The Most Dangerous Country In Europe
Submitted by Tyler Durden on 05/20/2013 - 08:25
"Preservation of Capital," has reached epic seriousness in a world with interest rates at unsustainable lows and underlying economic fundamentals that cannot support today's yields. The irrational game goes on based upon one thing and one thing only which is the creation of capital by all of the world's central banks. The money must go somewhere and so it does but the disconnect between the equity markets and bond yields from the real world is frightening. Nowhere on the planet is it scarier than in Europe.
- Comments: 58
- Reads: 23,578
It's Official: Yahoo Acquires Tumblr For $1.1 Billion, Promises Hipsters "Not To Screw It Up"
Submitted by Tyler Durden on 05/20/2013 - 08:12As has been rumored for months, and known for days, the official purchase of Tumblr by Yahoo is now in the books. For $1.1 billion, Yahoo is the proud owner of a whole lot of user-generated porn sites if not that much (read any) revenue. We cant wait to see how it monetizes them. And in a press release, apparently aimed squarely at hipsters, Yahoo promises "not to screw it up." It's cool to be hip and edgy: surely it's worth at least 15% in stock premium. As for profits... ah, it's an Amazon world after all.
- Comments: 61
- Reads: 7,071
Key Events And Market Issues In The Coming Week
Submitted by Tyler Durden on 05/20/2013 - 08:02In the absence of major data releases, the focal point of the week for markets becomes the release of the minutes of the May FOMC meeting. The most notable change in the statement was the inclusion of the new language: “the Committee is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes.” In the May meeting minutes, the market will be looking for any clarification of the motivation behind this change as well as any evidence that the committee members may be becoming less comfortable with the unemployment rate threshold or more specific about tapering timelines and dates.
- Comments: 7
- Reads: 3,042
Frontrunning: May 20
Submitted by Tyler Durden on 05/20/2013 - 07:32- Obama's Counsel Was Told of IRS Audit Findings Weeks Ago (WSJ)
- North Korea fires sixth missile in three days (Reuters)
- Enron No Lesson to Traders as EU Probes Oil-Price Manipulation (BBG)
- Don't cry for me, Eurozone: Thinking the Unthinkable - Quitting a Currency (WSJ)
- H-1B Models Strut Into U.S. as Programmers Pray for Help (BBG)
- Gold Bear Bets Reach Record as Soros Cuts Holdings (BBG)
- Yahoo has agreed to pay $1.1 billion for Tumblr (WSJ)
- JPMorgan Holders Led by Chairmen-CEOs to Vote on Dimon (BBG)
- Apple faces grilling over US tax rate (FT)
- Nissan to Sell First Joint Minicar to Expand in Japan Market (BBG)
- Fierce battle for corporate loans sparks US bank risk concerns (FT)
- Microsoft Updates Xbox as Apple to Facebook Gain in Games (BBG)
- Comments: 2
- Reads: 2,573
Steve Cohen's SAC May Face Criminal Charges
Submitted by Tyler Durden on 05/20/2013 - 07:05
The longest ongoing government "sting" operation against a hedge fund, possibly in all of history, that which absolutely everyone has known about for years now i.e., against Steve Cohen's SAC and its Bernie Madoff-esque series of profitable years (at least until recently that is, when "expert networks" no longer accept any calls originating out of Connecticut or New York), may be coming to an end, following what the WSJ reports may be an imminent filing of criminal charges against the hedge fund. "U.S. prosecutors are considering possible criminal charges against SAC Capital Advisors LP as a result of the government's insider-trading investigation of the hedge-fund firm, according to people familiar with the matter. It isn't clear what led prosecutors to warn the Stamford, Conn., hedge-fund operator that it could be charged criminally. But the move is the strongest sign yet that prosecutors and the Federal Bureau of Investigation are trying to ratchet up the pressure as a five-year deadline looms to file the most serious charges related to trading that allegedly involved Mr. Cohen."
- Comments: 41
- Reads: 6,000
Lack Of Overnight Euphoria Follows Japan Yen Jawboning In Light Trading Session
Submitted by Tyler Durden on 05/20/2013 - 06:55A quiet day unfolding with just Chicago Fed permadove on the wires today at 1pm, following some early pre-Japan market fireworks in the USDJPY and the silver complex, where a cascade of USDJPY margin calls, sent silver to its lowest in years as someone got carted out feet first following a forced liquidation. This however did not stop the Friday ramp higher in the USDJPY from sending the Nikkei225, in a delayed response, to a level surpassing the Dow Jones Industrial Average for the first time in years. Quiet, however, may be just how the traders at 72 Cummings Point Road like it just in case they can hear the paddy wagons approach, following news that things between the government and SAC Capital are turning from bad to worse and that Stevie Cohen, responsible for up to 10-15% of daily NYSE volume, may be testifying before a grand jury soon. The news itself sent S&P futures briefly lower when it hit last night, showing just how influential the CT hedge fund is for overall market liquidity in a world in which the bulk of market "volume" is algos collecting liquidity rebates and churning liquid stocks back and forth to one another.
