Bank of America
- FUTURES TRADER ARRESTED FOR ALLEGED ROLE IN 2010 FLASH CRASH
- FUTURES TRADER CHARGED WITH ILLEGALLY MANIPULATING STOCK MKT
- SARAO HAS BEEN CHARGED WITH COMMODITIES, WIRE FRAUD: GOELMAN
- SARAO WAS ARRESTED AT HIS HOME IN LONDON TODAY, GOELMAN SAYS
- CFTC FILES CIVIL CASE AGAINST NAVINDER SINGH SARAO
Over the past couple of years, there has been a growing chorus of individuals claiming that the financial markets have finally shaken the shackles of the secular bear market that began at the turn of the century. Bank of America is the latest to jump onto the "new secular bull market" bandwagon; but what they miss is that secular bull markets are not born of price, but rather of a set of fundamental metrics that foster sustained economic growth over long periods of time.
What do retail investors do on volatile days like Friday’s jolt lower on the S&P 500? Thanks to one very large online broker’s publicly available order flow, we now know...
Just two facts to best describe the New Paranormal:
1. Central bank assets now exceed $22 trillion, a figure equivalent to the combined GDP of US & Japan
2. 53% of all global government bonds are yielding 1% or less
Good luck with that "renormalization."
- 2010: The first full year of the recovery was a growth recession with a collapse in inventories (after the restocking was complete), and continued private sector deleveraging.
- 2011: There were a series of events, including the Japanese tsunami, spike in oil prices and US debt downgrade by S&P.
- 2012: The crisis in the Eurozone intensified with concerns over a Greek exit and a breakup of the Eurozone. The policy response abroad was lackluster and there were concerns of another financial crisis.
- 2013: The combination of the sequester, debt ceiling fight and government shutdown created an environment of heightened uncertainty and fiscal restraint.
- 2014: The polar vortex delayed economic activity and led to a permanent loss of growth.
- 2015: Rapid appreciation of the dollar and heightened uncertainty about the winners and losers from plunging oil prices has hurt growth. A small part of the weakness may be related to the weather and the dock strike.
It is almost too coincidental to be a coincidence: on the day Ben Bernanke, who until a year ago was the biggest fixed income portfolio manager in the world courtesy of the Fed's $4.5 trillion in assets, joins Citadel as an advisor, the massively levered "market-neutral" hedge fund which as we showed earlier has $176 billion in regulatory assets, "loses" its global head of fixed income, senior managing director Derek Kaufman. Well not exactly loses. The reason for his "voluntary" departure: according to Bloomberg Kaufman is leaving Citadel not because he is about to be replaced by the former Fed chairman but because last year he lost $1 billion "in a variety of trades."
Moments ago the Department of Commerce reported March starts and permits data, which after the February collapse was expected by everyone to rebound strongly because, well, it didn't snow as much in March as it did in February. Apparently it did, because not only did Housing Starts miss massively, and just as bad as in February, printing at 926K, on expectations of a 1.040MM rebound from last month's revised 908K.
Back in November we chronicled the (quiet) death of the Petrodollar, the system that has buttressed USD hegemony for decades by ensuring that oil producers recycled their dollar proceeds into still more USD assets creating a very convenient (if your printing press mints dollars) self-fulfilling prophecy that has effectively underwritten the dollar’s reserve status in the post WWII era. Now, with oil prices still in the doldrums, oil producers are selling off their USD assets in a frenzy threatening the viability of petrocurrency mercantilism and effectively extracting billions in liquidity from the system just as the Fed prepares to hike rates.
There were the usual trite, forgettable highlights in the just released beige snow book, which as summarized by Bloomberg, had the following highlights:
FED: ECONOMY EXPANDED IN MOST REGIONS MID-FEB. TO END-MARCH; HIGHER RETAIL SALES REPORTED BY MAJORITY OF REGIONAL FED BANKS; BEIGE BOOK: LABOR MARKETS STABLE OR SHOWED MODEST IMPROVEMENT; REGIONAL FEDS NOTED MODEST UPWARD WAGE AND PRICE PRESSURE;
One can ignore all of the above, because the only word that matters in the latest beige book was one: "Weather"
Bank of America Revenue Drops, Misses Due To Declining Trading Revenues, Loan Creation And Net Interest MarginSubmitted by Tyler Durden on 04/15/2015 08:02 -0400
One look at BofA's earnings report shows why contrary to popular opinion, the bank that bailed out insolvent Merrill Lynch is far better off to be pnealized with tens of billions in legal fees than running its business unbothered by the racketeering government. The reason: a year after BofA reported $6 billion in litigation charges, moments ago Bank of America announced only $0.4 billion in legal fees, which meant it barely had any credible addbacks. So when looking at its numbers on a realistic, GAAP basis, BofA once again missed EPS, with the bottom line printing at $0.27, or below the $0.29 estimate.
Inventor of Antivirus Sofware: The Government Is Planting Malicious Software On Your Phone So It Can See What You're DoingSubmitted by George Washington on 04/14/2015 22:12 -0400
“Encryption Doesn’t Matter In a World Where Anyone Can Plant Software On Your Phone and See What You’re Seeing”
While today's macro calendar is empty with no central bank speakers or economic news (just the monthly budget (deficit) statement this afternoon), it’s a fairly busy calendar for us to look forward to this week as earnings season kicks up a gear in the US as mentioned while Greece headlines and the G20 finance ministers meeting on Thursday mark the non-data related highlights.
China Stocks Soar To 7 Year High After Collapse In Exports; US Futures Slip On Continuing Dollar SurgeSubmitted by Tyler Durden on 04/13/2015 06:55 -0400
If there was any doubt that global trade is stalling, it was promptly wiped out following the latest abysmal Chinese trade data which saw exports tumble by 15% - the most in over a year - on expectations of a 8% rebound, with the trade surplus coming in at CNY18.2 billion, far below the lowest estimate. While unnecessary, with the Chinese GDP growth rate this Wednesday already expect to print at a record low, this was further evidence of weak demand both at home and abroad. Weakness was seen in most key markets, and the strength of China's currency was partly to blame, which again brings up China's CNY devaluation and ultimately QE, which as we wrote some time ago, is the ultimate endgame in the global reflation trade which, at least for now until the CBs begin active money paradropping to everyone not just the 0.01%, is only leading to inflation in stocks and deflation in everything else.v
GE’s announcement that its getting out of the finance business should be a reminder of how crony capitalism is corrupting and debilitating the American economy. The ostensible reason the company is unceremoniously dumping its 25-year long build-up of the GE Capital mega-bank is that it doesn’t want to be regulated by Washington as a systematically important financial institution under Dodd-Frank. Oh, and that its core industrial businesses have better prospects. We will see soon enough about its oilfield equipment and wind turbine business, or indeed all of its capital goods oriented businesses in a radically deflationary world drowning in excess capacity. But at least you can say good riddance to GE Capital because it was based on a phony business model that was actually a menace to free market capitalism. Its deplorable raid on the public purse during the Lehman crisis had already demonstrated that in spades.
“In my 30-year career, it’s one of the most unattractive risk-return propositions that I’ve seen,” DoubleLine's Bonnie Baha says. Between abysmally low yields, heightened rate sensitivity heading into a rate hike cycle, and balance sheet re-leveraging on the part of US corporations, it’s a bad time to be betting on corporate credit.