It has been 20 days since the last March 2009-like $522/share 'Generational Low' buying opportunity arrived for AAPL. Well, it would appear that one whole generation suddenly cried out in terror and was suddenly silenced, as AAPL dipped to $518 moments after opening. As the clip below suggests, we can only imagine the crowd of "traders" waiting to scoop up all these generational low prints (and today's volume is epic so far) being sold to them by over 200 hedge funds running for cover... WWJTD? A second bite at the Apple? And is that unlimited cost basis facilitated with "Other people's" or simply monopoly money?
- MSM discovers window dressing: Fund Managers Lift Results With Timely Trading Sprees (WSJ)
- White House Unyielding on Debt Limit (WSJ)
- Obama, Boehner talk; Geithner prepared to go off "cliff" (Reuters)
- Republicans urged to resist tax rises (FT)
- China looms large over Japanese poll (FT)
- As predicted here two months ago, Greek Bond Buyback Leads S&P to Cut to Selective Default (BBG)
- Japan opposition LDP set to win solid election majority – polls (BBG), but...
- Japan Opposition LDP’s Main Ally Cautions Abe on BOJ Pressure (BBG)
- U.S. and Europe Tackle Russia Trade (WSJ)
- King Seen Maintaining QE as Osborne Extends Fiscal Squeeze (BBG)
- Syria pound fall suggests currency crisis (FT)
- Irish budget seeks extra €3.5bn (FT)
- U.K. Extends Cuts Due to Poor Outlook (WSJ)
- ECB Seen Refraining From Rate Cuts as Yields Sink on Bond Plan (BBG)
While trading during US hours is all about the Cliff On/Cliff Off debate, the rest of the world is simple: the overnight session begins (and largely ends) with whether or not China has done another reverse repo (if yes, then PBOC will not lower rates, and inject unsterilized billions into the market) and whether the Shanghai Composite is up or down. Last night, after jumping by 3% the session before, it was down 0.13% to 2029. Was this it for the great Chinese "bottom?" Japan may or may not figure in the equations, although with the 10 Year future just hitting a record overnight, it is amusing to see how the bond complex is indicating record deflation just in time for the market to anticipate a surge in inflation. Ah, the joys of frontrunning central planning's monetization of government bonds. And then we move on to Europe, which is a whole new level of basket case-ness...
Now that it's nearly impossible for naysayers to downplay or refute the most contrarian research of the decade, what's next? #MARGINCOMPRESSION!
More Spying On Citizens than in Stasi East Germany
Lather. Rinse. Repeat. Over and over. Europe doing about fine on its own and with an urge to test higher risk levels, in absence of negative news. Spanish BONOs feeling sad… US look more fickle. Is the fruit getting bad? Question of Muppets getting nervous out of boredom, or what?
"Furry Happy Monsters" (Bunds 1,35% -4; Spain 5,38% +15; Stoxx 2589 +0,1%; EUR 1,307 -10)
And so yet another saga of a trader who bet on AAPL rising, just before it tumbled, ends in tears, this time with what appears to be near certain incarceration of another small, 2-bit trader. As we previously reported, back in November, as AAPL stock was in freefall, none other than the firm of everyone's favorite financial permabull, Rochdale, ended up being a proud if involuntary holder of nearly $1 billion in AAPL stock. The scapegoat for AAPL's price drop: one ex-trader David Miller. What Miller is accused of, is buying 1.6 million shares of AAPL on the day of the company's last earnings announcement in hopes, of course, the stock would surge. It didn't. Furthermore, Miller was in reality executing a trade for a client who had only wanted to buy 1,625 shares, but Miller was confident enough the stock would go up, he bet the firm's money to buy the difference. Sadly, neither the AAPL earnings announcement, nor its stock price, did quite as planned. End result: $5 million loss, Miller terminated and now arrested and charged, and Rochdale left scrambling for a bailout.
We find ourselves more amazed than ever at the ability of those in power to lie, misinform and obfuscate the truth, while millions of Americans willfully choose to be ignorant of the truth and yearn to be misled. It’s a match made in heaven. Acknowledging the truth of our society’s descent from a country of hard working, self-reliant, charitable, civic minded citizens into the abyss of entitled, dependent, greedy, materialistic consumers is unacceptable to the slave owners and the slaves. We can’t handle the truth because that would require critical thought, hard choices, sacrifice, and dealing with the reality of an unsustainable economic and societal model. It’s much easier to believe the big lies that allow us to sleep at night. The concept of lying to the masses and using propaganda techniques to manipulate and form public opinion really took hold in the 1920s and have been perfected by the powerful ruling elite that control the reins of finance, government and mass media. How many Americans are awake enough to handle the truth? Abraham Lincoln once said that he believed in the people and that if you told them the truth and gave them the cold hard facts they would meet any crisis. That may have been true in 1860, but not today.
