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Thrill-Ride Thursday – Markets Collapse as Sweden goes Negative

Really, Sweden?  

Well, it's just an excuse to sell off on a 30-year auction day (happens almost every one) because it panics people into TBills at ridiculously low rates and makes it look like the Fed is doing its job and people really do want to lend the Government money for 30 years at 2.5% rather than do something productive with the money.   Why?  Because if people don't want to by 30-year Treasury Notes at 2.5% then one would have to question our Government's $19,000,000,000,000 debt load which, at 2.5%, costs $475Bn in interest payments alone to sustain and if we were to assume rates climb to 5%, then another $475Bn per year would have to be figured into the budget (without asking the Top 1% or Corporations to contribute, of course!).  

On the other hand, with Sweden now CHARGING 0.5% to put money in the Riksbank, 2.5% on US debt looks like a pretty good deal, doesn't it?  I already sent out an Alert this morning (tweeted too, with the hashtag #CurrencyWars) on what happened and how we're playing the Futures, so I won't rehash all that boring stuff here.

Oil, meanwhile, is down another 4% this morning ($26.25) and that's on me as I told Canada that oil was not going to make a comeback on Money Talk last night – and it was not a happy conversation.  We would like to play the $25 line for a bounce on /CL but we're EXTREMELY concerned about the MASSIVE overhang of FAKE!!! contracts (see Monday's post and here is a good place to say "I told you so!") with 324,000 open orders still remaining in the March contracts (but they did cancel 191,000 fake orders in 3 days, so catching up).  

In fact, since I get a lot of mail from people who can't believe the NYMEX is a complete and utter scam used only to defraud the American people by creating a false demand for oil and driving up prices, let's compare the "open order "demand"" (had to double quote demand as it's such BS) from Monday morning to yesterday's close.  Here's Monday's NYMEX contract strip:

Here's yesterday's closing strip:

Where did the fake orders for 191,000,000 barrels (1,000 per contract) go?  We know they can't possibly be delivered since Cushing, OK can only handle 40M barrels a month (less than 10% of the fake order capacity) so what happened?  Well, if you noted the next 4 months from Monday – they totaled 665,000 contracts and now, amazingly, they total 875,000 contract – that's a gain of 210,000 contracts!  

In other words, there is no actual change to the fake, Fake, FAKE!!! orders at the NYMEX, they just roll them along to the next months so they can pretend there is demand there as well.  Since all those trading and rolling losses are worked into the price of oil – only the consumer suffers the losses while the traders and the Banksters that work with them make Billions in fees for their barrel-rolling trick.

And I will tell you now that, as usual, 90% of the remaining 324M barrels worth of contracts to buy oil at $27 will be CANCELLED and not delivered to the US in March – in hopes of screwing you with higher prices later.  

And this is the problem Canada, and the rest of the World have now.  There has been a scam, pretty much since the deadly Commodity Futures Modernization Act Revisions, which were literally signed into law the day after Bush won his Presidency in the Supreme Court (hidden inside an 11,000 page appropriations bill that HAD to be signed to avoid a Government shut-down a week before Christmas).  This bill and it's repercussions are now wreaking havoc with the Global Economy for the 2nd time.  

The first time, aside from Enron (Bush's biggest single donor) et al (made possible by the deregulation in the Act, which was sponsored by Enron) ripping off consumers all over the country, the unregulated trading caused oil to jump from $20 per barrel under Clinton to $140 a barrel under Bush, which ultimately broke the consumers' backs and led to our 2008 market collapse.  

Now it's time for round two as the misallocation of capital towards energy projects, based on the assumption that $100 oil was a REAL price based on market demand (it's not, it's completely unaffordable) has caused MASSIVE over-production of oil all around the World and the companies and countries that borrowed money to finance that production growth AND the banks that lent them the money are now in BIG TROUBLE with oil back at it's NORMAL price of $26.50 per barrel.  

As I said on BNN last night, countries like Canada, where 20% of their GDP comes from the energy sector, are going to have a very painful time adjusting to normal oil prices but the sooner they come to grips with that reality, the better.

The worst thing they can do is attempt to prop up a failing industry that is drastically in need of a consolidation wave as they are currently over-producing, according to the IEA, 1.75Mb of oil per day.  That's about 2% of global production that needs to go off-line before we're even close to sopping up the GLUT of oil that has flooded Global storage facilities to near capacity.  

The worst part is (for OPEC and the North American Energy Cartel – you know who you are!) is that the sanctions lifted on Iran are now going to put another 1.5Mb/d of production on-line by the end of this year (already over 500,000/day) which is accelerating the problem.  OPEC has, so far, not made any moves to cut back – part of their problem is they now only control 30% of the World's oil because their previous policy of holding back production to jack up oil prices has backfired as the high prices led 60M daily barrels of competing oil to come to market and their share of the global market has fallen 50% since they held us hostage in the 70s.  

And now we head towards the end game and it's the Chinese curse of living in "interesting times" indeed for oil producers.  As I told Canada last night – don't rush to find "bargains" in the energy sector – a lot of these guys are never coming back!  

 


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  1. Good Morning

    Phil--would u go long /RB at .90—-or wait until the rollover of /cl—-thanks


  2. Good morning!  

    How exciting, right?  

    /RB/Savi – I'd take a poke at 0.925 with a tight stop as it's Thursday (and the long weekend) and I'd hate to miss a recovery and then 0.90 if that fails.  


  3. Thanks Phil


  4. as soon as u said that Phil /RB took off—--  ;-(


  5. Good Morning!


  6. Great post Phil!


  7. Hello PSW!  All that shimmers is gold, yellow gold.  What a few weeks we have had in biotech land (mine) and baseball spring training (my kids)!  I hope I can now tread water using my inflatable raft! And away we go!


  8. That's why you need to move beyond asking to acting!   It will come over time…

    Thanks 1020.  

    See, the majors will come out of all this OK – just a bit less profitable:

     
    • Total (NYSE:TOT) -1.3% premarket even after reporting better than expected Q4 earnings, which fell 26% Y/Y vs. a reported 58% drop at Exxon and 56% at Shell; TOT cites the strength of its refining and chemicals businesses, as well as efforts to control costs.
    • TOT’s earnings were “probably the most resilient set of [Q4] results we’ll see from any major,” says Oswald Clint, an analyst at Bernstein Research.
    • TOT says it is keeping its dividend steady at €0.61, but to save cash it is offering the option of taking the payout in the form of new shares at a 10% discount.
    • TOT says it will cut 2016 capital spending to $19B, lower than previously expected and down from $23B last year, and plans to trim $2.4B in operating costs this year by squeezing contractors and cutting spending at all levels.
    • Q4 production rose 9% Y/Y to 2.3M bbl/day, partially due to the start of nine new projects which had been under construction before oil prices went into free fall.
    • CEO Patrick Pouyanné praises the company's "resilience in a degraded environment," and says he signed agreements to sell $4B in assets during the year as part of a $10B streamlining program.
    • World Fuel Services (NYSE:INTagrees to acquire from certain Exxon Mobil (NYSE:XOM) affiliates their aviation fueling operations at 83 airports in Canada, the U.K., Germany, Italy, Australia and New Zealand; three additional locations in France are expected to be added, pending required reviews.
    • INT also says it will enter a long-term agreement with Imperial Oil (NYSEMKT:IMO) to become a wholesale distributor for general aviation fuel in Canada.
    • The total purchase price, including the French locations, is ~$260M.
    • Earlier: World Fuel beats by $0.14, misses on revenue

