Financial sources feeds
Moments ago the Fed released the first phase of its annual stress test which, once again, found that all thirty-four of the US largest banks "passed", exceeding minimum projected capital and leverage ratios under severely adverse scenarios, based on their projected ability to withstand economic shocks, which as Bloomberg notes, shows that "firms are getting the hang of the once-dreaded reviews." The result marks the third straight year all firms cleared the minimum requirements in the exams’ first phase, begging the question just how "stressful" this test truly is.
Of the participant banks, every single one exceeded minimum thresholds, although Morgan Stanley trailed the rest of Wall Street on a key measure of leverage, the second year it performed worse than peers on this key metrics. During the second phase of last year's stress test the bank was forced to resubmit its plan to address a “material weakness”, before it was allowed to pay out capital to shareholders. Results from that round are due next week.
One notable finding: in the Fed's forecasts for loan losses in a "severely" adverse scenario, Goldman’s projected loan-loss rate of 8.1% was surpassed only by commercial lenders or card issuers such as American Express, Capital One, and Discover Financial Services. Wells Fargo & Co.’s $7.7 billion in trading and counterparty losses came close to firms with larger Wall Street operations, with Morgan Stanley at $9.5 billion. JPMorgan Chase & Co. led the group with $25.2 billion in losses.
“This year’s results show that, even during a severe recession, our large banks would remain well capitalized,” Fed Governor Jerome Powell said in a statement announcing the central bank’s findings Thursday.
It remains to be seen if that will also be the case when over $2 trillion in excess reserves which pad the bank's balance sheets are eventually drained.
The "successful" outcome will boost the industry's arguments that the banking system is safe enough to allow for cutting back some regulations. Furthermore, once the second round is released, expect all banks to further boost payouts to investors.
The "test" designed to boost confidence in the banking sector after the financial crisis, assesses how banks would handle hypothetical turmoil, such as surging unemployment, a sharp drop in housing prices or an extended stock slump. Firms that handily clear the first phase typically have more room to make payouts to shareholders.
The tests have become less dramatic in recent years with fewer quantitative failures. And under regulators selected by President Donald Trump, that may continue. The Treasury Department issued a report last week proposing tests occur less frequently, that highly capitalized banks be exempt from the process and that one of the toughest hurdles be scrapped.
Today's results covered the "Dodd-Frank Act Stress Test" that measures banks’ capital under stress over nine quarters. This year, the Fed projected supplementary leverage ratios at the largest banks. Morgan Stanley’s projected 3.8 percent ratio in a potential economic downturn was lowest - though it still cleared the 3 percent minimum, according to Bloomberg.
Here are the parameters for what the Fed defined as the "Severely Adverse", or worst-case, scenario:
The adverse scenario is characterized by weakening economic activity across all of the economies included in the scenario. This economic downturn is accompanied by a global aversion to long-term fixed-income assets that, despite lower short rates, brings about a near-term rise in long-term rates and steepening yield curves in the United States and the four countries/country blocks in the scenario.
The severely adverse scenario is characterized by a severe global recession that is accompanied by a period of heightened stress in corporate loan markets and commercial real estate markets. In this scenario, the level of U.S. real GDP begins to decline in the first quarter of 2017 and reaches a trough in the second quarter of 2018 that is about 6½ percent below the pre-recession peak. The unemployment rate increases by about 5¼ percentage points, to 10 percent, by the third quarter of 2018. Headline consumer price inflation falls to about 1¼ percent at an annual rate by the second quarter of 2017 and then rises to about 1¾ percent at an annual rate by the middle of 2018.
As a result of the severe decline in real activity, short-term Treasury rates fall and remain near zero through the end of the scenario period. The 10-year Treasury yield drops to ¾ percent in the first quarter of 2017, rising gradually thereafter to around 1½ percent by the first quarter of 2019 and to about 1¾ percent by the first quarter of 2020. Financial conditions in corporate and real estate lending markets are stressed severely. The spread between yields on investment-grade corporate bonds and yields on long-term Treasury securities widens to about 5½ percentage points by the end of 2017, an increase of 3½ percentage points relative to the fourth quarter of 2016. The spread between mortgage rates and 10-year Treasury yields widens to over 3½ percentage points over the same time period.
Asset prices drop sharply in this scenario. Equity prices fall by 50 percent through the end of 2017, accompanied by a surge in equity market volatility, which approaches the levels attained in 2008. House prices and commercial real estate prices also experience large declines, with house prices and commercial real estate prices falling by 25 percent and 35 percent, respectively, through the first quarter of 2019.
The international component of this scenario features severe recessions in the euro area, the United Kingdom, and Japan and a marked growth slowdown in developing Asia. As a result of the sharp contraction in economic activity, all foreign economies included in the scenario experience a decline in consumer prices. As in this year’s adverse scenario, the U.S. dollar appreciates against the euro, the pound sterling, and the currencies of developing Asia but depreciates modestly against the yen because of flight-to-safety capital flows.
In other words, neither inflation, nor 10Y yields drop negative even as VIX surges to 70. Mmmk then.
And here is the VIX scenario that the Fed believes all banks will survive:
Some other findings courtesy of Bloomberg:
- Firms boosted share of agency MBS, Treasuries in securities portfolios, cut holdings of less-liquid assets like securitized products
- Loan portfolios grew, driven by strong growth in corporate, commercial real estate (CRE), credit-card loans
- Residential mortgage growth lagged, as healthy growth in first-lien mortgages was offset by notable decline in home- equity loans
- Credit quality of some loan portfolios -- including first-lien mortgages and commercial mortgages -- has improved, largely due to recent gains in real estate prices
- At the same time, improvements in portfolios secured by real estate were partially offset by continued stress on some corporate loans due to persistently low oil prices, recent uptick in delinquency rates in credit-card portfolios
- Results overall show banks have strong capital levels, retain ability to lend to households and businesses during severe recession
- Most-severe hypothetical scenario projects $493b in losses at the 34 participating banks during the 9 quarters tested, with $383b in accrual loan portfolio losses, $86b in trading and/or counterparty losses at the 8 cos. with substantial trading, processing, custodial operations
- Companies’ aggregate common equity tier 1 capital ratio would fall to minimum level of 9.2% from actual 12.5% in 4Q 2016
- In "adverse" scenario (featuring moderate recession), aggregate common equity capital ratio fell to minimum 10.7% from actual 12.5% in 4Q
- Since 2009, the firms have added >$750b in common equity capital
On June 28, at 4:30pm, the Fed will release the results of the second round of the Stress Test, the Comprehensive Capital Analysis and Review (CCAR).
