Kirstie Alley Slashes Price on Opulent Los Angeles Palazzo

May 31, 2019

Perhaps it’s an indication of a slowing high-end market, reflective of a more realistic real estate headspace or some other far more benign reason entirely, but Kirstie Alley has dramatically cut the asking price of her Los Angeles estate in one fell swoop by more than 10%. Too optimistically saddled with an elephantine $11.97 million […]

Mark David

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Melt-Up Mania: Stocks Reach Most Expensive, Most Overbought Levels, Surpassing DotCom Bubble

17 January 2020

Melt-Up Mania: Stocks Reach Most Expensive, Most Overbought Levels, Surpassing DotCom Bubble

The Fed has created a Full-Rick-Astley market...

[youtube https://www.youtube.com/watch?v=dQw4w9WgXcQ]

And everyone knows, you never go full-Risk-Astley!

Source: Bloomberg

China was mixed on the week with a dash-for-trash rotation from big caps to small cap tech...

Source: Bloomberg

European markets were all green on the week with UK's FTSE leading the way,,,

Source: Bloomberg

European 'VIX' hit a new record low today...

Source: Bloomberg

All major US indices were notably green this week with Trannies and Small Caps best...

Notably Small Caps and Trannies were weakest today (after some chaos at the open). The Dow was rescued every time it touched unch...

Defensives dominated cyclicals this week...

Source: Bloomberg

The S&P 500 has now had 70 straight days without a 1% loss... SURPRISE - since The Fed started re-expanding its balance sheet...

Source: Bloomberg

In case you wondered, the period before the Fed 2018 crash was 112 days without a 1% move.

Nasdaq is as overbought as it was during the dotcom bubble peak...

Source: Bloomberg

And the S&P 500 has never been more expensive...

Source: Bloomberg

This week saw the biggest short-squeeze since October...

Source: Bloomberg

This week saw the 'average' stock in America finally transcend its previous highs of Sept 2018...

Source: Bloomberg

After this morning's solid housing starts dats, PHLX Housing Index spiked to record highs...

Source: Bloomberg

Broker-Dealer stocks soared to all-time highs...

Source: Bloomberg

Auto stocks surged to the highest since 2004?

Source: Bloomberg

Jeff Bezos is still not a member of the "four commas" club...

Source: Bloomberg

Credit spreads were hammered lower every day this week as equity protection costs tumbled to an 11 handle briefly...

Source: Bloomberg

Treasury yields roundtripped on the week after dropping early and rising in the last two days to end unchanged...

Source: Bloomberg

The Dollar spiked today, testing a key resistance level and failing once again...

Source: Bloomberg

Global FX Vol fell to a new record low...

Source: Bloomberg

A big week for cryptos led by Bitcoin Cash...(NOTE - late day today cryptos were dumped)

Source: Bloomberg

Bitcoin tagged $9,000 intraday today...

Source: Bloomberg

Commodities were mixed with PMs flat, copper up and crude lower...

Source: Bloomberg

US NatGas dropped below $2 for the first time since 2016

Source: Bloomberg

Palladium has gone utterly parabolic, soaring 8% today - the biggest daily spike since Dec 2009

Source: Bloomberg

And while Palladium had a massive 2019, it has started 2020 off exponentially strong...

Source: Bloomberg

Finally, according to BofA, the S&P is overvalued on 19 of 20 metrics

So there's still hope!

And the Y2K Fed Liquidity Analog is still holding...

Source: Bloomberg

Tyler Durden Fri, 01/17/2020 - 16:00 Tags Business Finance Technology Internet

Winter Storm To Blast Northeast Through Saturday

17 January 2020

Winter Storm To Blast Northeast Through Saturday

A powerful winter storm is dumping snow and ice across the Midwest and will arrive in the Northeast on Saturday, reported The Weather Channel.

By Friday afternoon, snow will be seen from eastern Dakotas and Minnesota to as far as Wisconsin and Illinois.

