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$6 Billion Activist Fund Relational Liquidating: Here Are Its Top Holdings

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Lately it seems that not a day goes by without some big or not so big fund manager realizing they have had it with Bernanke/Yellen’s legacy farce of a market, and exiting stage left, doing so either in bombastic style, a la Bill Gross, or in a more subdued fashion, in the vein of Stanley Druckenmiller, or sometimes in part (or in whole) liquidating without telling anyone, like what BlueCrest is rumored to have done last week.

So not surprisingly, today brings the latest hedge fund unwind, with the WSJ reporting that $6 billion veteran acitivst hedge fund Relational Investors LLC, plans to wind down its operations and dissolve its current funds by the end of next year, according to people familiar with the matter. The reason? The same reason why Jamie Dimon himseld is about to quit the financial industry any second: the firm’s co-founder and public face, Ralph Whitworth, has throat cancer and while he said he was taking a leave of absence in July, he appears to have changed his mind and made it permanent.

From the WSJ:

Plans remain fluid and the ultimate status of funds and positions in them will be sorted out over the next year or so, the people said.

 

The firm’s executives expect eventually to launch a new fund with the same name, though founders Mr. Whitworth and David Batchelder will cede day-to-day control, the people said.

 

Shortly thereafter, Relational said no new investments would be made, citing Mr. Whitworth’s indefinite medical leave. The firm said it would continue to manage the current portfolio with Mr. Batchelder at the helm.

But the question on everyone’s mind is what happens tomorrow, and thus today, as everyone discounts the upcoming liquidations of the fund’s largest positions, which are Hewlett Packard, SPX and Mondelez, and where Relational is a 10% holder in GBNK, MHR, SPW and PMCS.

So here is a partial list of everyone else that is about to be dumped en masse as Relational is merely the latest fund to liquidate.

It won’t be the last, and in this CYNK&P market, in which one seller is all it takes to start an avalanche, the Fed better be taking notes.

Source: BBG





Ray Dalio: “There Is Always A Downturn”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Thanks to The Federal Reserve’s extreme monetary policy, “the prospective return of asset classes is very narrow,” warns Bridgewater’s Ray Dalio, with expected returns for equities of “only about 4 percent.” This is a problem, he explains in this brief clip, as monetary policy relies on that transmission mechanism of apparent wealth creation to keep the dream alive. In Europe and Japan there is no “spread”, Dalio notes, and in the US it is miniscule – which means monetary policy is practically ineffective. While he believes in the short-term, the US economy can maintain stability (not commenting on the market per se), his “biggest concern is when the next downturn comes in 1-2 years,” the central bank must be on the ‘tighter’ side of market expectations to be capable of providing its life-giving elixir once again. Simply put, Dalio sums up “there is always a downturn”something that no Wall Street economist is expecting.

 

 

More from Bridgewater’s Dalio here





Who Is Buying The Islamic State’s Illegal Oil?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Chis Dalby via OilPrice.com,

In June 2014, computer files captured from a courier for the Islamic State shortly after the fall of Mosul revealed that the group had assets of $875 million, largely gained in the sacking and looting of Mosul and its central bank.

The size of the group’s bank account has now risen to an estimated $2 billion dollars, thanks in part to revenues from ransom paid for kidnapped foreigners and more pillaging. However, oil remains the group’s primary source of income.

The 11 oil fields that IS controls in Iraq and Syria have made it a largely independent financial machine. Reports show that IS-controlled fields in Iraq produce between 25,000 and 40,000 barrels of oil per day, at an estimated value of approximately $1.2 million, before being smuggled out to Iran, Kurdistan, Turkey and Syria.

That doesn’t account for revenue from oil fields that IS has held much longer in Syria, which take the Islamist group’s daily profit to just under $3 million.

But if the regional narrative of IS’s rise is to be believed, the group is universally loathed. How, then, is it so readily finding customers to buy its oil abroad?

Oil smuggling is hardly new in Iraq and Syria — Iran and Turkey have been major conduits for illegal oil exports since the days of Saddam Hussein. Those smuggling rings are still very active, and are now working with IS and contributing to its exploding wealth.

In an interview with CNN, Luay al-Khatteeb, the director of the Iraq Energy Institute, explained that “IS smuggles the crude oil and trades it for cash and refined products, at a refined price,” thanks to its own refineries in Syria.

One important reason that smugglers have been so eager to work with IS is that the terrorist group sells its oil on the cheap. A barrel of oil that would ordinarily sell for over $100 can be discounted as much as 75 percent. But it’s still a profitable sale for IS, as the money it loses from such a discount is more than made up for by the readiness of customers to buy its oil and the plethora of routes through which it can export it.

