Despite distressed-debt funds suffering their worst losses since 2008, mainstream apologists continue to largely ignore the carnage in the credit market (even though veteran bond managers have urged "it's not just energy, it's everything.") With the number of loan deals pricing below 80 (distressed) at cycle peaks, and "a less diverse group of investors holding a lot more bonds," price swings continue to be wild but as DB's Melentyev warns, initially "all of this looks random when there is no underlying news to support the big moves. But eventually a narrative emerges -- maybe we have turned the corner on the credit cycle."
After tripling down on Valeant by way of a synthetic short as we noted previously, which pushed Ackman's long to a grand total of 34.1 million Valeant shares, all it takes for Ackman to generate $100MM in paper losses is a modest $3 move lower in Valeant stock, which is what it has done this morning following a new report by Bronte Capital alleging that Valeant is still back up to its specialty pharma gimmicks, only this time instead of a "chess" theme, the Canadian company is using a cluster of pharma names linked to Stephen King books.
Focus on policies promoting economic growth, lower taxes, and spending tax receipts more efficiently and not on one`s sexual orientation in the bedroom.
There exists a common theme amidst these signs of societal decay: The super-rich keep taking from the middle class as the middle class becomes a massive lower class. Yet the myth persists that we should all look up with admiration at the “self-made” takers who are ripping our society apart.
The traditional view of the impact of low oil prices seems to be, "It is just another cycle." Or, "The cure for low prices is low prices." We are doubtful that either of these views is right.
- French, U.S. Troops Enter Mali Hotel as Gunmen Hold Hostages (BBG)
- Top suspect seen on CCTV in metro during Paris attacks (Reuters)
- Paris Attacks’ Alleged Ringleader, Now Dead, Had Slipped Into Europe Unchecked (WSJ)
- Global shares march on as alarm bells ring for metals (Reuters)
- European Stocks Rise With Asian Shares as Zinc, Ringgit Advance (BBG)
- World leaders arrive for summit amid heavy security (Reuters)
Today we got confirmation that the spinning plates of the Affordable Care Act are finally falling down, when none other than the U.S.’s biggest health insurer, UnitedHealth, cut its 2015 earnings forecast with a warning that it was considering pulling out of Obamacare, just one month after saying it would expand its presence in the program.
-If you're thinking of buying that dream house on the ocean in the Sunbelt, wait a year - there will be some bargains. If you're a seller - call the broker soon....
"Nothing Makes Sense Anymore" Traders Fear Debt Market Distortions Signal "Something Big Is Brewing"Submitted by Tyler Durden on 11/16/2015 19:00 -0500
In the last few months we have warned of the "perversions" in US money markets (here, here, and most recently here) adding that "to ignore them at your own peril." And now, as Bloomberg reports, it appears the mainstream is beginning to recognize that something very strange is going on in debt markets. Across developed markets, the conventional relationship between ('risk-free') government debt and other 'more risky' assets has been turned upside-down. "Everybody in the fixed-income market should care about this," warns a rates strategist and in fact, it’s hard to overstate how illogical it is when swap spreads are inverted, as JPM warns the moves in swap-spreads "should be viewed as symptomatic of deeper problems."
Angered that Facebook, Google, Amazon, etc. pay very little tax, an entire town in Wales decided to employ the exact same tax strategies used by big companies to reduce their own tax burdens. As the proprietor of the local smokery put it, the plan is "jolly clever." Doing this is not immoral or unpatriotic.
Prepping has not only gone mainstream, it's infected even the billionaire culture as referenced recently on a ZH article:
"The ECB’s bond buying programme has created favourable financing conditions and provides member states with an incentive to defer much-needed budget consolidation and structural reforms. However, further structural reforms to strengthen markets and competitiveness are crucial for a self-sustaining economic recovery. In addition, monetary policy is leading to a build-up of risks to financial stability which could pave the way for a new financial crisis."
But who is the governments' strongest ally in their 'war on cash'?
Why is the price of oil so low now? In fact, why are all commodity prices so low? We see the problem as being an affordability issue that has been hidden by a growing debt bubble. As this debt bubble has expanded, it has kept the sales prices of commodities up with the cost of extraction (Figure 1), even though wages have not been rising as fast as commodity prices since about the year 2000. That period is ending as the productivity of additional debt is falling.