Gold Bullion Demand Hits Record Volumes in USA
by ValueWalk - June 4th, 2020 12:39 pm
By James Anderson. Originally published at ValueWalk.
With ongoing bailouts exploding the fiat US dollar’s M1, M2, & M3 supplies at record paces. It is not surprising to see physical gold bullion USA imports now hitting 21st Century high levels.
Q1 2020 hedge fund letters, conferences and more
U.S. Physical Gold Bullion Imports
Most of this recent record-sized US gold import volume is being delivered from Switzerland which has four of the five largest gold refineries in the world.
It is safe to assume that the over $3 billion and then $6 billion of gold imported into the USA in March and April 2020 respectively are newly refined gold bars.
Judging by ongoing COMEX data (US gold futures exchange), most of these fractional reserve gold holdings have found their way into Brink’s NY.
Record Swiss-US Gold Imports While China & India Are Locked Down
Typically the Swiss refine physical gold where it is demanded most, in the east. Most gold from Switzerland since the 2008 GFC has been bound for China and India.
What is going to happen with the 2020s gold price and gold market once China and Indian demand return back towards normal pre-viral crisis levels likely by this coming September?
In the following bullion market update, we examine ongoing financial bailouts versus big bank gold trading losses versus record-paced Gold ETF and US physical gold bullion import demand.
Gold Bullion Demand is Overwhelming the System
So we now have looting and many riots in major cities amidst over 40 million recently unemployed in the USA. Much of this looting is ruining businesses that were likely already on the threshold of bankruptcy thanks in large part to being shut down for months due to the viral crisis.
And we have a private central bank that has used terms like infinite QE while it has effectively melded with the US Treasury to bail out over $4.5 trillion without any ability of US Citizens to audit where those fund flows are going.
Meanwhile, the NY Fed REPO loan ramp saga which began in September 2019 is still ongoing with tens of billions needing to be lent out overnight daily…
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Small Businesses Need PPP Flexibility Act To Become Law
by ValueWalk - June 4th, 2020 12:36 pm
By Jacob Wolinsky. Originally published at ValueWalk.
Small biz need PPP Flexibility Act to become law, as well as a longer term program
Q1 2020 hedge fund letters, conferences and more
Small businesses need all these adjustments, but there are still multiple gaps, including data collection and money for PPE
The Passage Of The PPP Flexibility Act
On the passage of the PPP Flexibility Act in the Senate last night, Executive Director of the Main Street Alliance Amanda Ballantyne has this to say:
“The Paycheck Protection Flexibility Act is a first step in addressing the design flaws of the PPP and must immediately go to the President’s desk to become law, however, additional support is necessary to address the ongoing crisis millions of small business owners are still facing.
As protests continue across the nation, we cannot ignore that the PPP is another government program that has continued to expand racial wealth inequality with new data showing that Latinx and Black small businesses have closed at 1.5 times and double the rate respectively, compared to overall small businesses. The PPP fixes are necessary, but still fail to address the continued crisis of access to funding for these small businesses.
Expanding the time horizon, and reducing the fixed percentage on payroll for loan forgiveness are critical improvements.
Small Businesses Have Already Spent Their PPP funding
The PPP Flexibility Act extends the timeline — but not the funding for small businesses. Most small businesses have already spent their eight weeks of PPP funding — but it will be months or more before businesses are able to safely reopen and consumer confidence is back to create demand and profitable businesses.
We must make these short-term changes to PPP to improve functionality. But we need a comprehensive longer term solution that recognizes the financial crisis Covid-19 has created for small business and our entire economy.
Payroll subsidy programs like the Senate’s Paycheck Security Act, also introduced last week by Senators Sanders, Warner, Blumenthal and Jones, reflect the on-going nature of this crisis, is a policy idea that has bipartisan support and would be part of larger set of policies that works in tandem with the PPP to provide the kind of support we need…
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Colleges Don’t Need Liability Protection To Open
by ValueWalk - June 4th, 2020 12:00 pm
By Jacob Wolinsky. Originally published at ValueWalk.