Laying the groundwork of Leftist talking points for the next few days, former President Barack Obama took to his Facebook page to defend Obamacare against the GOP's Healthcare Plan... [emphasis added]
Our politics are divided. They have been for a long time. And while I know that division makes it difficult to listen to Americans with whom we disagree, that’s what we need to do today.
I recognize that repealing and replacing the Affordable Care Act has become a core tenet of the Republican Party. Still, I hope that our Senators, many of whom I know well, step back and measure what’s really at stake, and consider that the rationale for action, on health care or any other issue, must be something more than simply undoing something that Democrats did.
We didn’t fight for the Affordable Care Act for more than a year in the public square for any personal or political gain – we fought for it because we knew it would save lives, prevent financial misery, and ultimately set this country we love on a better, healthier course.
Nor did we fight for it alone. Thousands upon thousands of Americans, including Republicans, threw themselves into that collective effort, not for political reasons, but for intensely personal ones – a sick child, a parent lost to cancer, the memory of medical bills that threatened to derail their dreams.
And you made a difference. For the first time, more than ninety percent of Americans know the security of health insurance. Health care costs, while still rising, have been rising at the slowest pace in fifty years. Women can’t be charged more for their insurance, young adults can stay on their parents’ plan until they turn 26, contraceptive care and preventive care are now free. Paying more, or being denied insurance altogether due to a preexisting condition – we made that a thing of the past.
We did these things together. So many of you made that change possible.
At the same time, I was careful to say again and again that while the Affordable Care Act represented a significant step forward for America, it was not perfect, nor could it be the end of our efforts – and that if Republicans could put together a plan that is demonstrably better than the improvements we made to our health care system, that covers as many people at less cost, I would gladly and publicly support it.
That remains true. So I still hope that there are enough Republicans in Congress who remember that public service is not about sport or notching a political win, that there’s a reason we all chose to serve in the first place, and that hopefully, it’s to make people’s lives better, not worse.
But right now, after eight years, the legislation rushed through the House and the Senate without public hearings or debate would do the opposite. It would raise costs, reduce coverage, roll back protections, and ruin Medicaid as we know it. That’s not my opinion, but rather the conclusion of all objective analyses, from the nonpartisan Congressional Budget Office, which found that 23 million Americans would lose insurance, to America’s doctors, nurses, and hospitals on the front lines of our health care system.
The Senate bill, unveiled today, is not a health care bill. It’s a massive transfer of wealth from middle-class and poor families to the richest people in America. It hands enormous tax cuts to the rich and to the drug and insurance industries, paid for by cutting health care for everybody else. Those with private insurance will experience higher premiums and higher deductibles, with lower tax credits to help working families cover the costs, even as their plans might no longer cover pregnancy, mental health care, or expensive prescriptions. Discrimination based on pre-existing conditions could become the norm again. Millions of families will lose coverage entirely.
Simply put, if there’s a chance you might get sick, get old, or start a family – this bill will do you harm. And small tweaks over the course of the next couple weeks, under the guise of making these bills easier to stomach, cannot change the fundamental meanness at the core of this legislation.
I hope our Senators ask themselves – what will happen to the Americans grappling with opioid addiction who suddenly lose their coverage? What will happen to pregnant mothers, children with disabilities, poor adults and seniors who need long-term care once they can no longer count on Medicaid? What will happen if you have a medical emergency when insurance companies are once again allowed to exclude the benefits you need, send you unlimited bills, or set unaffordable deductibles? What impossible choices will working parents be forced to make if their child’s cancer treatment costs them more than their life savings?
To put the American people through that pain – while giving billionaires and corporations a massive tax cut in return – that’s tough to fathom. But it’s what’s at stake right now. So it remains my fervent hope that we step back and try to deliver on what the American people need.
That might take some time and compromise between Democrats and Republicans. But I believe that’s what people want to see. I believe it would demonstrate the kind of leadership that appeals to Americans across party lines. And I believe that it’s possible – if you are willing to make a difference again. If you’re willing to call your members of Congress. If you are willing to visit their offices. If you are willing to speak out, let them and the country know, in very real terms, what this means for you and your family.
After all, this debate has always been about something bigger than politics. It’s about the character of our country – who we are, and who we aspire to be. And that’s always worth fighting for.
Yeah, but apart from that...
We are still somewhat bemused at why the Trump's administration didn't just let this disaster fail totally and utterly before saving it, especially as NBC proclaims today - in a poll - that Americans now love Obamacare more than ever (must be the collapsing coverage and spiking premiums).
Oil bounced a bit (on Saudi noise)... banks dropped (ahead of CCAR)... Healthcare ripped again (on a bill that appears to be DOA)... and stocks gave up hope in the last few minutes...
Everything was awesome briefly - an opening ramp on crude and some healthcare hope steadied stocks early but that was it. After Europe closed, stocks went nowhere until slumping into the close...
FANG Stocks ended marginally lower, stuck in a very tight range fo rthe last 4 days...
