Merrill

Merrill

"The Damage Could Be Massive" - How Central Banks Trapped The World In Bonds

Yields on $7.8 trillion of government bonds have been driven below zero by worries over global growth, forcing investors looking for income to flood into debt with maturities of as long as 100 years. Worse still, as Bloomberg reports, central banks’ policy is exacerbating matters, as the unprecedented debt purchases to spur their economies have soaked up supply and left would-be buyers with few options. This has driven the 'duration' - or risk sensitivity - of the bond market to a record high, meaning, as one CIO exclaimed, even with a small increase in rates "the positions are so huge that the damage can be massive... People are complacent."

Stocks Soar As Corporations Are Defaulting On Their Debts Like It's 2008 All Over Again

The stock market and the economy are moving in two completely different directions right now. Even as stock prices soar, big corporations are defaulting on their debts at a level that we have not seen since the last financial crisis. In fact, this wave of debt defaults have become so dramatic that even mainstream media is reporting on it...

Institutionalized Lying - Why Central Bankers Never See Bubbles

Every day there is more confirmation that the casino is an exceedingly dangerous place and that exposure to the stock, bond and related markets is to be avoided at all hazards. In essence the whole shebang is based on institutionalized lying, meaning that prouncements of central bankers, Wall Street brokers and big company executives are a tissue of misdirection, obfuscation and outright deceit. And they are self-reinforcing, too.

Is Deutsche Bank’s Gold Manipulation The Main Scam Or Just A Side-Show?

Is Deutsche's gaming of the London precious metals fix the same thing as - or even tangentially related to - the main manipulation of the gold price, which is the practice of central banks “lending” their gold to big commercial banks, which then sell that gold on the open market to depress the price?

Peter Schiff Slams Managers' "Denial... And Mindless Optimism"

The Winter of 2015-2016, which came to an end a few weeks ago, has been officially designated as the mildest in the U.S. in 121 years according to NOAA. While this fact will certainly add a major talking point in the global warming debate, it should also be front and center in the current economic discussion. The fact that it isn’t is testament to the blatantly self-serving manner in which economic cheerleaders blame the weather when it’s convenient, but ignore it when it’s not.

Former Fed Advisor Asks "Has The Fed Bankrupted The Nation"

In 1977, the total indebtedness of U.S. government, corporate and household borrowers was $323 billion. By 1985, that figure had grown to $7 trillion. Volcker left the Fed in August of 1987 after handing the reins over to Alan Greenspan. By year’s end 2015, U.S. indebtedness had swelled to $45.2 trillion. Tack on financials, which few do, and it’s $64.5 trillion and unabashedly growing. We are a nation transformed. What has today’s vast store of debt purchased? Certainly not freedom.

In Its Second Attempt At Going Public, BATS Prices $253 Million IPO At $19/Share

It's time for try number two. Moments ago BATS announced that it has just priced its second attempt at going public by pricing its (second) initial public offering at a price to the public of $19.00 per share (this time the high end of the range). The size of the offering has been increased from the initially announced 11,200,000 shares of common stock to 13,300,000 shares of common stock.

The ECB Effect: European Telecom Issues Largest Ever Junk Bond After More Than 100% Upsizing

The market bond market, which is now frontrunning not just what the ECB has announced it will buy but what it may buy, just led to a record European junk bond issuance, when French cable and telecom operator Numericable "stunned the market" (as Reuters put it), when it upsized what was originally supposed to be a $2.25 deal by more than 100% to a whopping $5.2 billion bond deal on Wednesday. This was the largest single high-yield bond tranche ever issued.

USDJPY Crashes, Drags Equities With It As Gold Soars

Ever since the USDJPY breached the 110 support level three days ago for the first time in 17 months, the pressure on this all important FX carry cross has been rising, and then overnight, following the latest bout of recurring and increasingly ignored jawboning by various Japanese officials, the Yen soared, with the USDJPY plunging first below 109 and then moments ago dropping as low as 108.02 before rebounding modestly, dragging US equity futures lower with it.

2016: The End Of The Global Debt Super Cycle

The credit markets are signaling that the debt fueled expansion that began in 2010 is turning to bust. This is the most precarious moment in financial market history because as the world slides into recession global central banks have no ability to soften the oncoming recession with debt creation. The world economy is on the precipice of another Great Depression.

It's Not Over Yet - Moody's Put Deutsche Bank On Review For Downgrades

In a worryingly coincidentally timed move, Moody's has put Desutche Bank on review for downgrade, citing "execution challenges" in its new strategic plan. The worrying aspect comes from the fact the timing is entirely fitting with the ratings downgrade that started the last and most painful down-leg in Lehman's collapse...

Mystery HFT "Dude" Is Crushing The Turkey Stock Market

"There’s a giant bull in the [Turkey stock market] china shop," exclaims one trader, but (unsually for Turkey), "nobody knows anything for sure" about who he, she, or it is. As Bloomberg reports, a mystery investor who first appeared a year and a half ago with $450 million of bets on a single day, almost double the market average, is now executing major transactions with increasing frequency, scaring away competitors who can’t figure out when he or she will strike next, traders and bankers said.