Volatility Headlines

  • Signs Of The Top? Chinese Demand For 10x Levered Structured Products Surges In US... Again

    In the run up to the 'great recession' of 2008/2009, it was unsuspecting European and Asian buyers that supplied the marginal capital required to turn America's plain vanilla, fed-induced housing bubble into a turbo-charged, global financial time bomb by indiscriminately scooping up highly-levered structured mortgage products with absolutely no idea what was behind those products. Now, it seems that China's lust for levered returns in U.S. structured products has returned and is focused this...

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  • The Silence Of The Bears

    Authored by Sven Henrich via NorthmanTrader.com, The silence of the bears is deafening. And who can blame them? The last 2 years have been absolutely brutal for any fans of price discovery, volatility and anything analytical mattering. Nothing matters. Be it divergences, valuations, earnings misses, slowing data, yield curve, equal weight, internals, catastrophes in nature, slowing loan growth, slowing auto sales, slowing real estate, retail apocalypse, debt levels, etc…I can drone on. Nothing...

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  • Kolanovic Asks "How Close Are We To The Market Top" And Answers

    "How close are we to the market top?" While that is and always has been the question on every trader and investor's lips, it is also what an increasingly greater number of more and more nervous JPMorgan clients wants to know, especially those who, according to JPM head quant Marko Kolanovic - want to protect strong YTD gains or chase year end performance. What sucks is being designated the person responsible with answering this question. In this case, that's person is the quant guru himself, who...

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  • FOMC Signals Dovish Inflation Concerns, Warns "Sharp Reversal" In Markets Could Damage Economy

    With a dumping dollar and collapsing yield curve since November's FOMC, all eyes are on the Minutes for any signals of The Fed hawkishly ignoring inflation concerns but instead a few Fed officials opposed near-term hikes (on the basis of weak inflation). Furthermore, several Fed officials warned of the potential for bubbles, "in light of elevated asset valuations and low financial market volatility, several participants expressed concerns about a potential buildup of financial...

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  • These Are The Top 50 Hedge Fund Long And Short Positions

    In its latest quarterly hedge fund trend monitor - a survey of 804 hedge funds with $2.1 trillion of gross equity positions ($1.4 trillion long and $704 billion short) - which analyzes hedge fund holdings as of Sept 30, Goldman makes some interesting observations about the current state of the hedge fund industry. First and foremost, it finds that the average equity long/short hedge fund has posted a 10% YTD return, which while the strongest since 2013 is once again underperforming the S&P...

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  • Positive Feedback Loops, Financial Instability, & The Blind Spot Of Policymakers

    Authored by Francesco Filia of Fasanara Capital, “Learn how to see. Realize that everything connects to everything else.” – Leonardo da Vinci A Dangerous Market Structure is More Worrying than Expensive Asset Valuations and Record Debt Levels Macro-prudential regulations follow financial crises, rarely do they precede one. Even when evidence is abundant of systemic risks building up, as is today, regulators and policymakers have a marked tendency to turn an institutional blind eye, hoping for...

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  • Bitcoin: An Unknowable Bubble?

    "Whatever [Bitcoin] is, I missed it... It looks and smells like all the bubbles I have seen throughout history." - billionaire investor Jim Rogers Authored by Constantin Gurdgiev via True Economics blog, There is a much-discussed in the crypto-sphere chart making rounds these days, plotting Bitcoin price dynamics against the historical bubbles of the past: The chart is striking. Albeit simplistic. See Note 1 below for a technical argument on the chart timing. On price dynamics alone, Bitcoin...

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  • Asian Stocks Smash Records; Dollar Slides As Crude Surges To July 2015 Highs

    Global shares hit another record high on Wednesday, propelled higher by what increasingly more call (ir)rational exuberance, and investors’ unflagging enthusiasm for tech stocks. That said, S&P futures are unchanged the morning before Thanksgiving (at least before the market open ramp), as are European stocks (Stoxx 600 is flat), despite the euphoria in the Asian session which saw the MSCI Asia Pac index hit a new all time high... ... as oil jumped, rising as much as $1.15 to $57.98/bbl,...