Equities advanced after two days of losses as crude broke a three-day downturn. Treasury yields continued lower with a flatter 2s/10s curve as a strong reopening of a $5b 30-year TIPS auction helped to keep yields in check throughout the afternoon. Fed’s Bullard, in an interview with WSJ, said the Fed’s projected rate path may be too aggressive. S&P reversed early session losses led by advances in health-care stocks with biotech and pharmaceuticals leading the way. The Canadian dollar advanced after a strong retail sales beat while Mexico’s peso gained over 1% vs the greenback.
VIX was clubbed like a baby seal today, but notably S&P Futs did not react too exuberantly... and once VIX had reached Tueaday;s losw it snapped back higher...
Banks were the biggest losers today as Healthcare soared after the GOP Bill was released... (and retail bounced)
Bank Stocks have taken a hit in the last few days...
Hospital stocks soared after the release of the Obamacare replacement bill...
And Biotech stocks are now up almost 10% in the last 4 days to its highest since Jan 2016...
HY Energy credit risk has spiked back to 7-month wides...
But Credit markets continue to show signs of stress...(HY CDX at 2-month wides)
NOTE: Virgin Media pulled a $3.43b 1L TL refinancing from syndication due to market conditions, according traders and portfolio managers who aren’t authorized to speak publicly. Co. launched the repricing on June 15, seeking to shave 25bps off its existing loan. Virgin Media is the 16th loan to be pulled this year...About 10 loans in all were withdrawn from syndication in 2016.
Treasury yields fell on the day across the entire complex (even as stocks rallied) with further flatteniing in 2s30s...
All yield curve bets are collapsing...
Banks remain at a premium to the yield curve's collapse (ahead of tonight's CCAR)
The Dollar Index fell for the 2nd day in a row, having stalled at the payrolls-ledge...
WTI and RBOB rallied modestly on the day after Saudi comments on $60 oil price hope for the Aramco IPO....
Gold rose for the second day (as the dollar slid), pushing back above the 200-day moving average
Dip-Buyers remain absent as Central Bank balance sheets drop most since December...
Update: As it turns out, the Senate's healthcare bill may be even 'dead-er' on arrival than originally thought as Senators Rand Paul (KY), Ted Cruz (TX), Ron Johnson (WI) and Mike Lee (UT) have issued a joint statement saying they will oppose the bill, as it is currently written, because it does not fulfill a promise made to the American public to "repeal Obamacare and lower their health care costs."
"Currently, for a variety of reasons, we are not ready to vote for this bill, but we are open to negotiation and obtaining more information before it is brought to the floor. There are provisions in this draft that represent an improvement to our current health care system, but it does not appear this draft as a written will accomplish the most important promise that we made to Americans: to repeal Obamacare and lower their health care costs."
Statement from. Rand Paul, Ted Cruz, Mike Lee, Ron Johnson (!) opposing health care bill as it currently stands pic.twitter.com/oxwwvdTapo
— James Arkin (@JamesArkin) June 22, 2017
* * *
The Senate healthcare bill has been "in the open" for less than an hour, and already NBC's Chuck Todd reports that it may be DOA after "at least" 3 GOP senators plan to publicly announce their opposition to the bill.
In a tweet, NBC anchor Chuck Todd said that according to a “solid” unnamed source "at least 3 GOP sens (perhaps more) plan to announce public opposition to McConnell health bill later today."
Per solid source: at least 3 GOP sens (perhaps more) plan to announce public opposition to McConnell health bill later today. Developing
— Chuck Todd (@chucktodd) June 22, 2017
As a reminder, Republicans can lose no more than two Republicans, assuming all Democrats in the Senate oppose measure, as expected.
For now, hospital stocks far more excited by the announced provisions noted earlier, don't buy it, or at least assume that it will be relatively easy to "flip" one or more of the three holdouts.
OPEC’s production cut deal is unlikely to survive beyond its current deadline in March 2018, with the agreement seen falling apart towards the middle of next year, in which case a huge amount of extra oil would hit the market, Ian Reid, head of European oil and gas research at Macquarie, told CNBC on Thursday.
OPEC’s deal has not had the cartel’s desired effect on the markets, neither in terms of oil prices nor in drawing down the global glut.
According to Reid, the volume of U.S. shale output is basically nullifying OPEC’s efforts.
The key question for OPEC now is if they can extend the production cut deal into 2019, Macquarie’s manager said, but added that he did not see the cartel being able to do that.
“I think that’s going to be a very hard ask to be honest,” Reid noted.
“They can’t get the price up to a level where they can keep the shale guys out of the game so unfortunately they’re just chasing their tail at the moment,” he said, commenting on OPEC’s current strategy.
On Wednesday, Macquarie slashed its Brent price forecasts for the rest of this year as well as for 2018 and 2019, saying,
“We believe OPEC has few options. Option 1 is to maintain cuts through 2019 and allow time for demand to grow and easy growth to slow; option 2 is stop the cuts immediately. The current strategy is probably the worst. The reality is even the most optimal of OPEC's potential strategies probably will not work.”
Mounting fears of rising oversupply, coupled with no tangible signs for traders and analysts that OPEC’s agreement is working, sank oil prices to a 10-month low on Wednesday, with WTI touching its lowest intraday level since August last year.
Just this morning we reported that as the global equity research market wrestles with how it will comply with the EU's MiFID II regulations, in a new study McKinsey said that banks will have no choice but to fire a ton of equity research analysts who write a bunch of stuff that no one ever reads...which seems like a reasonable guess. The consultancy calculated that Europe’s impending ban on free research will cost hundreds of analysts their jobs with banks set to cut about $1.2 billion of investment on the area, and estimates the $4 billion that the top-10 sell-side banks currently spend on research annually is likely to fall by 30% as clients become pickier about what they pay for.
Of course, banks - and especially sellside research - will fight valiantly before that happens with aggressive attempts to find a market clearing price for the true value of their now unbundled research. A first attempt comes from Nomura, which according to Bloomberg has proposed that clients pay as much as 120,000 euros ($134,000) a year to access their favorite analysts. For that staggering price, clients would get what Nomura calls an all-inclusive "premium offering."