There’s an elevated risk that Minneapolis-St. Paul and Chicago could see accumulating snow that would impact rush-hour commute this evening.

Sleet and freezing rain are expected for parts of Kansas and Missouri through Friday afternoon, extending into southern Nebraska, southern Iowa, and southern Illinois. Much of the wintery precipitation should change over to rain by evening.

Accumulating snow and blizzard conditions are possible Friday evening for parts of eastern Dakotas, western Minnesota and northwest Iowa.

By midnight, snow will push into the Great Lakes from Wisconsin to western Pennsylvania. Sleet and freezing could be seen across parts of Ohio to West Virginia.

Snow is expected to arrive in the Northeast by early Saturday and move up the Interstate 95 corridor from the Baltimore–Washington metropolitan area to Boston throughout the day. A changeover to a wintery mix then to rain will be seen for coastal areas along the Interstate 95 region.

Accumulating snow will be seen in the interior Northeast throughout Saturday.

Preliminary estimates show up to 6 inches could be seen for the Upper Midwest across the Great Lakes to upstate New York and northern New England through Saturday night.

Major metros along the Interstate 95 corridor of the Northeast could see 1 to 3 inches, but a transition to rain could lessen the totals.

Tyler Durden Fri, 01/17/2020 - 15:50 Tags Weather

A $50 Billion Hole Emerges In Trump's China Trade Deal

17 January 2020

A $50 Billion Hole Emerges In Trump's China Trade Deal

Now that the dust has settled on the US-China trade deal and analysts have had some time to pore over its 90+ pages, various chapters and (non-binding) terms that comprise the body of the agreement, one high-level observation noted by Rabobank, is that the agreement foresees the total amount of goods exports from the US to China to reach above $ 290BN by end-2021. The implication of this is that the chart for US exports to China should basically look like this for the next two years:

As Rabobank's senior economist Bjorn Giesbergen writes, there are probably very few economists that would deem such a trajectory feasible (except for the perpetually cheerful economics team at Goldman, of course), seeing that it took the US more than 15 years to raise exports from around USD16bn in 2000 to USD 130bn in 2017. Moreover, the Chinese purchases of goods are beneficial to US companies, but at the cost of other countries, and the agreement is only for two years. If China will buy more aircraft from the US, that could be to the detriment of the EU.

According to the document “the parties project that the trajectory of increases … will continue in calendar years 2020 through 2025.” But "to project" does not sound as firm as "shall ensure." So, as the Rabo economist asks, "are we going to see a repetition of the 2019 turmoil caused by the phase 1 trade negotiations after those two years? Or is this supposed to be solved in the phase 2 deal that is very unlikely to be made? What’s more, while the remaining tariffs provide leverage for US trade negotiators, they are still a tax on US importers and US consumers of Chinese goods."

But before we even get there, going back to the chart shown above, Bloomberg today points out something we have pointed out in the past, namely that China’s $200 billion, two-year spending spree negotiated with the Trump administration appears increasingly difficult to deliver, and now a $50 billion "hole" appears to have opened up: that is the amount of U.S. exports annually left out and many American businesses still uncertain about just what the expectations are.

Some background: while Trump officials stressed the reforms aimed at curbing intellectual-property theft and currency manipulation that China has agreed to in the “phase one” trade deal signed Wednesday, the Chinese pledge to buy more American exports has become an emblem of the deal to critics and supporters alike.

The administration has said those new exports in manufactured goods, energy, farm shipments and services will come over two years on top of the $130 billion in goods and $57.6 billion in services that the U.S. sent to China in 2017 -- the year before the trade war started and exports were hit by Beijing’s retaliatory measures to President Donald Trump’s tariffs.

And while Goldman said it is certainly feasible that China can ramp up its purchases of US goods, going so far as providing a matrix "scenario" of what such purchases could look like...

