Many animal lovers have heard of Puerto Rico’s ‘dead dog beach,’ a stretch of sand and jungle on where people dump their dogs. But the truth is Puerto Rico has become ‘dead dog island.’
Source: Puerto Rico has become ‘dead dog island’
It is pretty ironic that Netflix disrupted Blockbuster, causing Blockbuster to go the bankruptcy route, and ultimately On Demand is already disrupting Netflix as we speak. This is a Sea Change in the space, the worm has turned because of the market arrival of On Demand through multiple alternative platforms. This deflationary trend means all media content is actually a depreciating long term asset base.
Ultimately content is gravitating directionally towards the “Free Zone” globally, the only value added will be in interface convenience, and organizational platform offerings of “commoditized content” for the upper end of the disposable income demographic. Given Netflix`s balance sheet they are a depreciating asset for any acquirer over the next 10 years, a perpetual write-down so to speak.
If Netflix remains a standalone company their stock will drop below $30 a share, and they could even go the bankruptcy route given their debt obligation trajectory structure, and the Sea Change that we think is just about to hit the entire market landscape for Netflix. In short, the Disrupter got Disrupted!
They ultimately are the next blockbuster, the next DVD sales, the next CD sales – they are an archaic, antiquated dinosaur in the fast moving Moore`s Law technologically changing world that we live in, and they barely got started. Moreover, Netflix`s management will be the last to see this Sea Change until it is too late in our opinion.
They should be selling high right now at any price before the overall market realizes what we do, because by the time the market gets it, collapsing valuations will inevitably have management riding this company all the way down.
With lowered management expectations always being one step higher and behind the dropping market valuations of the stock – the inevitable ‘ride-down’ ends up in what I refer to as the Bag Holder Syndrome of a highly overvalued asset in a perpetual depreciation cycle on the way down.
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Source: Netflix Analysis – On Demand is the Game Changer – Market Sea Change (Video)
Pope Francis launched his Instagram account on Saturday and within the first 12 hours of having it, he’d scored one million new followers.
Source: Pope Francis gains 1 million Instagram followers in under 12 hours
By Tyler Durden
Violence at a Trump rally? Hardly unexpected. However, make that violence between by a black Trump supporter who unloaded on an abusive, KKK-dressed, Hitler-saluting white protester who was being escorted out of the building, and the absurd shock value suddenly evolves to such surreal proportions one would expect a Salvador Dali portrait of Trump in the oval cabinet to emerge any day now.
The protestor was wearing a hood while saluting, presumably referring to KKK/Hitler, before he was punched & kicked https://t.co/BfioarhaBR
— Noah Gray CNN (@NoahGrayCNN) March 19, 2016
As the Hill first reported, a Trump protester was punched and kicked several times while being escorted out of a rally in Tucson, Ariz., by police. Videos show a protester in an American flag shirt holding up a picture of Trump before being punched. Another protester walking right behind him is seen wearing a white KKK-style hood. Police immediately handcuffed the attacker, a black man.
Trump called out the hooded protesters early on in the rally. “He’s a disgusting guy,” Trump said. “That is a disgusting guy, really disgusting.”
This is a clip of what happened:
VIOLENCE at another Donald Trump rally, this time in Tucson, AZ. Man hits and kicks protester: pic.twitter.com/7FWuSeE0Jt
— Frank Thorp V (@frankthorpNBC) March 19, 2016
And now we wait for the “impartial” media (whose CTR and CPM is through the roof in the past few months thanks to the Trump phenomenon) to accuse Trump of racial violence and somehow blame him for this latest embarrassing incident.
Source: KKK-Dressed, Nazi-Saluting Protester Beaten Up By Black Trump Supporter At Arizona Rally
By Tyler Durden
(The Dow Jones Industrial Average, daily – still creeping higher after concerted cooing by assorted central bankers)
“Germany is a disaster right now,” says Donald J. Trump A lot of Europeans would agree with him. Chancellor Angela Merkel’s open-door refugee policy is leading to widespread discontent. Her political position is “becoming weaker,” says the Financial Times. Why?