Nomura’s premium offering includes all analyst reports on global economics, fixed income, credit and foreign exchange, as well as services such as access to analysts and invitations to events. Different "a la carte" options would let clients purchase research reports only, with extra per-hour fees to talk to analysts of varying seniority at rates still to be determined, in other words a quasi "expert network", in which the analyst however is still conflicted to promote the bank's own investment banking agenda.
Among the cheaper options: to only get currency and economic reports, Nomura was quoting 60,000 euros. For emerging markets research, or a fixed income and credit analysis package, the prices rose to 80,000 euros. The document didn’t give any quotes for equity research, and said the prices, denominated in euros, are all indicative and “subject to contract.”
As a reminder, the EU's MiFID II regulations will start being enforced on Jan. 3, and aim to eliminate conflicts of interest by requiring asset managers to separate the trading commissions they pay from investment-research fees.
Banks have worked to find a model to sell their research at a price that won’t drive away clients, while also not being so low that regulators accuse them of gaming the system.
While Nomura said pricing is still fluid and it’s being flexible in
talks with clients, the guidance shows how banks and their clients will approach valuing something they’ve rarely charged for.
Unfortunately for Nomura and its peers, something tells us they are set up for substantial disappointment in a world where not only passive investors now dominate, but where less than 1% of all sellside research reports are actually read.
Wherever one looks there are disconnects... between bonds and stocks, between risk and uncertainty, between hope and reality. But, as former fund manager Richard Breslow notes, most critically, there is a divergence between data and Fed actions, and this time is different as central banks appear to have shifted into 'whatever it takes' to tighten policy from emergency levels mode.
As Bloomberg's Richard Breslow writes,
Ranges have been mostly tight in the foreign exchange market encouraging options traders to further reinforce the boundaries. After all, it’s now officially summer and attention is wandering. Trade the range that the market allows and go home as early as possible. Except that’s really bad advice.
One thing that has changed more and more over time is you just can’t predict when a move is going to happen. Summer doldrums, December somnolence are all true until they’re not. And increasingly less so. Day traders may schedule more holidays, but fund managers don’t and can’t reduce positions because it’s nice outside. One thing they know, far better than commentators, is you have to be in it to win it.
What makes this year even more interesting than most is that indecision isn’t being driven by our waiting on some financial crisis or election timeline, but by an extraordinary level of cognitive dissonance. The ability of people to string together utterly inconsistent arguments to describe what’s going on in markets, and the world for that matter, is staggering.
And most importantly, it makes, what are manifesting themselves as quiet markets, actually highly unstable.
The global economy can’t be simultaneously growing well and picking up momentum while limping into recession. Nor can it be buy every dip in carry if we are increasingly risk averse.
And if there’s one question that needs to be addressed, it’s whether investors or monetary policy makers better understand what central bank reaction functions will be to both data and market setbacks. It can’t be ignored that with everyone stressing over the four-week caning of oil prices, the Norges Bank removed its easing bias today.
In fact, look around the globe and tote up the preponderance of those surprising, hawkish or dovish, and you’ll see a pretty compelling picture.
And yet traders don’t buy it for a second. Something will have to give. It’s understandable that there’s been this impetus to flatten yield curves, but what happens if that global recession doesn’t come soon.
People forget that the Fed has two official mandates and a lot of discretionary leeway in addition. Poorly constructed measures of inflation don’t require them by some law to ignore labor market strength or other factors. They don’t have to be governed only by the lowest common denominator. Nor forever ignore the negative externalities of oppressively low global rates and how they further suppress yields and encourage profligate risk-taking.
Breslow's apparently pro-rate-hike advice is simple...
Don’t spend your time zoning out. Use it to resolve some of these inconsistencies as you forecast and think about where asset prices will go.
In the wake of last week’s shooting at a practice session for members of the House Republicans’ baseball team, federal authorities announced that they’ve arrested an Illinois man for threatening President Donald Trump. In a Facebook post published June 15, Joseph Lynn Pickett of Edwardsville Ill. said planned to assassinate the president, according to the Belville News-Democrat.
“Guess what Trump? I’m waiting for the right time...and I KNOW your (sic) Putin’s (expletive)! The secret service now has a heads up as to my plan to assassinate Trump...let’s see if they act.”
U.S. Secret Service Special Agent Vincent Pescitelli said Pickett’s post constituted a threat to “take the life of, to kidnap, and to inflict bodily harm” against Trump, according to a criminal complaint filed with the charges. After the original post, Pickett continued to comment, saying he was “still waiting” for the Secret Service to knock on his door and arrest him.
In another deranged post, Pickett mused about how Trump deserves “a blade in his neck." He also threatening violence against Trump’s supporters.
“Honestly am I really going to have to kill Trump before our fine Government (the jack booted thugs they are) actually takes me into custody for threatening to assassinate President Donald Trump?” Pickett wrote. “I mean he sold our country to The Russians. He is a Benedict Arnold but hey the (expletive) is our President even though he needs a blade in his neck. And you dumb, asses who stick up for him...who’s gonna protect you when someone like me comes t (sic) take you out.”
Until about six to eight months ago, Pickett had been working at Lowe’s in Granite City, Ill. until he was fired for – wait for it - making threats to a coworker, according to the News-Democrat.
Two of Pickett’s former coworkers contacted the St. Louis chapter of the US Secret Service and told them that Pickett had threatening posts on his Facebook page. They also said he had bragged about having weapons. A judge ruled that Pickett, who was determined to be “mentally unstable,” should be detained until his trial to ensure the safety of others.
Edwardsville isn't far from Belleville Ill., the home town of Congressional shooter James Hodgkinson.