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  • Biggest Bubble Ever? 2017 Recapped In 15 Bullet Points

    Yesterday we presented readers with one of the most pessimistic, if not outright apocalyptic, 2018 year previews, courtesy of BofA's chief investment, Michael Hartnett who warned that in addition to the bursting of the bond bubble in the first half of the year, the stock market could see a 1987-like flash crash, potentially followed by a sharp spike in (violent) social conflict. However, in addition to his forecast, Hartnett also had one of the more informative, and descriptive, reviews of the...

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  • Running "The Program"

    Authored Sven Henrich via NorthmanTrader.com, As the dips keep getting shallower and shallower and market projections get more bullish by the day (see Goldman’s capitulation today) the running volatility compression program continues to be the cornerstone of market gains. Just last week we got another taste of the precision with which the program is run: $VIX: Trend line rejection. Perfection.KILLER chart and has been for 2 years.Long time followers know what I'm talking about. I've discussed...

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  • WTI Tops $57 After Biggest Crude Draw In 3 Months

    WTI/RBOB bounced today in anticipation of a reversal of the last two week's builds in crude inventories, and bulls were not disappointed by the API print.  Jan '18 WTI pushed above $57 but RBOB fell after a big crude draw (though gasoline build). “It looks like we are going to get a draw in crude oil inventories. That’s somewhat supportive,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, said by phone. Investors are also “looking ahead to the OPEC meeting, and...

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  • Novogratz Slams Dimon: Buy Bitcoin Because "We No Longer Trust Financial Institutions"

    It must be a sign that cryptocurrencies are becoming mainstream when Bloomberg TV launches the first of a six-part series on this comparatively recent innovation. Setting the scene, Bloomberg replayed comments made in interviews from what it described as “Wall Street sceptics”, including (not surprisingly) JPMorgan Chase’s Jamie Dimon, Neil Dwane of Allianz Global Investors and Severin Cabannes, SocGen’s Deputy CEO. The vignettes were peppered with sound bites like “index of money laundering”...

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  • Spitznagel Warns "Not All Risk Mitigation Is Created Equal"

    Authored by Mark Spitznagel via PIOnline.com, There is a movement today among pension funds toward systemic risk mitigation - or "safe haven" - strategies. This makes great sense as a potential solution to the widespread underfunding problem. Many pension funds still haven't fully recovered from the crash of 2008, and can't afford another. Moreover, truly effective risk mitigation must lead to an incrementally higher long run compound annual growth rate; and a higher CAGR is the way to raise a...

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  • Morgan Stanley: Tesla Will Surge To $400 Before Crashing To $200

    When it comes to Wall Street cheerleaders, Tesla has few closer friends than Morgan Stanley's Adam Jonas (current price target of $379). To be sure, the relationship cuts both ways, with Jonas relentless enthusiasm 'for the EV maker granting Morgan Stanley a reserved spot for any future debt, convert and equity underwriting, as well as associated IB fees.  Yet, following the recent volatility in Tesla's business model, in which the "production hell" that is Model 3 has been quietly relegated to...

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  • What We Can Expect For Gold Prices in the Wake of the Hurricane Season

    The recent spate of back-to-back hurricanes in the US is expected to compound the economic damage of an already over-extended debt. As the stock market braces for a correction, traders are inclined to sell out of riskier stock markets and take refuge in safe havens like gold. Although it will take months for the impact of the hurricane season to be apparent, investors are already losing appetite for risk and investing in secure assets as gold. This was evident from the figures leading up to the...

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  • Goldman Bets On "Rational Exuberance": Unveils Its S&P Price Targets, Sees Bull Market Lasting Until 2020

    Just days after Barclays released its 2018 equity outlook with the title "Rational Exuberance"... ... Goldman's David Kostin decided that imitation is the sincerest form of flattery and in presenting his S&P price target* for 2018 (and 2019 and 2020), and has named his preview report the same: We footnoted price target, because once again Kostin has decided to avoid making a definitive forecast for where the S&P will go in the near term, and instead - as he did one month ago - has left...