Colleges Don’t Need Liability Protection to Open; A Simple Proven Alternative Already Exists – Expert
Q1 2020 hedge fund letters, conferences and more
WASHINGTON, D.C. (June 3, 2020) - At a Senate hearing on Thursday, many higher educational organizations will be asking for immunity from COVID-19-related lawsuits should they reopen campuses this fall, but Senator Patty Murray, among many others, said she opposes “granting a ‘liability shield’ because it would essentially say, ‘it’s okay if students or employees get sick.’”
A Third Option
But there’s a third option – a simple proven alternative compromise solution – which would help shield educational organizations without awarding them blanket immunity, while at the same time permitting them to return to in-classroom instruction for students who demand it, and are willing to accept the unavoidable risks of classroom instruction, says public interest law professor John Banzhaf.
Banzhaf, who has been called “a Driving Force Behind the Lawsuits That Have Cost Tobacco Companies Billions of Dollars,” and “The Man Big Tobacco and Now Fast Food Love to Hate,” helped persuade Congress not to grant immunity to the tobacco industry and to the food industry (in the infamous “cheeseburger bill”).
Although the risks of becoming infected in a classroom cannot be completely avoided – even if students are required to wear masks, are seated far apart, and a 6-foot social separation rule can somehow be maintained without a single exception – that doesn’t necessarily mean that no classroom instruction should begin in the fall.
Since the individual risk to mostly young and largely healthy college students is very small, they may be willing to assume it for the benefits they see from in-classroom instruction, at least for some classes, and to avoid the kind of bad on-line instruction most just experienced – largely so unfavorable that they call it “ZOOM U.”
Students “Assume The Risk” Of Getting Infected
If these students are willing to assume the risk of infection, then universities can, if they wish, ask the students to sign a release or waiver, similar to the releases they are accustomed to signing when they go skiing, engage in organized commercial activities such as rock climbing, or rent an e-scooter.
In all such cases – i.e., skiing, rock climbing,…
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JDE Peet’s IPO: Classic Story, Classic Investment Case
by ValueWalk - June 4th, 2020 11:59 am
By Alex Gavrish. Originally published at ValueWalk.
Alex Gavrish discusses JDE Peet’s IPO
Previous IPO we discussed was TeamViewer AG which started trading on September 25th, 2019. Teamviewer priced its IPO at EUR 26.25 per share, with Permira funds selling a 42% stake in the company.
Q1 2020 hedge fund letters, conferences and more
Since our recommendation on October 23, 2019 shares of TeamViewer performed extremely well (both before and especially after COVID-19 crisis developments). At the current market price of about EUR 46 per share, shares returned 95%.
JDE Peet’s IPO
We believe that the recent IPO of coffee maker JDE Peet’s provides investors a classic story and classic investment opportunity.
JDE Peet’s started trading at Euronext on May 25, 2020. Company raised approximately EUR 700 mil by issuing 22.2 mil new shares while existing shareholders sold an additional 49.2 mil shares at an IPO price of EUR 31.5 per share. Funds managed by Soros Fund Management LLC have subscribed for an aggregate amount of EUR 761 million, taking approximately 33% of IPO shares.
Mondelez international will retain a 23.4% stake while Acorn Holdings (JAB) will retain a 62.2% stake. JDE Peet’s free float post IPO will therefore be 14.4% percent only.
At the current market price of EUR 37 per share, the company has a market capitalization of EUR 18.3 billion and an Enterprise Value of about EUR 24.1 billion, valuing the company at an EV/Adj EBITDA multiple of x15. Assuming a 70% free cash flow conversion rate (according to IPO prospectus), JDE Peet’s has a Free Cash Flow Yield of 6.15%.
Soros Fund Management’s Participation Makes JDE An Attractive Investment
We believe that participation of Soros Fund Management in the IPO (33% of IPO shares), low free float, reasonable valuation multiple and attractive free cash flow yield make JDE Peet’s shares an attractive investment.
