$107 billion beer takeover awaits nod from China
A takeover deal between Anheuser-Busch InBev and SABMiller still needs approval from Chinese regulators and global investors. …read more
Source: $107 billion beer takeover awaits nod from China
Archive for the ‘Uncategorized’ Category
Can an anonymous social network ever work?
Candid is the latest social app that lets people share their opinions but not their identity. Its creators hope AI can turn it into the next Reddit, instead of the next Secret or Whisper. …read more
Source: Can an anonymous social network ever work?
So… the Entire Rally Was Based on a Lie?
The Bank of Japan admitted back in June helicopter money is not on the agenda. Amazingly this is news today after the market has rallied hard based on hope that helicopter money is about to be unveiled.
The yen pared an advance against the dollar as it emerged that an interview in which Bank of Japan Governor Haruhiko Kuroda dismissed the idea of so-called helicopter money was conducted in June.
The Japanese currency earlier jumped more than 1 percent after, in comments broadcast on BBC Radio 4 on Thursday, Kuroda said there was no need or possibility for such a strategy. The interview was conducted on June 17, a BBC spokeswoman said.
Source: Bloomberg
This is not a surprise to anyone who does actual analysis. Kuroda said back in April 2016 (even before the above interview) that the Bank of Japan CANNOT implement helicopter money because it is ILLEGAL under Japan’s constitution.
But then again, we are talking about the same Central Bank head that claimed NIRP wasn’t coming… only to launch it eight days later in February 2016. However, that proved a disaster with the Yen surging while the Nikkei plunged.
This is the problem with the entire financial system today: everything is trading based on the words of a handful of Central Bankers, many of whom was perfectly willing to lie or deceive just to push stocks higher.
Indeed, the entire market move from the BREXIT lows has been a desperate manipulation by Central Banks as they begin to lose control of the financial system.
We saw the same thing happen in 2007: a final push to new all-time highs in October. What followed wasn't pretty.
A Crash is coming… and the time to prepare is NOW, before it hits.
On that note, we are already preparing our clients for this with a 21-page investment report titled the Stock Market Crash Survival Guide.
In it, we outline the coming crash will unfold…which investments will perform best… and how to take out “crash” insurance trades that will pay out huge returns during a market collapse.
We are giving away just 1,000 copies of this report for FREE to the public.
To pick up yours, swing by:
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Best Regards
Graham Summers
Chief Market Strategist
Phoenix Capital Research
Source: So… the Entire Rally Was Based on a Lie?
Philly Fed Slumps To 6-Month Lows As National Activity Index Jumps To 6-Month Highs
By Tyler Durden
In the first wave of macro data today, initial claims beat expectations, dropping to 253k near record lows (but remains wildly divergent from tumbling consumer confidence). Following June's rebound in Philly Fed, July missed expectations tumbling to six-month lows, back to a contractionary -2.9 (against expectations of a flat print of +4.5). Finally, Chicago Fed's National Activity Index surged unexpectedly to six-month highs (+0.16 vs -0.20 exp) but the smoother 3-month avg remains in contraction for its 17th straight month.
If the jobs market is so awesome, judging by initial claims near historic lows, then why is US consumer's economic confidence collapsing?
Philly Fed's bounce into the green in June is over with July printing back to its lowest since Jan 2016…
Which is odd given that almost all the subindices improved…
And finally The Chicago Fed's National Activity Index surged back into positive territory (the highest since January) but the 3-month average remains in negative territory for 17 months…
So take your pick – bias confirming data abounds.
