Black Swan

Mark Spitznagel On The 'Myth' Of The Black Swan Event

The major sudden bear markets of the last decades were not dreaded “black swan” events at all. They were perfectly predictable, by economic logic alone, the same logic that says governments cannot manipulate market prices without creating distortions that will always, without exception, be counterproductive. In the next stock market crash, we will be told that the fault was some surprising economic or geopolitical shock. Let’s remind ourselves now that this will be false.

Mapping The Next Nation To Join The Currency War

With China devaluation looming as the great unspoken Black Swan trade, and on the heels of the Swiss National Bank folding on its 'peg', we thought a quick glance at the world's "pegged" currencies would be useful as a guide to where the next shoe (and pant legs) will drop. With global FX implied volatility at EU crisis highs, the markets clearly expect more to come...

Guest Post: 5 Reasons To Buy Gold & Silver In 2015

“In effect, there is nothing inherently wrong with fiat money, provided we get perfect authority and god-like intelligence for kings. Aristotle (?2,400 years ago)

“Remember what we’re looking at. Gold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it. Alan Greenspan (2014)

The Black Swan Of Super Bowls: "Ticket Prices Are Being Manipulated To The Extreme"

Super Bowl ticket prices continue to soar. With the game now just a day away, prices have exceeded the $10,500 average and get-in price is just over $9,000 but, as TiqIQ's CEO reports, the ticket market’s "Black Swan" moment will leave some fans showing up to Arizona having paid for tickets they’ll never receive... as derivative-based speculators were selling tickets they never had to begin with, and the short squeeze is unprecedented. "The market is being manipulated to the extreme by those who have paid teams and the league for access." When this happened in the 2011 BCS National Championship game, many brokers went out of business filling their short orders, and some others even walked away from their orders, leaving fans to fend for themselves and it appears tomorrow will be the same for Super Bowl attendees (and speculators).

Maybe Oil Goes to $70 on its Way to $40

When the conventional media ordains oil inevitably dropping to $40/barrel, we start looking for something else to happen - like oil going to $70/barrel. There are number of reasons this isn't as farfetched as it might seem at the moment.

2014 Year In Review (Part 2): Will 2015 Be The Year It All Comes Tumbling Down?

Despite the authorities' best efforts to keep everything orderly, we know how this global Game of Geopolitical Tetris ends: "Players lose a typical game of Tetris when they can no longer keep up with the increasing speed, and the Tetriminos stack up to the top of the playing field. This is commonly referred to as topping out."

"I’m tired of being outraged!"

Mario Draghi: Goodbye ECB, Hello Italian Presidency?

While the entire financial world is hanging on to every Mario Draghi word in hope Europe finally improves the market's (if not the economy's) "fundamentals" to new record highs, and joins the rest of the "developed" world's central banks in injecting trillions of liquidity into the Div/0 P/E stocks "whatever it takes" (because in a world where only multiple expansion is left, the ECB is the last wildcard at least until the US is dragged right back into the global recession and the Fed admits any pipe dreams of a rate hike in 2015 were just that), something far more different may be taking place behind the scenes. According to at least one journalist, the Fiscal Times' Patrick Smith, "Draghi appears set to leave Frankfurt and return to his native Italy the first chance he gets."

The Financialized-Oil Dominoes Are Toppling

Oil is not just something that is refined into fuel--it is capital, collateral, debt and risk. In other words, it is intrinsically financial. Simply put, the sharp drop in oil revenues has knocked over a line of financial dominoes whose end is not yet in sight.

"When The Market Moves Fast, Stuff Blows Up"

One of our old rules of trading is that whenever a major asset class, index, or other benchmark has a sudden, rapid move in price, something blows up. Sky high. That’s because people get used to regimes. They get used to a certain state of affairs with a lack of volatility. They become complacent. Maybe they stop hedging. Maybe they allow themselves to have unbounded downside risk. Maybe they start gambling. So what's going to blow up?