soaring

"We must break you" speculators...


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Managing Risk Through A Commodity Downturn

Instead of looking at the rise of the NASDAQ to bubble territory and using that as a basis to assume the economy is strong, it is more useful to look at real assets like commodities. For real economic growth, commodities matter much more than a money printing drive to inflate stocks like biotech and technology.


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When "Whatever It Takes" Fails - Global Bank Risks Are Soaring

The surge in credit risk across the global financial system is starting to get to the point where even Bill Miller will be forced to pay attention. With every central banker "all-in" with "whatever it takes" or "no limits" monetary policy, the fact that US, European, Chinese, Japanese, and Middle-East banks are all seeing credit risk spike should be a major concern to all...


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2Y German Bond Yields Collapse Below -50bps For First Time Ever

Presented with no comment...


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Oil Dumps'n'Pumps Despite Crude, Gasoline Inventories Surge

Crude has soared back above $31 as it seems a new bullish narrative around seasonally high crude refining has sparked dreams of demand...

After initial weakness, crude prices have rallied since last night's across the board inventory build reported by API (especially gasoline). Against headline expectations of a 3.8mm build, DOE reported a huge 7.8mm rise with Gasoline also surging 5.9mm barrels. The overnight ramp gains on OPEC rumors have been erased and WTI is back below $30.


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Gold Surges Above Key Technical Level

With the dollar tumbling and Dudley and Kuroda exposed as impotent, investors are rotating to the safety of not Biotechs but Bullion and Bonds. Gold just pushed above $1135 to 3-month highs, breaking above its crucial 200-day moving-average...


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Manufacturing Recession Spills Over Into Services After Dismal PMI, ISM Data

In the words of Markit's chief economist, "the US upturn has lost substantial momentum over the past two months," as the golden child of any current bullish narrative - the Services economy - drops to its weakest since October 2013 (PMI 53.2, missing expectations). Plunging backlogs suggest hiring will slow notably and then ISM Services hit at a 23-month low, plunging back towards manufacturing's weakness, with employmenmt at its weakest sicne April 2014 and unadjusted new orders at their weakest since Jan 2014.


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We're Gonna Need More Dudley

Dudley is no Bullard...


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