Charts: Bloomberg
Source: Philly Fed Slumps To 6-Month Lows As National Activity Index Jumps To 6-Month Highs
Frontrunning: July 21
By Tyler Durden
- Global stocks nurse nine-month highs before ECB meeting (Reuters)
- Kuroda Says No Need and No Possibility for Helicopter Money (BBG)
- As Republican Party tries to heal wounds, discord rules at convention (Reuters)
- GOP Divided as Cruz Snubs Trump (WSJ)
- Trump Chooses War With Cruz at Convention Aimed at Unification (BBG)
- Trump considering fracking mogul Harold Hamm as energy secretary (Reuters)
- Turkey says no return to past repression despite state of emergency (Reuters)
- UK says unlikely to trigger formal EU divorce before year end (Reuters)
- Citadel Hiring About 17 Portfolio Managers From Shuttered Hedge Fund Visium (WSJ)
- Goldman Sachs under spotlight in Malaysian fund scandal (Reuters)
- Tesla CEO Elon Musk Announces Heavy Truck, Ride Sharing Fleet of Cars (BBG)
- France orders Nice policing inquiry after July 14 attack (Reuters)
- Another First for S&P 500 as Record Comes With Yuan in Reverse (BBG)
- Komatsu to buy U.S. mining equipment rival Joy Global in $3.7 billion deal (Reuters)
- Cryptocurrency Platform Ethereum Gets a Controversial Update (WSJ)
- Exxon Grabs Reins in InterOil Hunt as Rivals Bow Out of Deal (BBG)
- Son of Bangladesh opposition leader gets seven-year jail term for money laundering (Reuters)
- Chinese Private Equity Funds Are Taking on the World’s Giants (BBG)
Overnight Media Digest
WSJ
– Texas Senator Ted Cruz upstaged Republican vice presidential nominee Mike Pence Wednesday night by refusing to endorse Donald Trump for president, disrupting a night that was supposed to be devoted to party unity. http://on.wsj.com/2acF2gg
– U.S. prosecutors have linked the prime minister of Malaysia to hundreds of millions of dollars allegedly siphoned from an economic development fund, and are seeking the seizure of more than $1 billion of assets. http://on.wsj.com/2acFcEp
– A foreign-exchange executive of HSBC Holdings Plc was arrested for allegedly front-running a $3.5 billion currency trade for a client, in a deal that netted millions in profits for the bank. http://on.wsj.com/2acEUNJ
– The custodians of the popular cryptocurrency platform Ethereum implemented a controversial change to it Wednesday. The change, called a “hard fork,” essentially undoes the transactions that allowed a June theft of $60 million worth of the digital currency, thereby allowing the money to be returned its rightful owner. http://on.wsj.com/2acFvis
– Kenneth Griffin’s Citadel Llc hedge fund hired about 17 portfolio managers this week from fallen rival Visium Asset Management, imperiling Visium’s plan to sell its last remaining part to another money manager. http://on.wsj.com/2acFhrB
– The U.S. Justice Department on Wednesday signed off on Anheuser Busch InBev SA’s acquisition of rival SABMiller Plc, removing one of the last major hurdles standing in the way of a roughly $108 billion deal to create a global beer giant. http://on.wsj.com/2acFOK8
FT
*Two HSBC foreign exchange traders have been arrested and charged for allegedly making $8 million in profits and fees by “front running” a client’s $3.5 billion foreign exchange trade.
*German exchanges operator Deutsche Borse remains short of a 60 percent threshold it needs to merge with the London Stock Exchange.
*FirstGroup will be the first UK bus and rail operator …read more
Source: Frontrunning: July 21
Yen Soars, Stocks Slide After Kuroda Says "No Need Or Possibility For Helicopter Money"
By Tyler Durden
The main catalyst that has pushed stocks to new all time highs, and sent the Yen plunging the most in the 21st century last week, were reports that Ben Bernanke was urging Japan to unleash helicopter money. Indeed, just yesterday, the USDJPY hit new two month highs on reports Japan was considering doubling the previously rumored fiscal stimulus of JPY10 trillion to 20, with the implication that the BOJ would provide the funds. It appeared that Japan had found just the jawboning tagline to keep stocks levitating and the Yen dropped: just hint every other day that more helicopter-funded stimulus is coming and jawbone assets, the same way verbal hints of more BOJ QE worked in 2015.
