"The GPIF in October slashed its targeted holdings of low-yielding government bonds and doubled its target for stocks, as part of Prime Minister Shinzo Abe's plan to boost the economy and promote risk-taking," Bloomberg notes, marking a shift into risk assets by the country's pension funds.
"Under our central case, gold prices are likely to rise gradually, eventually breaking through the USD2,000/oz level within the next decade. This is the most likely outcome, to which we assign a 45% probability," ANZ analysts say, in a note explaining how a number of factors are converging to make the outlook for gold particularly bullish.
In 1987, Aviva France started offering The Fixed Price Arbitrage Life Insurance Contract for wealthy clients. The Financial Times called it "the worst contract in the world". It allows the contract holder to invest with hindsight. Did you see a stock go up this week? Now you can buy it at last week's price. Did your stock plummet? Sell it at last week's price. It is the ultimate form of insider trading: time travel.
If it was the Fed's intention to slow down the relentless surge in the dollar with yesterday's "impatient" removal which blamed the dollar strength on the "strength" in the US economy, it promptly failed after algos and a few carbon-based traders looked at the Atlanta Fed and realized that a 0.3% Q1 GDP print is anything but "strong." As a result the EURUSD, after soaring by nearly 400 pips yesterday in a market reminiscent of a third-world FX pair's liquidity especially following the previously noted USD flash crash, the dollar has recoupped nearly all losses, and the DXY is once again on the way up and eyeing the resistance area of 100.
the next time someone asks "why is Yellen so terrified of even the smallest possible rate hike", show them this chart above and explain that the Fed vividly remembers what heppened when LTCM blew up. What the Fed doesn't want, is not one but one thousand LTCMs going off at exactly the same time in what is now the world's most levered trade...
Even as a Graccident becomes more likely by the day, there are still plenty of signs that EMU members are prepared to present a unified front in the face of uncertainty.
What we have here is another powerful case of the Great Immoderation. That is, the havoc that the Fed’s bubble finance policies have visited upon the main street economy. In short, in the name of improving upon the alleged instability of the private economy - absent the Fed’s expert ministrations - the geniuses in the Eccles building have actually caused the rate of housing starts to gyrate wildly. To wit, by a factor of 5X from top to bottom - so far this century.
This time is not different. The excesses being built up in the markets today will eventually revert just as they have been at every other peak in market history. The only question, of which no one has the answer to, is exactly when this occurs. With this in mind, there are 10-basic investment rules that have historically kept investors out of trouble over the long term. These are not unique by any means but rather a list of investment rules that in some shape, or form, has been uttered by every great investor in history.
This is why the Greek debt crisis continues without end. The minute Greek bondholders have to take a REAL haircut, the wheels come off the EU and the $100 trillion bond bubble finally blows up.
Hedge Fund Manager Fears "Sudden, Pervasive Loss Of Faith" In Markets; Says "It's A Truly Scary Time"Submitted by Tyler Durden on 03/17/2015 17:45 -0400
First it was Sam Zell, warning "it's very likely that something has to give here." Then George Soros upped his market hedge drastically, followed by Carl Icahn's "worry about excessive money printing," adding that he was "very nervous" about US equity markets. "Financial markets are euphoric," warned Stan Druckenmiller, warning that "market participants are pricing in hardly any risks," and Crispin Odey explained "there are consequences to CB actions," stating that "we have front-row seats to an imminent market shock." And now hedge fund manager Andy Redleaf (who predicted "there is going to be a panic in credit markets," in 2007) has come out with the most ominous of warnings yet among the billionaire crowd... "I think it is a truly scary time."
"The boom years of the past decade and a half were the exception and not the rule. Australia and Canada will have a bit of rough patch in the years to come, but will manage through as they always do. The much touted growth prospects of many of the BRICs will prove to be nothing more than a commodity-boom-fuelled mirage."
Wall Street Poised For Another Revenue Bloodbath After Harbinger Jefferies Reports 56% Fixed Income PlungeSubmitted by Tyler Durden on 03/17/2015 10:40 -0400
What Jefferies is best known for among Wall Street shareholders is that, by still reporting a Nov. 30 fiscal year end, 1 month ahead of everyone else, it provides an invaluable glimpse into the fortunes of its Wall Street peers with a 4 week advance notice, especially when it comes to its bread and butter: fixed income trading (recall that CEO Rich Handler was a Drexel bond trader when the firm blew up). The result, just like last quarter, was a disaster and indicative of nothing short of a trading bloodbath on Wall Street in the past three months of trading. The bottom line, and what everyone who is awaiting the latest FICC numbers from the balance of the banks will be focusing on, is the 56% drop in Q1 revenue from fixed-income trading, down to $126 million from $286 million a year ago.
Greece will need to find €2 billion by Friday in order to repay creditors as Schaeuble, others see no way out. With no contingency plan, Athens' day of reckoning may be at hand. Morgan Stanley is out today with a note diagramming what happens next.
Following yesterday's inexplicable ramp in stocks, which perhaps was driven by the collapse in oil (which sent energy companies higher because a 30x energy forward PE is cheap), and by the latest battery of disappointing economic data which made it less likely the Fed will proceed with a tightening move, overnight futures have given up a portion of the gains, and were trading down 0.3% at last check. And yet, if yesterday's weakness was driven by USD weakness, today's jump in the EURUSD above 1.06 (on absolutely disastrous German ZEW investor index print) is now somehow responsible for risk offness? And, adding confusion to insult, the 10 Y is down to 2.05% and in danger of re-entering a 1% handle. Sadly, nothing makes sense any more and today's conclave of central planners in the Marriner Eccles building ahead of tomorrow's 2pm FOMC "impatient" announcement isn't going to make it any better.
Money is getting tight in China where the PBoC finds itself stuck between easing to counter economic deceleration and exacerbating capital outflows.