"We have until March, the summer maybe, for a European solution. Then Schengen goes down the drain. There is a big risk that Germany closes. From that, no Schengen ... There is a risk that February could start a countdown to the end."
As so often happens, whenever there is a political spat in Europe, the rating agencies are quickly involved (thing S&P and Moody's downgrades and upgrades of Greece depending on how well the vassal nation is "behaving"), and moments ago S&P downgraded Poland from A- to BBB+ outlook negative, precisely due to Poland's new media law which has been the topic of so much consternation over the past week. In other words, S&P is now nothing more than a lackey for Brussels, threatening to send Polish yields higher if Poland does not fall in line.
This is just the beginning. The bond bubble will take months to completely implode. And eventually it will consume even sovereign nations. Globally the bond bubble is $100 trillion in size: larger than even global GDP.
by a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens
The default of Sherwin Alumina, a US subsidiary of Glencore, refocused the market's attention on the one company which in September was among the hardest hit in the post-China devaluation rout, and the immediate result was that while Glencore stock plunged and is once again approaching all time lows, a more ominous development was that GLEN's CDS spiked to as much as 950 basis points, the highest since April 2009 and suggesting far more pain is in store for the commodity trading giant.
But here is a giant freebie for all those stupid, clueless oil executives out there in North America.
Our balance sheet - the strongest in recent history - represents a significant advantage as we continue to identify high value growth opportunities across the products and geographies we operate in. Maintaining out investment grade rating with the international rating agencies is a vital part of this strategy.
- Noble Group 2014 Annual Report, p. 27
"As more companies cross the Rubicon out of the buyback zone, the bid for their equity shrivels. For the 2013 financial year, 60% of stocks in my sample were in good shape to gear-up for buybacks. By the end of 2015, just 35% of the sample were in good shape to do buybacks."
"... what we are going to see next is a credit cycle, and in a credit cycle you see some losses, but if China's banking system loses 10%, you are going to see them lose $3.5 trillion."
While the list of "most hated buyside" stocks is at least actionable, not even we are sure what to do with the list of companies that are most hated by the sellside, besides perhaps revealing what it is. So for all those wondering, here courtesy of Factset, is the list of 10 S&P500 companies with the highest percentage of Sell ratings.
What explains America's revulsion with the existing system? The answer comes from the latest Gallup article: "Explaining Trump: Widespread Government Corruption" in which it finds that once the silent majority of the population can identify the object of their distrust and anger - in this case Congress and the political status quo - and once they can subsequently identify an object that represents its opposite, the latter object's distance to the Oval Office becomes considerably shorter.
Default Rate Highest since 2009, US Distress Ratio Soars.
From EM darling to depression, it's been a rough ride for the "B" in BRICS. As we kick off 2016, analysts are growing increasingly concerned that Brazil's economic downturn could well be deeper and longer than anyone expected. The market's collapsing expectations are summarized in one stunning chart.
- China stocks tank, triggers circuit breaker (Reuters)
- Stocks Slump Across Europe and Asia Following Shanghai's 7% Crash (BBG)
- China Halts Stock Trading After 7% Rout Triggers Circuit Breaker (BBG)
- Iran says Riyadh thrives on tension after relations cut (Reuters)
- Saudis and Bahrain Face Off With Iran in Worst Clash Since 1980s (BBG)
- Syrian rebel group backs Saudi move to cut ties with Iran (Reuters)
- Oil ends 2015 in downbeat mood; hangover to be long, painful (Reuters)
- Recession, retrenchment, revolution? Impact of low crude prices on oil powers (Guardian)
- Midwest Flooding Might Make the Oil Glut Worse (BBG)
- From Oil Glut to Shortage? Some Say It Could Happen (WSJ)
- Ten Years After Blowup, Amaranth Investors Waiting to Get Money Back (WSJ)
- China Fires a Warning Shot at Yuan Speculators With Bank Bans (BBG)