Hodgkinson, an ostensibly “progressive” never-Trumper, wounded five people when he opened fire on the GOP baseball practice in Alexandria Va. on June 14. Scalise, who was badly wounded after being shot in the hip, was rushed to the hospital after the incident with life-threatening injuries, though his condition has since been upgraded to stable. Hodgkinson was killed during the shootout that ensued.
Hodgkinson, who identified as a supporter and former campaign volunteer for Democratic candidate Bernie Sanders, also shared anti-Trump memes and rants on his Facebook page.
Start buying oil.
That's not only this morning's recommendation by Dennis Gartman but, as this afternoon, also Citi's commodities team (led by OPEC's impressario Ed Morse) which moments ago issued a report according to which crude oil markets will not only bottom, but more importantly, "investors should position now for a potential V-shaped rebound in crude oil prices, as price risk seems asymmetrically skewed to the upside."
Do two wrongs make a right? But we digress...
Citi explains the recent collapse (which it did not in any way anticipate as it was bullish all the way into a bear market), by noting that WTI flat price has sold off another ~5% this week, as bearish sentiment continued to prevail among oil market participants. However, it counters, "both weekly and monthly storage data are pointing to a tighter market by end-2017, and Citi expects global oil stocks to draw ~200-m bbls to year-end. While it is possible for prices to dip even lower near-term, we do not view this as sustainable, and once market sentiment turns, prices could rally sharply."
Some additional observations from uber-bullish Citi on the crude vol surface:
The flattening of the vol skew has gathered pace. The discount of the 3rd contract’s 25-delta call implied vol to the ATM vol narrowed to ~0.9 vol pts or just ~3%, the smallest in over a year, while the call skew on longer-dated contracts shrank significantly as well (Figure 1).
Meanwhile, WTI short-dated implied vol remains cheap, despite having bounced off the lows. The negative relationship between implied vol and oil prices has restored after breaking down briefly last week, marked by the 1-month implied vol (OIV) repricing ~4 vol pts higher during the sell-off in flat price to ~32 pts, in line with the current realized vol. While the implied breakeven is back up to $0.86 from just below $0.80, it still looks cheap historically, even compared to the $0.75-1.05 range established in the low vol environment so far this year (Figure 2).
We do not expect a quick reversal of such dynamics, as muted producer activity as well as stronger consumer hedging demand at this price level should continue to suppress downside vols and support upside vols. Should market sentiment improve, a build-up in investor length, which is near the lowest since last November (Figure 3), could keep calls better bid, too.
Assuming Citi is right this time, and in case readers want to trade alongside (or maybe's that opposite from) the bank, here are the three trade recommendations from Morse's team:
- Trade Idea 1: Buy Dec17 WTI 46/53 call spreads; sell Dec17 WTI 40 puts for zero cost. Pricing as of 9:35am EST, Jun 22nd, 2017. Transaction costs are included. Reference prices: NYMEX WTI Dec17 futures at $43.75/bbl. Expiry: Nov 15th, 2017. Net delta: 0.56. Max payout: $7 (16% of reference prices).
- Risks: The trade is subject to losses if WTI trades below the $40 put strike by maturity, which remains an unlikely scenario in our view. As aforementioned, we cannot rule out the possibility of another leg lower in oil prices in the near-term, but it should be short-lived, in our view.
- Trade Idea 2: Buy 1x Dec17 WTI 44 call; sell 2x Dec17 WTI 52 calls for $1.67. Pricing as of 9:48am EST, Jun 22nd, 2017. Transaction costs are included. Reference prices: NYMEX WTI Dec17 futures at $43.69/bbl. Expiry: Nov 15th, 2017. Net Delta: 0.12. Max payout: $8 (18% of reference prices and x4.8 of costs).
- Risks: The payout of this trade will turn negative should WTI trade above $60/bbl (or ~37% higher than the reference price) by maturity
- Trade Idea 3: Buy Sep17 WTI 44 calls for $1.63. Pricing as of 9:55am EST, Jun 22nd, 2017. Transaction costs are included. Reference prices: NYMEX WTI Sep17 futures at $43.09/bbl. Expiry: Aug 17th, 2017. Delta: 0.45.
- Risks: The trade will lose the premium if oil prices remain under pressure in the near-term and WTI trades below the $44 strike by maturity. We like the risk-reward of this trade which takes advantage of the relatively cheap implied vol on shortdated contracts.
Not to be outdone by Jeff Bezos' "out of the box thinking", Elon Musk has turned the amplifier of fast money to '11'...
Car-maker, tech stock, solar company... and now music streaming service.
Oh the genius of Elon Musk... "you just don't get it"
As ReCode reports, put this one in the “You can do that, but why would you want to do that?” file:
Tesla is talking to the music industry about creating its own streaming music service.
Music industry sources say the carmaker has had talks with all of the major labels about licensing a proprietary music service that would come bundled with its cars, which already come equipped with a high-tech dashboard and internet connectivity.
Label sources aren’t clear about the full scope of Tesla’s ambitions, but believe it is interested in offering multiple tiers of service, starting with a Pandora-like web radio offering.
The bigger question: Why doesn’t Tesla simply integrate existing services, like Spotify or Apple Music, into all of its cars from the start — especially since Tesla already does a deal with Spotify for Teslas sold outside the U.S.?
“We believe it’s important to have an exceptional in-car experience so our customers can listen to the music they want from whatever source they choose,” a Tesla spokesperson said.
“Our goal is to simply achieve maximum happiness for our customers.”
Of course shareholders can see only the upside (even though the stock did drop ever so slightly on this headline) even if Musk just found another way to burn more money.
Will this be the next excuse to raise more capital?
Oh and just one more thing...
NFA News Releases
Elite Forex Blog - Market Research & Analysis
Some effort is required to protect your privacy with Bitcoin. All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances. This is one reason why Bitcoin addresses should only be used once. Always remember that it is your responsibility to adopt good practices in order to protect your privacy. Read more about protecting your privacy.
