Archive for 2015

Why the World Needs the US Economy to Struggle

Thoughts from the Frontline: Why the World Needs the US Economy to Struggle

By John Mauldin

The headlines this morning talk about the US dollar hitting an 11-year high. I have been saying for years that the dollar is going to go higher than anyone can imagine. This trade is just in the early innings. And the repercussions will be dramatic, not only for emerging markets that have financed projects in dollars, but also for commodities and energy, gold, and a variety of other investments. The world is at the doorstep of a new era of volatility and currency wars.

In this week’s letter, my associate Worth Wray explores what a rising dollar means for emerging markets and what central banks are likely to do in response. Can they smooth the ride, or will it be the world’s scariest roller coaster? This letter will print long because of the number of fabulous charts Worth provides. I might make a brief comment or two at the end. Here’s Worth.

On the Verge of a Disaster… or a Miracle

By Worth Wray

Twenty years after the first divergence-induced currency crisis of the 1990s, commodity prices are tumbling, the US dollar is rallying, and externally fragile emerging markets are reliving the horrors of their not-so-distant past. Except, this time, major economies like the United States, the United Kingdom, the Eurozone, Japan, and the People’s Republic of China may not be able to side-step the ensuing contagion.

With 2014 now behind us, I want to focus this week's letter on what may prove to be the most important global macro pressure points in the coming year(s):

  • The growing divergence among the world’s most important central banks
  • The ongoing collapse in oil and other commodity prices as a function of excess supply and/or weakening global demand
  • The rise of the US dollar, driven by divergence and risk aversion… and the squeeze it’s putting on the multi-trillion-dollar carry trade into emerging markets
  • The vicious slide in emerging-market currencies
  • The rising risk of 1990s-style contagion and financial shocks
  • And what, if anything, can avert the next global financial crisis

But first, let…
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Monday's After-Hours Market Movers

Courtesy of Benzinga.

Related CEMP
Benzinga's Volume Movers
Mid-Morning Market Update: Markets Open Lower; General Motors U.S. Sales Surge 19%

Minerva Neurosciences Inc (NASDAQ: NERV) +77% – Shares are higher following positive study results.

RCS Capital Corp (NYSE: RCAP) +0.62% – Point72 announced an increased stake in RCS Capital to 6.6 percent.

New York Mortgage Trust Inc (NASDAQ: NYMT) +0.25% – The company entered a master purchase agreement with Deutsche Bank AG.

Cyberonics, Inc. (NASDAQ: CYBX) -8.3% – The company provided an update on Departmental Appeals Board decision regarding coverage of its VNS Therapy System.

Cerus Corporation (NASDAQ: CERS) -7.9% – Shares are lower following the announcement of a public offering of common stock.

Five Prime Therapeutics Inc (NASDAQ: FPRX) -4.3% – The company announced a $75 million offering of common stock.

Cempra Inc (NASDAQ: CEMP) -0.53% – The company announced a $100 million common stock offering.

Posted-In: News After-Hours Center Movers





US Stock Futures Slip Ahead Of Auto Sales Data

Courtesy of Benzinga.

US Stock Futures Slip Ahead Of Auto Sales Data
Related SBUX
Sozzi: Starbucks Faces Challenges In 2015 Despite Recent Positive Developments
Fast Money Picks For December 23: Gilead Sciences, Starbucks, CVS Health
10 Things Your Kids Will Live Without (Fox Business)
Related STXS
Morning Market Movers
US Stock Futures Down Ahead Of Wholesale Trade Data

Pre-open movers

US stock futures traded lower in early pre-market trade. Data on motor vehicle sales will be released today. Futures for the Dow Jones Industrial Average dropped 37 points to 17,686.00, while the Standard & Poor’s 500 index futures fell 4.70 points to 2,041.60. Futures for the Nasdaq 100 index declined 8.25 points to 4,206.00.

A Peek Into Global Markets

European markets were lower today, with the Spanish Ibex Index dropping 0.87%, STOXX Europe 600 Index falling 0.21% and German DAX 30 index dropping 0.36%. French CAC 40 Index declined 0.72% and London’s FTSE 100 Index fell 0.64%. Spain’s jobless claims fell by 64,405 to 4.45 million in December, versus November.

