BAC

Consumer Spending Falls Again In March According To Latest Credit Card Data

While big banks blame the collapse in Q1 GDP on "residual seasonality" (more on that later), with BofA recently slashing its Q1 estimate from as much as 2.7% to just 0.2%, the reality is that something is not well with the US consumer. The latest proof of this comes from the most recent Bank of America credit and debt card spending data, which reveals that sales were once again down 0.1% yoy.

What Hedge Funds Bought And Sold In Q4: The Full 13-F Summary

Yesterday was the last day for hedge funds to submit their Q4 13-F filings, and the biggest reactions this morning can be found in the stock of Kinder Morgan which rises 9% pre-mkt after Berkshire reported a new stake. Autodesk also gained 2% post-mkt yday after Lone Pine took a new position. Several funds boosted or reported new stakes in JD.com while Jana Partners reported a new stake in Valeant. Both Icahn and Einhorn trimmed their AAPL holdings.

The Return Of Crisis

Let me be blunt: this next crash will be far worse and more dramatic than any that has come before. Literally, the world has never seen anything like the situation we collectively find ourselves in today. The so-called Great Depression happened for purely monetary reasons. Before, during and after the Great Depression, abundant resources, spare capacity and willing workers existed in sufficient quantities to get things moving along smartly again once the financial system had been reset. This time there’s something different in the story line...

"2016 Will Be No Fun" - Doug Kass Unveils 15 Surprises For The Year Ahead

My overriding theme and the central drama for the coming year is that unexpected events can take on greater importance as the Federal Reserve ends its near-decade-long Zero Interest Rate Policy. Consensus premises and forecasts will likely fall flat, in a rather spectacular manner. The low-conviction and directionless market that we saw in 2015 could become a no-conviction and very-much-directed market (i.e. one that's directed lower) in 2016. There will be no peace on earth in 2016, and our markets could lose a cushion of protection as valuations contract. (Just as "malinvestment" represented a key theme this year, we expect a compression of price-to-earnings ratios to serve as a big market driver in 2016.) In other words, we don't think 2016 will be fun.

Unintended Consequences

Actions – including the state’s best-intentioned ones (giving them the benefit of the doubt) - have consequences, not all of them foreseen and some of them contrary to what was (we assume) intended.

Top Hedge Funds Dump Stocks In Q3: Complete 13-F Summary

The just concluded 13-F bonanza shows that "some of the world’s top hedge fund managers scaled back their U.S. stock investments last quarter as markets tumbled." Below, courtesy of Bloomberg, is the full summary of what the most prominent hedge fund names did in Q3...

The Legendary U.S. Consumer Is Out Of Cash In These Cities

There is a very clear distinction in which cities US consumers are doing well, versus cities in which they have been tapped out. For those wondering where the US consumer is all spent out, look no further than the cities at the bottom of this chart.

Morgan Stanley Predicts Up To A 25% Collapse in Q3 FICC Revenue

Of all sectors the one which may pose the biggest surprise to investors is financials: it is here that Q3 (and Q4) earnings estimates have hardly budged, and as of September 30 are expected to rise by 10% compared to Q3 2014. This may prove to be a stretch according to Morgan Stanley whose Huw van Steenis is seeing nothing short of a bloodbath in banking revenues, with the traditionally strongest performer, Fixed Income, Currency and Commodity set for a tumble as much as 25%, to wit: "we think FICC may be down 10- 25% YoY (FX up, Rates sluggish, Credit soft), Equities marginally up but IBD also down 10-20%."

Mandatory Breathalyzers Could Soon Be In Every Car If Feds Have Their Way

The National Highway Traffic Safety Administration (NHTSA) and the Alliance of Automobile Manufacturers is currently working on a plan to put alcohol detection systems in every vehicle. The plan, called Driver Alcohol Detection System for Safety (DADSS), is still in its early stages, and while they are calling this technology “non-invasive” but it tests the content of your blood every time you get into your vehicle, which by its very nature is extremely invasive.

Last Thing The Fed Sees Before Its Rate Hike Decision Will Be Very Ugly

"The weakness in the August BAC data suggests a high risk for softness in the Census Bureau advance retail sales report given that the two measures trend closely. While we know that the retail sales figures are volatile and subject to revisions, it is hard to ignore a weak report." Why is all of the above particularly important? Because with the August Retail Spending report due on September 15, it will be the last report on the economy the Fed will read ahead of its "most important if not ever then surely in the past decade" FOMC meeting starting on September 16, and concluding with the 2pm announcement on September 17.