Two resources available almost exclusively to central banks could soon be opened up to additional users as a result of a new digital currency project designed by a little-known startup and Swiss bank UBS. One of those resources is the real-time gross settlement (RTGS) system used by central banks (it’s typically reserved for high-value transactions that need to be settled instantly), and the other is central bank-issued cash. Using the Utility Settlement Coin (USC) unveiled today, the five-member consortium that has sprung up around the project aims to help central banks open-up access to these tools to more customers. If successful, USC has the potential to create entirely new business models built on instant settling and easy cash transfers. In interview, Robert Sams, founder of London-based Clearmatics, said his firm initially worked with UBS to build the network, and that BNY Mellon, Deutsche Bank, ICAP and Santander are only just the first of many future members.
Google Ventures and China-based IDG Capital Partners are the second group of tech investors in two months to place a bet on OpenCoin, the company behind the currently-in-beta Ripple open-source payments protocol. OpenCoin announced today that it had closed an additional round of funding — the amount wasn’t specified — with Google Ventures and IDG Capital Partners. (Hat tip to GigaOM for the news.) Last month, OpenCoin wrapped up an earlier angel round of funding from another high-profile group of technology VCs: Andreessen Horowitz, FF Angel IV, Lightspeed Venture Partners, Vast Ventures and the Bitcoin Opportunity Fund.
Soon after these stories were published, authorities in Australia raided the home of Mr Wright. The Australian Taxation Office said the raid was linked to a long-running investigation into tax payments rather than Bitcoin.
Questioned about this raid, Mr Wright said he was cooperating fully with the ATO.
“We have lawyers negotiating with them over how much I have to pay,” he said.
The New Yorker published a piece pointing at two possible Satoshis, one of whom seemed particularly plausible: a cryptography graduate student from Trinity College, Dublin, who had gone on to work in currency-trading software for a bank and published a paper on peer-to-peer technology. The other was a Research Fellow at the Oxford Internet Institute, Vili Lehdonvirta. Both made denials.
Fast Company highlighted an encryption patent application filed by three researchers – Charles Bry, Neal King and Vladimir Oksman – and a circumstantial link involving textual analysis of it and the Satoshi paper which found the phrase “…computationally impractical to reverse” in both. Again, it was flatly denied.
The NSA was one of the first organizations to describe a Bitcoin-like system. About twelve years before Satoshi Nakamoto published his legendary white paper to the Metzdowd.com cryptography mailing list, a group of NSA information security researchers published a paper entitled How to Make a Mint: the Cryptography of Anonymous Electronic Cash in two prominent places, the first being an MIT mailing list and the second being much more prominent, The American Law Review (Vol. 46, Issue 4 ).The paper outlines a system very much like Bitcoin in which secure financial transactions are possible through the use of a decentralized network the researchers refer informally to as a Bank. They list four things as indispensable in their proposed network: privacy, user identification (protection against impersonation), message integrity (protection against tampering/substitution of transaction information – that is, protection against double-spending), and nonrepudiation (protection against later denial of a transaction – a blockchain!).“We will assume throughout the remainder of this paper that some authentication infrastructure is in place, providing the four security features.” (Section 1.2)It is evident that SHA-256, the algorithm Satoshi used to secure Bitcoin, was not available because it came about in 2001. However, SHA-1 would have been available to them, having been published in 1993.
In October 2000 Iraq insisted on dumping the US dollar – ‘the currency of the enemy’ – for the more multilateral euro. The changeover was announced on almost exactly the same day that the euro reached its lowest ebb, buying just $0.82, and the G7 Finance Ministers were forced to bail out the currency. On Friday the euro had reached $1.08, up 30 per cent from that time.Almost all of Iraq’s oil exports under the United Nations oil-for-food programme have been paid in euros since 2001. Around 26 billion euros (£17.4bn) has been paid for 3.3 billion barrels of oil into an escrow account in New York. The Iraqi account, held at BNP Paribas, has also been earning a higher rate of interest in euros than it would have in dollars.
Claims that the NSA created Bitcoin have actually been flung around for years. People have questioned why it uses the SHA-256 hash function, which was designed by the NSA and published by the National Institute for Standards and Technology (NIST). The fact that the NSA is tied to SHA-256 leads some to assume it’s created a backdoor to the hash function that no one has ever identified, which allows it to spy on Bitcoin users.“If you assume that the NSA did something to SHA-256, which no outside researcher has detected, what you get is the ability, with credible and detectable action, they would be able to forge transactions. The really scary thing is somebody finds a way to find collisions in SHA-256 really fast without brute-forcing it or using lots of hardware and then they take control of the network,” cryptography researcher Matthew D. Green of Johns Hopkins University said in a previous interview.
The CIA Project, a group dedicated to unearthing all of the government’s secret projects and making them public, hasreleased a video claiming Bitcoin is actually the brainchild of the US National Security Agency.The video entitled CIA Project Bitcoin: Is Bitcoin a CIA or NSA project? claims that there is a lot of compelling evidences that proves that the NSA is behind Bitcoin. One of the main pieces of evidence has to do with the name of the mysterious man, woman or group behind the creation of Bitcoin, “Satoshi Nakamoto”.According to the CIA Project, Satoshi Nakamoto means “Central Intelligence” in Japanese. Doing a quick web search, you’ll find out that Satoshi is usually a name given for baby boys which means “clear thinking, quick witted, wise,” while Nakamoto is a Japanese surname which means ‘central origin’ or ‘(one who lives) in the middle’ as people with this surname are found mostly in the Ryukyu islands which is strongly associated with the Ryūkyū Kingdom, a highly centralized kingdom that originated from the Okinawa Islands. So combining Nakamoto and Satoshi can be loosely interpreted as “Central Intelligence”.