... that now appears virtually impossible, because as Bloomberg notes, the list of goods categories in the agreement covers a narrower group of exports to China that added up to $78.8 billion in 2017, or $51.6 billion less than the overall goods exports to the Asian nation that year. The goods trade commitment makes up $162.1 billion of the $200 billion total, with $37.9 billion to come from a boost in services trade such as travel and insurance.

Here, the math gets even more ridiculous:

The target for the first year that the deal takes effect is to add $63.9 billion in manufactured goods, agriculture and energy exports. According to Bloomberg economist Maeva Cousin’s analysis, that would be an increase of 81% over the 2017 baseline. In year two, the agreement calls for $98.2 billion surge in Chinese imports, which would require a 125% increase over 2017.

Importantly for China, the deal requires those purchases to be “made at market prices based on commercial considerations,” a caveat which spooked commodities traders, and led to a sharp drop in ags in the day following the deal's announcement.

Can China pull this off? Yes, if Beijing tears up existing trade deals and supply chains and imposes explicit procurement targets and demands on China's local business. As Bloomberg notes, "critics argue that such pre-ordained demand amounts to a slide into the sort of government-managed trade that U.S. presidents abandoned decades ago" and the very sort of act of central planning that U.S. officials have, paradoxically, spent years trying to convince China to walk away from.

This may also explain why a key part of the trade deal will remain secret: the purchase plan is based on what the administration insists is a specific - if classified - annex of Chinese commitments. "The 20-page public version of that annex lists hundreds of products and services from nuclear reactors to aircraft, printed circuits, pig iron, soybeans, crude oil and computer services but no figures for purchases."

Going back to the critics, it is this convoluted mechanism that has them arguing that China's stated targets will likely never be met: "This is ambitious and it will create some stresses within the supply system," said Craig Allen, the president of the U.S.-China Business Council.

That's not all: as Allen said, among the outstanding questions was whether China would lift its retaliatory duties on American products as the US keeps its tariffs on some $360 billion in imports from China as Trump seeks to maintain leverage for a second phase of negotiations. Allen also made clear the overall purchase schedule left many U.S. companies uncomfortable even as they saw benefits in other parts of the deal. “The vast majority of our members are looking for no more than a level playing field in China,” Allen said. “We are not looking for quotas or special treatment."

As a result, for many manufacturers what is actually changing - and what China has committed to instead of given a "best efforts" promise to achieve - remains unclear.

Major exporters such as Boeing Co., whose CEO Dave Calhoun attended Wednesday’s signing ceremony, have stayed mum about what exactly the deal will mean for their business with China. In an attempt to "clarify", Trump tweeted that the deal includes a Chinese commitment to buy $16 billion to $20 billion in Boeing planes. It was unclear if he meant 737 MAX planes which nobody in the world will ever voluntarily fly inside again.

Finally, prompting the latest round of cronyism allegations, Trump’s new China pact also includes plans for exports of American iron and steel, "a potential gain for an industry close to the president that has benefited from his tariffs and complained about Chinese production and overcapacity for years." As Bloomberg adds, the text of the agreement lists iron and steel products ranging from pig iron to stainless steel wire and railway tracks, but steel industry sources said they had been caught by surprise and not been given any additional details on China’s purchase commitments.

It is unclear why Beijing would need US products: after all, in its scramble to erect ghost cities and hit a goalseeked GDP print, China produces more than 50% of the world’s steel, drawning criticism from around the world - if not Greta Thunberg - for the massive coal-derived pollution that comes from flooding global markets with cheap steel.

Tyler Durden Fri, 01/17/2020 - 15:30 Tags Business Finance

A Market Full Of Gaps

17 January 2020

A Market Full Of Gaps

Authored by Sven Henrich via NorthmanTrader.com,

The bubble keeps on bubbling, the never ending rally keeps on rallying and the charts keep getting ever more dangerously stretched.

Intra-day price discovery is virtually absent as volatility remains woefully compressed and $SPX barely moves.

