"Given our views on credit contraction in Asia, and in China in particular, let's say they are going to go through a banking loss cycle like we went through during the Great Financial Crisis, there's one thing that is going to happen: China is going to have to dramatically devalue its currency."
Update: It's a miracle..."Someone" stepped in and bid the entire Chinese market higher off its huge opening gap down...
Despite the biggest liquidity injection (CNY130bn) in 4 months, it appears Kyle Bass' top trade remains well on target as Offshore Yuan plunges, underperforming Onshore Yuan despite the largest Fix devaluation in two months. In a word - it's chaos in Chinese markets. The Shanghai Composite looks to be opening down 3% - extending yesterday's losses (beyond the US session's ADR's move). What a mess.
Kyle Bass Suffers "Worst Year In The Last Ten", Reveals His Best Investment For The Next "3-5 Years"Submitted by Tyler Durden on 01/02/2016 13:52 -0400
Iin an interview to be aired tomorrow on Wall Street Week, Hayman Capital's Kyle Bass says that "this has been one of the worst years in the last ten"as a result of his dogmatic views on energy prices. And yet, instead of backing out the Texan is doubling down: "If you are going to allocate capital for the next three to five years, you should do it now" into the energy space over the next 6 months. Will he be right this time? Find out in 12 months.
“To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything.” ~Edward Abbey
What else do you buy when monetary policy failure concerns loom...
Roughly 21 tonnes, or 685,652 troy ounces of gold in .999 fine kilo bars, was withdrawn, net of a small deposit of 27,328 ounces, from the Brinks warehouse in Hong Kong yesterday. To put that into some perspective, that is the same amount of all gold in the entire JPM warehouse in the US. The point of this is that the price discovery in New York is becoming increasingly distinct from the actual physical supply and demand flows of bullion which are taking place in Asia... And that is a potentially dangerous development, especially with respect to a commodity that is being traded at a leverage in excess of 200:1.
If one looks at the NDX alone, one would have to conclude that the bull market is perfectly intact. The same is true of selected sub-sectors, but more and more sectors or stocks within sectors are waving good-bye to the rally. Even NDX and Nasdaq Composite have begun to diverge of late, underscoring the extreme concentration in big cap names. Naturally, divergences can be “repaired”, and internals can always improve. The reality is however that we have been able to observe weakening internals and negative divergences for a very long time by now, and they sure haven’t improved so far. In terms of probabilities, history suggests that it is more likely that the big caps will eventually succumb as well.
China Margin Debt Hits 8-Week High, Japan Pumps'n'Dumps As Kyle Bass Fears Looming EM Banking CrisisSubmitted by Tyler Durden on 10/27/2015 21:21 -0400
Following Marc Faber's reality check on China recently, Hayman Capital's Kyle Bass took a swing tonight noting that "China's 7% GDP growth is a farce," and adding that, just as we detailed previously, China's credit cycle has begun and non-performing loans will rise rapidly leading to an emerging Asia banking crisis ahead. Japanese markets continue to entertain with "someone" insta-ramping NKY Futs 100 points at the open only to give it all back as USDJPY slides back towards 120.00 (and 10Y JGB yields drop below 30bps for the first time in 6 months).
Kyle Bass shared his macro views during the “Squawk on the Street”
News That Matters
Nahhh ... The Problem Is NOT ENOUGH Debt! </sarc>
Greenspan: “Debt, Deficits and Entitlement Programs Are All Coming to a Head In a Few Months, All Over the World”Submitted by George Washington on 09/09/2015 16:12 -0400
What Could Possibly Go Wrong?
The centrally-planned house of cards is finally starting to shake uncontrollably.
Will the Japanese “monetary perpetuum mobile” ever get questioned by financial markets?