    Jobless Claims see a sharp decline

    • Initial Jobless Claims-16K to 269K vs. 281K consensus, 285K prior.
    • Continuing Claims 2.239M vs. 2.255M prior.
    • The global stock market plunge is intensifying this morning, with Europe down nearly 3% and U.S. index futures almost 2%. Hong Kong fell 3.85% after returning from holiday. Shanghai and Tokyo were closed.
    • The 10-year Treasury yield is lower by ten basis points to 1.57%. Maybe even more interesting, the January 2017 contract for Fed Funds futures has risen to exactly the same price as the Feb 2016 contract – meaning traders are putting 100% probability on no Fed rate hikes this year. It'll be even more fun when the Jan 2017 contact moves ahead of Feb 2016 – meaning the pricing in of a chance of a rate cut even as the Fed insists tighter policy is still necessary.
    • Up later is day two of Janet Yellen's Congressional testimony. Will she change for positive tone?
    • TLT +1.65%, TBT -3.3% premarket

    Featured in Bloomberg Businessweek, Feb. 15, 2016. Subscribe now.Oil Is the Cheap Date From Hell

    • The yellow metal's up 3.5% to $1,237 per ounce as Europe plunges nearly 4% and U.S. stock index futures tumble more than 2%. It was nearly one year ago to the day when gold last was this high.
    • While Janet Yellen in her first day of Congressional testimony acknowledged the risks to growth have ticked higher, the Fed boss was perhaps somewhat surprisingly upbeat on the economic outlook and hawkish on the likelihood of more rate hikes. Will she change her tune on day two?
    • GLD +3% premarket

    Skechers higher after tipping strong Q1 sales

    • Skechers (NYSE:SKX) says sales in January were up 35% Y/Y and were strong into the first week of February.
    • The company say it's "comfortable" with the consensus estimate for Q1 revenue of $885M-$890M and EPS of $0.50-$0.55.
    • Looking ahead, Skechers continues to become more of a global play. International sales were at 41% of total Skechers sales in Q4 as the percentage swings closer to the company's long-term target of 50%.
    • SKX +6.05% premarket to $28.81.
    • IMAX (NYSE:IMAX) signs a deal with T-Joy to add two theaters in Japan.
    • The company now has 42 theaters (25 open, 17 contracted) in Tokyo and Yokohama through its partnership with T-Joy.
    • IMAX box office sales in Japan were up 30% last year

    3D Systems on the move after preliminary results

    • The company expects Q4 revenue to come in at $183M vs. $160M expected. The charge related to the shift away from consumer products will be about $27M.
    • After annual goodwill and intangibles testing, the company anticipates booking a noncash charge of $510M-$570M.
    • At year-end, DDD had $156M in the bank and no draws under its $150M revolver.
    • Interim CEO Andy Johnson: "Industry conditions remain challenging and demand may be uneven in the coming periods."
    • Full Q4 results are due on Feb. 29.
    • Source: Press Release
    • Shares +10.9% premarket to $8.95.

  9. SCO, sold 2017 360 call for 20, dipping a toe in


  10. Pharm

     Any thoughts on

     

    MNK  Mallinckrodt Public Limited Company

     Thanks


  11. MNK….being in the specialty Pharm business has its advantages, and now with the pull back, they are getting a little more attactive.  Their P/E is in line at ~15, and at 8B in M. Cap. could be a good take over target for a big boy.  So, how about selling a few Ps OTM and down some, giving room for more dips.  I am not advocating any Pharma right now, and I think it will be a rocky road for the next few years.  This company should do ok bc of the space they are in.


  12. Jomptien – Check that price.  I show it's trading at 57.  I was thinking the same thing this morning.  Sold a couple of the Jan 18 360 calls this morning myself.  Last trade at 86.


  13. A new study ranks Bush near the very bottom in history, due to delusional wars, reckless spending and inflexibility

    US Congressman Steve Cohen introduced the 'Seat Egress in Air Travel Act' this week in a bid to establish minimum seat size standards. He said a…
    DAILYM.AI/1QTFYI0
     

     

    Gosh, why can't those Syrian refugees just stay in their own country?  https://www.facebook.com/TheIndependentOnline/videos/10153387826906636/

    And, of course, Bernie gets the last word:

    Wow, hope, inspiration and inclusion – not in my country Dammit!  blush?


  14. Phil/DIS

    BID is getting killed.  Another downgrade hit them.  Did you recommend an adjustment to DIS July $95 calls in the OOP.  Thank you.


  15. albo, jomptien--those options are up more points than SCO is today..crazy


  16. Gold/Pharm – So funny how it played dead for so long and then, voom!  

    Who knew it was "just pining"?

    Speaking of VOOM – let's hope this little spike at the open has some legs.  Probably not as Europe still down a lot so tight stops on Futures gains!  

    SCO/Jomp – Nice call.   Oil popping back to $27.50.  

    Pharma/Pharm – Years?  Yikes!  

    BID/C – Holy crap!  

    DIS is crap too but we will be pressing that one.  


  17. Phil, do you have any thoughts on AIG? Currently studying for my CFA designation and the guy who teaches my prep course (who seems like a bright guy) was pretty high on them with his basic logic being that they have a very attractive price/book ratio and with them set to continue share buybacks the price/book will only get more attractive. 

    He did caveat that he has to do more due diligence over the next week though. 


  18. For Futures players:  Now we're at Dow 15,700, S&P 1,832, Nas 3,952, Rut 955 and /NKD 15,315 so we simply set stops at 15,700, 1,830, 3,950, 952.50 and 15,300 and get out if ANY two (doesn't have to be yours) goes red.  Then, if they go green again, we pick up the laggard and do it again.  


  19. All of them failing already. Get out of /NKD?


  20. When in doubt, sell half!  


  21. At least ABX is up…

    FU oil!!!!!!!!!


  22. ABX has a long long long way to go Jabo….a very long way. 


  23. I sold the $2 calls in HMY about a week or so too early lol. 


  24. any hope this mkt recovers today? oil?


  25. A looongg way/Pharmboy – How do you figure on ABX, Pharmboy? I bought stock at 9.64 and am happy at the moment.


  26. Phil, Nice little drop in /NGK6 down to 2.135…..are you still in this position? Looking to enter at 2.10 or wait till we get a confirm on weather for the remainder of the winter?


  27. Yellen testimony killing the markets again. It's not here its the Senators attacking her authority to act, calling into question whether or not the Fed CAN do anything to support the markets going forward.  

