Morgan Stanley

Wall Street's Latest Retail Fleecing Product Exposed – Structured CDs

Wall Street is an industry that should have been allowed to go down in flames back in 2008. Bailing out these career criminals and sociopaths was one of the gravest errors in American history. An error that we as a nation continue to suffer from to this day. As an example, yesterday’s Wall Street Journal reported on the industry’s latest scheme to pocket the hard earned savings of those dwindling Americans who still have a few pennies left — structured CDs.

Morgan Stanley Throws In The Bearish Towel, Sees S&P At 2,300 On A 19x "Bull Case" PE Multiple

"We are raising our 12-month price targets for the S&P 500 – base case from 2200 to 2300, bear case from 1600 to 1800, and our bull case from 2400 to 2500... For the bull case, we are leaving our EPS essentially unchanged, moving the out year from $137.1 down to $136.5, but raising our bull case multiple from 18x to 19x, yielding our new 2500 bull case forecast."

August Payrolls Loom: Futures Flat, Dollar Rises, Treasuries Slip

The much anticipated payrolls day, expected to provide at least some more clarity on future Fed policy, has arrived and heading into today's report both price action and newsflow has been muted. U.S. equity index futures were fractionally higher, as European stocks rise 0.6% while Asia was flat. Gold fell as the dollar rose, while comments by Vladimir Putin which endorsed an OPEC oil production freeze while granting Iran an exemption, have pushed oil higher.

Frontrunning: August 30

  • EU demands Apple pay Ireland up to 13 billion euros in tax (Reuters)
  • Dollar Advances as Treasuries Drop on Rate Outlook; Stocks Rise (BBG)
  • Chinese embassy in Kyrgyzstan hit by suspected suicide car bomb (Reuters)
  • France, joining German Economy Minister, urges halt to trade talks with U.S. (Reuters)
  • Euro zone monthly economic sentiment falls more than expected (Reuters)

Futures Flat, Global Stocks Higher As Dollar Resumes Rise

The quiet overnight market had been focused on the upcoming comments by Stanley Fischer, who is set to give a Bloomberg TV interview at 6:30am ET, where he was expected to expand on his recent hawkish comments. Heading into Fischer's appearance, the dollar strengthened, global stocks rose, oil hovered around $47, while US index futures were largely flat and Treasuries fell.

One Striking Chart Shows Why, According to MS, The Next Global Recession Begins In China

here is the chart revealing what may be the most unsustainable trend in China, one that is even more dramatic than China relentless debt growth: accounted for 26% of global annual capex in 2015, compared with 9% in 2006 and 5% in 2000. Hence, as China continues to invest with low return expectations, that this will continue to weigh on the global returns on capital employed.

The First Victims Of The Libor Surge Have Emerged... In Japan

So far US banks have escaped the recent Libor surge, but the higher funding costs and shrunken market are hitting Japanese banks particularly hard, as they have been sourcing as much as a third of their U.S. dollar liquidity in the short-term U.S. market. Japanese banks have about $125 billion to $150 billion of CP and CDs maturing before the end of September.

Madness In Mario-World: European Companies Issue Debt Simply Because The ECB Will Buy That Debt

Things are so absurd in the Eurozone that the ECB is buying private placement debt with little regard for safety. In turn, private equity companies issue debt simply because they know in advance the ECB will buy it. It’s a startling example of how the market is adapting to extremes of monetary policy, and it’s a safe conclusion the experiment will not end well.

OPEC Ignites Biggest Short Squeeze In History: Hedge Funds Cut Oil Shorts By Most On Record

The past week saw the biggest crude oil short squeeze on record as money managers cut bets on falling prices by the most ever.  Hedge funds trimmed their short position in WTI by 56,907 futures and options during the week ended Aug. 16, the most in data going back to 2006. As a result WTI soared nearly 10% in the past week, pushing it into a bull market just three weeks after it tumbled into a bear market.

Morgan Stanley: "This Is The Most Dangerous Time As Hope And Greed Overtake Fear And Loathing"

"It is often said that a rising tide lifts all boats, but perhaps the more pertinent question just now is whether this logic works in reverse... Although equity valuations continue to look extremely attractive relative to bonds, there is always a plausible argument that the equity rally will continue; however, this is potentially the most dangerous time for investors as hope and greed overtake fear and loathing."

"The Most Difficult, Treacherous Year" - What The Market Wall Of Worry Looked Like In 2016

2016 has been according to one buysider, "the most difficult, treacherous year" for the hedge fund community in recent history as a result of unprecedented shifts in market sentiment, choppy trading, low conviction, investor redemptions, illiquidity and  volatility month after month, which has left the hedge fund community exhausted and reeling even as the S&P hits all time highs.

Oil Prices Continue To Rise On Hollow Saudi Comments

This is just the latest confirmation that Saudi Arabia has taken center stage when it comes to oil. Nobody cares anymore about fundamentals, everyone listens to what Riyadh says. If Riyadh is bullish on oil, then oil prices rise, despite any production data that might contradict their words. If Riyadh decides for some reason to be bearish, the market follows. The extent of this dependency of traders on every word that comes out of Khalid al-Falih’s mouth (and other Saudi officials) becomes all the more evident in light of the latest production forecasts for Saudi Arabia.

S&P Futures Unchanged As Europe Rises; Dollar Slide Sends Oil Above $47

In the latest quiet trading session, European shares rose while Asian stocks fell and S&P futures were little changed. Minutes of the Fed’s last meeting damped prospects for a U.S. interest-rate hike, sending the Bloomberg Dollar Spot Index doen 0.3%, approaching a three-month low. Dollar weakness continues to buoy commodities, with the Bloomberg Commodity Index set for the most enduring rally in more than two months, as WTI flirted with $47