In Asian markets, Japan’s Nikkei Stock Average dropped 0.24%, Hong Kong’s Hang Seng Index declined 0.57%, China’s Shanghai Composite Index jumped 3.58% and India’s Sensex slipped 0.16%.

Broker Recommendation
Analysts at Janney Capital downgraded Starbucks Corporation (NASDAQ: SBUX) from Buy to Neutral. The price target for Starbucks has been lowered from $90 to $85.

Starbucks’ shares fell 1.01% to $80.60 in pre-market trading.

Breaking news

  • Stereotaxis, Inc. (NASDAQ: STXS) announced today that it has received 510(k) clearance by the Food and Drug Administration (FDA) for its Vdrive® with V-CAS™ Catheter Advancement System in the U.S., representing the Company’s third Vdrive system product to be cleared for market entry. To read the full news, click here.
  • Amazon.com Inc. (NASDAQ: AMZN) today announced that sellers on Amazon sold a record-setting more than 2 billion items worldwide in 2014. To read the full news, click here.


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Jefferies Downgrades PPL To Hold

Courtesy of Benzinga.

Related PPL
UPDATE: PPL Posts Rise In Q3 Profit, Lifts Forecast
Earnings Scheduled For November 4, 2014

Analysts at Jefferies downgraded PPL Corporation (NYSE: PPL) from Buy to Hold.

The price target for PPL has been lowered from $39 to $37.

PPL shares have jumped 22.22% over the past 52 weeks, while the S&P 500 index has gained 12.67% in the same period.

PPL’s shares rose 0.08% to close at $36.36 on Friday.

Latest Ratings for PPL

Date Firm Action From To
Jan 2015 Jefferies Downgrades Buy Hold
Sep 2014 Hilliard Lyons Initiates Coverage on Buy
Aug 2014 UBS Maintains Neutral

View More Analyst Ratings for PPL
View the Latest Analyst Ratings

Posted-In: JefferiesDowngrades Analyst Ratings





Benzinga's Top #PreMarket Losers

Courtesy of Benzinga.

Related PTNR
Mid-Afternoon Market Update: Crude Oil Slides 3%; Gilead Sciences Shares Spike Higher
Mid-Day Market Update: Ambarella Slips On Analyst Downgrade; Juno Therapeutics Shares Surge

Related MOLG
Shareholder Vincent Tan Says Still Confident in MOL Global's Prospects
MOL Global Extends Gains On Shareholder's Statement

Partner Communications Company Ltd. (NASDAQ: PTNR) shares fell 12.68% to $4.34 in pre-market trading. Partner Communications reported the interest rate for the Series D Notes for the period commencing on December 31, 2014 and ending on March 30, 2015.

MOL Global, Inc. (NASDAQ: MOLG) shares dropped 11.38% to $2.68 in pre-market trading after falling 0.98% on Friday

Transocean Ltd. (NYSE: RIG) fell 2.48% to $17.67 in pre-market trading. Crude oil futures fell 3.11% to trade at $51.05 a barrel.

Ariad Pharmaceuticals Inc. (NASDAQ: ARIA) shares declined 2.47% to $6.72 in pre-market trading after rising 0.29% on Friday.

Starbucks Corporation (NASDAQ: SBUX) shares dropped 1.40% to $80.28 in pre-market trading. Analysts at Janney Capital downgraded Starbucks from Buy to Neutral and lowered the price target from $90 to $85.

Posted-In: PreMarket LosersNews Movers & Shakers Pre-Market Outlook Markets





UPDATE: Wunderlich Securities Reiterates On Harvest Natural Resources As Stock Still Has Value

Courtesy of Benzinga.

Related HNR
Stocks Hitting 52-Week Lows
Morning Market Losers

In a report published Monday, Wunderlich Securities analyst Jason A. Wangler reiterated a Buy rating on Harvest Natural Resources, Inc. (NYSE: HNR), but lowered the price target from $6.00 to $2.00.

In the report, Wunderlich Securities noted, “Harvest Natural Resources’ (HNR) recent announcement that the sale of its Venezuelan assets was terminated sent the stock down hard. Surprisingly, or maybe not given the deal fatigue, the company provided color as to why Venezuela did not approve the deal. These reasons range from a request to ample financing on the projects (which we think were doable) to what amounts essentially to bribes (which we think were not doable); now Harvest still has a 20.4% interest in Petrodelta while the buyer (Pluspetrol) still holds a 11.6% due to the first tranche sale executed about a year ago. The inability to sell the Venezuelan interests, which are out of Harvest’s control, causes us to write the valuable assets off at this time but we still see value in the stock at these depressed levels.”

