• Tim Knight from...
    04/28/2016 - 00:27
    I was expecting a few boring candidate statements of the U.S. Senate - AKA the World's Most Exclusive Club - but, boy, was I wrong. Just take a look at some of these gems.
  • Tim Knight from...
    04/28/2016 - 00:27
    I was expecting a few boring candidate statements of the U.S. Senate - AKA the World's Most Exclusive Club - but, boy, was I wrong. Just take a look at some of these gems.

Rating Agencies

Tyler Durden's picture

The Fed Sends A Frightening Letter To JPMorgan, Corporate Media Yawns





Yesterday the Federal Reserve released a 19-page letter that it and the FDIC had issued to Jamie Dimon, the Chairman and CEO of JPMorgan Chase, on April 12 as a result of its failure to present a credible plan for winding itself down if the bank failed. The letter carried frightening passages and large blocks of redacted material in critical areas, instilling in any careful reader a sense of panic about the U.S. financial system. The Federal regulators didn’t say JPMorgan could pose a threat to its shareholders or Wall Street or the markets. It said the potential threat was to “the financial stability of the United States.”

 
Tyler Durden's picture

BofA Explains Why The ECB Will Be Forced To Buy Junk Bonds





When judged against the BoJ, the ECB probably still has a ways to go before hitting the limits of central banker insanity and so, we think it's entirely possible that Draghi moves into HY next. But the reasons to believe the ECB will take the plunge into non-IG corporate credit go beyond the “MOAR is always better” line. As BofAML’s Barnaby Martin explains, the EU corporate sector’s penchant for bond buybacks may ultimately force Draghi further down the ratings ladder lest the ECB should end up entangled in tender offers or else find itself without enough debt to monetize.

 
Tyler Durden's picture

"No Signs Of Recession" Says Agency That Always Fails To Predict Recession





The top economist for Moody’s (one of the largest rating agencies in the world) said yesterday, as he unleahed the latest jobs guess, that there are absolutely zero signs of recession. These sameguys were so drunk on their own Kool-Aid that in October 2007, Moody’s announced that “the economy is not going to slide away into recession.” Everyone assumed that the good times would last forever. This is what virtually assures negative interest rates in America.

 
Tyler Durden's picture

Moody's Downgrades China's Credit Outlook From Stable To Negative - Full Text





It is likely just a coincidence that just a month after we reported that China's real debt/GDP was far greater than the 280% or so accepted conventionally, and was really up to 350% if not higher after the recent record loan issuance surge, moments ago Moody's officially downgraded its outlook of China's credit rating from stable to negative, citing three key risks: 1) The ongoing and prospective weakening of fiscal metrics, as reflected in rising government debt and in large and rising contingent liabilities on the government balance sheet; 2) A continuing fall in reserve buffers due to capital outflows, which highlight policy, currency and growth risks; 3) Uncertainty about the authorities' capacity to implement reforms - given the scale of reform challenges - to address imbalances in the economy.

 
Tyler Durden's picture

Chesapeake's AIG Moment: Energy Giant Faces $1 Billion In Collateral Calls





"we have received requests to post approximately $220 million in collateral, of which we have posted approximately $92 million. We have posted the required collateral, primarily in the form of letters of credit and cash, or are otherwise complying with these contractual requests for collateral. We may be requested or required by other counterparties to post additional collateral in an aggregate amount of approximately $698 million."

 
Capitalist Exploits's picture

What The Big Short Can Teach You About Investing





"Truth is like poetry. And most people f**king hate poetry." - From the Big Short movie (overheard at a Washington D.C. bar)

 
Tyler Durden's picture

Citi: "There Was Something About The Entire Recovery Narrative That Is Downright Wrong"





"Far from making the world safer, then, there is a risk that the post-crisis policy mix has simply suppressed problems, making markets stickier, and may even have added to them, by driving the global credit cycle far ahead of the current interest rate cycle. Recent market dislocations are a sign that that stickiness may be reaching breaking point. At this point we may start to question whether it can provide a similar solution this time round, not just because of the zero lower bound, but because the entire premise on which it has been based – inducing credit expansion and risk-taking in some other part of the global economy – seems to be reaching its limits."

 
Tyler Durden's picture

S&P Downgrades Glencore To Lowest Investment Grade Rating





Overnight, one of the two rating agencies, Standard and Poors, came one step closer to that fateful moment of junking Glencore when it downgraded Glencore, however it decided to throw the company one last lifeline by keeping it at the very lowest investment grade rating, and instead of cutting it from BBB to single B or CCC where its CDS and bond yield implies the company should be trading, it kept it a BBB-.

 
EconMatters's picture

The Big Short of 'Mother Frackers'





While energy E&P companies were dropping like flies in 2015, credit rating agencies and banks have remained awfully quiet.... 

 
Tyler Durden's picture

Bad Loans Pile Up In Alberta, As Oil Bust Weighs On State Lender





Just in case you needed another reason to fear for the worst in Alberta, Moody’s and DBRS are becoming increasingly concerned about crown corporation ATB Financial. “Alberta's debt situation was under the microscope last week, with [the] two rating agencies taking a look at the province's fiscal situation and economy and not liking what they saw,” CBC reports.

 
Tyler Durden's picture

With EMs And SWFs Pushing Markets Lower, Here Are The Three Dramatic Conclusions





Earlier today we showed an amazing schematic courtesy of Citi's Matt King: if one includes the reserve liquidation by various EMs and SWF, and nets it against liquidity injections by DM central banks (and the PBOC), one gets a perfect quantitative, not just qualitative, walk thru on how to trade markets: in other words one can measure, using high frequency data in real-time, just where markets should trade based on liquidity flows and promptly profit from any arbitrage opportunities. But aside from the potential for substantial profits, there are more profound implications. Matt King lays them out as follows..

 
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