    HMY/Crs – Look like they are going to go parabolic:

    Even NAK is taking off:

    Oil/Jabob – LOL, back to $26.50 already.  What a joke.

    /NG had a smaller than expected draw and sold off hard – glad we got out.  $2.20 has been a tough nut to crack on /NGK6 but now we're at $2 on /NG and that's $2.13 on /NGK6 and I like that, of course.


  28. Yellen says Fed was surprised by slump in oil prices – that's not good as they still count on oil to "recover" and spur inflation – not likely.

    Also saying surprised that Dollar has been so strong – WTF?  Can they really be that oblivious to what's happening in the rest of the World?


  29. Gold $1,250 shows just how scary Yellen is sounding today.  


  30. Anybody see BA today? Down $9!!!!


  31. Snow, some of us have been in it since ABX since a long long long time ago! :)   Say $25


  32. Phil – KKR might be worth a look here.

    From Briefing :

    ~~KKR on Conference Call  

    •Seeing enhanced pipelines in direct lending and mezzanine on a global basis.
    •Asia is a major area due in part to China fall out.
    •notes it has low exposure to China.
    •Says dry powder is at extremely high levels and ready to be put to use.
    •Says they like market volatility as it creates opportunity; built the business model for this type of business.
    •Strong balance sheet allows co to step in when others are hesitant.
    •Raising significant CLOs and have been over the past year.
    •Have $230 mln left on buyback; thinks stock represents extraordinary value, will be buying once earnings are out; want to control share count dilution; glad they have buyback in place and will be glad to use it and will let markets now when it is ready to reload.
     


  33. BA costing about 85 Dow points, no confirmation from SEC yet!  

    Boeing Said to Face SEC Probe Into Dreamliner and 747 Accounting

    The U.S. Securities and Exchange Commission is investigating whether Boeing Co. properly accounted for the costs and expected sales of two of its best known jetliners, according to people with knowledge of the matter.

    The timing of this is massively suspicious. 


  34. Phil / BA – and BCS that looks good today?


  35. Speaking of fake asset prices I recommended owning ethereum back at $0.60 to $0.90 in December, which is now over $5.


  36. Dow issues:  GS down $5 (42 points), V down $2.50, JPM down $2, TRV down $2.20, NKE down $1.70, UNH down $2…

    KKR/Albo – I do like them when they are cheap but scary environment to be catching a knife.  Better to let the market tell us when they have a bottom than to try to guess.  

    BA/Batman – Just a few more words and you might have had a complete sentence there!  cheeky

    I'll guess you want to know what bull call spread looks good and I'd say the same as KKR, it's not the kind of chart you want to catch knives in but  I'd keep an eye on the sale of the BA 2018 $80 puts, now $10 but probably you could get $11 for a net $69 entry on the $104 stock – that's a nice cushion.  Then that money could be spent on the $100 ($17.50)/$130 ($7.25) bull call spread at $10.25 and then you have the $100/130 bull call spread for net 0.25 with a $29.75 upside potential and your worst case is owning BA at $80.25, more than 20% off the current price.  

    Nice call BDC! 


  37. Albo/SCO, my fault, that should have been  selling the April 360 calls, not 2017


  38. Phil/BID,TLT, GLD,GLL

    BID below $20

    TLT above $135

    GLD above your $118 mark and GLL at $82. crazy..someone making lot of money on gold.

    regards


  39. ABX / /HMY / AUY – this is a good example of panic selling simply going too far. These are good companies with solid histories for the most part with high probability of avoiding bankruptcy. Over the past year+ one of their most major costs broke down by >70% (fuel), and now the primary asset they pull out of the ground is up 15% from a longer term average. That's a formula for the stock going nuts.


  40. Europe worse into the close.

    SCO/Jomp – What a ride, right?

    Gravity/Scott – Big stuff!  Hoverboards and flying cars – here we come!  

    /NG really struggling at $2 but, then again, so is everything.  Dollar failing 95.50 not helping (especially not helping /NKD).  

    Marks/Pat – Good time to take profits where we're right and grin and bear it while we ride out the rest.  


  41. capitulation please!!!!


  42. 15,500, 1,810, 3,900 and 940 again for you risk takers.  /NKD 15,135 not playable until 15,100 is tested.  


  43. Gold really strong !  Maybe some panic being displayed here rather than in the VIX.


  44. Phil / fake oil — it's a game of relative fakeness, the currency oil is priced in is any less fake than the price of oil? TLT at 135? Years of QE/ZIRP and no inflation? That's so fake it makes oil almost look like something useful that people do useful things with like drive cars, heat homes, make chemicals, and fly airplanes. Almost…

    Van Gogh painted sunflowers and you say the sunflowers are fake but isn't it the sunflowers are real and the paint is fake?


  45. LMT – what kicked them down the well?


  46. panic?

    oil VIX is at 78—wow.


  47. FCX – Not feeling the love from gold's big move.  Too much copper and oil, I guess.


  48. BID – oh I love how it don't just creep down to my stop, it plunged WAY past it on the open, then kept dropping. my loss is now at +2x my "desired" loss-at-stop.  another reason to keep risk on trades to .5% of portfolio.. so when stops are (regularly) blown out, can still be holding at ~1% effective risk. Hmm.. expect i'll be killing this trade in short order, will see what the close brings us.


  49. Phil, Thoughts on BTU after earnings? Looking at the Jan 2018 puts for $.51 or so. Of course they are dipping into and using there revolving credit line now to stay afloat.


  50. MSFT getting cozy with its 200dma


  51. Those are the $1.00 BTU puts to sell


  52. At this point do you leave the GLD and ABX calls in place as hedges or because you believe they will still gain more in price than they lose in time value?


  53. Greetings, all! 

    The replay of yesterday's webinar is now up!

    https://youtu.be/x8HCC11KG-4


  54. Scottmi/LMT

    Perhaps this?

    "The Pentagon must mitigate key software issues in Lockheed Martin‘s (LMT) F-35 by late spring, or else the Air Force might have to delay declaring its variant combat-ready."

    http://www.investors.com/news/two-major-issues-with-f-35-before-its-ready-for-combat/?ven=YahooCP&src=AURLLED&ven=yahoo


  55. BID   they are snapping up the April $20 puts, paying up to $2.80


  56. LNKD      someone selling 1100 Jan 2018 $80 puts for $16.50, collecting $1.8M willing to own shares at the 2012 IPO range


  57. Sunflowers/BDC – But Vinnie never tried to pass them off as real, did he?   The fact that other things, like currency, are also manipulated doesn't make oil manipulation "OK", because of it's Relative Fakeness Index.  You can justify all sorts of horrors with that logic, can't you?  

    Reality is simple (or should be):

    What is the demand for oil?

    What is the lowest-cost way to produce that much oil?  (in a truly free market, those who charge more than they have to get taken out by those who are willing to work with less margins)

    How much profit is fair?  

