Goldman Sachs

As the chart below shows, from oil to bunds, to US HG and Convertible debt, to USTs and even to Developed Market stocks, turnovers are virtually non-existant, while the only place where there has been a transitory surge in turnover has something to do with Chinese stocks, where volume however has been quite muted in recent months ever since the bubble died.

While 75% of 'expert economists' expect The Fed to raise rates in September, Goldman Sachs warns that if investors are worried about a September rate hike then it is not being priced via S&P 500 options...

It appears some are finally waking up...

Moments ago, Morgan Stanley did it again just as expected, only this time it at least followed protocol when it announced it is raising its price target on TSLA from $280 to a whopping $465, or just shy of $61 billion in implied market cap. Incidentally at this price TSLA would be the biggest US automaker, surpassing not only GM's $50bn in market capo, but also Ford's $60 billion.

It was a relatively quiet weekend out of China, where FX warfare has taken a back seat to evaluating the full damage from the Tianjin explosion which as we reported on Saturday has prompted the evacuation of a 3 km radius around the blast zone, and instead it was Japan that featured prominently in Sunday's headlines after its Q2 GDP tumbled by 1.6% (a number which would have been far worse had Japan used a correct deflator), and is now halfway to its fifth recession in the past 6 year, underscoring Abenomics complete success in desrtoying Japan's economy just to get a few rich people richer. Of course, economic disintegration is great news for stocks, and courtesy of the latest Yen collapse driven by the bad GDP data which has raised the likelihood of even more Japanese QE, the Nikkei closed 100 points, or 0.5% higher. 

The hard data runs completely counter to the uptick in GDP growth shown by Fed's models. 

The last time former Goldman employee and then Treasury Secretary Hank Paulson bailed out the hedge fund known as Goldman Sachs, and its closest peers (but not its biggest fixed income competitor Lehman Brothers of course), even the traditionally confused American public pushed back on the structure of the bailout which converted the Goldman holding company into an FDIC-insured company, which led many to ask: just where are Goldman's deposits? The answer, of course, was nowhere, so perhaps in anticipation of the logical pushback against its second, upcoming bailout which would see the taxpayer-backed depositor insurance company once again provide trillions in cash to banks as well as the glorified hedge funds such as Goldman, the firm moments ago decided to do something it has never done before: become an actual bank with checking accounts and such.

It doesn't get more flagrant than this: the full HFT criminal monty exposed for all to see.

Some companies, particularly hedge funds looking for an edge, are having employees wear “biosensing wearable devices,” in order to collect detailed analytics about them and hopefully improve performance. “The idea that you can augment yourself with technologies will become absolutely commonplace and a natural progression.”

Over the weekend, when looking carefully at Tesla's cash burn, pardon cash inferno we said that at "the current cash burn rate, TSLA can only fund just two more quarters of cash burn at which point, and most likely well before it, the company will have to aggressively raise new capital." It wasn't 1-2 quarters. It was barely 3 days. Moments ago TSLA announced that, just as we expected, it would dilute its shareholder by just under 2% by issuing $500 million in equity.

Guess who was responsible for Wednesday's magical levitation that allowed U.S. stocks to stage the biggest turnaround in three years? 

• China central bank under pressure to weaken yuan further (Reuters)
• Currency Rout Goes Global as Jen Sees Risk of 50% Loss on China (BBG)
• Europe Stocks Fall Most in Two Weeks as China Sparks Growth Fear (BBG)
• German Yields Drop to Record as China Boosts Bonds Around World (BBG)
• FT to Japan, Economist to Italy: Agnelli Family Raises Stake in Economist as Pearson Exits (BBG)
• Goldman Sachs to Give Out ‘Secret Sauce’ on Trading (WSJ)
• Greece's Preliminary Bailout Deal Faces German Turbulence (BBG)

Despite claiming yesterday's devaluation was a "one-off", The PBOC has devalued the Yuan Fix dramatically for the 2nd day in a row - now 22 handles weaker than Monday's Fix. Offshore Yuan is trading at 4 year lows against the USD. The carnage from this dramatic shift is just beginning as global equity markets (US futures to China cash) are tumbling, US Treasury bond yields are crashing, gold is up, China credit risk is at 2 year highs, and China implied vol has exploded to 4 year highs. Ironically, China's government mouthpeiece Xinhua explains "China is not waging a currency war; merely fixing a discrepancy."