Insider-Selling Explodes To Record Highs As Buybacks Re-Emerge
by Zero Hedge - January 20th, 2021 5:05 pm
Courtesy of ZeroHedge View original post here.
Well this is a little awkward…
Since the start of 2021, Bloomberg reports that company executives sold $300 million worth of shares through Friday, 16 times the total they purchased (a total of 1,000 insiders sold their own stock and 128 bought shares, leaving the sell-to-buy ratio poised for the highest monthly reading in data going back to 1988).
And at the same time, those company executives have authorized their companies to buy back $29 billion over the stretch, up 46% from a year earlier
While factors other than greed, valuations, and knowing just how bad shit really is can influence insiders’ decisions to sell, their action warrants caution to Mark Freeman, chief investment officer at Socorro Asset Management LP.
“Investors always want to make sure their objectives are aligned with the management,” Freeman said.
“Ideally you would like to see that management feels that what they own is valuable and going to continue to grow in value, as opposed to the potential message that could be ‘well, now is a good time to sell.’”
Clearly, the message from the C-Suite, much like that of so many officials across the nation during COVID lockdowns, is "do as I say, not as I do." Just keep buying my stock while I sell it…
Are America's corporate executives worried about socialism… taxes… and the 'eat the rich' mentality that is coming? Perhaps it's time to do as they do too?
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WTI Slides After Surprise Crude Build
by Zero Hedge - January 20th, 2021 4:35 pm
Courtesy of ZeroHedge View original post here.
Oil prices gave back a lot of their early gains today as chatter about the US stimulus plan suggested its not ponies and unicorns for all after all and worries about Chinese demand weighed. WTI slipped back below $53 briefly.
The U.S. “is still the biggest market in the world and it hasn’t recovered all the demand loss,” said Peter McNally, global head for industrials, materials and energy at Third Bridge.
In the near-term, additional lockdown measures in China are weighing on the outlook as “Chinese demand has been one of the big drivers of improved oil fundamentals.”
For now, all eyes are back on inventories to see if the seasonal slowdown is accelerating surging product stocks.
API
- Crude +2.562mm (-2.5mm exp)
- Cushing -4.285mm
- Gasoline +1.129mm
- Distillates +816k
Crude inventory unexpectedly rose last week (+2.5mm vs -2.5mm exp) as product stocks rose for the 3rd straight week…
Source: Bloomberg
WTI hovered just above $53 ahead of the API data and fell back below on the surprise crude build…
The “U.S. inauguration will tilt oil supply risks in a bearish direction, but Saudi determination to support markets holds sway for now,” said Paul Sheldon, chief geopolitical risk analyst at S&P Global Platts. “OPEC+ production cuts are markets’ most supportive factor at current prices and now appear to be running ahead of coronavirus-related demand uncertainty.”
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Evermore Global Advisor: Opportunity In Europe
by ValueWalk - January 20th, 2021 12:24 pm
By Jacob Wolinsky. Originally published at ValueWalk.
Evermore Global Advisor commentary for the month of October 2020, discussing the EU recovery plan.
Q4 2020 hedge fund letters, conferences and more
Opportunity Highlights
- We believe the European business climate over the next five years will be unlike any period investors have witnessed in our lifetimes.
- The COVID-19 pandemic is evolving into a game changing catalyst for Europe-focused investors.
- The European Union (“EU”) and European Commission (“EC”) stimulus packages, coupled with the explosion of American-style entrepreneurs, family-controlled businesses and aggressive corporate leadership teams will be, in our view, a driving force behind significant value creation for investors in the years ahead.
- Special situations, that we believe should do well regardless of macro inputs, are expected to benefit from the underpinning of these transformative and unprecedented plans and are positioned to deliver potentially exceptional results. The micro (bottom up) is now coinciding with what we believe are improving macro (big picture, top down) tailwinds.
- We highlight opportunities in several businesses and sectors in the pages to follow.
Setting The Table
For years, we have maintained that while the EU and EC building process was likely to be worse than a messy sausage making process, when all was said and done, together, Europe should have a feast at the end.
Many investors believe that the opportunity for compelling investment returns in Europe has been a tomorrow story for many years now. This negative sentiment is pervasive among many market participants with whom we speak these days. Throughout our investing careers, there have been several long stretches where Europe has delivered exceptional returns. There have also been other periods that were more like false starts. While the U.S markets have substantially outperformed Europe since the 2008/2009 financial crisis, we believe that the COVID-19 pandemic is evolving into the catalyst that knocks over the first phase of many dominoes to fall there over the coming years.