    This is the problem with late-stage capitalism, there's no consideration of the benefit or detriment to society in the pricing of goods and services – especially those that are necessities.  That's why oil, water, health care, air fare, college, cable/internet… costs are going through the roof – people HAVE to have them and they have monopolistic pricing power.  

    By paying excess profits to those sectors (and excess can be defined as above the average of all corporations – say 12%) the consumers are left without discretionary spending dollars to buy the things they actually do want, causing a huge misallocation of capital and resources along the way.  

    Then you have a stock market that will move capital to those sectors and ignore other sectors (starving them for capital) unless they too can generate outrageous profits off the backs of the consumers.  And then the cycle never ends – it's a race to give the consumer as little as possible while taking as much as possible with no regard whatsoever to the health and well-being of the consumer.  Eventually, you kill the golden goose but if the World falls apart and you have a Billion Dollars – you'll do fine…

    LMT/Scott – F35 negotiations not going well.  

    Air Force May Delay F-35 Combat Readiness Unless Software Improves

    ARLINGTON, VA. — The Pentagon must mitigate key software issues in Lockheed Martin's (LMT) F-35 by late spring, or else the Air Force might have to delay declaring its variant combat-ready. The plane …

    They want a plane that works?  What hard-asses!  

    BID/Scott – Yes, they are getting killed as terrible January stock market leads to terrible Jan art auctions:

    Art market meltdown?

    The auctions in London fell short of expectations. CNBC's Robert Frank looks at a turning art market.

    Fortunately, there's always liquor:

    A twelve-bottle lot of Chateau Lafite Rothschild 1982 Bordeaux wine and a six-bottle lot of Macallan whisky spanning the years 1945 to 1950 each sold for HK$318,500 ($40,900) at a Sotheby’s auction in Hong Kong.

    A three-bottle lot of Romanee Conti 2009 Domaine de la Romanee Conti grand cru Burgundy fetched HK$294,000 while a similar lot from the same grower’s 2007 vintage sold for HK$245,000, according to an e-mailed statement from Sotheby’s.

    BTU/Button – Coal is deader than oil.  

    BTU/Albo – Coal is dead. 

    Submitted on 2015/09/28 at 7:04 am

    BTU/Shashi – Coal is dead.  End of outlook (and welcome, by the way!).  It's being regulated out of profitability at the same time nat gas is cheap and plentiful (so much so that it's a problem for them).  Unless there's a huge advance in the "clean coal" they have been promising us for 8 years – I wouldn't be on the global warmers.  

    We even had some in the LTP and still have a little in the Butterfly Portfolio, but I just don't have the conviction to buy more (we did at first) so we got out in the LTP as I can think of better things to do with cash than throw it down a coal shaft. 

    Submitted on 2015/09/11 at 12:48 pm

    BTU/Shashi – Coal is dead.  End of outlook (and welcome, by the way!).  It's being regulated out of profitability at the same time nat gas is cheap and plentiful (so much so that it's a problem for them).  Unless there's a huge advance in the "clean coal" they have been promising us for 8 years – I wouldn't be on the global warmers.  

    BTU/Scott – It's my understanding that World coal consumption is off 5% from last year.  US probably worse than most countries.  That causes and imbalance and drives down prices but they equalize eventually.  The CEO said they don't have a major bump in the road ahead of debt repayment until late 2018 and BTU lost about $175M on $1.5Bn in sales last Q but a lot of those losses were from hedges that seemed like a good idea but paid them in Aussie Dollars, which ended up being worse for them than if they had just taken the hit on coal prices!  That's why the CFO was replaced – he gambled (with the company's money) and lost.

    Submitted on 2015/08/04 at 7:47 am

    BTU/Sibe – Hmmm, you should read this article where some guy says coal is a "dead industry walking."  The downside to selling calls is you miss the rally (if ever) and 0.04 isn't much to collect.  As with oil, I think it's a long phase-out for coal.  We still have some BTU in the STP and $25KP as we thought it would bounce ($1/2.50 Jan/Aug spread) but I think I'll just leave the Jan $1s (net 0.70, still 0.70) naked for now – just hoping to get out with a small gain. 

    Submitted on 2015/07/14 at 12:52 pm

    BTU/QC – Unfortunately, we are in on the Butterfly Portfolio but I'm not happy about being long on coal – it's an industry with a lot of challenges.  

    Submitted on 2015/07/02 at 2:10 pm

    BTU/Scott – WLB is a small little company ($350M) with $1Bn revenues that keeps them afloat and not a terrible cash burn ($46M last year).  BTU is now a small company too ($500M at $1.81) even though they have $7Bn in revenues and their cash-flow was -$146M so losing less per ton than WLB but they make it up in VOLUME.  

    So that's a no on BTU (still).  

    Improving a bit since the EU close (11:30) but we topped out on our bounce at 1pm yesterday so be careful.  

    15,533, 1,817, 3,934, 951 & 15,160 means stops at 15,525, 1,815, 950 and 15,150.


  58. Sorry if I have missed a post on this, but what are your thoughts on IRBT here?


  59. GLD/Tangled – I don't know which ones you mean.  We have ABX in the LTP and that's a LONG-term portfolio so not changing those.  We also have SLW, getting back on track.  We have GLD in the Butterfly as a bullish play and, when we think it's toppy, we can sell some calls (but we need to let it SHOW us where the top of the new range is – not guess based on a 1-day move).   In the OOP we did sell our GLD hedge for $5.10 earlier this week and that leaves us with an ABX spread that's a mile in the money and, if we can get most of our money now – why not but otherwise just wait for April to collect 100%.

    IRBT/Delboy – They are dead to me now that they dumped the military division and I wish we had bailed the day they announced it – now down below $30.   

    LOL – Weak demand on 30-year but they got 2.5%.  NOW the markets can move back up as we panicked just enough sheeple into our crappy long bonds.  


  60. Cash is public enemy No. 1

    Terrorists are no longer public enemy number one. Nor are drug lords, people traffickers, arms dealers, cyber terrorists, or any other unsavory do-badder. Today, the biggest threat to global peace and security is physical cash, a means of exchange that has flourished for over 4,000 years but which …


  61. Global markets are acting as if the world economy is about to tank.

    And while signs out of industries like global shipping point to a slower growth trajectory globally, data out of the world’s largest economy is simply not indicating recession.

    On Thursday morning the latest report on initial jobless …


  62. Thousands of iPhone users have been left with bricked devices after having their home buttons repaired by non-Apple authorized technicians.

    The Guardian on Friday reported on the issue, known as “Error 53″ that apparently affects the iPhone 6, 6 Plus, 6S and 6S Plus.

    The basic problem happens if you …


  63. FRANKFURT (Reuters) – The amount of cash across the euro zone rose to more than 1 trillion euros ($1.1 trillion) last year, with almost 30 percent of it hoarded in 500 euro notes, ECB data has shown, as nervous individuals keep more of their money at home or in a vault.