After this year's presidential campaign, private equity and certainly Bain Capital, will likely be the last entity that those pandering to populist agendas will go to advice over the future of the business cycle in broad terms, and the future of US labor, most certainly including outsourcing, in narrow terms. And Goldman - that staunch defender of the superiority of capital over labor - will hardly be confused as ever taking the role of workers in any discussion. Which is why we read the following interview by Goldman's Hugo Scott-Gall with Bain Capital partners Michael Garstka and Alan Bird on such topics as corporate restructurings and the future of outsourcing with great interest, as it is very much unlikely that any of the conventional media sources would carry it. And while one may have ideological biases in whatever direction, the truth as presented previously, is that US private equity is a massive "behind the scenes" juggernaut, whose portfolio holding companies account for a whopping 8% of US GDP, and is directly and indirectly responsible for tens of millions of currently employed US workers! At the end of the day, it may well be that what private equity firms such as Bain think about the future of US labor prospects is the most important thing that matters for the future of the so very critical US unemployment rate. Which is why we present, for your reading pleasure, the somewhat unorthodox interview below...
Following some well-timed 'suggestions' in Natural Gas and Apple this year, the new bond guru has some rather more concerning views about the future of America. Reflecting on a dismal outlook progressing due to the fact that "Retirees take resources from a society, and workers produce resources", Gundlach has cut his exposure to US equities (apart from gold-miners and NatGas producers) noting their expensive valuation and low potential for growth. In a forthcoming Bloomberg Markets interview, the DoubleLine CEO warns we are about to enter the ominous third phase of the current debacle (Phase 1: a 27-year buildup of corporate, personal and sovereign debt. That lasted until 2008, when Phase 2 started, unfettered lending finally toppled banks and pushed the global economy into a recession, spurring governments and central banks to spend trillions of dollars to stimulate growth) as deeply indebted countries and companies, which Gundlach doesn’t name, will default sometime after 2013. "I don’t believe you’re going to get some sort of an early warning," Gundlach warns "You should be moving now."
- Turns out no free lunch after all: Greeks rage against pension calamity (Reuters)
- Athens banks told of debt buyback ‘duty’ (FT)
- U.N. Gives Palestinians 'State' Status (WSJ)
- Obama's Cliff Offer Spurned (WSJ)
- Republicans Reject Obama Budget as He Sells It to Public (Bloomberg)
- Macau Gangster Who Missed Boom to Be Freed After 14 Years (Bloomberg)
- China Economic Optimism Returns in Poll as Xi Beats Hu (Bloomberg)
- Spain May Escape European Bailout, Former ECB Board Member Says (Bloomberg)... but they won't
- After a bashing, BOJ weighs "big bang" war on deflation (Reuters)
- Recession Left Baby Bust as U.S. Births Lowest Since 1920 (Bloomberg)
- Japan unveils second Y880bn stimulus package (FT)
Let's face it, Smartphone Hardware Manufacturers Are Dead, Long Live The Google-like Solution Providers!Submitted by Reggie Middleton on 11/29/2012 10:20 -0400
Sometimes the truth is a tough pill to swallow, particularly if that pill is low (and getting lower) margined hardward-based.
- Egypt protests continue in crisis over Mursi powers (Reuters)
- Greece hires Deutsche, Morgan Stanley to run Greek voluntary debt buy back, sources say (Kathimerini)
- Executives' Good Luck in Trading Own Stock (WSJ)
- Hollande Presents Mittal Nationalization Among Site Options (Bloomberg)
- Eurozone states face losses on Greek debt (FT)
- Spain's rescued banks to shrink, slash jobs (Reuters)
- EU Approves Spanish Banks' Restructuring Plans (WSJ)
- At SAC, Portfolio Managers Are Treated Like Stocks (BBG)
- China considers easing family planning rules (Reuters)
- European Court to Rule Over ECB’s Secret Greek File (BusinessWeek)
- And another top tick indicator: Asia Funds Buy London Offices in Bet Volatility Is Past (Bloomberg)
- Harvard Doctor Turns Felon After Lure of Insider Trading (BBG)
- Zucker Is Lead Candidate to Head CNN (WSJ) - it's not true until CNN misreports it
- Iran "will press on with enrichment:" nuclear chief (Reuters)
Ok. It’s not that the Greek deal is nothing. But then again, third strike. Eventually expected, or at least hoped for. Hence, lack of concrete follow-through. So, now it’s there. And now what? You Ain’t Seen Nothing Yet? What is there to see??? Pitch the markets some input, something concrete, something to feed off, something to see!
"You Ain't Seen Nothing Yet" (Bunds 1,43% +2; Spain 5,51% -9; Stoxx 2538 -0,2%; EUR 1,293 -30)
Reasons to be bullish.