Financial Markets and Economy
To Emerging Market Investors, State Backing Means Less and Less (Bloomberg)
Government support doesn’t count for as much these days in the developing world.
‘Flash Boys’ Hero Is Picking a Fight With Hedge Fund Citadel (Bloomberg)
Brad Katsuyama and his Investors’ Exchange were lionized in the best-selling book “Flash Boys” as protecting mom-and-pop investors from predatory high-frequency traders.
Now nearly two years later, his firm, IEX Group Inc., is counting on that renown to help smooth its path to become a public stock exchange. The designation would bring a stamp of approval from the U.S. Securities and Exchange Commission for Katsuyama’s idea of briefly pausing orders to take away the edge possessed by traders with superfast computers.
This Time, Cheaper Oil Does Little for the U.S. Economy (NY Times)
It has been a truism of the American economy for decades: When oil prices rise, the economy suffers; when they fall, growth improves.
But the decline of oil prices over the last two years has failed to deliver the usual economic benefits.
Verizon Jumps After Topping Wireless Subscriber Estimates: Chart (Bloomberg)
Verizon Communications Inc. rose as much as 4.3 percent, the most since August 2013, after posting fourth-quarter profit that beat analysts’ estimates and adding 1.5 million new wireless customers.
The world’s most important chart (Quartz)
For our money, and pretty much everyone else’s, this is the chart that best explains the parlous state of global financial markets.
Yahoo to decide next strategic steps after quarterly earnings: sources (Business Insider)
Yahoo Inc <YHOO.O> will decide on its next strategic steps only after releasing quarterly earnings on Feb. 2, people familiar with the matter said, as the company continues to resist investor calls to explore a sale of its core Internet assets.
Yahoo wants to gauge shareholder reaction after presenting its strategic vision during the earnings conference call, one of the people said.
George Soros says too early to buy stocks after shorting S&P 500 (Market Watch)
Billionaire investor George Soros on Thursday said he shorted the S&P 500 stock index and that it isn’t yet the time to buy.
In an interview with Bloomberg Television in Davos, Switzerland, the 85-year-old hedge-fund titan said he had also taken a long position in U.S. Treasurys. The S&P 500 SPX, +0.52% is down 8.6% in the new year, while Treasurys have rallied.
Tech’s ‘Frightful 5’ Will Dominate Digital Life for Foreseeable Future (NY Times)
There are currently four undisputed rulers of the consumer technology industry: Amazon, Apple, Facebook and Google, now a unit of a parent company called Alphabet. And there’s one more, Microsoft, whose influence once looked on the wane, but which is now rebounding.
The part of the stock market that sells a lot of stuff to Americans is doing great (Business Insider)
Here's an illustration of how the US stock market does not reflect the US economy.
Fed Meeting, U.S. GDP, Home Data, Tennis: Week Ahead Jan. 23-30 (Bloomberg)
The U.S. central bank’s Federal Open Market Committee meets to set monetary policy, and economists expect the key rate to remain on hold.
Liquidity stress is building in U.S. high-yield market (Market Watch)
Yet another sign has emerged to suggest that stress is rising in the U.S. high-yield market.
Moody’s said Thursday its Liquidity Stress Index continued to rise in January after breaking above its long-term average in December, suggesting a rising default rate in 2016.
Wall Street is rolling its eyes at this comment from the Vice President of China, but it actually makes sense (Business Insider)
Bloomberg caught up with the Vice-President of China at the World Economic Forum in Davos on Thursday, and he said something that has traders all over Wall Street rolling their eyes into the back of their heads.
"The fluctuations in the currency market are a result of market forces, and the Chinese government has no intention and no policy to devalue its currency," said Li Yuanchao, China's vice president.
Ritholtz's Reads: Markets Divorced From Reality (Bloomberg View)
Banking Busts
American Express profit falls (Business Insider)
Credit card issuer American Express Co <AXP.N> reported a 39.2 percent fall in quarterly profit as the company's non-interest revenue fell 10.6 percent.
Net income attributable to common shareholders fell to $873 million, or 89 cents per share, for the fourth quarter ended Dec. 31, from $1.44 billion, or $1.39 per share, a year earlier.
Oil services giant Schlumberger is buying $10 billion of itself (Business Insider)
Oilfield services giant Schlumberger is spending $10 billion to buy its own shares.
The company reported fourth-quarter earnings after the closing bell on Thursday, and it was a beat on earnings with revenues virtually in line with expectations.
With the earnings results, it announced its board's approval of the buybacks, in addition to the near-complete $10 billion program it started in Q3 2013.
Another Year of Insubstantial Gold Trading in the New York Market (Jesse's Cafe Americain)
Looking back, it is evident from the charts below that 2015 was another year of decline for physical gold deliveries in New York. This is thought to be a benign phenomenon by some.