- Comments: 9
- Reads: 3,020
Japan's Nikkei 225 Overtakes Dow For First Time In 3 Years
Submitted by Tyler Durden on 05/20/2013 - 00:25
Following an 80% rise off October 2012 lows, Japan's Nikkei 225 nominal price just exceeded that of the Dow Jones Industrial Average for the first time since May 6th 2010. Though the Dow is around 8% above its 2007 all-time highs, the Nikkei remains 16% below its 2007 highs (and over 60% below its 1989 all-time highs). While the Dow is pushing its P/E towards 15x, the Nikkei just passed 28x - quite a 'valuation' difference. JGB futures - though not halted yet - are plunging notably (with JGB yields up 3-4bps). The last time the Nikkei was here a USD bought 95 JPY, now it buys 103... and 10Y Japanese government bonds yielded 1.29% against today's 86bps (compared to 10Y Treasuries 3.5% then and 1.96% now) ... In those three years the Fed has expanded its balance sheet by just over $1 trillion and the BoJ by about $400 billion equivalent.
- Comments: 39
- Reads: 7,353
White House Damage Control Script Jeopardized By New Disclosures
Submitted by Tyler Durden on 05/19/2013 - 21:51
It has been a tough weekend for the President. First, the CEO of the Associated Press states the government's seizure of AP phone records was "so broad and so secret," among other factors, "that it was an unconstitutional act," adding that it had already had a chilling effect on newsgathering and press freedom. Add to that James Goodale's comments (the leading force behind the release of the Pentagon Papers and first amendment lawyer), that President Obama is "worse for press freedom than Nixon" and things are not going well. But, the problems did not stop there as the Wall Street Journal reports that while President Obama claims not to have been made aware of the IRS indiscretions until May 10th it seems the White House's chief lawyer learned weeks ago that an audit of the IRS likely would show that agency employees inappropriately targeted conservative groups. The President's response so far is that "we’re not going to participate in is a partisan fishing expedition."
- Comments: 272
- Reads: 29,915
The 'Other' Way To Exit The Euro...
Submitted by Tyler Durden on 05/19/2013 - 21:30
With unemployment rates running at all-time record highs across the peripheral European nations and the rise of nationalist (some might say extremist) parties, it remains somewhat surprising that there has not been greater social unrest (yet). The people of Europe are caught in a hinterland of knowing what is best in the long-run but fearing the short-term band-aid ripping pain of exiting the political farce known as the European Union. But some have found a way... There is another way to 'exit' on personal terms from the austerity and pain induced by a centrally planned overlord. Immigration to Germany from Italy, Spain, Greece, and Portugal has 'never' been higher... leaving us wondering - at what point does the free and open exchange of everything in the union gets its share of 'protectionism' from an over-stuffed Germany freezing the import of labor? So it seems that not only is the money (deposits) finding a new home but the people too are moving to where the money is..
- Comments: 70
- Reads: 14,457
A Dollar-Yen Tale Told By An Idiot, Full Of Sound And Fury, Signifying Nothing
Submitted by Tyler Durden on 05/19/2013 - 20:12
We are so deep inside the centrally-planned, Keynesio-monetarist Twilight zone, that the best we can advise is just laughing at the utterly ridiculous amounts of daily idiocy hitting the tape now on an hourly basis.
- Comments: 124
- Reads: 21,287
19 Tornadoes Strike Kansas And Oklahoma In Three Hours
Submitted by Tyler Durden on 05/19/2013 - 20:06
Bullish for GDP, foodstamps and BLS scapegoating of the weather as the reason for a weak May jobs report.
- Comments: 92
- Reads: 12,295
Crushed By Soaring Energy Costs, Japan Prepares To Reactivate Its Nuclear Power Plants
Submitted by Tyler Durden on 05/19/2013 - 19:51
Proving that Japan has learned absolutely nothing from its recent past, it is now preparing to risk yet another Fukushima, just to make sure that Goldman's partners have a fresh year of record bonuses, driven by the BOJ's monetary insanity. Yomiuri Shumbun reports, that just two years after a wholesale shutdown of Japan's nuclear power plants demanded by the people, Japan is once again going to reactivate its nuclear power plants, much to the chagrin of the already massively irradiated local population.
- Comments: 136
- Reads: 14,426
Adding Insult To Injury, South African Gold Mining Union Demands Up To 60% Wage Hikes
Submitted by Tyler Durden on 05/19/2013 - 19:06
In case the complete disconnect of paper selling from physical hand-over-fist buying (see this chart to explain all the gold activity in Q1 which can be summarized in two words: paper liquidation) were not enough to send the price of precious metals to zero, then news that quite soon gold mining companies in one of the world's largest producers of gold may be going out of business, leading to a collapse in physical product, should be sufficient to really send precious metals well into negative territory. The only question will be if the GDX gets there first. Reuters reports that South Africa's National Union of Mineworkers said it would seek pay rises of up to 60 percent from gold and coal producers, raising the prospect of fresh strikes as firms battle higher costs and falling prices in an already heated labor climate.
- Comments: 66
- Reads: 11,045
Silver Plunges As Yen Stop Surge Triggers Margin Liquidation
Submitted by Tyler Durden on 05/19/2013 - 18:18
Not a moment after someone was slammed with a massive margin call following the hit of 102 USDJPY stops as we noted moments ago, was that same someone(s) forced to dump a whole lot of silver in thin, no volume trading taking out the entire bid stack on what can only be described as "get me the hell out and pay me anything" liquidation, sending the precious metal to just over $20, before yet another round of buying programs kicked in, and sent it right back up, allowing those quick enough to capitalize on some foolish macro trader's blowing up to pocket a huge profit before Japan has even woken up.
- Comments: 338
- Reads: 44,403