Which is why we were surprised to read this morning that BOJ governor Kuroda had shut down Bernanke, saying there is no need and no possibility of helicopter money in Japan, increasing speculation about the course of monetary and fiscal policy in the world’s third-largest economy. Given the current institutional setting, there is “no need and no possibility for helicopter money,” Kuroda said in a BBC Radio 4 program that was broadcast Thursday. “At this moment, the Bank of Japan has three options with quantitative and qualitative easing with negative interest rates.”
These current policies can be expanded, he said. Kuroda also repeated that he is determined to rid Japan of its deflationary mindset, and that there are no significant limitations to further monetary stimulus if needed by the BOJ.
Which, however, is not true: like the ECB, the BOJ is rapidly running out of willing bond sellers as its universe of eligible bonds gets smaller, while NIRP has proven to be far more deflationary than anyone had expected. In fact, the only way the BOJ’s policies can continue is if the government opens the debt issuance spigot, which is all that helicopter money really is. We are confident that Kuroda gets this, and we are confident that despite his reverse-jawboning today, helicopter money is precisely what will happen.
But first there needs to be a crisis. As BofA’s Athanasios Vamvakidis said, “markets had run ahead of themselves, expecting too much. Helicopter money is the inevitable end game in Japan, but we aren’t there yet, it will be the bazooka that the BOJ will use after a crisis.” So we just need the crisis. For now however, there is none, and immediately after Kuroda’s interview, the Yen soared, strengthening against all 16 of its major peers. The USDJPY tumbled more than 1% in the minutes after Kuroda’s interview was releaesed.
“Kuroda has just given investors a bit of a disappointment,” said Peter Garnry, head of equity strategy at Saxo Bank A/S in Hellerup, Denmark. “The market had actually changed its sentiment and pricing based on the assumption that we would get something big on the fiscal stimulus side, and that Japan would be the first wave.”
Meanwhile, almost $5 trillion has been added to the value of global equities since June 27 amid signs …read more
Source: Yen Soars, Stocks Slide After Kuroda Says "No Need Or Possibility For Helicopter Money"
Beware of Junkyard Dogs: “This Isn’t A Really Normal Environment”
By Tyler Durden
Having spent a chunk of his youth “shopping” them, Jim Croce came to know a thing or two about junkyards. In those youthful days, should his clunker de jour be missing some vital part or parts, a trolling expedition through South Philly’s scrap heaps was always the enterprising Croce’s preferred method of procurement.
Amid all of Croce’s parts foraging, it was a universal joint for a ‘57 Chevy and a ‘51 Dodge transmission, two must have and must-be-cheap or, better yet, free, parts that the legendary folk singer still recalled. He also reminisced that junkyards could and would provide a no frills, but highly motivated and easy way to get in some cardio, as in running for your life.
“I got to know many junkyards well, and they all have dogs in them,” the late Croce said in a 1973 interview. “They all have either an axle tied around their necks or an old lawnmower to keep ‘em at least slowed down a bit, so you have a decent chance of getting away from them.”
So was born the junkyard dog yardstick by which to measure the meanness of one Bad, Bad Leroy Brown, Croce’s hit which landed at the top of the charts 42 years ago this week.
As for high yield bond analysts, they aren’t exactly known for catchy turns of phrase. However, in recent weeks, they’ve shed the dry and donned the dramatic, as you’ll soon see. Such is the overheated state of the junk bond market this sweltering summer.
In his latest missive, Deutsche Bank’s Oleg Melentyev, arguably the best in class high yield analyst among his sell-side peers, warned of the perils of investing in this “frenzied market.”
Legendary high yield investor Marty Fridson shares Melentyev’s concerns and has for some time. By his best estimate, high yield was already in “extreme overvaluation” territory on June 30th, defined as being one standard deviation above fair value. Flash forward two weeks, and he calculates that the standard deviation has doubled.