Because she represents the spirit of a different age. Once the most popular leader in Europe, if not the world, Ms. Merkel is now the Lady for Whom Time Stopped. She is an anachronism from a more optimistic era, when people believed in free trade, democratic government, and ever-rising prosperity.
(Angela Merkel: out of touch, out of style… Photo credit: Markus Schreiber / AP)
Now, the zeitgeist has changed. Ms. Merkel is out of style and out of step. In Britain, France, the Netherlands, Slovakia, Hungary, and the U.S., the candidates getting the most enthusiastic support are those who urge closing borders, restricting trade, and looking to protect themselves from all that is threatening, different, or new.
Forget free trade! Forget freedom of travel! Stop immigration… especially of the Muslims and Mexicans! Build a wall! Torture your enemies! Stop trying to expand the empire!
Gone is the brave optimism of the 1980s (remember “Morning in America”?)… and the bumptious corruption of the 1990s (remember Monica Lewinsky?). Now, we are old, tired, fearful, cowardly, and cranky. We want a strong leader to protect us – one who promises to take us back… to make us strong again… to make us young again.
Here at the Diary, we do not believe the “Great Man” theory of history. Look closely at the great men of history… and they don’t look so great. They are just as flawed as the rest of us – bumbling along from victory to disaster, with little real insight into what they are really doing or what role in history they are playing.
But a democracy must find a leader to express its soul. Unwittingly, he moves the country in the direction it was going anyway. Then, unaware of his limits, he goes too far. Marcus Licinius Crassus (the richest man in Roman history) attacked the Parthians… and died at Carrhae. Napoleon had Europe at his feet… and invaded Russia. Japan rolled over Southeast Asia… and bombed Pearl Harbor.
The battle of Carrhae (53 BC) cost Rome seven legions plus one Marcus Licinius Crassus, member of the first triumvirate and the richest man in Rome.
We all breathe in and breathe out. Economies. Markets. Societies and human beings. Now, after at least a generation of globalism, imperial expansion, and EZ money, the world is ready to exhale.
Trump may be fulfilling the empire’s destiny… helping us retreat from promises that can’t be kept, delusions that can’t be financed, and commitments that never should have been made.
It has taken us a long time to understand The …read more
Source: Why Trump Triumphs
Here’s a look at Donald Trump’s tweets about Fox News anchor Megyn Kelly and the network’s response.
Source: Read Donald Trump’s tweets about Megyn Kelly
A year ago, WTI rose 41% in 35 days from $43 to almost $61 per barrel. Like today, analysts then believed that a bottom had been reached. Prices stayed around $60 for 37 days before falling to a new bottom of $38 per barrel in late August. Much lower bottoms would be found after that all the way down to almost $26 per barrel at the beginning of the present rally.
Higher prices were unsustainable a year ago partly because crude oil inventories were more than 100 mmb (million barrels) above the 5-year average (Figure 2). Current inventory levels are 50 mmb higher than during the false rally of 2015 and are they still increasing.
International stocks reflect a similar picture. OECD inventories are at 3.1 billion barrels of liquids, 431 mmb more than the 2010-2014 average and 359 mmb above the 2015 level. Approximately one-third of OECD stocks are U.S. (1.35 billion barrels of liquids).
For 2015, U.S. liquids consumption shows a negative correlation with crude oil storage volumes (Figure 3). During the 2015 false price rally, consumption began to increase in April and May following the lowest WTI oil prices since March 2009–response lags cause often by several months. First quarter 2015 prices averaged $47.54 compared to an average price of more than $99 per barrel from November 2010 through September 2014 (44 months).
This coincided with the onset of declining U.S. crude oil production after April 2015 (Figure 4).