This memo will review some highlights from the EC and EU stimulus packages that are game changers for the continent. We will discuss how the stimulus plans, when coupled with the explosion of creative entrepreneurs, aggressive corporate restructurings and leadership from family-controlled businesses, should allow some businesses to strategically change and perhaps leapfrog their competition.
We believe that the real opportunity in Europe is not to buy…
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Biden’s Pick Of Yellen Could Herald Even Higher Stock Markets In 2021
by ValueWalk - January 20th, 2021 10:42 am
By Jacob Wolinsky. Originally published at ValueWalk.
Biden’s pick of Janet Yellen as U.S. Treasury Secretary will help see stock markets reach record highs during 2021, predicts the CEO of one of the world’s largest independent financial advisory organizations.
Q4 2020 hedge fund letters, conferences and more
Joe Biden’s Inauguration And Yellen’s Testimony
The bold forecast from Nigel Green, chief executive and founder of deVere Group, which has $12bn under advisement, on the day of Joe Biden’s inauguration as the 46th President of the United States, follows Ms Yellen’s testimony in Congress ahead of her expected appointment.
Mr Green observes: “Today’s political pageantry in Washington represents the dawning of an era of renewed certainty, stability and the return to established norms, all of which the markets approve.
“However, despite the inauguration pomp and ceremony at the Capitol, investors’ focus is now already on Janet Yellen, who will take over from Steve Mnuchin as U.S. Treasury Secretary.”
He continues: “In her testimony in Congress on Tuesday, the former Federal Reserve Chair called on lawmakers to ‘act big’ on coronavirus stimulus especially with interest rates being at historic lows.
“At the Fed she continually made the case for full employment, meaning we know already, her track record proves it, that she is prepared to spend.
Expectations Of Massive Spending
“With Ms Yellen in charge and with an economy that needs a shot in the arm, I think we can expect massive spending combined with continued ultra-low interest rates for years.
“This will act as a catalyst for stock markets.”
Following her testimony in Congress, the U.S. dollar dipped lower as investors moved away from safe-haven assets, such as the U.S. currency, and more towards stocks, indicating more confidence in the markets.
As the markets experienced their best performance between the election and the inauguration for any president going back at least five decades, on Tuesday the deVere CEO warned investors not to be complacent when confidence grips the markets.
He said: “Investors should ride the Biden bounce in the markets – but do so judiciously.”
Mr Green concludes: “Ms Yellen has indicated that she will do whatever is necessary to get the economy going again. We can expect considerable government spending under…
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The Money Trail to the Siege at the Capitol Leads to Charles Koch and Koch Industries
by ilene - January 20th, 2021 10:32 am
Courtesy of Pam Martens
By Pam Martens and Russ Martens
Charles Koch, Chairman and CEO of Koch Industries
The FBI has asked the public for help in collecting evidence surrounding the siege at the Capitol on January 6 — an insurrection that left five people dead, dozens injured, and Congressional members’ offices ransacked and laptops stolen. The violent scenes at the Capitol played out live on TV, humiliating the United States around the world. The world will watch President-Elect Joe Biden’s inauguration today, surrounded by 25,000 National Guard Troops in Washington, D.C. These images will further undermine the standing of the United States among world leaders.
Because the FBI seems to have ignored for decades the serial warning signs regarding Charles Koch, Koch Industries and their intrusions into elections, we’re providing the FBI a simple and clear roadmap today.
Charles Koch is the billionaire Chairman and CEO of Koch Industries, one of the largest private corporations in the world. Koch Industries is a conglomerate with interests in fossil fuels, refineries, chemicals, paper products and extensive trading operations. For the past forty years, Charles Koch has been involved in a stealthy network of front groups that seek to gut the federal government of its regulatory functions and kill off popular federal programs like the U.S. Post Office, Social Security and Medicare.
To understand the full scope of Koch’s involvement in the events of January 6, let’s first remember what actually fomented the attack on the Capitol. It was based on the Big Lie that the election had been stolen from Donald Trump through voter fraud — something that Trump’s own cyber security chief, Chris Krebs, and Attorney General, William Barr, dismissed as lacking a factual basis. The playbook for the Capitol attack on January 6 was to intimidate Republican members of the Senate and House into refusing to certify the election results, thus withholding the Presidency from Joe Biden.