(A quick Statistics 101 refresher: standard deviation tells you how tightly clustered or wide-of-the-center individual components of a given data set are from their mean. Remember the grade bell curve the engineering undergrads blew in business school? When all of the test scores came in on top of each other, the bell curve was super steep; when there was vast divergence, the bell curve was low and wide.)
Defining bond valuation also requires one employ “spreads,” which compare the prevailing yields on a given credit to a supposedly risk-free Treasury of a comparable maturity. And that means you have to get down to the nitty-gritty of measuring risk in basis points (bps), or hundredths of a percentage point.
In the event your eyes have rolled into the back of your head, listen up! This is important folks, your sweet grandparents could well own junk bonds in their desperate need to generate yield on their atrophying retirement funds!
With that preamble posited, on July 15th the option-adjusted spread on Bank …read more
Source: Beware of Junkyard Dogs: “This Isn’t A Really Normal Environment”
234 Billion-Dollar-Managing Fund Unclear Why Market Ignoring The Biggest Risk
By Tyler Durden
“It’s unclear why this hasn’t been a significant driver of markets across the board… maybe we just haven’t hit the threshold,” exhorts $234 billion bond fund Invesco’s Ray Yu. The head of the firm’s macro research told Bloomberg that a general theme of political risks increasing or political risk premium has been prevailing for the last few years and we are now seeing tension between established political regimes and populist movements.
But it appears Mr. Yu has had his lightbulb moment, as he adds:
“Investors are still dealing with aftermath of negative rates, super-accommodative monetary policy globally and structural need for income, which is mobilizing capital flows in unprecedented ways; “maybe that’s what we’re seeing overcome some of the concerns.”
In his view, the safest strategy in a world of this much uncertainty is to buy American, noting that post-Brexit and other risks, “we’ve gotten a lot more constructive on the dollar.”
Yu added that a Fed hike later this year would likely be warranted and the market is probably underpricing chance of a move sooner than expected…
“Everyone’s sort of gotten too comfortable with developments in China,” warning that “that story is not over.”
Investors “really need to stay atop what policy makers are thinking or where they think they are in terms of executing structural plan,” warning that this is “not an area investors should get too complacent about.”
Which is ironic as not only is the Yuan tumbling to fresh cycle lows but rate-hike odds are quietly resurgent…
Source: 234 Billion-Dollar-Managing Fund Unclear Why Market Ignoring The Biggest Risk
Sharia In Denmark
By Tyler Durden
Submitted by Judith Bergmann via The Gatestone Institute,
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“All the bullying happens in Arabic… The hierarchy of the Arab boys creates a very violent environment. … I have filmed the particularly vile bullying of a Somali boy. You can see the tears in his eyes. They are destroying him; it is very violent. “ — From a dissertation by Jalal El Derbas, Ph.D.
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Danish teachers are the least respected and are spoken of in denigrating and humiliating terms.
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“I am not saying that all the Arab children did ugly things, but we witnessed on a regular basis… using derogatory Arabic language towards Somalis and girls.” — Lise Egholm, former head of the Rådmandsgade school in Copenhagen.
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Whether Danish parliamentarians wish to acknowledge this problem or not, they are up against far wider issues than that of religious incitement in mosques by radical preachers.
After the television documentary, “Sharia in Denmark“, embarrassed Danish authorities by revealing how widespread the preaching of sharia is in mosques in Denmark; the Danish government, in May, concluded a political agreement about “initiatives directed against religious preachers who seek to undermine Danish laws and values and who support parallel legal systems.”
“We are doing everything we can without compromising the constitution and international agreements,” Bertel Haarder, the Minister for Culture and Church, said about the political agreement.
The agreement centers on a number of initiatives, which are supposed to compensate for the detrimental effects of all the years in which sharia was allowed to spread in Denmark while most authorities paid only scant attention to what was happening. Part of the new effort, therefore, will be the mapping of all existing mosques in Denmark.
