RBS

"Manic Depressive" Market Needs "Wholesale Panic" Before It Bottoms

"The market is manic depressive and it swings from seeing only the positives to seeing only the negatives," notes the world’s biggest distressed-debt investor, Howard Marks, but for now, as Bloomberg reports, the extremes (in risk pricing and sentiment) that usually signal opportunity (or capitulation) are not present. As Guggenheim's Scott Minerd warns, "wholesale panic" is what's needed before the market turns, and as RBS notes, "1,800 might come pretty quick."

Sage Investment Advice From Mike Tyson

The optimists have had things their own way in an almost unbroken line since March 2009. January 2016 so far would suggest that the pragmatists are now in charge.

Weekend Reading: Breaking Markets - Season II

Fed Chair Janet Yellen will be forced to either acknowledge labor market tightening as reason to continue with the four-hike schedule for 2016 or risk her credibility, belittle job market stability and sound a warning about the risks of lower oil prices and cheap gasoline (sacrilege to regular Americans) by slowing the hiking pace after a single 0.25 percent increase last month. If she gets it wrong, things could get ugly fast."

Frontrunning: January 15

  • Crude sinks 4 percent as market braces for more Iranian oil (Reuters)
  • Plunge in crude oil prices send stock futures sliding (Reuters)
  • Oil Slides, Deepening Gloom in Stocks as Bond Buyers Celebrate (BBG)
  • China Stocks Enter Bear Market, Erasing Gains From State Rescue (BBG)
  • Friendly no more: Trump, Cruz erupt in bitter fight at Republican debate (Reuters)
  • Dollar in Best Run Since July on Haven Bid Even as Fed Odds Fall (BBG)

Norway's Black Gold Fields Are A Sea Of Red - A Real-Time Map Of Crude Carnage

Norway is in trouble. As we have detailed previously (here, here, here, and here), the world's largest sovereign wealth fund has begun liquidating assets (after its largest quarterly loss) as the nation faces recessionary fears (key data deterioration as oil stays lower for longer) with expectations building (despite denials by the central bank) that ZIRP (or even NIRP) is coming. Why? Simple - as the following real-time map shows - every one of Norway's oil fields are currently underwater!

More Strategists Throw In The Towel: "Things Will Only Get Worse"

Having been abandoned by equity analysts, perhaps investors could find some solace in the Treasury analyst community. Alas no: as Bloomberg notes this morning, citing independent Treasury strategist Marty Mitchell, "our concern is that things will only get worse (effects of commodity super-cycle, bankruptcies, debt defaults, hedge fund redemption/failures, global economic slowdown, equity weakness, global debt deleveraging, etc, etc) before they get better."

Frontrunning: January 12

  • Oil slips toward $30, traders bet on more falls (Reuters)
  • Oil Plunge Sparks Bankruptcy Concerns (WSJ)
  • RBS cries 'sell everything' as deflationary crisis nears (Telegraph)
  • World stocks drop but Europe shrugs off oil slide, China money market surge (Reuters)
  • Canadian Stocks Fall in Longest Slump Since 2002 as Oil Slides (BBG)
  • "Murderous" Yuan Rate Jolts Hong Kong as Top Currency Hub (BBG)

How Low Will The Yuan Go? Deutsche Bank Answers

"Until the market acquires greater confidence on the intended scale of currency depreciation as well as the equilibrium level of capital outflows (and effectiveness of capital controls) concerns around China’s currency policy are unlikely to subside any time soon."

RBS: "This Is Simply The Worst Week We Had In Recent History... After Too Much Policy Kool-aid"

This week is simply the worst we had in recent history for markets, RBS exclaims, the worst ever start to the year for The Dow, the worst since 1999 for S&P and the second-worst for credit since 2008. Worst still is, they think there’s more weakness ahead and that many fundamental risks will continue to haunt markets. Why? Simple! Investors drank too much policy kool-aid last year.

Saudi Aramco Confirms "World's Most Valuable Company" May Go Public

"Saudi Aramco confirms that it has been studying various options to allow broad public participation in its equity through the listing in the capital markets of an appropriate percentage of the Company’s shares and/or the listing of a bundle its downstream subsidiaries."

Frontrunning: December 24

  • Global Stocks Take Breather After Oil-Fueled Rally (WSJ)
  • Junk Investors Evade the Trade (WSJ)
  • How the Third Avenue Fund Melted Down (WSJ)
  • Oil Traders Set to Pounce as U.S. Prepares to Lift Export Ban (BBG)
  • JPMorgan Says Japan Inc. Must Prepare for Yen Below 100 a Dollar (BBG)

Frontrunning: December 14

  • Oil prices drop towards 11-year lows on worsening glut (Reuters)
  • Third Avenue Seen by Top Investors as Fueling More Carnage (BBG)
  • Lucidus Has Liquidated $900 Million Credit Funds, Plans to Shut (BBG)
  • Investor nerves tested with yuan, oil, Fed in play (Reuters)
  • Junk Bonds Stagger as Funds Flee (WSJ)
  • Seattle lawmakers set to vote on allowing Uber, other drivers to unionize (Reuters)