In addition to this, current dislocations in the market due to COVID-19 crisis make the company extremely attractive due to the defensive nature of its products and sector. Investors do not have many investment opportunities of such kind in the current market environment, and we believe that shares warrant a higher valuation multiple. Expansion of valuation multiple to x18.5 and an annual growth of 5% in Adj EBITDA could…
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COVID-19 Puts AI M&A In The Spotlight
by ValueWalk - June 4th, 2020 10:55 am
By Jacob Wolinsky. Originally published at ValueWalk.
COVID-19 puts artificial intelligence AI M&A in the spotlight on the back of record deal volumes in 2019, says Hampleton Partners’ report
Q1 2020 hedge fund letters, conferences and more
- AI-driven remote security and monitoring of social distancing and mask-wearing, plus fever detection technology is in play
- AI technology is adding value across all sectors with healthcare, automotive, finance, education and security benefitting most in current conditions
London, UK – 4 June 2020. The AI M&A market report from Hampleton Partners, the international technology mergers and acquisitions advisor, reveals the year 2019 saw a total of 279 deals – more than the 261 AI deals recorded across 2017 and 2018 combined. The first quarter of 2020 recorded a promising 95 deals.
Heiko Garrelfs, Sector Principal, Hampleton Partners, said: “On the back of record AI deal volumes in 2019 the arrival of Covid-19 is putting artificial intelligence innovators and companies further in the spotlight for strategic buyers.
“New norms such as health checks and social distancing at work are driving AI adoption and adaptation. Companies are having to find new ways of automating processes and drive cost-efficiency as, in many sectors, their profits are coming under pressure.
“On the home front, if ‘stay at home’ and ‘shelter in place’ orders continue, we expect to see more language analysis, chatbot and personal assistant AI deals beyond the usual suspects of Apple, Amazon and Google.”
Hampleton’s Artificial Intelligence M&A report analyses transactions, trends and activity across the quantitative analysis, vision, and language analysis segments. It also features interviews with two of the sector’s pioneers: Albert Stepanyan, founder and CEO, Scylla.ai, the AI-based protective intelligence suite that enhances security operations; and Artem Rodichev, Head of AI, Replika, which has created an AI-friend experience chatbot, proving popular with those under 25 years of age.
Most Active Sector And Largest Deals
AI used for the purpose of quantitative analysis represented 70 per cent of all AI deals between May 2019 and May 2020. It remains the technology of choice for acquirers seeking to capitalise on efficient ways of processing, automating and augmenting large amounts of data.
The segment also saw the largest AI deals, courtesy…
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What A Larger Than Expected ECB QE Bond Purchase Program Means
by ValueWalk - June 4th, 2020 10:54 am
By Jacob Wolinsky. Originally published at ValueWalk.
The following are the comments from Henderson Rowe’s Artur Baluszynski and Kingswood’s Rupert Thompson, discussing the recovery of the EU economy, the worst contraction in employment and ECB’s QE Bond Purchase Program.
Q1 2020 hedge fund letters, conferences and more
The Differing Indicators With Regards To The Recovery Of The EU Economy
Commenting on differing indicators with regards to the recovery of the EU economy, Artur Baluszynski, Head of Research at Henderson Rowe, said: “Lagging indicators such as the unemployment rate are showing a really bad state of affairs for the EU economy while leading indicators such as PMI are showing signs of recovery. The speed at which EU governments will choose to exit lockdowns and barriers to international travel will dictate the pace of the recovery from here. There might be a chance that Southern Europe can salvage what’s left of the Summer season, a prime time for seasonal hiring”.
The Worst Contraction In Employment Since The Great Depression
Commenting on the worst contraction in employment since the great depression, Artur Baluszynski, Head of Research at Henderson Rowe, said: “Recent data shows that over 40 million Americans have filed for unemployment but the pace is decelerating which means that people are slowly starting to return to work. However, this figure means that we are looking at an unemployment rate of approximately 25% in the US. If one considers that it took only three months to achieve such a high figure, this must be the worst contraction in employment since the great depression”.
