Citadel

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"More Probable Than Not"





To use the ponderous, legally parsed language of the NFL’s Wells Report on “deflate-gate”, language which we think wonderfully encapsulates the pinched spirit of our age, here are four things that we believe are “more probable than not”: 1) Alex Rodriguez has routinely used steroids and PED’s of various stripes since he was a sophomore in high school; 2) Tom Brady has routinely bribed equipment managers with autographed jerseys and new shoes in order to receive footballs deflated well below what he knew was the legal limit; 3) Janet Yellen has routinely leaked market-moving information to favored private sector conduits, and has also sought to quash internal investigations of same; and 4) Ben Bernanke is for sale to the highest bidder.  But here’s the thing, we're not that worked up about 'any' of these issues. What we are worked up about, though, is the mendacity - the utter lack of character and authenticity - on full display in all of these cases. All of these cases and so many, many more.
 
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For HFTs It's All About FX: Trading Currencies Is Now Virtu's Biggest Source Of Revenue





Today, Virtu released its first public financials since going public, and our speculation has been proven correct: FX is now the largest revenue generator for VIRT, amounting to 28.4% of revenues in the quarter ended March 31, at $42.2 million, well above the $29.1 million generated from trading  America Equities and the $34.7 million from global commodities. In fact, as the chart below shows, on an LTM basis, FX is now not only the biggest revenue item for the world's dominant HFT firm at $131.1 million, but is also the fastest growing source of profit, rising 103% on a year over year basis!

 
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Tepper Topples From Top 10 Highest-Earning Hedgies





For the first time in 4 years, Appaloosa Management's David Tepper is not the highest-earning hedge fund manager in the world. Plunging from No.1 to tied-for-11th (with a mere $400 million earned last year) Tepper appears to have suddenly found investing difficult now that The Fed has stopped printing money (up just 2.2%). What is more ironic, perhaps, is that the other alleged beneficiary of Fed largesse (and recent hirer or blogger Ben Bernanke) - Citadel tops the list with Ken Griffin making $1.3 billion last year.

 
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Futures, Treasurys Flat After Chinese Stock Bubble "Incident"; Bunds Stage Feeble Rebound





If yesterday's laughable lack of volume (helped by the closure of Japan and the UK) coupled with hopes that the end of the buyback blackout period was enough to send stocks surging if only to end with a whimper below all time highs despite what is now looking like three consecutive quarters of Y/Y EPS declines according to Factset, today's ramp will be more difficult for the NY Fed and Citadel to engineer, not least of all due to the headwind of the overnight "incident" by China's stock bubble which saw the Shanghai Composite tumble by 4%, the most since January.

 
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Ben Bernanke: On The Way From Hero To Zero?





It seems yet another hero of the recent cyclical bull market, resp. echo bubble, may be in danger of falling from grace. This has already happened to his predecessor Alan Greenspan, who has been gradually demoted from “Maestro” to “irresponsible bubble blower”. In this sense the somewhat less praise-laden verdicts that are lately emerging with respect to Ben Bernanke could be seen as an early warning sign.

 
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The Swiss National Bank Is Long $100 Billion In Stocks, Reports Record Loss





According to the latest SNB financial release, 18%, or CHF 95 ($102 billion) of the assets held on the SNB's balance sheet are, drumroll, foreign stocks!  In other words, the SNB holds 15% of Switzerland's GDP in equities!

 
Tyler Durden's picture

Did The Japanese Just Save The World Again?





Suddenly, and with no catalyst whatsoever, "someone" decided to sell JPY, buy EUR and USD and aggressively bid for US equities and European peripheral bonds... just as they headed for an ugly day... Paging GPIF?

 
Tyler Durden's picture

Bernanke All About The Benjamins: After Citadel, Will "Advise" PIMCO Next





 
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Goldman Warns Companies To Halt Buybacks At Record Valuations, Reminds What Happened In 2007





While preserving the farce of the S&P's relentless rise no matter the earnings recession, the 1% GDP or the negative funds flow, has been entirely a central bank mandate in the past month (one which will soon inlude the PBOC), the good news for the BOJs and the NYFeds of the world is that the stock buyback hiatus is almost over, and starting this week the bulk of companies can come right back and proceed to repurchase their stocks at all time highs. And what a come back it will be. According to Goldman, the pace of buybacks is now absolutely off the charts, with nearly $1 trillion in buyback announcements expected in just this calendar year, a mindboggling number, one which is the same size as the largest annual Fed Quantiative Easing amount in any one year going back to the great financial crisis.

 
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Equity Futures At Session Highs Following Chinese QE Hints; Europe Lags On Greek Jitters





It has been a story of two markets so far, with China's Shanghai Composite up another 3% in today's continuation of the most ridiculous, banana-stand driven move of the New Normal (and there have been many ridiculous moves in the past 6 years) on the previously reported hints that the PBOC is gearing up to start its own QE, while Europe and the Eurostoxx are lagging, if only for the time being until Citadel and Virtu engage in today's preapproved risk-on momentum ignition, on Greek jitters, the same jitters that last week were "fixed"and sent Greek stocks and bonds soaring. Needless to say, neither Greek bonds nor stocks aren't soaring following what has been the worst week for Greece in months.

 
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Why Nav Sarao Had To Be Destroyed: He Found A Way To Beat The HFTs At Their Own Game





Today, we find precisely how and why Sarao was singled out: he not only ratted out the parasitic trading strategies of the real culprits behind the broken market, the massive HFT firms (such as Virtu which just went public just a day before the Sarao charges were filed) which gave the "regulators" no choice: one of them had to be put away for good, but found a way to capitalize on the algos' stupidity, and actually make money by beating them at their own game.  As such, regulators and exchanges such as the CFTC and CME had no choice but arrest him and prevent him from trading ever again!

 
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UK "Flash Crasher" Refuses To Be Broken Market Scapegoat, Will Fight Extradition Request Facing Decades In Prison





While we eagerly await for the SEC to retract its official 104 page report summarizing the "Findings regarding the market events  of May 6, 2010" in light of "recent developments", and as we follow the shift in the official narrative to the outright bizarre, in which the entire Flash Crash is now blamed on just one man (as opposed to just Waddell & Reed as per the previous narrative), we learn that the latest scapegoat for a broken, fragmented and manipulated market, Navinder Sarao, is not quite so eager to go to minimum security prison in the US for doing what leads to a slap on the wrist when someone like Citadel or Virtu does it, and will challenge the CFTC's attempt to pin everything on him.

 
williambanzai7's picture

THe SHiLL ON THe CiTaDeL...





OR: He who knows...

 
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Central Bankers Next Test Of Omnipotence May Be Coming





Here we are, just barely into our first earnings season without the incessantly added fuel provided by QE and the markets are stumbling. At times on Friday the indexes were hovering near the possibility of posting 2% losses going into the weekend. In today’s media mindset of “everything is awesome.” That’s near – unthinkable. No Fed speaker saved the day; no HFT-induced ramp came to the rescue... Maybe it’s because all ammo (and there has been no silver bullet more powerful of late than a Central Banker press conference) is being reserved for a much larger crisis looming on the horizon (i.e. Greece and all its tenuous implications calling for an “All hands on printing presses deck, battle stations” response).

 
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What Bernanke's New Employer Had To Say About Him Just 2 Years Ago





Having previously explained the 175,846,629,768 reasons why former Fed Chair Ben Bernanke would join Citadel - the most-levered hedge fund in the world and alleged conduit of fed put protection; we thought it intriguing to note what billionaire Citadel Ken Griffin had to say about Bernanke and his policies just 2 years ago...

 
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