• Tim Knight from...
    10/06/2015 - 17:03
    As we head into another earnings season, the bulls better pray to whatever pagan gods they worship that company after company magically defy the downturn that the economy is quite obviously entering.


Tyler Durden's picture

Echoes Of 1997: China Devaluation "Rekindles" Asian Crisis Memories, BofA Warns

Even before the latest shot across the bow in the escalating global currency wars, EM FX was beset by falling commodity prices, stumbling Chinese demand, and a looming Fed hike. And while, as Barclays notes, "estimating the global effects China has via the exchange rate and growth remains a rough exercise," more than a few observers believe the effect may be to spark a Asian Financial Crisis redux. For their part, BofAML has endeavored to compare last week’s move to the 1994 renminbi devaluation, on the way to drawing comparisons between what happened in 1997 and what may unfold in the months ahead.

Tyler Durden's picture

Keeping The Bubble-Boom Going

To keep the credit induced boom going,policy makers have convinced themselves that more credit and more money, provided at ever lower interest rates, are required. Why then, as The FOMC Minutes just showed, do the decision makers at the Fed want to increase rates? If Fed members follow up their words with deeds, they might soon learn that the ghosts they have been calling will indeed appear — and possibly won’t go away. The sooner the artificial boom comes to an end, the sooner the recession-depression sets in, which is the inevitable process of adjusting the economy and allowing an economically sound recovery to begin.

Tyler Durden's picture

Momo No Mo' - BofAML Warns Stocks "Close To A Tipping Point"

Momentum traders - relying on the 'trend is your friend' theme - may have a rude awakening soon as momentum stocks trade at a stunning 50% premium to the market (vs an average 20%). As BofAML notes, high growth, high multiple names that have been leading the market over the past year are showing some signs suggest we are close to a tipping point. The growth-to-value spread is at its highest since the peak of the dotcom bubble in 2000 and, as Subramanian ominously notes, when momentum ends, it ends badly - with an average loss of 25% over the next 12 months.

Tyler Durden's picture

The S&P's 13th Trip Thru 2,100 Since Feb 13th: Call It Monetary Rigor Mortis - The Bull Is Dead

The robo machines pushed their snouts through 2100 on the S&P index again yesterday. This was the 13th time since, well, February 13th that this line has been re-penetrated from below. But don’t call it an omen of bad luck; its more like monetary rigor mortis. The bull market is dead, but the robo-machines and talking heads of bubble vision just don’t know it yet.

Tyler Durden's picture

Default Wave Looms As Energy Sector Credit Risk Surges To Record High

With oil prices pushing cycle lows and Shale firms as loaded with debt as they have ever been, the spike in energy sector credit risk should come as no surprise as the hopes of the last few months are destroyed. At 1076bps, credit risk for the energy sector has never been higher. As UBS recently warned, more defaults are looming and, as we discussed this week, private equity is waiting to pick up the heavily discounted pieces.

Tyler Durden's picture

This Is What Capitulation Looks Like, EM Positioning Is Most Extreme On Record

Given the carnage unfolding across EM currencies and the myriad headwinds the world's emerging economies face going forward, it should come as no surprise that sentiment has turned decisively negative. Is it time to be a contrarian? BofAML thinks so.

Phoenix Capital Research's picture

Could the FDIC Seize Bank Deposits During a Crisis?

This is precisely what has happened in Spain during the 2012 banking crisis. Since then it’s also happened in Cyprus, Greece…and it is now perfectly legal in the US courtesy of a clause in the Dodd-Frank bill.

Tyler Durden's picture

Currency Carnage: Gross Warns On "Fakers And Breakers", Morgan Stanley Tells Asia To Watch Its REER

What does China's "surprise" move to devalue the yuan mean for "broken" EM currencies? Nothing good, Morgan Stanley says. In short, the path ahead is riddled with exported deflation and decreased trade competitiveness against a backdrop of declining global growth and trade.

Tyler Durden's picture

American Malls In Meltdown - The Economic Recovery Is Complete & Utter Fraud

What happens when we roll back into the next official recession, unemployment soars, and consumers really stop spending? What is revealed when you look under the hood of this economic recovery is that it is a complete and utter fraud. The recovery is nothing but smoke and mirrors, buoyed by subprime auto debt, really subprime student loan debt, corporate stock buybacks, and Fed financed bubbles in stocks, real estate, and bonds. The four retailers listed below are nothing but zombies, kept alive by the Fed’s ZIRP and QE, as they stumble towards their ultimate deaths. The coming recession will be the knife through their skulls, putting them out of their misery.

Tyler Durden's picture

China Sends In Chemical Warfare Troops, Orders Tianjin Blast Site Evacuation After Toxic Sodium Cyanide Found

Chinese authorities ordered the evacuation of residents within a 3km radius of the Tianjin blast site “over fears of chemical contaminationaccording to BBC. According to a tweet by The People's Daily, anti-chemical warfare troops have entered the site to handle highly toxic sodium cyanide which had been found there.

Tyler Durden's picture

Bad Timing: Japan Opens First Nuclear Plant Since Fukushima As Neighboring Volcano Erupts

In case last week’s deadly chemical explosion in the Chinese port of Tianjin wasn’t enough to satisfy your thirst for black swan-ish disasters that could serve to accelerate the ongoing global currency wars, Japan is now warning that Sakurajima, one of the country’s most active volcanos which sits just 50 kilometers from a recently restarted nuclear reactor, is poised for a "larger than usual" eruption.

Tyler Durden's picture

The Great China Ponzi - An Economic And Financial Trainwreck Which Will Rattle The World

There is an economic and financial trainwreck rumbling through the world economy. Namely, the Great China Ponzi. In all of economic history there has never been anything like it. It is only a matter of time before it ends in a spectacular collapse, leaving the global financial bubble of the last two decades in shambles. The resulting deflationary spiral will suck the global economy into its vortex. And Wall Street will go down for the count because this time the Fed will be utterly powerless to reverse the tide.

Tyler Durden's picture

Malaysia Meltdown: Asian Currency Crisis 2.0 Sends Ringgit, Stocks, Bonds Crashing

When China went the "nuclear" devaluation route earlier this week, everyone knew things were about to get a whole lot worse for an EM currency basket that was already reeling from plunging commodity prices, slumping Chinese demand, and the threat of an imminent Fed hike. With some Asian currencies already falling to levels last seen 17 years ago, some analysts fear that an Asian Financial Crisis 2.0 may be just around the corner. That rather dire prediction may have been validated on Friday when Malaysia’s ringgit registered its largest one-day loss in almost two decades, as stocks plunged and bond yields rose.

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