Globo CEO Admits He "Falsified Data" After Short-Seller Report, Resigns; But First Sells 40 Million SharesSubmitted by Tyler Durden on 10/26/2015 11:49 -0500
The following story of corporate greed, corruption, and fraud is surely one of the best in recent years.
The Morning After: Valeant Default Risk Soars After Called Next "Tyco", Sellside "Analysts" HumiliatedSubmitted by Tyler Durden on 10/22/2015 09:08 -0500
As always happens after shocking events like yesterday which "nobody could have possibly predicted", watching the Penguin gallery reel in its humiliation is absolutely worth the price of admission.
"Then tell me, future boy, who's President of Brazil in 2016? Then who's vice president?"
Are you a yield-starved investor? Joshua Siegel has a deal he wants to sell you and it involves subordinated loans originated by "35 community banks, some of them so small they don’t have credit ratings."
The US has seen that movie before, it's not a happy ending. Oh, and enjoy that AAA credit rating while it lasts.
Last week, beleaguered Illinois Comptroller Leslie Geissler Munger admitted that, thanks to the bitter budget battle going on in Springfield, the state would miss a $560 million pension payment in November. Now, in a move that shouldn't exactly surprise anyone, Fitch has cut the state's GO rating citing the budget impasse. The move affects some $27 billion in debt.
"Najib has tarnished the country’s image in the world and caused investors to lose faith in the government. Malaysians do not believe in this prime minister."
"In many ways, EM is showing similar symptoms to its DM counterparts of weak economic performance and over- reliance on credit. The outcome is what we call the three EM debacles: de-leveraging, depreciation (or devaluation even de-pegging) and downgrades of credit ratings."
You’re doing yourself a disservice if you don't have a basic working knowledge of what, say, a volatility surface means. We're not saying that we all have to become volatility traders to survive in the market jungle today, any more than we all have to become game theorists to avoid being the sucker at the Fed’s communication policy table. And if you want to remove yourself as much as possible from the machines, then find a niche in the public markets where dark strategies have little sway. Muni bonds, say, or MLPs. The machines will find you eventually, but for now you’re safe. But if you’re a traditional investor whose sandbox includes big markets like the S&P 500, then you’re only disadvantaging yourself by ignoring this stuff. Ignorance is not bliss...
Brazil's economic recession is likely to be deeper and longer than Fitch's earlier expectations and its performance has diverged materially from those of its rating peers. Medium-term prospects also look weak compared to peers and most other large emerging markets. Fitch forecasts that Brazil's economy will contract by 3% and 1%, respectively in 2015 and 2016 before recording modest growth in 2017, with risks skewed largely to the downside.
Since inception in June 1998, UBS' Managed High Yield Plus Fund survived through the dot-com (and Telco) collapse and the post-Lehman credit carnage but, based on the press release today, has been felled by the current credit cycle's crash. After 3 years of trading at an increasingly large discount to NAV, and plunging to its worst levels since the peak of the financial crisis, the board of the Fund has approved a proposal to liquidate the Fund. While timing is unclear, this is the worst case for an increasingly fragile cash bond market as BWICs galore are set to hit with "liquidty thin to zero."
Despite The Fed's best efforts to crush the business cycle, the crucial credit-cycle has reared its ugly head as releveraging firms (gotta fund those buybacks) and deflationary pressures (liabilities fixed, assets tumble) have led to a soaring market cost of capital and surge in downgrades. In fact, in the latest quarter, the ratio of upgrades-to-downgrades is its weakest since the peak of the financial crisis in 2009. “We’re seeing more widespread weakness across more industry sectors in the U.S... It’s become broader than just the commodity story.”
Just when you thought the M&A boom is over after a surge in bond yields that Goldman has repeatedly dubbed as "recessionary", and which will make the debt cost of any funding so high that there is barely any room for execution error, moments ago as had been extensively leaked previously, private Dell announced it would acquire tech giant EMC in a deal valued roughly $67 billion, while maintaining VMWare as a publicly-traded corporation. Good luck with raising the tens of billions in debt the deal will require: our best wish to Barclays, BofA, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan, RBC who will all be underwriting the required debt financing to Dell.
Biggest Weekly Stock Rally Since 2012 Continues Driven By Tumbling Dollar, Dovish Fed; Commodities SurgeSubmitted by Tyler Durden on 10/09/2015 05:53 -0500
The global risk on mood (which is really anything but, and is merely an unprecedented short covering squeeze as we will report momentarily) launched by an abysmal jobs report one week ago and "validated" yesterday by the surprisingly dovish FOMC minutes, which said nothing new but merely confirmed what most knew, namely that a rate hike is almost certain to not occur until mid-2016 if ever, and accelerated by a Fed-driven collapse in the dollar which overnight has led to a historic 3.4% move in the Indonesian Rupiah the most since 2008, has pushed global stocks even higher in their biggest weekly rally since 2012, despite the start of an earnings season where virtually every single company reporting so far has stumbled on earnings reports that were far worse than even gloomy consensus had expected.