Certainly, anonymity is one of the biggest myths about Bitcoin. In fact, there has never been a more easily traceable method of payment. Every single transaction is recorded and retained permanently in the public “blockchain”. The idea that the NSA would create an anarchic, peer-to-peer crypto-currency in the hope that it would be adopted for nefarious industries and become easy to track would have been a lot more difficult to believe before the recent leaks by Edward Snowden and the revelation that billions of phone calls had been intercepted by the US security services. We are now in a world where we now know that the NSA was tracking the pornography habits of Islamic “radicalisers” in order to discredit them and making deals with some of the world’s largest internet firms to insert backdoors into their systems.
Nonetheless, Svintsov’s remarks count as some of the more extreme to emanate from the discussion. Svintsov told Russian broadcast news agency REGNUM:“All these cryptocurrencies [were] created by US intelligence agencies just to finance terrorism and revolutions.”Svintsov reportedly went on to explain how cryptocurrencies have started to become a payment method for consumer spending, and cited reports that terrorist organisations are seeking to use the technology for illicit means.
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The FBI employs 35,000 people, including special agents and support professionals such as intelligence analysts, language specialists, scientists, and information technology specialists. Learn how you can join us at FBIJobs.gov. For details on our executives and organizational structure, see our Leadership & Structure webpage.
As of 2013, 8,500 witnesses and 9,900 family members have been protected by the U.S. Marshals Service since 1971.
For 30 years, DeVecchio was one of the FBI 's most important mob busters.
DeVecchio was Scarpa's handler, and Scarpa was more than an ordinary stool pigeon -- he had also allegedly served as muscle for the FBI when the bureau needed some extra legal assistance in making difficult cases. As a result, he was allegedly accorded special, sometimes questionable, favors, including tips on coming indictments that allowed Scarpa's associates to skip town in advance. But, in aiding his informant to commit murder, prosecutors now allege that DeVecchio went too far in protecting his valuable mob asset. Law enforcement sources say DeVecchio may have also enriched himself in the process.
WASHINGTON — The F.B.I. has significantly increased its use of stings in terrorism cases, employing agents and informants to pose as jihadists, bomb makers, gun dealers or online “friends” in hundreds of investigations into Americans suspected of supporting the Islamic State, records and interviews show.
Undercover operations, once seen as a last resort, are now used in about two of every three prosecutions involving people suspected of supporting the Islamic State, a sharp rise in the span of just two years, according to a New York Times analysis. Charges have been brought against nearly 90 Americans believed to be linked to the group.
The increase in the number of these secret operations, which put operatives in the middle of purported plots, has come with little public or congressional scrutiny, and the stings rely on F.B.I. guidelines that predate the rise of the Islamic State.
While F.B.I. officials say they are careful to avoid illegally entrapping suspects, their undercover operatives are far from bystanders. In recent investigations from Florida to California, agents have helped people suspected of being extremists acquire weapons, scope out bombing targets and find the best routes to Syria to join the Islamic State, records show.
But defense lawyers, Muslim leaders and civil liberties advocates say that F.B.I. operatives coax suspects into saying and doing things that they might not otherwise do — the essence of entrapment.“They’re manufacturing terrorism cases,” said Michael German, a former undercover agent with the F.B.I. who researches national security law at New York University’s Brennan Center for Justice. In many of the recent prosecutions, he said, “these people are five steps away from being a danger to the United States.”
French bank BNP Paribas was fined $350 million by the New York State Department of
Financial Services for lax oversight in its foreign-exchange business that
allowed “nearly unfettered misconduct” by more than a dozen employees involved
in exchange rate manipulation, officials announced Wednesday.
From 2007 through 2013, a trader on the bank’s New York desk, identified in the
consent order as Jason Katz, ran a number of schemes with more than a dozen
BNPP traders and salespeople on key foreign exchange trading desks to
manipulate prices and spreads in several currencies, including the South
African rand, Hungarian forint and Turkish lira, officials said.
He called his group of traders a "cartel" and they communicated in a
chat room called "ZAR Domination," a reference to the rand’s trading
symbol, according to the consent order. The group would push up the price of
the illiquid rand during New York business hours when the South African market
was closed, moving the currency in whichever way they chose, and thus
depressing competition, officials said.
Katz also enlisted colleagues at other banks to widen spreads for orders in
rands, increasing bank profits and limiting competition at the customer’
expense, the order says. Some of the traders engaged in illegal coordination
and shared confidential customer information, officials said. As part of a
cooperation agreement with prosecutors, Katz pled guilty in Manhattan federal court in
January to one count of conspiracy to restrain trade in violation of the
“Participants in the foreign exchange market rely on a transparent and fair
market to ensure competitive prices for their trades for all participants,”
Financial Services Superintendent Maria T. Vullo said in a statement. “Here the
bank paid little or no attention to the supervision of its foreign exchange
trading business, allowing BNPP traders and others to violate New York state
law over the course of many years and repeatedly abused the trust of their
BNP Paribas, which employs nearly 190,000 people and has total assets of more
than €2.1 trillion (approximately $2.36 trillion), said in a statement that the
$350 million fine will be covered by existing provisions. It said it had
implemented a group-wide remediation initiative and cooperated fully in the
“The conduct which led to this settlement occurred during the period from 2007
to 2013. Since this time, BNP Paribas has proactively implemented extensive
measures to strengthen its systems of control and compliance,” the bank said in
its statement. “The group has increased resources and staff dedicated to these
functions, conducted extensive staff training and launched a new code of
conduct which applies to all staff.”
Three BNPP employees were fired, seven more resigned and several others were
disciplined for misconduct or supervisory shortcomings in relation to the
probe, the order says.
Katz’s attorney, Michael Tremonte of Sher Tremonte LLP, did not respond Wednesday to a call seeking
SAN DIEGO – Jeffrey Spanier, a 51-year-old former owner of Amerifund Capital Finance, LLC located in Boca Raton, Florida, was convicted by a federal jury today for his role in an elaborate stock-loan fraud scheme in which executives and shareholders of publicly traded corporations collectively lost over $100 million when the stock they pledged as collateral for loans was immediately sold in order to fund the loans.
