Posts Tagged ‘Credit Line’

Tim Backshall On Europe: “Default Now Or Default Later” As EuroStat Complains That Greece Is Still Withholding Critical Data

Tim Backshall On Europe: "Default Now Or Default Later" As EuroStat Complains That Greece Is Still Withholding Critical Data

Courtesy of Tyler Durden

There is one major problem with putting houses of card back together – they tend to fall…over and over. And while abundant liquidity in May and June served as an artificial prop to return European core and PIIGS spreads to previous levels merely as mean reversion algos took holds, the second time around won’t be as lucky. CDR’s Tim Backshall was on the Strategy Session today, discussing the key trends in sovereign products over the past few months, noting the declining liquidity in both sovereign cash and derivative exposure (we will refresh on the DTCC sovereign data later after its weekly Tuesday update). Yet the most interesting observation by Backshall is the declining halflife of risk-on episodes, which much like the SNB’s (now declining) interventions, are having less of an impact on the market, as ever worsening fundamentals can only be swept under the carpet for so long before they really start stinking up the place, and indeed, as Tim points out at 5:30 into the interview, even the IMF now realizes that soon the eventual second domino will fall, and it is better the be prepared (via the previously discussed infinitely expanded credit line), than to have to scramble in the last minute as was necessary in May. In other words, the storm clouds are gathering and only fools will invest in risk asset without getting some additional clarity on what is happening in Europe. The bottom line as Backshall asks is: "do they default now or default later." And that pretty much sums it up. Buy stocks at your own peril.

Incidentally all this is happening as we read in an exclusive Bloomberg piece that "four months after the 110 billion- euro ($140 billion) bailout for Greece, the nation still hasn’t disclosed the full details of secret financial transactions it used to conceal debt" and that EuroStat still has not received the required disclosure about just how fake (or real) the Greek debt situation truly is. When one steps back and ponders just how bad (and unknown) the situation in Europe is, and that stocks are unchanged for the year, one must conclude, as Dylan Grice does every week, that the lunatics have truly taken over the asylum.


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IMF Eliminates Borrowing Cap On Rescue Facility In Anticipation Of Europe Crisis 2.0; US Prepares To Print Fresh Trillions In “Rescue” Linen

IMF Eliminates Borrowing Cap On Rescue Facility In Anticipation Of Europe Crisis 2.0; US Prepares To Print Fresh Trillions In "Rescue" Linen

Courtesy of Tyler Durden

Back in April, when we discussed the inception of the IMF’s then brand new New Arrangement to Borrow (NAB) $500 billion credit facility, we asked rhetorically, "If the IMF believes that over half a trillion in short-term funding is needed imminently, is all hell about to break loose." A month later the question was answered, as Greece lay smoldering in the ashes of insolvency, and the developed world was on the hook for almost a trillion bucks to make sure the tattered eurozone remained in one piece (leading to such grotesque abortions as Ireland, whose cost of debt is approaching 6%, funding Greek debt at 5%).

Well, if that was the proverbial canary in the coalmine, today the entire flock just keeled over and died: today the IMF announced it "expanded and enhanced its lending tools to help contain the occurrence of financial crises." As a result, the IMF has as of today extended the duration of its existing Flexible Credit Line (FCL) to two years, concurrently removing the borrowing cap on this facility, which previously stood at 1000 percent of a member’s IMF quota, in essence making the FCL a limitless credit facility, to be used to rescue whomever, at the sole discretion of the IMF’s overlords. Additionally, as the FCL has some make believe acceptance criteria (and with countries such as Poland, Columbia, and Mexico having had access to it, these must certainly be sky high), the IMF is introducing a brand new credit facility, the Precautionary Credit Line (PCL), which will be geared for members with "sound policies [which just happen to need an unlimited source of rescue funding] who nevertheless may not meet the FCL’s high qualification requirements." In other words everyone. In yet other words, the IMF as of today, has a limitless facility to bail out anyone in the world, without a maximum bound in how much is lendable. One wonders who would be stupid enough to take advantage of the gullibility of IMF’s biggest backers (the US), to borrow an infinite amount of money for any reason whatsoever… And just what all this means for the imminent explosion of the amount of money in circulation…Not to mention the brand new Ben Bernanke smokescreen of…
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Senate Expands FDIC Credit Line To $100 Billion

Courtesy of Tyler Durden

Senate Expands FDIC Credit Line To $100 Billion

As had been widely expected, today (a day before the stress test results finally stop leaking, compliments of the securities and exchange commission) the senate passed a measure approving the expansion of the credit line from the Treasury to the FDIC to $100 billion, from $30 billion previously. The vote passed 91 to 5. In addition, the FDIC will now have half a trillion credit limit that will expire by the end of 2010. As the senate has firmly decided that dollars are now not worth even their weight in zero-ply toilet paper, it makes sense to see just how quickly the FDIC has managed to eat through the Deposit Insurance Fund, of which it had roughly $19 billion at the end of 2008, and now has a couple of pennies above zero, which any way one looks at it is less than the statutory DIF reserve minimum of 1.15% of insured deposits (indicatively, the minimum balance in the DIF (at least according to existing laws: once can imagine these will be promptly "adjusted") should be $54 billion, or 1.15% of the $4.7 trillion in insured deposits. Once it falls below that amount the FDIC must come up with a restoration plan to raise the DIF to that level. Good luck with that) .

And all this was accomplished in a mere four months.