Harvest Natural Resources closed on Friday at $1.81.

Latest Ratings for HNR

Date Firm Action From To
Jun 2014 Vertical Research Downgrades Sell
Nov 2013 Wunderlich Maintains Buy
Aug 2013 Wunderlich Upgrades Hold Buy

View More Analyst Ratings for HNR
View the Latest Analyst Ratings

Posted-In: Jason A. Wangler Wunderlich SecuritiesAnalyst Color Price Target Analyst Ratings





UPDATE: JMP Securities Reiterates On Esperion Therapeutics On Minimal Risks

Courtesy of Benzinga.

Related ESPR
Benzinga's Volume Movers
Morning Market Losers

In a report published Monday, JMP Securities analyst Jason N. Butler reiterated a Market Outperform rating on Esperion Therapeutics Inc (NASDAQ: ESPR), and raised the price target from $53.00 to $75.00.

In the report, JMP Securities noted, “The completion of two-year carcinogenicity studies represents a key de-risking milestone for ETC-1002; reiterate our Market Outperform rating and increase our price target from $53 to $75 on Esperion Therapeutics. In our view, there is minimal risk of negative results from the two-year carcinogenicity studies for ETC-1002. Specifically, we believe management received final reports for these studies in 4Q14 and we gain confidence from the lack of disclosure of any unexpected negative findings. We see surpassing this milestone as a key de-risking event for the development of ETC-1002 and look to additional value-driving clinical and regulatory catalysts for the drug candidate in 1H15. We believe these catalysts have the potential to further reinforce the strategic attractiveness of the asset (either in a large pharma partnership or acquisition of the company). Our $75 price target is derived from a risk-adjusted, NPV analysis of ETC-1002.”

Esperion Therapeutics closed on Friday at $41.23.

Latest Ratings for ESPR

Date Firm Action From To
Dec 2014 Credit Suisse Maintains Outperform
Oct 2014 Citigroup Maintains Buy
Oct 2014 Credit Suisse Maintains Outperform

View More Analyst Ratings for ESPR
View the Latest Analyst Ratings

Posted-In: Jason N. Butler JMP SecuritiesAnalyst Color Price Target Analyst Ratings





Swing trading portfolio – week of January 5th, 2015

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

Optrader 

Swing trading virtual portfolio

Reminder: OpTrader is available to chat with Members, comments are found below each post.</p></body></html>

 





Wow, They Really Are Tapering

Courtesy of John Rubino.

In the sound-money community there is universal skepticism about the Fed’s plan to stop monetizing the world’s debt. Hardly anyone thinks they’ll go through with it and absolutely no one thinks they’ll succeed if they do.

But the Fed is acting like it’s serious. Take a look at the monetary base, which is the amount of new currency that’s been created and pumped into the banking system. The trajectory since the 2008 crash tells you all you need to know about the “recovery,” which turned out to be just the Fed printing money and a few mostly rich people spending some of it. But check out the far right edge where the line turns negative. Not wildly negative, but still, the Fed does appear to have stopped adding and started subtracting. The money supply is falling.

Monetary base 2015

This kind of tightening would normally coincide with — or cause — rising interest rates. But that’s not yet part of the plan, so even in the face of manifestly tighter money, interest rates have been allowed (or forced) to decline.

But the pressure of tighter money has to be released somewhere, and in this case it’s been the foreign exchange market. The euro, for instance, has tanked since mid-year.

Euro Jan 2015

Every other major currency is down as well, which is the same thing as saying that the dollar is up big. And a rising currency is functionally the same thing as higher interest rates. Consider: If you borrow money you have to pay back the principal plus interest. A higher interest rate obviously makes the loan harder to repay. But so does a rising currency because in order to pay dollars to a creditor you have to get those dollars, and if they’ve become more valuable in the meantime you have to pay up.