ECB’s QE Bond Purchase Program
Commenting on a larger than expected ECB QE bond purchase program, Rupert Thompson, Chief Investment Officer at Kingswood, said: “The ECB has boosted the size of its covid-related QE bond purchase program by €600bn from €750bn to €1350bn and extended its operation until at least June 2021. The increase was somewhat larger than expected and follows recent moves by Germany and the EU more generally to step up their fiscal stimulus. The ECB move came despite the German Constitutional Court’s move a few weeks ago to stymie the ECB’s bond buying. These moves mean the EU, which has lagged considerably behind the US in terms of its policy stimulus, has now…
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Stimulus check round 2: Where do we stand?
by ValueWalk - June 4th, 2020 10:07 am
By Michelle Jones. Originally published at ValueWalk.
The situation involving a round 2 of IRS stimulus checks continues to evolve. It seemed like there was no chance for a second round of coronavirus stimulus checks, but that may be changing. Lawmakers may be moving closer to acting, especially if the Trump administration influences Republican lawmakers. Here’s the current status of a round 2 of IRS stimulus checks.
Q1 2020 hedge fund letters, conferences and more
Status of round 2 of IRS stimulus checks
Right now there’s no clear package that has the approval of most lawmakers. The bickering and debate continues on Capitol Hill. The HEROES Act, which was passed by the Democrat-led House, appears essentially defunct. President Trump and Senate Republicans have called it “dead on arrival,” and that certainly appears to be the case.
Even if the HEROES Act never comes up for a vote, it doesn’t mean that round 2 of IRS stimulus checks won’t happen. McConnell has said that the next stimulus package will be written in the Senate and be the last such bill. Based on that comment, it sounds like the Senate will start from scratch on a new bill, which would mean that if both sides of the aisle can come to an agreement, it will then have to go to the House for a vote.
Possible timing of coronavirus stimulus checks round 2
The timing of a round 2 of IRS stimulus checks is up in the air. The White House is said to be working on another stimulus bill this week as President Trump was scheduled to meet with advisors to talk about it. However, Senate Majority Leader Mitch McConnell has said that people shouldn’t expect more stimulus until early next month.
That could mean that lawmakers will start debate on another package soon with the goal of passing it in early July. On the other hand, it could also mean that the Senate will wait to even start debate on another stimulus bill until next month.
Even if McConnell wants to wait for a month before starting debate, it’s possible the Trump administration could convince him and other Republicans who want to take a wait-and-see approach to move faster than they currently want to move. If the Trump…
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IRC: PPP Fixes Give Independent Restaurants Hope
by ValueWalk - June 4th, 2020 10:04 am
By Jacob Wolinsky. Originally published at ValueWalk.
Independent Restaurant Coalition: Paycheck Protection Program (PPP) Fixes Give Independent Restaurants Hope
Q1 2020 hedge fund letters, conferences and more
WASHINGTON, D.C. — Today, the Independent Restaurant Coalition (IRC) released the following statement on the passage of the Paycheck Protection Program Flexibility Act in the United States Senate:
Flexible PPP Funds Give A Fighting Chance For Restaurants
“By making PPP funds more flexible, Congress is giving independent restaurants a fighting chance at reopening. Republicans and Democrats put forward a bill that gives many restaurant owners some hope amidst these unprecedented times. We are grateful for Senate Majority Leader Mitch McConnell, Minority Leader Chuck Schumer, Senators Ben Cardin, Steve Daines, Cory Gardner, Tim Kaine, Angus King, Marco Rubio, Debbie Stabenow, Thom Tillis, and Reps. Dean Phillips and Chip Roy, who were among the first to listen to the unique needs of independent restaurants during this crisis.
“Even with these changes, many restaurants will still have a hard time surviving the crisis we’re in. Social distancing measures are forcing restaurants and bars to operate with dramatically reduced revenues for the foreseeable future, which will be unsustainable in the long-run. The coronavirus pandemic is a long term problem and these PPP fixes are only the beginning of a solution. We need an independent restaurant stabilization fund like the one proposed by Rep. Earl Blumenauer to ensure 500,000 independent restaurants can reopen, stay open, and re-employ 11 million Americans.”
The Independent Restaurant Coalition was formed by chefs and independent restaurant owners across the country who have built a grassroots movement to secure vital protections for the nation’s more than 500,000 independent restaurants and the more than 11 million restaurant workers impacted by the coronavirus pandemic
The post IRC: PPP Fixes Give Independent Restaurants Hope appeared first on ValueWalk.