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  • Why Cryptos Will Not Replace Gold As A Store Of Value

    Why Cryptos Will Not Replace Gold As A Store Of Value - Gold versus Bitcoin: The pro-gold argument takes shape- Why cryptocurrencies will not replace gold as a store of value- Similarities between crypto and gold but that does not make them substitutes- Gold remains a highly liquid market, cryptocurrencies continue to be fragmented and difficult to spend- Bitcoin  does not make it an effective hedge against stocks- Gold coins and bars cannot be hacked and vaults are insured This weekend saw...

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  • Bonds, Futures, Global Stocks All Rise, Boosted By "Germany's Brexit Moment"; TSY Curve Collapse Continues

    S&P 500 futures are higher, continuing on yesterday's momentum, after European and Asian shares also rose alongside a rebound in oil, as the year-end performance chase appears to be accelerating. There were several different moving parts in a mixed European session, in which early Euro strength gave way to weakness... ... which in turn pushed the Stoxx 600 and US index futures higher, rising above yesterday's session high on negligible volumes.  Global equity futures rallied with Hang...

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  • Realtors In Miami And Manhattan Are Embracing Bitcoin

    Back in September, we reported on a major milestone in bitcoin’s evolution into a respectable medium of exchange for large purchases: A Dallas real estate agent had negotiated the first all-bitcoin purchase of a US home on record. Few details about the home or the identity of the buyers were released. However, given bitcoin’s blistering rise since then – the value of a single coin has more than doubled – it’s reasonable to assume that, whoever they are, they probably regret pulling the trigger...

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  • Bubble Dynamics and Market Crashes

    Authored by James Rickards via The Daily Reckoning, To paraphrase one of the great gems of Wall Street wisdom, “Nothing infuriates a man more than the sight of other people making money.” That’s a pretty good description of what happens during the late stage of a stock market bubble. The bubble participants are making money (at least on a mark-to-market basis) every day. Meanwhile, the more patient, prudent investor is stuck on the sidelines - allocated to cash or low-risk investments while...

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  • Learning From The '80s: The Power And Irony Of "MDuh"

    Authored by Daniel Nevins via FFWiley.com, Forget about big hair, Ray-Bans, and Donkey Kong. Don’t even think about Live-Aid, Thriller, and E.T. Above all else, the 1980s were the gravy days of the money supply aggregates. Beginning in late 1979, the Fed built its policy approach around the aggregates - primarily M1 but occasionally M2, and policy makers also monitored M3 while experimenting with M1B and, later, MZM. But those were just the “official” figures. Economists and pundits debated the...

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  • BofA's Apocalyptic Forecast: Stocks Flash Crash, Bond Bubble Bursts In H1 2018, War May Follow

    Having predicted back in July that the "most dangerous moment for markets will come in 3 or 4 months", i.e., now, BofA's Michael Hartnett was - in retrospect - wrong (unless of course the S&P plunges in the next few days). However, having stuck to his underlying logic - which was as sound then as it is now - Hartnett has not given up on his "bad cop" forecast (not to be mistaken with the S&P target to be unveiled shortly by BofA's equity team and which will probably be around 2,800), and...

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  • What Happened To Cash Flow Growth: The Red Flag In Q3 Earnings

    Listening to Wall Street analysts, or their financial press cheerleaders, one would be left with the impression that earnings season has been gangbusters, and the recent 2-3 quarters of growth are sure to lay the basis for a new golden age in which EPS rises at double-digit rates for years to come. There are just a few problems with this wildly incorrect conclusion. First, after a year of earnings recession and a year in which earnings went nowehere, 2017 is finally catching up to where analysts...

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  • As Bitcoin Tops $8,200, Only 39% Of Survey Respondents Say It's A Bubble

    Having first surged above $8000 overnight amid Zimbabwe's chaos, it appears uncertainty in the core of Europe has driven further demand for cryptocurrencu protection, sending Bitcoin to a new record high of $8247 - up 50% from the 'Bitcoin Cash' crash weekend lows. image courtesy of CoinTelegraph As CoinTelegraph reports, the latest milestone for Bitcoin, which came following news the first Bitcoin-to-Litecoin Lightning Network ‘atomic swap’ successfully debuted, caps its comeback after Bitcoin...

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