    Cash in circulation is almost …


  64. 5 Reasons Wall Street is Freaking Out About a Recession

    and why they might be wrong

    As Janet Yellen testifies in front of Congress this week, it is safe to say that she is facing the period of greatest economic uncertainty since she took over the role of Fed Chair roughly a year and a half ago.

    The Federal Reserve appears to be rethinking its pace of …


  65. GLD    They are buying the hell out of calls today, hundreds of thousands of 'em.   No surprise there


  66. GM    12,644 options traded in the Jan'18  $18.00 puts  


  67. Stockbern/GLD

    I guess "they" mean retailers. Won't it be chasing now.

    regards


  68. Just 9% predict a rate increase in March, down from 66% who last month expected a March move

    The Federal Reserve probably won’t raise short-term interest rates at its policy meetings in March or April, but a move in June is more likely, according to economic forecasters surveyed by The Wall Street …


  69. The massive selloff in European bank stocks and bonds is overdone and presents a “phenomenal” buying opportunity, according to some of Europe’s top hedge-fund managers.

    Despite a 28% slump in European bank stocks this year, including a 38% fall in Deutsche Bank AG and a 34% drop in Société Générale …


  70. This is an interesting variation on the Easterlin Paradox, the idea that past a certain point a country getting richer doesn’t seem to make it any happier. The contention now is that not being capitalist, not being caught up in the frenzy of consumerism, is what does make people happy. Thus we …


  71. UBS thinks we’ve reached peak “havoc” in European stock markets.

    Its analysts have made the call to buy stocks that investors have been overly pessimistic about.

    In a European Equity Strategy note sent out Thursday, strategist Karen Olney and her team say now is the time to buy value stocks, or …


  72. The surging value of the yen is putting a new strain on Japan’s central bank.

    On Thursday the yen jumped higher against the dollar as market turmoil sent investors running into assets that typically benefit from safe haven flows.

    Like other central banks, the Bank of Japan’s monetary policy stimulus …


  73. Six of the world’s largest mining companies – including the world’s second largest miner, Rio Tinto – abruptly resigned their membership on the …


  74. There were 170 fully funded Cthulhu-inspired projects — who knew?

    After almost seven years online, Kickstarter can now boast that it has 100,000 successfully funded campaigns under its belt. A photography project called Falklands/Malvinas: One War, all Wars by a Nat Geo photographer helped it get to …


  75. An OPEC production cut is unlikely until U.S. production declines by about another million barrels per day. OPEC won’t cut because it would accomplish nothing beyond a short-term increase in price. Carefully placed comments by OPEC and Russian oil ministers about the possibility of production cuts …


  76. And the U.S. may not hold up indefinitely.

    PepsiCo pep CEO Indra Nooyi has been around the block in her decades at the top of American business.

    So when she says the world economy and the stock markets are creating the bumpiest environment she has ever seen, she has a good deal of credibility. Her …


  77. In what could be described as nothing less than a “Hail Mary” attempt to block the Obama administration’s Clean Power Plan, the coal states have scored. In a 5-4 decision, the U.S. Supreme Court agreed on Tuesday to delay the carbon reduction plan’s implementation until it can be heard in court.

    If …


  78. Money talk

    Money Talk

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  79. A big thing just happened in the world of cryonics, and it has nothing to do with Ted Williams’ permafrozen remains.

    Officials from the Brain Preservation Foundation, a nonprofit that funds brain preservation research, just awarded its five-year old “Small Mammal Brain Preservation Prize” to 21st …


  80. The “r-word” — recession — has creeped back into the economic conversation in the US.

    And though weakness in manufacturing persists and the stock market has been rocky, the argument against a recession in the US is simple: the US consumer is fine.

    But what if they aren’t?

    According to Scott Brown, …


  81. Oil prices fell on Thursday, dented by record U.S. crude inventories, worries about the demand outlook and a Goldman Sachs forecast that prices would remain low and volatile until the second half of the year.

    However a report, quoting sources familiar with the discussions, that some OPEC countries …


  82. Phil/UNG,

    Is there a chance for it to move up slowly into march and then in April or is it only move up after that if it does because of the exports?

    regards


  83. Dammit Mr Naybob, I hate when you're right.   " snarly face smiling emoji"


  84. GLD/Stock – No one believed it until this week.

    This sucks, we can't even put a bounce together – not since the year began  and this is getting really ugly:

    UNG/Pat – Weather not in our favor next week but week after that a bit colder (don't forget "normal" is cold).    Still, I'm only banking on the exports kicking in in March/April and getting some news coverage for a pop to $2.50 and I'll be thrilled with that (on the /NGK6s).  


  85. They are covering their asses in consumer names today as well:

    MCD     6000 April $120 calls

    CMCSA  24,000 April $60 calls

    PG     32,0000 April $82.50 calls

    JNJ   39,000 April $105 calls


  86. Phil/UNG

    how much is UNG with NG at 2.50?

    regards


  87. Is mr stick dead???


  88. We tested and held the Jan spike low on the S&P so far. Great place to bounce if we're going to.


  89. LMT/dclark – thanks.. would hate to get a blue screen of death at Mach 2.


  90. KR sending a valentine to TFM


  91. my STWD trade sucks.  The sold calls dont do squat



  92. FU oil!!!!!


  93. I am glad I bailed on IRBT the day they sold their military division… 


  94. STWD / Stockbern – It does suck, but still collection $1.92 in dividend this year. I might add more to cost average.


  95. In any case, today pretty much everything sucks besides gold and hedges! 


  96. FU OPEC!!!!


  97. BAC down 7.8%   I'm still waiting on that one


  98. news?


  99. Just wow… Hope it's not true! But if it is, big deal!

    http://talkingpointsmemo.com/news/shamkhani-republican-prisonor-swap

    "In the course of the talks for exchanging prisoners, the Republican rivals of the current US administration who claim to be humanitarians and advocates of human rights sent a message telling us not to release these people [American prisoners] and continue this process [of talks] until the eve of US presidential elections,” Shamkhani said, according to Tasnim.


  100. Given the above 5% Chart, it looks like we need another short and the S&P has held up better than the rest so far, so we'll make a new hedge for the OOP and the STP.  This, of course, only applies if you didn't already do our SDS or SQQQ hedges from last Friday's post:

    SDS is at $24.80 so say $25 and it's a 2x ultra-short on the S&P so $27 would be our goal and soon would be our timeframe if things are going south from here.  March spreads are still 30 days so let's add to the STP:

    • Buy 100 SDS March $24 calls at $2.03 ($20,300) 
    • Sell 100 SDS March $27 calls at $1.08 ($10,800) 
    • Sell 5 CMG March $385 puts for $5.20 ($2,600) 
    • Sell 5 BA Jan $90 puts for $8.60 ($4,300) 

    That's net $2,600 and we risk owning 500 shares of CMG and BA cheap (and we'd roll them to the LTP) and it gives us $30,000 of protection.  