“The crude is transported by tankers to Jordan via Anbar
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Russell 2000 Enters 10% “Correction” As S&P, Dow, Transports Break Crucial Technical Support

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The small-cap Russell 2000 is down over 10% from its July highs (down 6.2% year-to-date) as VIX is back over 17. Treasury yields continue to collapse (down 8-9bps today alone) with 10Y trading with a 2.40% handle (and 3Y under 1% again). All other major equity indices are also red from the Russell 2000 peak in July and have broken various key technical levels today – S&P below 100DMA, Dow Industrials below 100DMA, Dow Transports At 100DMA, and Nasdaq broken well below its 50DMA. Russell is back at levels first seen a year ago.

 

Russell in correction…

 

Other major equity indices breaking key technicals…

 

Financials continue to catch down to credit…

 

and Treasury Yields are collapsing….

 

An odd reaction by bonds which “are in a bubble” and stocks which “aren’t”





Texas Governor Rick Perry To Explain How (Despite 2nd Case) Ebola Is “Contained” – Live Feed

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

With rumors spreading (and seemingly confirmed) of a 2nd Ebola case in Dallas; Texas Governor Rick Perry is set to explain to the American public that it’s all under control (despite the hospital discharging the Ebola victim 2 days ago) and the virus is contained (despite its potential spread to 12-18 more people)… Reuters further reports that the man being treated for Ebola in Texas traveled through Brussels en route to US according to the Liberian ministry of information. Rest assured Americans, Dance Moms will be on soon…

As KRJH reports,

A second person in Texas is being monitored for Ebola after coming into close contact with the first person in the U.S. diagnosed, according to health officials.

Gov. Rick Perry has scheduled a news conference at a Dallas hospital where a man with the first case of Ebola diagnosed in the U.S. remains in isolation.


 

Perry plans to speak at noon CDT Wednesday at Texas Health Presbyterian Hospital. He’ll be joined by Dr. David Lakey, who’s commissioner of the Texas Department of State Health Services.

 

Governor Perry is due to speak at 1300ET (via NBC Dallas)


 

Governor Perry is due to speak at 1300ET (via NBC Tulsa)





China Detains ‘Activists’, Adopts “Wait-’Em-Out” Tactic As Hong Kong Protest Swells To 300,000

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

On day four of the OccupyCentral protests in Hong Kong, leaders are expecting the crowds to swell to over 300,000 as National Day celebrations begin. The Chinese government appears to be taking two different approaches to the civil disobedience. First, major crackdowns on the mainland, as FirstPost reports, authorities have detained more than a dozen activists across China and questioned as many as 60 others who expressed support for Hong Kong's pro-democracy protests in recent days. However, the government's approach in Hong Kong appears to be "wait-it-out", a tactic that would rely on Hongkongers not taking part in the protests becoming fed up with the inconvenience caused by the demonstrations. Of course, how long that tactic remains in place (post National Day) is anyone's guess especially as student leaders threaten to escalate protests as their deadline for Leung's resignation looms.

 

Time-lapse view of the surge in crowds…

As SCMP reports,

Protests are expected to ramp up a gear tonight on the symbolic National Day holiday after student leaders set Chief Executive Leung Chun-ying a deadline of tomorrow to resign before they start occupying government buildings.

 

So far, Leung has refused to budge, raising a toast with mainland officials at the National Day flag-raising ceremony this morning against a backdrop of jeering protesters outside.

And more lawyers consider legal action against the police's use of force

More than 370 solicitors and international lawyers issued a statement yesterday condemning the use of force. Police on Sunday fired 87 tear gas canisters, used pepper spray and restrained protesters with batons. "Regardless of the technical legality or otherwise of such use of force by the police, their lack of self-restraint is an affront [to] the rule of law," they said.

 

 

The statement followed one by the Bar Association, which deplored the "excessive and disproportionate force" used on demonstrators in Admiralty. The Law Society has been silent.

 

Police actions have been defended by Chief Secretary Carrie Lam Cheng Yuet-ngor as reasonable.

 

Some of the signatories said they would help demonstrators file personal injury claims over the use of pepper spray and tear gas.

 

But solicitor and Democrat Albert Ho Chun-yan said such lawsuits would


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Hilsenrath Asks “Does Ben Bernanke Deserve A Nobel Prize?”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

No, it’s not a joke or sarcasm. The Fed-whispering Jon Hilsenrath has penned the first strawman sponsoring Ben Bernanke for the Nobel Prize…

Via The Wall Street Journal’s Jon Hilsenrath,

It is October, which in the geeky world of academic economics means it is Nobel Prize month, or actually in the case of the economics field, Sveriges-Riksbank-Prize-in-Economic-Sciences-in-Memory-of-Alfred-Nobel month. The prizes start getting announced next week, and as is the custom for this time of year, speculation has started about who will get them.