Oh, and by the way, advisor for the FDIC, in case you missed it before, is Perella Weinberg
(here is the link for the ongoing Zero Hedge FDIC-Perella Weinberg compensation FOIA initiative).

[click on table for larger image] hat tip Guillermo


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Zero Hedge

Viral Surveillance Video Reveals A Shocking Scene From China's Housing Bubble

Courtesy of ZeroHedge. View original post here.

Chinese home prices in August rose the most in more than six years, indicating local government efforts to avert a housing bubble have failed. Average new-home prices in the 70 cities rose 1.2% in August from July, the biggest increase since January 2010, while the value of home sales jumped 33% last month from a year earlier. At the same time, prices in Tier 1 cities, soared 3.5%, the ...



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ValueWalk

Choosing Your Candidate: There's an App for That

By Knowledge Wharton. Originally published at ValueWalk.

Voter App

While most of people have already decided whom to vote for in the presidential election, there are still quite a few undecideds. A new app, called ‘Voter,’ promises to help bring more clarity about candidates based on their stances on issues and one’s own beliefs. The app developers say it also automates what could otherwise be a laborious process of determining candidates’ credentials and positions, and reduces human bias in the selection process.

Hunter Scarborough, the creator of the Voter app, says plans call for extending the app beyond the November presidential elections to candidates in races for Senate, House of Representatives and governors’ seats. Next, he plans to take it further to local elections such as for city councils, and may also go international. He discusses th...



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Phil's Favorites

WTO Slashes Global Trade Forecast by 39% Since April: "Wake-Up Call" Says WTO Director

Courtesy of Mish.

Yesterday I commented Draghi Increases Risk of Global Trade Collapse With Brexit Tough Talk.

Today, the World Trade Organization (WTO), slashed its global trade forecast by 39%.

WTI director Roberto Azevedo issued a Trade Wake-Up Call noting trade estimates are below global growth estimates for the first time in 15 years.

The World Trade Organization cut its forecast for global trade growth this year by more than a...



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Kimble Charting Solutions

Silver facing "bunch" of resistance, sentiment lofty

Courtesy of Chris Kimble.

Below looks at a chart on Silver, dating back to the early 1970’s. Silver created an important top at $50 in 1980, did it create another important top at the same price in 2011?

CLICK ON CHART TO ENLARGE

Silver hit $50 in 2011, which was the highs back in 1980 and since then, has created a series of lower highs and lower lows.

Silver is now testing a bunch of resistance lines and its Fibonacci 61% retracement level at (1), wi...



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Market News

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Financial Markets and Economy

China Stemming Defaults Leaves Junk Bonds Hottest in 5 Years (Bloomberg)

China has stanched a string of defaults and speculation authorities will continue to stave off failures is leaving investors the most bullish on local junk bonds in five years, despite record maturities.

BlackRock Issues Warning on Treasuries as Fed Moves Toward Hike (Bloomberg)

BlackRock Inc., the world’s biggest money manager, said investors should ...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker.

Please review a collection of WWW browsing results.



Date Found: Saturday, 26 March 2016, 02:36:15 PM

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Comment: ZH: Its a BULLARD market, the FED jaw boning is keeping the market up!



Date Found: Sunday, 27 March 2016, 02:31:30 PM

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Comment: RTT: World trade near 2008/09 lows. SP500 near all time highs. PLACE YOUR BETS! Roll up! Roll up!



Date Found: Tuesday, 29 March 2016, 02:42:11 PM

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OpTrader

Swing trading portfolio - week of September 26th, 2016

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.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Members' Corner

Market Liquidity and Macroeconomic Bullshit

 

Market Liquidity and Macroeconomic Bullshit

Courtesy of The Nattering Naybob

STJL - "Apparently macroeconomics is all bullshit – ROFL! Paging Naybob now… Famous Economist Paul Romer Says Macroeconomics Is All Bullshit."

The Nattering One muses... Macroeconomics as practiced by academics and those in charge is pure voodoo. Better to chant over goat blood, bird feathers and scattered entrails...

As for reality, overnight CNH HIBOR (...



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Mapping The Market

Here's a Cautionary Tale of Pension Privatization From Chile

Via Jean-Luc:

"When you let the free market take over, the little people get screwed and bankers get rich. Chile tried privatizing retirement plans and surprise, surprise, fund manager ate the profits… Pretty sure the results would be the same here..."  ~ Jean-Luc

Here's a Cautionary Tale of Pension Privatization From Chile

By KEVIN DRUM, Mother Jones

Among free-market fans, Chile's privatized pension plan has long been held up as a model for us to follow. The problem, as the Financial Times notes today, is ...



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Digital Currencies

Gold, Silver and Blockchain - Fintech Solutions To Negative Rates, Bail-ins, Currency Debasement and Cashless

Courtesy of ZeroHedge. View original post here.

By Jan Skoyles

I was so pleased yesterday by the announcement that I have joined the Research team at GoldCore as it meant that I could finally start talking about it and was back in a role that lets me indulge in my passion by researching and geeking out on all things gold, silver and money.

...



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Biotech

Epizyme - A Waiting Game

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

Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer.  One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."

Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.  

Genetic components are the DNA sequences that are 'inherited.'  Some of these genes are stronger than others in their expression (e.g., eye color).  Yet, some genes turn on or off due to external factors (environmental), and it is und...



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All About Trends

Mid-Day Update

Reminder: Harlan 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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PSW is more than just stock talk!

 

We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

PhilStockWorld.com features the most important and most interesting news items from around the web, all day, every day!

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