Archive - Nov 11, 2015

How the mighty have fallen. Once (and still) "no brainer" hedge fund hotel, sponsored by any and all talking head; now sub-$5 share price 'languisher in the basement' of the last few years. SunEdison (down 14% today) is now down 86% from its July 20th highs as an armada of leveraged speculators flood through the straits of first-mover advantage...

Now that there are "no taboos," and assuming the ECB doesn't take our advice on the '52 Mantles or the lumber, the only question is whether the central bank will pair a depo rate cut with the PSPP expansion (in whatever form it takes)....

With no bond market to keep algos honest, it's all about USDJPY (until the VIX ramp at the close)..

Today’s dilemma – for financial markets and central bankers – is that pushing back against nascent “risk off” unleashes another forceful bout of “risk on.” At this point, it’s either Bubble on or off – destabilizing either way. The global Bubble has grown too distended and the market backdrop too dysfunctional. Central bankers over the past 25 years have created excessive “money,” while incentivizing too much finance into financial speculation. There is now way too much “money” crowded into the securities and derivative markets, and the upshot is an increasingly hostile backdrop for leverage and speculation.

"It is a bloodbath. We’re at the highest point of fear and uncertainty now.... God only knows what’ll happen if oil doesn’t rebound. I try not to let that penetrate my mind."

It is important to note that the current weakness of gold is primarily in dollar and sterling terms. For investors in Canada, Australia, New Zealand and the EU gold is once again acting as a hedge.

With winter looming, some European states are warning that a humanitarian crisis may be right around the corner as the proliferation of anti-migrant fences and border controls has slowed refugees on their trek to Germany. Now, hundreds of thousands could end up stranded. Fearing a "catastrophe" on its soil, Slovenia has now built its own razor wire border barrier, a move Croatia calls "a waste of time." 

To the degree that serfdom is political powerlessness and near-zero access to the processes of accumulating productive capital, super-welfare guaranteed income for all is simply serfdom institutionalized into a Hell devoid of purpose, pride, meaning, community and positive social roles.

It's not HFTs; It's not global orchestrated central bank intervention in "markets"; it is not even confirmed manipulation of virtually every asset class by the Too Big To Prosecute banks, who instead of doing research spent time colluding in anonymous chat rooms how to manipulate everything from FX, to Treasurys, to gold. No: according to the SEC what is truly broken with the markets, and why two-thirds of Millennials have lost faith in stocks, are short sellers "manipulating" stock prices on twitter.

Breaking a critical trendline (particularly one that has been in place for several decades) is one thing. Breaking it and then failing to reclaim it during the following bounce is indicative of BEAR MARKET.

Listening to the mainstream media would imply that the Fed has made the decision already; but Fed Funds Futures are priced (as-of 11/10/2015) for only a 66% chance of the Fed raising to 0.25%-0.50% in December. It isn't the foregone conclusion you would think after watching CNBC. We do not think the Fed will have enough time of relative solace to raise even once before a global slowdown/recession is obvious in the U.S.

After a disappointingly un-uber-dovish speech this morning by Draghi,it appears The ECB needed to full ease-tard to make sure 'markets' believe. EURUSD tumbld 50 pips - to the lows of the day - after Reuters reports that, in what is becoming increasingly clear desperation, The ECB is mulling buying the debt of cities and regions.

"People of privilege will always risk their complete destruction rather than surrender any material part of their advantage. Intellectual myopia, often called stupidity, is no doubt a reason."

Hypocrisy gets a mulligan...

A suspect was in custody this morning for making online threats to shoot black students at the University of Missouri following the racial protests that prompted the school's president and chancellor to step down this week, campus police said. The announcement followed a post on the social media app Yik Yak on Tuesday, tagged for the college town Columbia. The posting read: "I'm going to stand my ground tomorrow and shoot every black person I see."