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Here’s the status of a second round of IRS stimulus checks
by ValueWalk - June 4th, 2020 9:38 am
By Michelle Jones. Originally published at ValueWalk.
The status of a second round of IRS stimulus checks hasn’t changed much, but there has been some movement on the issue. Pressure on lawmakers to act is increasing, and now the proposal for $2,000 payments per month is back on the table.
Q1 2020 hedge fund letters, conferences and more
Updated status of round 2 of IRS stimulus checks
Lawmakers are looking at several ways to put more money in the pockets of Americans who have taken a financial hit during the coronavirus pandemic. The chances of a second round of coronavirus stimulus checks have been looking slim as lawmakers are finding it impossible to agree on anything. However, the longer the emergency goes on, the more likely they are to act.
Just as many businesses are being allowed to reopen amid the pandemic, other businesses are being forced to shut down due to the widespread looting and rioting related to the death of George Floyd in police custody. Even stores that weren’t affected by the pandemic are now closing to protect against looters.
Although the closures may not lead to layoffs because they aren’t expected to last as long as the pandemic-related closures, they will still result in income losses for workers whose stores are closed. These closures are occurring at a time when the U.S. can ill afford more income losses and financial turmoil for workers.
Three main proposals are being talked about right now. The first is a second round of IRS stimulus checks amounting to $1,200 per adult and $1,200 per dependent of any age. However, this proposal is part of the House’s HEROES Act, which is encountering strong opposition from both Republicans and Democrats in the Senate.
Proposals for monthly payments
Two proposals for monthly payments come from Senators Kamala Harris and Andrew Yang. Harris renewed her call for a $2,000 per month stimulus payment, while Yang pushed for a $1,000 per month universal basic income. The two senators touted their plans for a monthly check during a virtual town hall hosted by The Appeal.
According to Forbes, the Monthly Economic Crisis Support Act touted by Harris would provide up to $2,000 per month to Americans earning up to $120,000 per…
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Bill Ackman leads rioting in NYC to benefit his retail shorts
by ValueWalk - June 3rd, 2020 5:44 pm
By TheStonkMarket. Originally published at ValueWalk.
NEW YORK CITY – Hedge fund manager, Bill Ackman, was spotted last night leading a hoard of 10,000 angry rioters down the streets of 5th Avenue. Reports indicate that Ackman was persuading looters to steal and destroy as much as possible. Sources suggest that Ackman lead and instigated rioters solely to profit from his retail shorts. Bill Ackman is the founder of Perishing Square Capital Management a hedge fund with assets under management (“AUM”) of $8 billion.
Q1 2020 hedge fund letters, conferences and more
Julia Miller, a financial reporter with The Wall Street Journal noted that Ackman lead rioters with a burning torch down the streets of Fifth Avenue. Once on Fifth Avenue Ackman handed out Herbalife Nutrition (“HLF”) products to anyone who looted and destroyed a retail store.
Bill Ackman Handing Out Herbalife Products To Rioters
Cassandra Williams, local rioter stated the following, “I followed this thin, silver haired man with a burning torch that was handing out Herbalife products as an incentive to loot high-end retail stores. Not only did I get a massive amount of dietary products but I helped destroy part of the ‘cog’ in the capitalistic system that ties me down.”
Other notable investors have taken Ackman’s lead. Andrew Left, founder of Citron Research was reported to buy rioters several M1 Abram tanks in hopes of destroying the entire world. Ben Axler, another well known short seller, has urged rioters to loot as much WD-40 as possible. Even small time individual short sellers have taken to the streets to help profit their shorts.
The question remains, is a new breed of activist investors emerging? The answer is yes. With markets seemingly making new highs every day, short sellers need to start creating their own destiny. And the best way to forge your own destiny? Actively burn down the business you are short.
With Bill Ackman’s net short position in the retail sector Perishing Square’s investors stand to benefit.
This article first appeared on The Stonk Market
The post Bill Ackman leads rioting in NYC to benefit his retail shorts appeared first on ValueWalk.
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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...
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