So the US is experiencing two of the three symptoms of tighter money: a falling money supply and rising currency. Will we eventually get the third, rising interest rates? That would be interesting to say the least. To understand why, let’s revisit the monetary base chart, with the addition of arrows showing what the stock market did during the previous two attempts at tapering. It tanked — or at least started to tank — and the government relented.

Monetary base plus stocks

Note that during those other two taper attempts…
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US and Canadian Expatriates Comment on US Healthcare

Courtesy of Mish.

I have a couple more emails from readers in response to Single-Payer “Medicare for All” Proposal; Live and Let Die; Why Does Single-Payer “Work” in Europe?

Comments From a US Expatriate

Reader David a US citizen living in Europe writes …

Hi Mish,

I am a native born US citizen who has worked mainly outside of the USA since 2003. In 2012 I liquidated everything in the USA and moved to Europe for the foreseeable future.

In Europe the rules are different for every nation depending on whether you are working for a company, self employed, or a “person of means”. France and Luxembourg have single-payer universal coverage. In Hungary and Spain, you don’t need health insurance if you can prove you can pay your medical expenses (person of means). Switzerland mandates that all people must have some form of health insurance (private). Ireland has a couple of levels:  public, private, etc. Germany allows you to take the state system or take a private system. 

In most “Single Payer” systems that I have seen, the patient pays the bill and the bill is reimbursed at 80% (or whatever) via a SEPA transfer to their account. For those “of means” with no insurance, the person simply pays the bill.

Using Luxembourg as an example, if you go to a doctor and the bill is 50 euros for the visit, You pay the doctor the 50 euros and he hands you a receipt that you submit for reimbursement. The government wires you 80% of the bill within 2 weeks.

Note that the patient sees the bill, and pays the bill at the time of treatment and is typically reimbursed later.

David

Views From a Canadian Expatriate

Reader Peter, a  now living in the US writes …

Hello Mish

I have a few observations about single-payer healthcare. First, here are a few tidbits about me so you know where I get my perspective:



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Zero Hedge

Americans' Economic Hope Has Collapsed

Courtesy of ZeroHedge. View original post here.

Which came first, the confidence or the stock market rally?

One thing is for sure, the crash in stocks in December has crushed the hope of Americans that their economic future is going to be better under President Trump.

Overall confidence dipped to 58.1 - a 4-month low, but, U.S. consumers this month were the most downbeat on the economy since November 2016, a third straight drop after expectations reached a 16-year high just three months earlier, as the partial government shutdown wears on toward a fourth week.

...



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Kimble Charting Solutions

Triple Breakout Test In Play For S&P 500!

Courtesy of Chris Kimble.

Is the rally of late about to run out of steam or is a major breakout about to take place in the S&P 500? What happens at current prices should go a long way in determining this question.

This chart looks at the equal weight S&P 500 ETF (RSP) on a daily basis over the past 15-months.

The rally from the lows on Christmas Eve has RSP testing the top of a newly formed falling channel while testing the underneath side of the 2018 trading range and its falling 50-day moving average at (1).

At this time RPS is facing a triple resistance test. Wil...



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Phil's Favorites

Brexit deal flops, Theresa May survives -- so what happens now?

 

Brexit deal flops, Theresa May survives -- so what happens now?

Courtesy of Victoria Honeyman, University of Leeds

As the clock ticks down to March 29 2019, all of the political manoeuvring, negotiating, arguing and fighting is coming to a peak. In the two and a half years since the 2016 EU referendum, views on both sides have hardened and agreement still seems as far away as it was the day after the referendum.

With Theresa May’s withdrawal agreement disliked by all sides, and voted down by an unprecedented majority in the House of Commons, everyone is wondering what can and should be done next?

...



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Digital Currencies

Crypto-Bubble: Will Bitcoin Bottom In February Or Has It Already?

Courtesy of Michelle Jones via ValueWalk.com

The new year has been relatively good for the price of bitcoin after a spectacular collapse of the cryptocurrency bubble in 2018. It’s up notably since the middle of December and traded around the psychological level of $4,000... so is this a sign that the crypto market is about to recover?

Of course, it depends on who you ask, but one analyst discovered a pattern which might point to a bottom next month.

A year after the cryptocurrency bubble popped

CCN...



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ValueWalk

D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...



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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ...

http://www.insidercow.com/ more from Insider

Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

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

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

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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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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About Phil:

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...

Learn more About Phil >>


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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>