Net withdrawals from storage continued until consumption fell in July in response to higher oil prices that climbed to $60 per barrel in June. Production increased because of higher prices from July through November before resuming its decline after prices fell again, this time, far below previous lows. This complex sequence of market responses shows how sensitive the current market is to relatively small changes in price, production and consumption.
Most importantly, it suggests that a price variation of only $15 per barrel was enough to depress consumption a year ago. That has profound implications for the present price rally that is now $12 per barrel above its baseline and has already increased by a greater percentage than the 2015 rally.
Why Storage Matters
Although most analysts pay attention to storage volumes, market balance is generally thought of as a simple balance between …read more
Source: Another False Oil Price Rally: Crossing A Boundary
By Tyler Durden
Exactly
… since then things have gone from terrible to absolutely abysmal, and as of this moment the GSTHHVIP index which tracks the performance of these “most popular” among hedge fund stocks, has never been lower despite the dramatic rebound in the broad market!
So yes, anyone who shorted this index one month ago as we suggested, has made money. Unfortunately for Goldman’s hedge fund clients, the “basket” is still not available in ETF format, which means hedge funds are forced to pass these hot potato stocks among each other.
It also explains why while the most popular hedge fund stock basket has never done worse, its alternative, the least concentrated basket of stocks has never done better.
In other words, and as we also said last time around, the only winning trade is to do precisely the opposite of what the hedge funds are doing, none of whom have any clue as to what is going in this market anymore.
For those curious which stocks make up Goldman’s “hedge fund VIP basket”, so they can avoid them of course, here they are again.
Unfortunately for hedge funds it is too late to unwind exposure at this point, which is why despite the market rebounding to just modestly green on the year, most hedge funds remain deep in the red, because as Kostin puts it “the violent factor reversals have offset most efforts to generate alpha.” More:
Mutual funds and hedge funds have faced a difficult start to the year. High return dispersion is typically associated with increased stock-picking opportunities but the violent factor reversals have offset most efforts to generate alpha. Large-cap core mutual funds and hedge funds have lagged the S&P 500 YTD by 90 bp and 280 bp, respectively. 32% of large core funds has outpaced the S&P 500 YTD, close to the 10-year average of 33%. Large-cap growth funds have fared the worst with only 9% of funds beating the Russell 1000 Growth index so far in 2016.
Unfavorable stock selection has also hurt fund performance. Our basket the most popular hedge fund positions (GSTHHVIP) has lagged our very important short position basket (GSTHVISP) by 700 bp YTD (-5% vs. 2%). Similarly, our mutual fund overweights basket (GSTHMFOW) has trailed mutual fund underweights (GSTHMFUW) by 820 bp (-5% vs. 4%).
Mutual funds and hedge funds favor high growth, consumer-facing technology stocks such as Facebook (FB) and Alphabet (GOOGL). Eleven stocks appear in both our mutual fund overweights and popular hedge fund positions baskets. The median return of the 11 stocks was 19% during 2015 compared with -10% YTD. The median stock has higher expected 2016 sales growth (16% vs. 3%) and EPS growth (17% vs. 6%) vs. the market but a higher valuation (forward P/E of 19x vs. 17x for S&P …read more
Source: "Nobody Is Making Money" – Hedge Fund "VIP Basket" Obliterated, Plunges To Record Low
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By Tyler Durden
By Dana Lyons
Will these trendlines prove to be the resistance that potentially puts a pause – or end – to the post-February rally? Only time will tell. We will note that over the past 24 hours, we have begun to see some indices make an attempt at breaking out above their aforementioned lines of resistance. So bulls can argue that the scales may be tipping toward the side of positive breadth, momentum and sentiment winning out over price resistance. However, it’s too early to definitively make that call.
Furthermore, if these breakouts do occur, it will be crucial to monitor the indices to see if they can maintain their breakout levels for more than a day or two. Should they fail to hold for more than that, it will be just as damning, or more so, than had they failed at resistance in the first place.
Either way, next week promises to be another interesting one in the market.
Source: Another Major Index At A Crossroads
Welcome to Esh Carmel Blog.