It’s become quite the scene to watch an index representing 500 stocks with a combined market cap of $27 trillion “trade” in a 0.1% price range for hours on end:

Now let's make a new, even smaller price range. pic.twitter.com/wzogJo9sgd

— Sven Henrich (@NorthmanTrader) January 16, 2020 https://platform.twitter.com/widgets.js

Worse, the price advance action is mostly driven by up gaps that rarely if ever fill and market open ramps that settle into tight price ranges during the day.

While Fed critics are dismissed as QE conspiracists, we can either choose to be believe the Fed or our own lying eyes as the repo machine continues to execute relentlessly:

Open gaps in markets are not unusual, some stay open for weeks, months, even years. Some may never fill.

But it is when you get gap after gap after gap that the action becomes incredulous and challenges conventional market wisdom. I’ve seen 3 or 4 unfilled gaps in a short time frame, I’ve even seen 5, but I can’t recall seeing anything like this:

That’s the $SPY since not QE which is now widely acknowledged to be quasi QE. Count the unfilled gaps.

And here, for granularity, here’s the $SPX since just December:

Resistance is futile if you can just gap above it and never actually have any price discovery in between. It is impressive to say that this market finds support on top of each gap each time, but I suppose extraordinary liquidity measures produce extraordinary results.

But don’t take my criticisms seriously. I’m just a “swashbuckling pirate QE conspiracist” according to Neel Kaskari president of the Federal Reserve Bank of Minneapolis:

1 thing I've learned abt twitter is the louder the critic, generally the thinner the skin. I confess finding amusement in needling critics calling them conspiracists or goldbugs. Its fun to watch swashbuckling pirates of free market capitalism get easily upset. I mean no offense. https://t.co/dMgSsk2pBR

— Neel Kashkari (@neelkashkari) January 17, 2020 https://platform.twitter.com/widgets.js

My skin is plenty thick, thank you very much, but evading answers and accountability by those in power is pet peeve and when they think it’s all worth a giggle on twitter I find myself unimpressed by the institutional arrogance on display.

Fun and giggles over substance apparently:

Glad you find amusement in needling critics Neel. If you engaged the "swashbuckling pirates" on substance you may find that there are well founded concerns that deserve much deeper attention. The Fed is not beyond criticism & fault even if it acts like it. https://t.co/HivnNTsabZ

— Sven Henrich (@NorthmanTrader) January 17, 2020 https://platform.twitter.com/widgets.js

It’s a shame and a sham really. The Fed deserves to be criticized. If it wants to claim the banner of transparency it needs to earn it, and denying reality while labeling critics as “conspiracy theorists” is just not credibility building:

QE conspiracists can say this is all about balance sheet growth. Someone explain how swapping one short term risk free instrument (reserves) for another short term risk free instrument (t-bills) leads to equity repricing. I don’t see it. /end

— Neel Kashkari (@neelkashkari) January 17, 2020 https://platform.twitter.com/widgets.js

Especially as parts of the Fed have already admitted it:

They all know: “My own view is [buying bills] is having some effect on risk assets. It is a derivative of QE in that when we buy bills and we inject more liquidity, it affects all risk assets,” Kaplan said.https://t.co/l5WAviQkV1

— Sven Henrich (@NorthmanTrader) January 16, 2020 https://platform.twitter.com/widgets.js

And the bubble blowing recognition has also now extended to the Financial Times:

"The Federal Reserve is the cause of the bubble in everything. QE is here to stay. We should expect QE5, QE6, QE7 and beyond. Enjoy the party, yes. But dance near the door." h/t @jennablan https://t.co/RhFpmNsHjq

— Sven Henrich (@NorthmanTrader) January 16, 2020 https://platform.twitter.com/widgets.js

Maybe they too are now pirates sailing the stormy sea of QE conspiracies. Looks like the number of pirates is increasing outside the sound proof walls of cushy Fed offices.