Fund flows are sending a bearish signal to international equities (Market Watch)
A surprising move in non-U.S. fund flows in the first two weeks of the year is a bearish signal for international equities, according to fund tracker TrimTabs Investment Research.
Global equity mutual funds, which exclude U.S. equity funds, posted an inflow of $1.2 billion in January through Tuesday, according to TrimTabs. At the same time, global equity exchange-traded funds saw redemptions of $3.3 billion. That combines to create a net outflow of just $2.1 billion, a surprisingly small number given the heavy selling and losses posted across the world’s stock markets.
$30 oil is 'irrational' and a rebound is 'inevitable,' according to Saudi Arabia (Business Insider)
According to a report in The Financial Times, Khalid al-Falih, chairman of the state-owned oil company Saudi Aramco, said at the World Economic Forum in Davos that he expects a recovery in prices this year.
"The market has overshot on the low side and it is inevitable that it will start turning up," Falih said.
Saudi Arabia, however, is not prepared to cut production to bring prices back to something that it, apparently, thinks would make more sense.
Coca-Cola to invest $1 billion in Argentina over next four years (Business Insider)
Coca-Cola Co <KO.N> will invest $1 billion over four years in its bottling and distribution operations in Argentina, the company said on Thursday, and leave the door open to further acquisitions in the South American country.
Coca-Cola CEO Muhtar Kent told Argentine President Mauricio Macri of the spending plan when the two met at the World Economic Forum in Davos, where Macri has been courting chief executives with a message that Argentina is open for business.
Apple earnings optimism may be ‘detached from reality’ (Market Watch)
While Apple Inc.’s fiscal first quarter is historically the company’s strongest period because of the holidays, analysts have been taming their expectations for the quarter due to fears of a weaker-than-expected performance for the iPhone 6s.
European stocks surge on ECB boost (Business Insider)
European markets bounced back from Wednesday's rout to close uniformly higher on Thursday evening following reassuring comments from ECB president Mario Draghi.
Stocks and oil are rallying (Business Insider)
Stocks are rallying in morning trading after a painful sell-off on Wednesday.
Politics
The Hate-Cruz, Tolerate-Trump Republicans (Bloomberg View)
The biggest fuss in Republican presidential politics now seems to be why, or perhaps whether, some party actors have concluded that even though Donald Trump would be a bad nominee, he’s still better than Ted Cruz.
Bernie's American Dream, or Dream On? (The Atlantic)
One thing I still have trouble understanding is how Bernie believes he can be an effective commander in chief. President Obama, whom I think of as a moderate/pragmatic Democrat, came into office riding a wave of popular support and a mandate for change following eight years of Bush and a financial crisis. He also had overwhelming majorities in both the House and Senate.
Yet, he still struggled to get his agenda through Congress.
Technology
Tiny sensor monitors brain, then melts away (Futurity)
A new wireless brain sensor can monitor intracranial pressure and temperature and then be absorbed by the body making surgery to remove it unnecessary.
Such implants could potentially be used to monitor patients with traumatic brain injuries. Further, scientists believe they can build similar absorbable sensors to monitor activity in organ systems in other parts of the body.
Health and Life Sciences
Choose Better Fats To Reduce Heart Risk, Study Says (Forbes)
In the latest development in the ongoing fat debacle, amassive new study in the Journal of the American Heart Association, finds that replacing saturated fats with unsaturated fats would do our heart health a world of good. In fact, eating more healthy fats, like omega-6 fatty acids, and fewer saturated fats and refined carbs could save up to a million deaths from heart disease per year, the authors calculate. In our scramble to de-vilify fats after they were cast away, en masse, back in the 80s, this new study makes a convincing case–not for putting fat back in the diet indiscriminately, but putting the good ones back, taking out the bad, and continuing to cut down on refined carbs and sugars.
Take Care in the Bitter Cold (Medicine Net Daily)
As frigid temperatures send much of the northern half of the United States into a deep freeze, doctors say people need to take steps to avoid dangerous drops in body temperature, or hypothermia.
"It is important to take measures to stay warm, paying special attention to the head and scalp [as well as the nose, neck and ears], which are often exposed to the cold air and at risk for heat loss in cold temperatures," Dr. Robert Glatter, an emergency physician at Lenox Hill Hospital in New York City, said in a hospital news release.
Life on the Home Planet
U.S. East Coast braces for up to 30 inches of snow (Reuters)
Washington D.C., New York and other East Coast cities readied fleets of snow plows, thousands of flights were canceled or delayed and residents stocked up on groceries on Thursday ahead of a winter storm expected to dump up to 30 inches (76 cm) of snow on the region.
