Capital Markets

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Credit Suisse Plunges To 25 Year Lows After Posting Enormous $5.8 Billion Q4 Loss





"The environment has deteriorated materially during the fourth quarter of 2015 and it is not clear when some of the current negative trends in financial markets and in the world economy may start to abate."

 
Tyler Durden's picture

Negative Interest Rates Already In Fed’s Official Scenario





"The severely adverse scenario is characterized by a severe global recession, accompanied by a period of heightened corporate financial stress and negative yields for short-term U.S. Treasury securities.... As a result of the severe decline in real activity and subdued inflation, short-term Treasury rates fall to negative ½ percent by mid-2016 and remain at that level through the end of the scenario."

 
Tyler Durden's picture

The Last Time These Five Outlier Events Coincided Was In February 2009





(i) HY spreads above 800bp; (ii) oil down at least 25% yoy; (iii) S&P 500 EPS is negative yoy; (iv) Technicals are weak (% of stocks above 200d is below 15%) and (v) sentiment is terrible (AAII).

 
Tyler Durden's picture

Did A Central Banker Just Margin Call All Other Central Banks' Credibility?





Did the BOJ’s out-of-the-blue reversal on its monetary stance which was refuted just weeks prior by Mr. Kuroda himself take place because after listening to the arguments, suggestions, as well as concerns, from the participants at Davos he concluded much like what the movie “Margin Call” depicted: It was all about to unravel? And if so: is this him deciding to be “first” and considered it his only choice?

 
Tyler Durden's picture

"As Goes January"... What Happens When Bullish Seasonals Fail





November-January is the strongest consecutive 3-month period of the year. During this period, the S&P 500 is up 66.7% of the time with an average return of 3.35% going back to 1929. However, not this year.   Both the November-January & the January Barometer are flashing bearish signals for 2016.

 
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Here Is The Reason For January's Selloff: China's January Outflows Soar To Second Highest Ever





According to a Goldman report, so far in January "there has been around $USD 185bn of intervention (with the recent intervention predominantly taking place in the onshore market)" split roughly $143 billion on the domestic side and $42 billion on the offshore Yuan side

 
Tyler Durden's picture

"Nobody Really Knows Anything Right Now"





"We learned one thing yesterday: the U.S. Federal Reserve is in the same position as the rest of us when it comes to forecasting the future path of economic growth.  Nobody really “Knows” anything right now. Now, there’s enough doubt for everyone: markets, central banks, consumers, governments. Everyone. The best thing we can say about that: if markets accept that the Fed is no better informed than they are, maybe investors will devote more time to stock fundamentals and intrinsic value analysis."

 
Tyler Durden's picture

The Fed Passes The Buck: Blame Oil And China





Contrary to those blaming the Fed for causing stocks to fall by “raising rates” (which Joe Salerno reflects on here) we want to stress the fact that, in raising rates, the most that the Fed could do is unravel previously made mistakes. In other words, there is nothing praiseworthy in the first place about artificially propped up stock market levels. We have no interest in lauding the longevity of the bubble, because the bubble is the enemy of the healthy economy. The collapsing equity markets reveal where bubbles were formed and that our alleged prosperity is an illusion. And this is precisely what former Dallas Fed Chairman Richard Fisher stated in a conversation on CNBC last week when he confessed: “We frontloaded a tremendous market rally to create a wealth effect.”

 
Tyler Durden's picture

Why Junk Bonds Will Sink Stocks





After the white-knuckle sell-off of global equities that was finally punctuated by a rally late last week, everyone wants to know: Was this the bottom for stocks? And now Moody’s weighs in with an unwelcome warning... "it’s hard to imagine why the equity market will steady if the US high-yield bond spread remains wider than 800 basis point."

 
Tyler Durden's picture

Wrong For The Right Reasons: And Why It Matters





What is currently transpiring in the markets today is exactly what the "everything is awesome" crowd stated wouldn’t happen – and exactly what many others argued – was inevitable. And, suddenly it is they who are finding out the rarefied air of "brilliance" The Fed enabled them to breathe has indeed been shut off – and all that’s left to inhale is their own exhaust fumes.

 
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How Billionaires Are Investing In 2016: "The Only Winning Move Is Not To Play The Game"





"The world’s central banks can’t save us anymore." That was the message from some of the world’s most prominent investors at the World Economic Forum in Davos, Switzerland, on Friday. Each was resistant to putting on fresh positions and expected asset prices to head downward. In short, they say, the only winning move is not to play the game. “The trade now is to hold as much cash as possible,” said Nikhil Srinivasan, chief investment officer for Generali, a European insurer with $480 billion in assets. “Equity markets could go down 15% to 20%.”

 
zenkick2000's picture

It’s Not Always About Return on Capital Sometimes It’s About Return of Capital





  • Stronger than expected decline in GDP Growth & weaker economic activity
     
  • China in a major meltdown its government is not capable of stopping
     
  • Major deflationary pressures forcing commodities down & credit spreads up

 

Is the economy as strong as some say it is?

 
Tyler Durden's picture

"Perma-bears" 1 - BofA Economist 0





Eight months ago, Bank of America chief economist Ethan Harris triumphantly declared victory over the "perma-bears." Today, the "perma-bears" get the last laugh.

 
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