 

Thomson Reuters, using academic citations, predicts Phillippe Aghion of Harvard University and Peter Howitt of Brown University will win the prize for work advancing thinking on the idea of “creative destruction.” Others names including William Baumol and Paul Romer of New York University, Jean Tirole of Toulouse School of Economics, and Robert Barro of Harvard are sure to make the rounds in the days ahead.

 

Purely in the name of being speculative and provocative, here’s another name that warrants some debate: Ben Bernanke. Mr. Bernanke would get attention from the Swedes not for his work as Fed chairman from 2006 to 2014, but for an academic career that pre-dated his stint in government and mapped out links between the financial system and the economy, a subject of great importance today.

 

Mr. Bernanke’s 1990s “financial accelerator” papers with New York University professor Mark Gertler and Simon Gilchrist presciently drew attention to the damage done to the broader economy by shocks to the credit system.

 

His research in the 1980s on the Great Depression also proved to be a useful roadmap for how links between the financial system and the economy break down in a crisis.

 

The work, along with work by others like Douglas Diamond at the University of Chicago’s Booth School of Business, is seen by many academics as being at the leading edge of research in the field. Mr. Bernanke is the 25th most cited economist on the Ideas website hosted by the Federal Reserve Bank of St. Louis, just behind Nobel winner Paul Krugman and ahead of previous Nobel winners including Edward Prescott, Daniel Kahneman and Robert Shiller.

 

Having led the Fed through a crisis, Mr. Bernanke will forever be a lightning rod for the central bank’s


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Oil, Empire And Playing The Great Game

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Those waiting for the U.S. and its dollar to collapse in a heap may find their own stability is more contingent (and fleeting) than they reckoned.

Many observers (including myself) question the coherence of U.S. foreign policy in the Mideast: The Fatal Incoherence of the Bush/Obama Foreign Policy (June 18, 2014).
 

In my view, the incoherence stems from the intrinsic conflict between traditional (i.e. pre-1941) U.S. foreign policy (based on an uneasy marriage of non-intervention and the explicitly interventionist Monroe Doctrine) and the anti-imperialist values of the Founding Fathers, and the demands of maintaining global hegemony.

The other source of incoherence is the recent policy dominance of an intrinsically incoherent ideology of neo-Conservative Imperialism that is disconnected from both traditional non-interventionist U.S. values and the nuanced demands of maintaining global hegemony.
 
If we strip away these sources of incoherence, we're left with the Deep State playing the Great Game of controlling the master resource, oil. A consistent narrative has little value in the playing of this game, other than for public-relations value, and those seeking a single narrative are inevitably perplexed by the multiple paradoxes and agendas of the Deep State.
 
This leads many observers to declare the Deep State's game plan a disaster.
 
The important question is: which game plan? The incoherent one articulated by the president and his secretary of state? Or the one that nobody lays out because it would be the equivalent of showing everyone at the table all your cards?
 
The real game plan is flexible enough to tolerate multiple inconsistencies and paradoxes. The only goal is controlling the extraction and distribution of oil, and whatever serves this goal is in play. Switching sides, abandoning proxies, cutting deals with enemies--it's all in play, all the time.
 
From this perspective, the game requires constant shifting of strategies in response to what's working and what's not working. If taking down Syria's Assad with proxies didn't work, then move on to Plan B or Plan C. If degrading Iran's influence isn't working, then move on to reproachment (privately at first, of course).
 
In other cases, the strategy is public but the working parts are not necessarily public. Financial sanctions are a good example; beneath the PR bravado and the propaganda war of sanctions and counter-sanctions, one side is getting hurt where


continue reading





“The Trend Is Your Friend… Until It Ends”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

“The trend is your friend… until it ends.” The Russell 2000 just broke crucial primary support from the 2009 lows to become the first of the major indices to do so…

 

 

h/t Brad Wishak of NewEdge





Stocks Are On THE Line

Courtesy of ZeroHedge. View original post here.

Submitted by Phoenix Capital Research.

Stocks are about to take THE line that has supported the rally ?going back to 2012.

 

The amount of bearish issues the markets are facing is almost staggering.

1.     Corporate debt is back to 2007 PEAK levels.

2.     Stock buybacks are back to 2007 PEAK levels.

3.     Investor bullishness is back to 2007 PEAK levels.

4.     Margin debt (money borrowed to buy stocks) is at 2007 PEAK levels.

5.     The leveraged loan market is flashing major warnings.

6.     Corporate insiders are dumping shares at a pace not seen since the TECH BUBBLE TOP

7.     Numerous investment legends have warned of a coming crash.

8.     Investor complacency is at a record LOW.

9.     The Fed has confirmed QE is ending this month, so the juice is cut off for now.

 

Economically speaking…

 

1)    Japan is back in recession

2)    China is growing at 3.5% at best

3)    Germany is contracting.

4)    Italy is in its third recession since 2008.

5)    France has registered ZERO growth for six months.