These are the red flags that lead to the doorstep of Charles Koch and Koch Industries and should play a significant role in any serious investigation conducted by Congress, the FBI, or U.S. intelligence agencies.
Red Flag # 1: There were…
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$1,400 coronavirus stimulus check: Calculate how much you may get
by ValueWalk - January 20th, 2021 10:25 am
By Aman Jain. Originally published at ValueWalk.
President-elect Joe Biden last week revealed a massive $1.9 trillion stimulus plan, called the American Rescue Plan. Among other things, the bill proposes to offer stimulus checks of $1,400. If you want to know how much your coronavirus stimulus check amount would be once this bill becomes law, there is a calculator to help you with that.
Q4 2020 hedge fund letters, conferences and more
Calculate your coronavirus stimulus check amount
Lately, there were talks of Congress approving coronavirus stimulus checks of $2,000. However, they eventually agreed to send $600 in stimulus checks, but talks of $2,000 still continued. So, many anticipated that they would get stimulus checks of $2,000 in the third round, but Biden’s plan instead proposed to top up the $600 with $1,400, to bring the total to $2,000.
This means if you are an eligible single taxpayer, who got the full $600 in the latest payment round, then you are likely to qualify for $1,400 under Biden’s proposal. In case you got less or more, and want to know how much you could get under Biden’s proposal, Forbes has come up with a calculator to help you.
According to Forbes, this stimulus check calculator is based on the information from the CASH Act and the announcement by Biden last week. To calculate your stimulus check amount, visit this link. To use the calculator, you need to enter your income, your filing status from your 2019 tax return and the number of dependents (if any).
Forbes’ calculator uses the following assumptions:
- The maximum eligible amount for adults and child dependents under 17 years would be $1,400.
- The adult dependents, who were left out in the earlier stimulus rounds, could get up to $2,000.
- Your stimulus check amount would be reduced by $5 for every $100 of income above the $75,000 AGI threshold.
Those who use this calculator should know that Biden’s plan isn’t law yet, so the final payment may change. Forbes, however, assured that it would update the calculator as and when new information becomes available.
When to expect the $1,400 payment?
Talking about when you could get the stimulus checks of $1,400, there is no clear…
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US Policy Points To Value Up And Risk On
by ValueWalk - January 20th, 2021 10:25 am
By Jacob Wolinsky. Originally published at ValueWalk.
Value stocks and high-risk stocks are the most likely to outperform in the coming months:
Q4 2020 hedge fund letters, conferences and more
- Certainty in US leadership, the coronavirus vaccine roll-out and large economic stimulus will have a big impact on the performance of equities in 2021
- Value, Small Cap and High Volatility stocks are likely to outperform
- More investors will turn to High Momentum and anti-inflationary assets
- Investment strategies will shift to ‘risk-on’
US Election Impact on Stocks
Our research shows that regardless of the winning party, new Presidents tend to enact stimulatory policies that help Value (those cheaper than their fundamentals suggest), Small Cap and High Volatility stocks to outperform. That’s exactly what we saw in late 2020, with those factors surging ahead of the former darlings of Wall Street: Growth and Tech stocks. Now President-Elect Joe Biden is expected to enact larger than normal stimulatory policies. This will drive their continued outperformance and stoke a ‘risk-on’ investment appetite.
Democratic control of the US Congress means President-Elect Biden will find it much easier to push through larger and more widespread stimulatory policies. But the path is not clear. Centrist Democratic Senators are likely to provide a brake on any policy that fiscally leans too far left. This is great for Wall Street – a stimulatory President who is kept in check by the Senate.
Last week, President-Elect Biden announced a $1.9T stimulus package to address both the economy and the coronavirus vaccine roll-out. The intention is to return to more normal economic activity and spur a recovery. The risk is inadvertent inflation.
Value stocks and high-risk stocks are the most likely to outperform
So, how can we expect stocks to behave? Value stocks and high-risk stocks are the most likely to outperform. So-called ‘coronavirus casualties’ like hospitality and travel stocks could see a big comeback in the near term. Airbnb, which listed on the public market in December, has rallied since the New Year on expectations of a surge in international travel later in 2021.
The rotation from Growth stocks over the past few months has also meant a rotation away from Momentum. The two investment styles were highly correlated because the rapid price rise of Growth…
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Whipsaw Wednesday – America Heads in a New Direction
by phil - January 20th, 2021 8:23 am
We're going to go back to the future!