    In the OOP, our variation will be:

    • Buy 50 SDS March $24 calls at $2.03 ($10,150) 
    • Sell 50 SDS March $27 calls at $1.08 ($5,400) 
    • Sell 4 BHI 2018 $50 puts for $14.50 ($5,800) 

    That's a net credit of $1,050 on the $15,000 spread and bumps our short BHI puts from 6 to 10 (and we still have a lot of faith in that one). 


  101. Wait!!!! Hold off on the above – more rumors of OPEC cuts – sounds serious!  


  102. Let's see how things go first – game off!  


  103. Wow, do I feel like I just wasted a ton of research time – all undone by a whisper from OPEC.  Long on /CL at $27, of course, tight stops below – the whole thing can fall apart in 5 mins.  


  104. another consumer name with call action

    HSY  3500 May $95 calls


  105. UNG/Pat – Well, it's a straight-up ETF so, ignoring the decay, it would be +25% from $7.50 or $9.37.

    Stick/Jabob – Too many sellers overwhelm the stick.  

    So a rumor like OPEC at least puts the breaks on the selling and that gives the stick algos a chance to do their job.  

    Apparently WSJ says UAE Energy Minister says they are ready to make coordinated production cuts.  

    BA coming back fast – you might want to sell those above puts while you can as that's a smart play regardless.  

    Iran/StJ – Sure, that's the same thing Reagan did to Carter – just the usual GOP playbook.

    Not getting much gas out of this rumor rally – Oil already failed $27.  


  106. things I just noticed

    AAPL touching $92.59

    IBM touching $116.90


  107. Damn, look where /ES was just rejected – 1,831.50!  

    GAME ON – We are officially adding those SDS hedges!  


  108. Cash is still the best hedge – calculations are much easier!


  109. TLT/Phil – adjustments? new play?


  110. TLT/Scott – Not sure we're done panicking yet but it's the June $135 ($7)/$128 ($3.30) bear put spread at $3.70 that pays $7 for a possible 116% gain below $128 that I have my eye on.  

    CASH!!!/StJ – What a novel idea!   cheeky

    AAPL not helping at all:

    GS down $6 is pretty tragic for the Dow too.  People are really freaked out about the banks and that's the thing that's making me nervous because if you can get enough people to believe the banks are in trouble, then the banks are in trouble.

    Still, GS $6, BA $8, JPM $3 so $17 x 8.5 = 144 of the 236-point drop on those 3.  I think the BA thing will be nothing and GS and JPM probably fine (didn't we say that in 2008?) and that means the Dow is dragging everyone down for silly reasons and the big market sell-off puts the Fed on the table and weakens the Dollar so that too can reverse if the markets turn up (still 95.50).  Hopefully back over 1,850 tomorrow is +1% across the board into the long weekend (but that's still not enough not to want the new hedges, is it?).  


  111. Did the Nasdaq just turn green?


  112. I guess when you have FB, MSFT, AMZN and CSCO green, it does help!


  113. FAS/Phil – bounced off fib support on weekly chart. perhaps some calls?


  114. From the WSJ (who says it's from Dow Jones Newswire):

    *DJ UAE Energy Minister Says OPEC ‘Is Ready to Cooperate’ on Output Cuts: Sky News Arabia

    *DJ But UAE Energy Minister Adds Cuts Would Require ‘Total Cooperation from Everyone’: Sky News Arabia

    *DJ UAE Energy Minister Adds that Low Prices are Forcing Cuts Now Without Cooperation: Sky News Arabia

    UAE Minister Sees 2016 Oil-Market Rebalance — Market Talk

    14:30 ET – OPEC members are ready to cooperate on a cut, but current prices are already forcing producers outside the group to at least cap output increases, says UAE Energy Minister Suhail bin Mohammed al-Mazrouei. Non-OPEC supplies are expected to drop up to 800K barrels/day while global demand growth is seen at 1.3M–which will help the market balances itself. “The positive thing is the current market is forcing everyone not to increase output,” says al-Mazrouei, adding, “I’m optimistic that the balance will happen this year despite the oversupply and stocks overhang.”

    Note Sky News is also Murdoch – serpent swallows tail and likes the taste!  

    • It’s not that I think somebody planted a rumor, mind you. I’m not saying the news is wrong or that it’s being misreported. I just think that we hear this kind of talk out of OPEC a lot. 

      We’ve heard this chatter enough times over the past month so take it with a grain of salt,” said Lindsey Group’s Peter Boockvar.

      They have a notorious history of “agreeing” on cuts and quotas, and then going behind each other’s back and doing whatever is best for individual states.

      It’s best to wait until OPEC actually does something on this front, and then to wait and see if they honor it. In other words, we’re a long way away from anything really happening here.

      That’s all I’m saying.

       

      Look, the OPEC thing may turn out to be bogus. Lord knows we’ve heard that line too many times to count, and oil’s at $26/barrel. Even if it is bogus, though, the episode illustrates one thing: there is still a sizable contingent of operators out there just waiting for an excuse to pounce on equities.

      In other words, we still are not near capitulation.

      • 2:54 pm
      • Real rally?

       

      • 2:58 pm
      • Capitulation may not look how you think it looks
    •  

      If you want to know whether crude prices could fall even lower, look no further than refiners: they don’t want any more of it.

      For months, fuelmakers have been soaking up the glut of crude and running their plants hard. But now they’re throttling back to help alleviate the new glut they’ve created: gasoline. PBF Energy is just one example: the company says it’s processing 150,000 barrels of crude each day at its refinery in Toledo, Ohio–about 10,000 barrels less than the plant’s capacity. Cutting run rates means buying less crude, storing it, or even pushing oil onto already oversupplied markets.

      “It’s a tough place to get rid of the crude,” CEO Tom Nimbley says. 

      • 3:14 pm
      • Bank stocks

     

    Back to $27.20 on /CL

    Brent is a little more enthusiastic, that's a good sign as they should have a better handle on what's going on in OPEC.  

    Nadaq up 0.25% – Mighty, mighty…  

    FAS/Scott – We have calls, we have 60 Jan $35 calls, now 0.27 left over from a spread where we were short in the STP (that was a wise call!).  I suppose we could spend $1.60 ($9,600) and roll them down to the Jan $24 calls and sell 20 2018 $15 puts for $4.25 ($8,500) to pay for it and then we're in a position to sell some short calls.  


  115. Thanks Jabob:

    Wow, I forgot how good this song is (came on after Brick House):

    Somebody should bring back funk!  They have Uptown Funk but it's like a one-off.  


  116. OK, so listen up. I log in today and see oil is still down and then instead of crying about it I go punish myself (19 mile run in 2:05). And I come back and OPEC is making noise and USO is up?? I'm like PSW own personal savior: I sacrifice myself for you.

    :)

    Jabo – no $ for u, now we are even ;)   ?