No, keep denying the bubble and claiming to not to see the relationships in policy and price action as you wish. But the gaps are there. And they demand filling. Not only the gaps in the charts, but also the gaps in credibility.

* * *

For the latest public analysis please visit NorthmanTrader. To subscribe to our market products please visit Services.

Tyler Durden Fri, 01/17/2020 - 15:17

Bitcoin Tops $9,000 With Best Start To A Year On Record

17 January 2020

Bitcoin Tops $9,000 With Best Start To A Year On Record

Bitcoin topped $9,000 overnight for the first time since early November...

Source: Bloomberg

Notably this latest surge in demand from crypto began after Iranian General Soleimani was killed, and is now testing its 200DMA...

Source: Bloomberg

Year-to-date, all major altcoins are soaring led by Bitcoin Cash...

Source: Bloomberg

And in what we were stunned to note, this is the best start to a year - ever - for Bitcoin...

Source: Bloomberg

The rally in cryptos comes as CoinTelegraph's William Suberg notes, bitcoin derivatives trading looks set to reach record levels this month as volume spikes and open interest hovers near all-time highs.

Data from CME Group shows that as of Jan. 16, open interest for its futures products alone totaled 5,328 contracts — or 26,640 BTC ($237 million).

Open interest on track for record

The figure is higher than any monthly close CME has seen since it debuted in December 2017, with July 2019 currently in the lead with 5,252 contracts.

Open interest did surpass current levels earlier in January, reaching around 5,400 according to the latest data from United States regulator the Commodity Futures Trading Commission, or CFTC, published on Jan. 7.

As Cointelegraph reported, futures offerings have received significant attention from both investors and commentators as new participants appeared to fuel a Bitcoin price rise in 2020.

Bitcoin futures 1-month overall volume. Source: Skew Markets/ Twitter

As BTC/USD accelerated towards $9,000 this week, overall futures trading volume likewise saw a significant uptick. According to unofficial data from monitoring resource Skew Markets, worldwide volume hit $25 billion — the most since late October.

“I think that's a strong signal indicating that we're reversing now and probably have bottomed out,” regular Cointelegraph contributor Michaël van de Poppe commented about the latest data.

2020 the year of “clear” institutional adoption

CME launched a new product in the form of options on Bitcoin futures earlier in January. The release came just days after competitor FTX did likewise.

The company said it considered the options a “success” as volumes reached 275 BTC by day two.

Catering to long-term demand from institutional investors has long been a preoccupation for cryptocurrency businesses. In its 2019 retrospective this week, venture capital giant Grayscale revealed annual investment totals of over $1 billion.

A record for the firm, executives announced they now it was “clear” that the industry was seeing institutional adoption.

Tyler Durden Fri, 01/17/2020 - 14:55 Tags Business Finance

Labour activist Owen Jones claims he's being bombarded with death threats

17 January 2020

Owen Jones says that the Democratic Football Lads Alliance is targeting him since he was kicked from behind in Islington, north London, by a Chelsea fan whose home contains Nazi memorabilia.

Barack Obama shares photo booth snaps with 'his star' Michelle on her birthday

17 January 2020

The former president shared four black-and-white photos of the couple on social media on Friday, January 17, his wife's birthday.

Queen's aides say announcement on Megxit deal 'imminent'

17 January 2020

Buckingham Palace is expected to release a statement on the couple 'imminently' on the terms of the couple's arrangement. Her Majesty is pictured today at the wheel of her Range Rover.

Heathrow flight chaos as RAF make unplanned use of airspace

17 January 2020

At least four Heathrow-bound British Airways flights and one Virgin Atlantic aircraft were forced to land at other airports such as Gatwick, Stansted and Luton.

Question Time: Laurence Fox on Meghan Markle racism debate

17 January 2020

The 41-year-old accused Rachel Boyle, an academic at Edge Hill University, of 'being racist' after she called him 'a white privileged male' for denying Meghan was hounded from Britain.