Potentially Worth Trillions, But Is Aramco A "Good Deal" For Investors?
Submitted by Tyler Durden on 01/11/2016 - 12:25
Saudi Arabia’s deputy crown prince Muhammad bin Salman made headlines this week when he said that the kingdom was considering an IPO of Saudi Aramco, the nation’s state-owned oil company. But there are reasons to doubt that 1) the Saudi government will actually follow through on the plan, 2) even if some shares are listed, operations will change significantly, and 3) that such a move presents a huge opportunity for investors. Sure, Aramco might be worth trillions in theory. But returning cash to shareholders is not and will not be the top priority.
Is The Auto Loan Bubble Ready To Pop?
Submitted by Tyler Durden on 01/11/2016 - 11:45
On Tuesday, it was announced that over seventeen million new vehicles were sold in 2015, the highest it’s ever been in United States history. While the media claims that this record has been reached because of drastic improvements to the US economy, they are once again failing to account for the central factor: credit expansion. The auto bubble has yet to burst, but its negative effects are already starting to gradually appear.
China Warns No "V-Shaped" Recovery Is Coming; Says "There Will Be No Strong Economic Stimulus"
Submitted by Tyler Durden on 01/11/2016 - 11:17
Maybe because not enough people caught the dire warning the first time, moments ago Bloomberg reported that Han Jun, the deputy director of China’s office of the central leading group for financial and economic afairs, spoke at an event at the Chinese consulate in New York and practically reiterated the anonymous source's warning practically verbatim. To wit: "There won’t be a strong economic stimulus and people shouldn’t expect a V-shape recovery; instead long period of L-shape growth path is likely" said Han, who participated in the drafting of China’s latest five year plan.
S&P Gives Up "China Stability" Gains As WTI Tumbles To $31 Handle
Submitted by Tyler Durden on 01/11/2016 - 11:05
Well that escalated quickly...
Momo-Massacre: Under Armour Dented, FitBit Flops, & FANTAsy Stocks FUBAR
Submitted by Tyler Durden on 01/11/2016 - 11:00
The momentous momentum stocks appear to have crashed into the reality of extreme valuations in a no-growth, carry-trade-unwind environment. It's not pretty out there...
Is A Massive Earthquake Inevitable In Oklahoma?
Submitted by Tyler Durden on 01/11/2016 - 10:25
When Americans speak of “the big one,” they’re talking about the potential for a super-massive earthquake that could essentially destroy most of quake-prone California. Now some scientists believe something similar could happen in the once geologically placid Oklahoma.
Russian Stocks Are Crashing
Submitted by Tyler Durden on 01/11/2016 - 10:18
Down over 5%, Russia's RTS Index has plunged to its weakest level since Dec 2014 and the peak of its existential crisis mid-Ukraine/currency-crisis/oil-collapse. This is Russia's biggest one-day drop since April 2015. The Ruble continues to tumble (despite CNH strength) as oil pushes to new cycle lows...
Oil Tumbles To 11 Year Lows After Another Bank Joins "$20 Crude" Bandwagon
Submitted by Tyler Durden on 01/11/2016 - 09:45
Another algo-induced stop-run has tried and failed to maintain its gains this morning as Morgan Stanley becomes the latest (after Goldman) to join the "oil in the $20s is possible" bandwagon. Despite hopeful bullishness from Andy Hall who sees production destruction leading (an industry that couldn’t function at $50 certainly can't function with prices below $40) inevityably leading to higher prices, Morgan Stanley warns, "in an oversupplied market, there is no intrinsic value for crude oil. The only guide posts are that the ceiling is set by producer hedging while the floor is set by investor and consumer appetite to buy. As a result, non-fundamental factors, such as the USD, are arguably more important price drivers."
JPM: "Use Any Bounces As Selling Opportunities"
Submitted by Tyler Durden on 01/11/2016 - 09:30
"Our view is that the risk-reward for equities has worsened materially. Yes, stocks had a rough time most recently, and some of the tactical indicators, such as Bull-Bear at -16 which is at the bottom of its trading range, argue for a short-term respite. Clearly, equities are unlikely to keep falling in a straight line, with periodic rebounds likely. However, we believe that one should be using any bounces as selling opportunities."
The Shrinking Global Economy (In 3 Awkward Charts)
Submitted by Tyler Durden on 01/11/2016 - 09:12
The following three charts make last week’s market turmoil easier to understand. Falling trade means lower corporate profits, which, if history is still a valid guide, means less valuable equities. So it could be that the markets are simply figuring this out and revaluing assets accordingly.
The Question Every Trader Want Answered: Are Stocks Short-Term Oversold Or Long-Term Overbought
Submitted by Tyler Durden on 01/11/2016 - 08:44
"Shorter-term traders will feel that many moves have gone a long way very quickly and hence appear ripe for a brief rebound. The catalyst is that, in the height of a market panic, prices can become dislocated from fundamental valuations, as margin stops get triggered and “weaker” positions get cleaned out. The counter-argument is that distortions caused by the extraordinary monetary policies of global central banks mean markets might have been disconnected from traditional fundamentals for several years."
Futures, USDJPY, Crude Spike As PBOC Tries To Calm Panic
Submitted by Tyler Durden on 01/11/2016 - 08:28
Yuantervention overnight steadied the Chinese currency and despite a plunge in Asian equities, stabilized US equities thanks to an incvessant bid for USDJPY. However, this morning has seen PBOC's Ma crawl out from under the desk to attempt to calm investor panic with two-faced comments about the nation's new FX regime. Noting that PBOC will focus on stability of Yuan vs their new CFETS basket, Ma then back-handedly said two-way volatility was expected to increase (in a clear nod to stopping carry traders piling on). Of course, the crude oil algos loved it and surged, USDJPY jumped, but for now US equities and bond are unimpressed.
Gartman: "In Our Retirement Funds We Shifted To Modestly Net Short, We Have Had No Choice"
Submitted by Tyler Durden on 01/11/2016 - 08:22
" In a bear market, one can have only one of three positions also: aggressively short; modestly short or neutral. In our retirement funds here at TGL we began last week and indeed we began the year modestly long but by the weeks’ end we had shifted to modestly net short. We have had no choice. The market’s voice was loud and very clear." - Dennis Gartman
Man Who Stormed Paris Police Station With Meat Cleaver Tied To German Sex Attacks
Submitted by Tyler Durden on 01/11/2016 - 08:02
The man who ran into a police station in northern Paris wearing a fake explosive vest, waving a meat cleaver, and shouting "Allahu Akbar" on the Charlie Hebdo anniversary once lived in a German refugee center and may have been involved in the New Year's Eve "sex mob" attacks. Walid Salihi used at least seven aliases while roaming around Europe committing what police say was a string of petty crimes including, but probably not limited to: "touching women's behinds at the disco," strangling a roommate, attacking a "passerby," and beating up a homeless man.