It will now be obligatory, according to the agreement, for all priests, imams and others who are not part of the Church of Denmark, and who wish to be able to perform weddings — as well as for foreign preachers who apply for residence permits — to learn about Danish family law, freedom and democracy. At the end of the course, all will have to sign a statement that they will accept Danish law, including freedom of speech and religion, gender equality, freedom of sexual orientation, non-discrimination and women's rights.
The government will examine how to create more transparency in foreign donations to faith communities in Denmark, including controlling and, if necessary, preventing such donations. As part of this work, on May 4 the government presented a law making it a crime to receive funding from a terror organization to establish or run an institution in Denmark, including schools and mosques.
Another element in the political agreement is the establishment of national lists with the names of traveling foreign (non-EU) religious preachers who will be excluded from entry into Denmark on the grounds that they are a threat to public order in Denmark. These named preachers will not be granted an entry visa and will be denied entry at the border. In addition, a non-public list, containing the names of such preachers who are EU …read more
Source: Sharia In Denmark
Wikileaks Is About To Expose The Turkish ‘Coup’, But Someone Is Trying To Silence Them
By Tyler Durden
Submitted by Carey Wedler via TheAntiMedia.org,
Wikileaks claimed Monday it was under attack after it announced it would release hundreds of thousands of documents related to Turkey and the failed military coup attempted Friday, CNET reported.
The organization, which has released information on everything from war crimes to Hillary Clinton’s email scandal, announced Sunday it would be releasing 100,000 documents related to Turkey’s “political power structure,” some of which detail the “leadup” to the coup.
ANNOUNCE: Get ready for a fight as we release 100k+ docs on #Turkey's political power structure. #TurkeyCoup #Soon pic.twitter.com/dhJuWza4Es
— WikiLeaks (@wikileaks) July 18, 2016
Wikileaks anticipated the release would be censored in Turkey, cautioning in a three-part tweet posted Monday:
“Turks will likely be censored to prevent them reading our pending release of 100k+ docs on politics leading up to the coup. We ask that Turks are ready with censorship bypassing systems such as TorBrowser and uTorrent and that everyone else is ready to help them bypass censorship and push our links through the censorship to come.”
Turks will likely be censored to prevent them reading our pending release of 100k+ docs on politics leading up to the coup. (1/3)
— WikiLeaks (@wikileaks) July 18, 2016
We ask that Turks are ready with censorship bypassing systems such as TorBrowser and uTorrent (2/3)
— WikiLeaks (@wikileaks) July 18, 2016
And that everyone else is ready to help them bypass censorship and push our links through the censorship to come. (3/3)
— WikiLeaks (@wikileaks) July 18, 2016
The Turkish government, headed by President Recep Tayyip Erdogan, has increasingly ramped up censorship efforts against journalists, lending credibility to Wikileaks suspicions their release may not fully reach Turkish citizens—especially considering the latest leak concerns his ruling party, AKP.
As CNET noted:
“Facebook, Twitter and YouTube were reportedly blocked in Turkey during the attempted coup Friday, but many residents appear to have gotten around the blocks, posting messages and videos, likely using VPNs or other anonymizing services.”
Throughout Monday, Wikileaks continued to promote the release.
Turks ask whether WikiLeaks is pro or anti-AKP. Neither. Our only position is that truth is the way forward. 100k+ docs serves all sides.
— WikiLeaks (@wikileaks) July 18, 2016
They then tweeted that instead of 100,000 documents, they would actually be releasing far more. “Our pending release of 100k docs on Turkish political power? Just kidding. The first batch is 300k emails, 500k docs,” they announced.
But just hours later, they alerted followers their website was being attacked. “Our infrastructure is under sustained attack,” they tweeted, alongside the hashtag, #TurkeyPurge.
Our infrastructure is under sustained attack. #TurkeyPurge #Turkey
— WikiLeaks (@wikileaks) July 18, 2016
“We are unsure of the true origin of the attack. The timing suggests a Turkish state power faction or its allies. We will prevail …read more
Source: Wikileaks Is About To Expose The Turkish ‘Coup’, But Someone Is Trying To Silence Them