After taking an evolutionary step backwards for four years, it's time to get America back on track and moving forward again in the 21st Century and, hopefully, we still have time to make this decade the Roaring 20s and not the prelude to the second Great Depression. As Warren Buffett says about investing in companies:.
“I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.”
Well, America has not passed the idiot test but it's still too soon to get a grade as we have to see if Engineer Joe can get this train back on the tracks or if, at this point, he'll merely be able to bring us in for a soft landing. At 78 years old, even Joe Biden doesn't think he should be President for more than 4 years and is calling himself a "Transition President". Reagan was 78 when he left office, Trump is 74 but, as Reagan said of Walter Mondale:
“I want you to know that I will not make age an issue of this campaign,” Reagan said. “I am not going to exploit for political purposes my opponent’s youth and inexperience.”
Experience is certainly what Joe Biden is bringing to the table – he's been a Senator since 1973, then VP for 8 years in 2009 and then 4 years of relaxation as a Professor at the University of Pennsylvania while remaining at the forefront of the "Cancer Moonshot" program he started and is likely to bring to the White House officially as one of his first acts. If you want to know what Joe Biden is really about, watch his eulogy for John McCain.
Politics doesn't have to be ugly and our nation doesn't have to be bitterly divided. We, the people, are being offered a chance to go forward with the grace and…
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Steel Prices Are Exploding To Record Highs
by Zero Hedge - January 20th, 2021 5:45 am
Courtesy of ZeroHedge View original post here.
One of our readers writes in that a client just got a letter from US Steel:
"Dear valued client, effective immediately price of “seamless steel” has gone from $900 to $1350 per net ton."
Yes, a 33% price increase. This is what the Fed would call "inflation" if only the Fed measures rising prices correctly.
Impossible you say? Read the following take from The Fabricator industry mag and then reassess:
Steel prices reach levels not seen since 2008
The benchmark price for hot-rolled steel reached a new record high of $1,080/ton last month, according to our check of the market Jan. 11-12. That surpasses the previous high of $1,070/ton recorded by Steel Market Update (SMU) in 2008, and it leaves steel buyers with some important questions:
- How much higher can steel possibly go?
- When will the price peak?
- Will the eventual correction be a gradual decline or a dramatic death spiral as in 2008?
As fabricators and manufacturers are well aware, steel is in tight supply. Mills idled capacity in the spring in response to the coronavirus shutdowns and have been in no rush to bring it all back online. Tariffs imposed by the Trump administration continue to discourage imports. Demand among the steel-consuming industries is surprisingly robust, unlike the service sector of the economy, which is disproportionately impacted by COVID-19.
The domestic mills are having great difficulty producing and shipping steel on time to their customers, which is putting stress on service center inventories that are well below normal levels. Supply and demand are decidedly out of balance, forcing steel suppliers to focus on the needs of their contract customers first, leaving many smaller spot buyers to fend for themselves. As a result, prices in the spot market have been bid up to historic highs as OEMs and job shops pay huge premiums to get the material they need to keep their production lines running.
SMU data shows that in the past five months the average price for hot-rolled coil has jumped by two-and-a-half times, from $440/ton to nearly $1,100/ton.
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China’s Holdings Of US Treasuries Rise For First Time In 6 Months, Foreigners Keep Buying US Stocks
by Zero Hedge - January 20th, 2021 4:16 am
Courtesy of ZeroHedge View original post here.
After foreigners bought a record amount of stocks in the last 12 months into October, the latest Treasury International Capital flow data shows November was a massive month for private inflows overall.
Source: Bloomberg
After a record stretch of selling which ended in May 2020, foreign central banks bought US Treasury for 3 consecutive months in Aug, Sept and Oct, the longest stretch of buying since June 2014., but November saw the selling stretch resume, with the biggest selling since April 2020…
Source: Bloomberg
After 5 straight months of selling, China bought $9bn of US Treasuries in November…
Source: Bloomberg
Japan was a seller for the 4th straight month…
Source: Bloomberg
Foreigners bought $9.640BN in TSYs in November, a reversal from their selling of $20.1BN in October.
They doubled down on purchases of Agencies, buying $53.39BN in November after buying $48.9BN in October.
Foreigners bought $867MM in corporate bonds, after selling $21.5BN in October.
Finally, they purchased $61.9BN in equities in November, the 7th consecutive month of purchases…
Source: Bloomberg
Finally, we note that while Treasury holdings overall are rising modestly, but have a long way to go to match the de-dollarization trend seen in gold holdings over the past year…
Source: Bloomberg
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.