  117. StJ/Iran – They did exactly that in 1979. History doesn't always rhyme, sometimes it repeats!


  118. LOL at that mr. stick picture


  119. Stockbern: "Dammit Mr Naybob, I hate when you're right.   " snarly face smiling emoji""

     

    Thouest invoke me… It's not about being right, just in the right position at the right time. Timing IS EVERYTHING, especially while waiting for the target to walk into the crosshairs. Ask Blondie or the Man with No Name.

     

    From Monday: "Must hold at ES 1850, 1825 was touched, hovering at 1835, failure to hold… June 2014 low of 1811 is next support down, failure there, Jan 2014 low of 1775 awaits and Aug 2013 1630 is the next stop below that.  TBD.

     

    Today Thursday: SP500 futures 1869 to 1840 to 1807, currently taking a breather while trying to crawl back to 1830. 

     

    Goldman Sachs had to abandon FIVE or their SIX top trade calls from 2016. Hedges, short covering, how many wrong way bets are out there? I might have mentioned wacky Wend before at PSW, weeks prior to option expiration are wacky, especially mid week when positions unwind.  This can be especially painful when multiple long duration bond auctions are concomitant like this week: Tues 3 yr; Wend 10 yr; Thurs 30 yr.  

     

    Those bond auctions can tie up (in repo and reverse repo) what is at the moment, limited dealer and commercial bank balance sheet resources, cash vault, short duration UST's, HQLA (high quality liquid assets), causing fits of liquidity, bouts of liquidation and the indigestion of margin calls/squeezes in the markets.  

     

    More mad natterings here (cash hoarding due to ZIRP/NIRP) and here (why the hoarding and asset rotation effects market liquidity). And yes, the banks are in trouble, and the central banks have emptied their Colt 1851 Navy. IMHO they will lobby to get out of some impending regulatory requirements, and get reserve requirements lowered, amongst other measures.  TBD.  Chillin Sonny Crockett with Wayfarer's Emoticon. Out.


  120. Sorry about the spacing, Jabo I gotta, FU HTML EDITOR.


  121. Iran / BDC – I know. They have the same playbook they have been using since Nixon it seems. I hope that there are recordings!


  122. bio--we will be even if oil is up tomorrow!!!


  123. jabo – that is practically guaranteed   8)


  124. Phil – If the madness continues for the banks. Do you think we can look at some FAZ?


  125. natter……

    whats doing with king ? dollar……(i hasten to suggest you know what the queen said)……this recent decline of 4 + has caused mucho grief….as phil says the jpy is safe haven ..with neg rates it beats me…..why………..and the degree almost 10 + but all other crosses down major this last week….and we know the condition of ecb, aust, canada and neg rates in chf….

    what happened to libor hibor and all the other bors………;)

    hkd would prob be up if it wasnt pegged….been watching every level down and it just goes thru it……………and has the king had a ballectomy…….and singing soprano……your thoughts.


  126. See, earnings not so bad overall:

    Not great, but not terrible.  

    Thanks BDC, you saved us all!  We should get you one of those high-tech treadmills like The Flash uses and you can hook it up to the S&P and, whenever we need a boost, you can run on it and use the speed force to boost the markets…  

    Oil holding $27.30 – impressive!  

    FAZ/Bulls – I just pressed FAS so no to FAZ for me.  We have a 20% drop in XLF and today was hopefully the blow-off panic bottom (but we were lower in Aug).  While I was too nervous to pull the trigger on DB, I think JPM and others had solid earnings and this is not 2008 and Yellen said rates are still going up – just slowly – that's what the banks want.  

    Bors/Mill – Don't forget you have the EU investigating currency and rate manipulation now – that's also putting a spanner in the works. 


  127. Phil / LOLZ that was funny

    US Olympic Trials for the marathon on Saturday morning. Exciting TV for BDC! I'll be glued to my television 8) :)


  128. Speaking of Gravity waves and, uh, TLT…


  129. OK folks…..biotech play for upside and buyout rumour dejour…ICPT….

    Now, I am not a huge fan of the company, nor the drug, but the FDA is reviewing it in April, and their Phase 3 studies in PBC (primary biliary cirrhosis) are positive according to the company.  So, let's take a look at some options.

    April $95/110 BCS, selling some Feb 91 Ps for offset brings in a net $2.85 debit (margin is $25K in normal accounts).  Or, the April $95/110 BCS, selling some Feb 91 Ps for offset brings in a net 45c credit…. for a no risk trade after Feb OPEX.

    See what we can get tomorrow on these lines.


  130. Real business: XOM – actually does useful stuff like drill for oil and make chemical commodities. Result: not even below their 50-day despite the oil carnage.

    Fake business: DB – massive derivatives trading scam that produces nothing useful for anyone (and if they blow up taxpayers save their butt anyhow). Result: WAYYYY below it's 50-day


  131. JPM    Dimon buys 500,000 shares of JPM for about $26M


  132. Phil--do you think they worked off some of those oil contracts?


  133. Phil do you think the OPEC rumor will hold up through tomorrow? I guess since it is Friday, it may. Once it is debunked do we head on down to 25? I found it interesting that in the quote he talked about natural caps on production. 


  134. I'm thinking of shorting BRK/B.  Many of its components are doing poorly…IBM, AXP, PSX, US Bancorp, Burlington Northern, and probably Precision Castparts. Earnings are Feb. 26


  135. It is beginning! 

    • Repsol (OTCQX:REPYFOTCQX:REPYYplans to shut down its unprofitable Varg oil deposit in the North Sea, Bloomberg reports, the first time a Norwegian field would be closed because of the oil price collapse.
    • Repsol acquired Varg as part of its 2014 purchase of Talisman Energy, and has since terminated its contract with Teekay Corp. for the field’s floating production vessel, which will leave the area on Aug. 1.
    • Varg began production in 1998 and has entered its tail-production phase, although it was expected to operate until 2021; the field, in which Repsol owns a 65% stake, produced 4.8K bbl/day of oil, according to the latest data.

    And viva Las Vegas – that's a bullish sign for the US:

    • Wynn Resorts (NASDAQ:WYNNreports revenue from Macau operations fell 27% Y/Y to in Q4. EBITDA from the Macau business was $709M, down 44%.
    • The company's Las Vegas operations kicked in with revenue growth of 3.8% and churned out EBITDA of $477M. Though the occupancy rate in Vegas was down a full point, RevPAR (Revenue per available room) improved 6.8% to $237.
    • The company disclosed its investment in the Macau Cotai project is up to $3.5B.
    • Wynn ended the quarter with a cash position of $2.3B and debt of $9.1B.
    • Previously: Wynn Resorts beats by $0.27, misses on revenue (Feb. 11)
    • WYNN +1.52% AH to $60.60 after a 2.7% gain in the regular session.

    Contracts/Jabob – I can't see the numbers until morning but there were a couple of big down spikes – which may have been strong sell-offs.  

    F'ing Nikkei dropped another 2% – 14,930 after testing 14,900 but anything below 15,000 is a disaster.  Of course the multiple failures at 15,300 were a clue….  Still, I do like it long over the 15,000 line with tight stops.

