Stability is a myth yet it’s what we humans strive for...
- Banks Had Unfair Advantage From Commodity Units (Bloomberg)
- Report Notes Deals Between Goldman, Deutsche and Others Drove Up Aluminum Prices (WSJ)
- Goldman, Morgan Stanley Commodity Heyday Gone as Units Faulted (BBG) - because when you can no longer manipulate, you move on...
- Lenders Shift to Help Struggling Student Borrowers (WSJ)
- Immigrants face major hurdles in signing up to new Obama plan (Reuters)
- Distressed Debt in China? Ain’t Seen Nothing Yet, Buyers Say (BBG)
- Banking culture breeds dishonesty, scientific study finds (Reuters)
- Amazon Robots Get Ready for Christmas (WSJ)
- Yellen Inherits Greenspan’s Conundrum as Long Rates Sink (BBG)
- West African Mining Projects Take Hit From Ebola Crisis (WSJ)
- Saudi oil policy uncertainty unleashes the conspiracy theorists (Reuters)
- Senate Rejection of Keystone XL Measure Sets Up 2015 Showdown (BBG)
- Ferguson, Missouri, remains on edge ahead of grand jury report (Reuters)
- Putin Said to Stun Advisers by Backing Corruption Crackdown (BBG)
- Italian ‘Invasion’ Has Swiss Fuming as Immigration Vote Looms (BBG)
- Apple and Others Encrypt Phones, Fueling Government Standoff (WSJ)
One bank is already set to benefit from the ABS program no matter what its actual outcome and impact on the European economy: the same bank that spawned none other than ECB's head... Mario Draghi. According to Bloomberg, Goldman Sachs Group says it’s adding staff to its European asset-backed securities business as the bank prepares for a resurgence in the $305 billion market that shrank more than 40 percent over the past four years.
"My personal fond hope and expectation is still for a market that runs deep into bubble territory (which starts, as mentioned earlier, at 2250 on the S&P 500 on our data) before crashing as it always does. Hopefully by then, but depending on what the rest of the world’s equities do, our holdings of global equities will be down to 20% or less. Usually the bubble excitement – which seems inevitably to be led by U.S. markets – starts about now, entering the sweet spot of the Presidential Cycle’s year three, but occasionally, as you have probably discovered the hard way already, history can be a snare and not a help." - Jeremy Grantham
- Moar central banks! Asian Stocks Rise Amid Stimulus Speculation; Topix Jumps (BBG)
- Syria rebels in south emerge as West's last hope as moderates crushed elsewhere (Reuters)
- Bufett's Berkshire to Buy Duracell Business From Procter & Gamble in $3B Deal (AP)
- Weak Demand, Real-Estate Slump Signal Headwinds for China (WSJ)
- China Slowdown Deepens as Leaders Said to Mull Cutting Target (BBG)
- Saudis Reject Talk of OPEC Market Share War as Oil Slides (BBG)
- Oil Tankers Stream Toward China as Price Drop Sparks Boom (BBG)
"Geithner: I remember coming to the dinner and I’m looking at my Blackberry. It was a fucking disaster in Europe. French bank stocks were down 7 or 8 per cent. That was a big deal. For me it was like, you know, you were having a classic complete carnage because of people [who] were saying: crisis in Greece, who’s exposed to Greece?"
- Obama urges China to be partner in ensuring world order (Reuters)
- China Sees Itself at Center of New Asian Order (WSJ)
- Xi Dangles $1.25 Trillion as China Counters U.S. Refocus (BBG)
- China's Xi, Japan's Abe hold landmark meeting after awkward handshake (Reuters)
- Revenue Softness Worries Stock Investors (WSJ)
- How BOJ’s Kuroda Won the Vote for Stimulus Expansion (WSJ)
- Bonus Season Brings More Pain for Traders (WSJ)
- Russia’s Military Encounters Risk Clash in Europe (BBG)
“A Luxembourg structure is a way of stripping income from whatever country it comes from,’’ said Stephen E. Shay, a professor of international taxation at Harvard Law School and a former tax official in the U.S. Treasury Department. The Grand Duchy, he said, “combines enormous flexibility to set up tax reduction schemes, along with binding tax rulings that are unique. It’s like a magical fairyland.”
- The $9 Billion Witness: Meet JPMorgan Chase's Worst Nightmare (Matt Taibbi)
- Explains the midterm results: Optimism precedes job data (Reuters)
- EU Dream Ebbs Amid Weak Growth, Putin's Jets, 25 Years After Wall Came Down (BBG)
- SEC Probing Trading Activity at Apple Supplier GT Advanced (WSJ)
- Boehner touts bills to repeal Obamacare, build Keystone (Reuters)
- China Gold Buying Means Price Floor to Standard Chartered (BBG)
- High-Speed Ad Traders Profit by Arbitraging Your Eyeballs (BBG)
- Central Banks Can’t Be ‘Only Game in Town’ Boosting Economies (BBG) - less talking, more getting to work
- LOL@Fundamentals: European Stocks Fall as Investors Seek Stimulus Clarity (BBG)
- Obama, Republicans sound conciliatory note but battles loom (Reuters)
- Firms drop Pimco funds from managed accounts (Reuters)
- Not All QE Is Created Equal as U.S. Outpunches ECB-BOJ (BBG)
- Ukraine Accuses Russia of Sending Troops as Truce Wobbles (BBG)
- Lenovo Slumps After Projecting China ‘Hypergrowth’ to End (BBG)
- Palo Alto Networks discovers new malware targeted at Apple devices (Reuters)
- IPO That Brought In $1 Billion in March Implodes in Denmark (BBG)
"Solutions to the world's problems are not produced in a meeting between Bill Gates and George Soros... Renewal has to come from below... Limiting the influence [of the richest] is of the utmost importance... so that today's upper-class, high-finance capitalism can once again revert to being a capitalism of the real economy and the societal center."
"The decline in asset yields especially during QE3 created large wealth effects. Since the Fed's QE started at the end of 2008 the PE multiple of the S&P500 index (12-month forward) went up by five points, from 10.5 at the end of 2008 to 15.5 currently. This PE multiple expansion is responsible for around 650 index points or 32% of the current S&P500 index level. Extending that to the total stock of US corporate equities ($29tr currently), it implies an equity wealth boost of $9tr."
On eliminating investment risk...
There are three things that are certain: death, taxes and M&A "synergies." And while the recent debt and record stock price-funded M&A bubble has been a present from god, or rather the Fed, to the activist shareholders and owners of target stocks (and acquirors, because in the New Normal M&A announcements somehow boost the price of both), it has been a scourge for everyone else: namely the employees of companies that undergo M&A as the first and foremost place where EPS "synergies" are extracted is by eliminating duplicative headcount, read mass layoffs. This is precisely what workers at Canada's Tim Hortons are about to find out first hand, because as Financial Post reports, citing a study from the Canadian Centre for Policy Alternatives, "widespread layoffs and strict cost cutting measures could befall Tim Hortons if Burger King’s parent company takes over the chain." Small correction replace "could" with "definitely will" and the sentence will be spot on.