6)    The US economic data is all bogus bean counting based on inventory and accounting gimmicks (real GDP is negative).

 

All in all over 50% of world GDP is negative or flat-lining.

 

We have the very makings of a Crash. If stocks breakdown from this line and cannot reclaim it, we could easily wipe out all of the gains going back to 2013.

 

Are you ready?

 

This concludes this article. If you’re looking for the means of protecting your portfolio from the coming collapse, you can pick up a FREE investment report titled Protect Your Portfolio at http://phoenixcapitalmarketing.com/special-reports.html.

 

This report outlines a number of strategies you can implement to prepare yourself and your loved ones from the coming market carnage.

 

Best Regards

 

Phoenix Capital Research

 

 

 





 

Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!

 
 

Phil's Favorites

Why the Fed Is So Wimpy

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Another in what seems to be a small parade of scandals involving secretly recorded tapes of Federal Reserve regulators emerged last week. What a number of writers (including me) have written about regulatory capture over the past decade was brought out into the open, at least for a while. My brilliant young friend (40 seems young to me now) Justin Fox, editorial director of the Harvard Business Review and business and economic columnist for Time magazine, published a thoughtful essay this week, outlining some of the issues surrounding the whole concept of banking regulations.

Yes, the latest scandal involved Goldman Sachs, and it took place in the US, but do you really think it’s much different in Europe or Japan? Actually, there are those who a...



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Zero Hedge

David Tepper: Bill Gross "Who Cares?", Regrets FNMA, Economy "Good", Stocks Not Expensive

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

He's back. A month after Appaloosa's David Tepper explained the end of the bond bull market was here (and 10Y rates are now 5bps lower), the trend-following master-of-the-universe explained to Bloomberg TV's Stephanie Ruhle and Erik Schatzker how the departure of Bill Gross from PIMCO was "nothing... who cares?"; why "the US economy is pretty good", how junk bonds are at "fair value" and stocks are cheap as "multiples are not high." Finally he explains how he "wish...



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Chart School

S&P 500 Snapshot: October Opens with a Selloff

Courtesy of Doug Short.

When it comes to monthly market volatility in the S&P 500, October tops the list, ranging from its 16.3% surge in 1974 to its 21.8% plunge in 1987. How will October 2014 stack up on the volatility scale? Time will tell. But the month certainly opened on a weak note, dropping 1.32%, the sixth largest one-day decline so far this year. The index closed a bit off its -1.52% intraday low at the start of the final hour of trading. The intraday range was at the 96th percentile of the 189 market days of 2014.

The selloff in equities was matched by a rally in Treasuries. The yield on the 10-year Note closed at 2.42%, down 10 bps from yesterday's close.

Here is a 15-minute chart of the past five sessions

As we see on the daily chart, today's selling came on increased volume.

...

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The Mexican Libertad: The Currency Solution?

Better than a Bitcoin? The Mexican Libertad is a real coin made out of silver or gold whose value is based on the price of silver or gold. It's tangible, like our coins and paper money, but the value is pegged to its weight in previous metal. 

The Mexican Libertad: The Currency Solution?

By Jeff Thomas of The International Man

The Libertad is a Mexican coin that was first issued in 1981 in .999 fine gold and then in silver in 1982. Beginning in 1991, the Libertades became the only coins in the world that were issued in the convenient sizes of 1/20, 1/10, 1/4, 1/2, and 1 ounce—again, in both gold and silver. This made them very practical if they were to be used as currency.

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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Insider Scoop

UPDATE: JMP Securities Downgrades eBay Inc

Courtesy of Benzinga.

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VIX Call Spreads Trade

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Sector Detector: Stocks fight off predictable weakness, but expect more downside

Courtesy of Sabrient Systems and Gradient Analytics

Yes, the market showed significant weakness last week for the first time in quite a while. In fact, the Dow Jones Industrial Average moved triple digits each day. But it was all quite predictable, as I suggested in last week's article, and certainly nothing to worry about. Now the market appears to be poised for a modest technical rebound, and longer term, U.S. equities should be in good shape for a year-end rally. However, I still believe more downside is in order before any new highs are challenged. Moreover, market breadth is important for a sustained bull run, so the challenge for investors will be to put together broader bullish conviction, including the small caps.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, re...



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OpTrader

Swing trading portfolio - week of September 29th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

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Ebola is spreading too quickly for Ebola-vaccine makers to conduct typical studies of safety and efficacy on experimental vaccines. Instead, vaccines will be tested for basic safety, but then deployed with protocols devised now in order to test for efficacy essentially on the field. Testing has to be expedited because the situation in West Africa gets worse every day while there are no approved vaccines or other treatments.

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Stock World Weekly

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Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

The latest issue of Stock World Weekly is now available. Please sign in with your PSW user name and password. Or simply take a free trial to try out our weekly newsletter. 

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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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