    OPEC/Craigs – At $27.30, I'd say that rumor is already losing steam and, of course, after the long weekend, we have just 5 sessions to dump the remaining contracts.  

    BRK.B/Stock – That's a ballsy short.  They're not an ETF, stocks are about 1/4 of the company and they are already down from $150 last year so be careful.  


  136. The big overhang on the markets now is Shanghai opening on Monday is likely to do what the Hang Seng did, which is drop 4% at the open (5% now, with another 1% today).  Anything more than 1.5% down will fail the 2,700 line.  


  137. Barclays said in a note Friday that it believes the yen had been "excessively" undervalued compared with the country's economic fundamentals and that's now unwinding. It expects the dollar-yen pair to fall as low as 100 by end of the first quarter and 95 by year end. 

    Among Japanese exporters, ToyotaNissan and Sharp dropped 6.81, 5.82, and 10.32 percent, respectively. 

    Japanese banks saw steep losses, with Mitsubishi UFJ down 2.23 percent, SMFG lower by 4.06 percent, Mizuho Financial shedding 3.66 percent and Nomura falling 9.21 percent. 


  138. The field of White House candidates keeps dwindling as one presidential hopeful after another pulls out of the race. Yet the candidates inevitably say they are “suspending” their campaigns, not ending them.

    The choice of language is purposeful and motivated by both political and financial …


  139. Imagine someone told you about a country where real output per person is at an all-time high and growing at an increasingly rapid pace, its …


  140. Bank Stocks Sink Further, but Dimon Is Buyer

    James Dimon’s message to the markets: If no one else wants to buy bank stocks, I will.

    J.P. Morgan Chase & Co.’s chairman and chief executive on Thursday bought 500,000 of his firm’s shares, according to a regulatory filing, trying to deliver a jolt of confidence to investors as a monthlong slide in …


  141. Oil prices jumped almost 5 percent on Friday after comments by the energy minister of OPEC-member United Arab Emirates sparked hopes of a coordinated production cut, yet analysts said such a move remained unlikely and that oversupply would persist.

    International benchmark Brent crude was trading at …


  142. Aero-engine giant Rolls-Royce has cut its dividend by 50% after a torrid year.

    The company, which has issued a string of profit warnings over the year, also announced profits in line with the guidance it gave last year, albeit at the lower end of the range it outlined.

    Rolls-Royce made £1,355m before …


  143. On Economic Stupidity

    Bill Clinton’s 1992 campaign famously focused on “the economy, stupid.” But macroeconomic policy — what to do about recessions — has been largely absent from this year’s election discussion.

    Yet economic risks have by no means been banished from the world. And you should be frightened by how little …


  144. After a week that has seen the yen soar against rivals, specifically the dollar, the country’s finance minister on Friday sent a warning to investors. “We have seen quite rough movements in the exchange rate recently. We will continue to watch the foreign- exchange market with a sense of tension, …


  145. SAN JUAN (Reuters) – Billionaire hedge fund investor John Paulson, closely followed for his views on the markets, said on Thursday the sliding stock market is “overreacting” and that the United States economy remains strong.

    The S&P 500 is down 9.4 percent year to date on concerns about depressed …


  146. German Economy Grows Steadily

    Robust domestic consumption kept Germany’s economy on a steady yet modest growth path at the end of last year, despite weak exports and growing headwinds from the global economy, official data showed Friday.

    Germany’s gross domestic product grew at a quarterly rate of 0.3% in the fourth quarter—the …


  147. The headwinds that China’s foreign trade has faced for months — sluggish domestic and global demand — likely persisted in January. That means, the trade surplus, the difference between outbound and inbound shipments, probably increased again in January as imports dropped farther than …


  148. European stocks rose Friday, coming back from a sharp selloff in the previous session, ahead of the release of economic growth figures for the eurozone.

    The Stoxx Europe 600 SXXP, +1.79% gained 1.3% to 307.57, with oil and gas SXEP, +3.68% and financial shares SXFINP, -5.66% leading all sectors …


  149. It’s all a bit messy at the moment — European banks, Japanese banks post the BoJ’s move negative, er other stuff — but it’s not really clear what’s …


  150. Central banks are engaged in a game of dare with market participants


  151. Clinton embraces Obama and wins debate

    (CNN) — The days of Hillary Clinton subtly separating herself from President Barack Obama on one policy or another are over: she won the debate in Milwaukee by lavishly and repeatedly praising Obama — and delivered a sharp rebuke to Sen. Bernie Sanders for criticizing the President.

    “The kind of …


  152. Is Germany dragging down the eurozone?

    New eurozone economic figures released later today are likely to show continued if rather sluggish growth, with significant variation between countries.

    Germany is likely to be in line with that: growth but not very strong.

    But has Germany, which is the eurozone’s largest economy, actually been a …


  153. “Let’s not mince words,” economist Anthony Orlando says. “Student loans are killing people. People need to understand just how big a problem we’re talking about: Americans owe more in student loans than on all their credit cards combined.”

    Orlando, the author of Letter to the One Percent, suggests …


  154. For years, AT&T and Verizon have built their marketing around the idea that they had better networks than upstart rivals T-Mobile and Sprint.

    From “Can you here me now?” to “Better Matters,” both wireless leaders have hung their hats on the concept that superior service justified higher prices. Of …


  155. CBS CEO Les Moonves had plenty to say about the Apple TV last year, but this year for some reason he said that CBS hasn’t been talking with Apple very much at all. Apparently the two companies used to talk pretty frequently about bringing CBS to Apple TV’s rumored streaming television service, but …


  156. Good morning! Here’s what you need to know in markets on Friday.

    Global stocks officially entered a bear market on Thursday evening. The MSCI Index, closed down 20% from recent highs to meet the technical definition of a bear market. The index gauges large and mid-cap stock performance across 23 of …


  157. Solar firm SunEdison is getting punished for the second day in a row.

    The stock is down 10% on the news that the company is being sued by Latin America Power Holding B.V. for not completing a $733 million buyout, according to The Wall Street Journal.

    LAPH shareholders want a New York judge to freeze …


  158. In a recent post, we presented some preliminary evidence suggesting that corporate bond market liquidity is ample. That evidence relied on bid-ask …


  159. Lending Club Posts Second-Ever Profit

    Lending Club Corp. capped its first full year as a public company by reporting record quarterly profit and loan volume and telling investors it could weather a tougher economy.

    Shares were up 7.5% to $7.00 in morning trading as the company also announced a $150 million stock buyback program. Shares …


  160. The California bullet train project violates state law because it is not financially viable, will operate slower than promised and has compromised its design by using existing shared tracks in the Bay Area, attorneys for Kings County and two Central Valley farmers argued Thursday in Sacramento …


  161. At least he’s a leader.

    That’s what—time to get used to these words—Republican frontrunner Donald Trump said about Vladimir Putin when he was reminded that the Russian president’s critics in the press have a nasty habit of turning up dead. It was the sort of thing you might have heard in the 1930s …