The first timeshare in the United States was started in 1974 by Caribbean International Corporation (CIC), based in Fort Lauderdale, Florida. It offered what it called a 25-year vacation license rather than ownership. The company owned two other resorts the vacation license holder could alternate their vacation weeks with: one in St. Croix and one in St. Thomas; both in the U.S. Virgin Islands. The Virgin Islands properties began their timeshare sales in 1973 with owners Hillie Meyers, Don Saunders, and Arthur Zimand.
- Analysts upgrading HGV are not considering the 'dark side' of this industry.
- Potential liabilities can spring up anytime that can change this tune.
- Angry customers complain, which can soon become lawsuits, with deleterious consequences.
We see no reason to sign up for RCI except to give the company money. We are new members who tried to use RCI for the first time. We wanted to visit El Dorado Suites, Riviera Maya, using our exchange. Through RCI, we have to pay a $399 fee for a mandatory 7-day visit. RCI requires we also pay a $2500 "Mandatory all inclusive" fee for the El Dorado. So that's the cost of our RCI membership, plus a $399 fee, plus a $2500 all-inclusive fee. Curious, we logged into El Dorado's home page and found we could sign up for the exact same vacation, not using RCI, for a total cost of $2200, also all-inclusive. So the all-inclusive fee alone is more than the actual cost of staying at the El Dorado Suites, without having ever met an RCI salesperson....I have been with RCI approx 12yrs. My previous issues have been the fact that they charge for unused points... Live and learn. My complaint is that I had to cancel a reservation. It's unfortunate but situations do arise and plans have to get changed. I cancelled 5-days prior to my check-in date. RCI WILL NEITHER REFUND NOR CREDIT my charge of $99.00! They say they have a 24-hour 'grace period'. I feel this is a major RIP-OFF to consumers and extremely bad business practice. I have contacted them by email, customer service and 'blabbering' supervisor. I was told "they have to keep the lights on" in order to provide their service. Well, RCI, my lights need to be on as well!! BUYER BEWARE.
Nomura reiterated their buy rating on shares of Hilton Grand Vacations Inc in a research note published on Friday morning. The brokerage currently has a $43.00 price target on the stock.
Kosovo, self-declared independent country in the Balkans region of Europe. Although the United States and most members of the European Union (EU) recognized Kosovo's declaration of independence from Serbia in 2008, Serbia, Russia, and a significant number of other countries—including several EU members—did not.
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But there are plenty of other reasons to want to bring supply chains back to the U.S. High-value-added manufacturing — robot factories pumping out goods — creates jobs for Americans in other ways. As economist Enrico Moretti explains in his book “The New Geography of Jobs,” high-tech manufacturing creates higher-paying service-sector jobs in a local area. The dollars that come into a town with a robot factory get spent on doctors and waiters and personal trainers, and the money circulates throughout the community, leaving everyone better off.from another article:Moretti demonstrates that there really are two Americas — one that’s healthy, rich and growing, and a second that’s increasingly being left behind. The two nations-within-a-nation are divided not so much by region or race or religion, but by the kinds of industries they support. Those cities and towns that are home to innovative industries — information technology, pharmaceuticals, advanced manufacturing and the like — are wealthier, healthier and safer, while the places without these industries are steadily declining.
After predicting the 2008 economic crisis, the Brexit vote, the U.S. presidential election and other events correctly, Nassim Nicholas Taleb, author of the Incerto series on global uncertainties, which includes The Black Swan: The Impact of the Highly Improbable, is seen as something of a maverick and an oracle. Equally, the economist-mathematician has been criticised for advocating a “dumbing down” of the economic system, and his reasoning for U.S. President Donald Trump and global populist movements. In an interview in Jaipur, Taleb explains why he thinks the world is seeing a “global riot against pseudo-experts”.
Putting my work online motivates me to go deeper into a subject. I put it online and it gives some structure to my thought. The only way to judge a book is by something called the Lindy effect, and that is its survival. My books have survived. I noticed that The Black Swan did well because it was picked up early online, long before the launch. I also prefer social media to interviews in the mainstream media as many journalists don’t do their research, and ‘zeitgeist’ updates [Top Ten lists] pass for journalism.
Well, I’m talking about the United States where I get more credible news from the social media than the mainstream media. But I am very impressed with the Indian media that seems to present both sides of the story. In the U.S., you only get either the official, bureaucratic or the academic side of the story.
Oh, absolutely! The last crisis  hasn’t ended yet because they just delayed it. [Barack] Obama is an actor. He looks good, he raises good children, he is respectable. But he didn’t fix the economic system, he put novocaine [local anaesthetic] in the system. He delayed the problem by working with the bankers whom he should have prosecuted. And now we have double the deficit, adjusted for GDP, to create six million jobs, with a massive debt and the system isn’t cured. We retained zero interest rates, and that hasn’t helped. Basically we shifted the problem from the private corporates to the government in the U.S. So, the system remains very fragile.
Of course. The whole mandate he got was because he understood the economic problems. People don’t realise that Obama created inequalities when he distorted the system. You can only get rich if you have assets. What Trump is doing is put some kind of business sense in the system. You don’t have to be a genius to see what’s wrong. Instead of Trump being elected, if you went to the local souk [bazaar] in Aleppo and brought one of the retail shop owners, he would do the same thing Trump is doing. Like making a call to Boeing and asking why are we paying so much.
Not the Islamic State, but al-Qaeda at the time, and I said the U.S. administration was helping fund them. See, you have to have courage to say things others don’t. I was lucky financially in life, that I didn’t need to work for a living and can spend all my time thinking. When Trump was running for election, I said what he says makes sense to a grocery store owner. Because the grocery guy can say Trump is wrong because he can see where he is wrong. But with Obama, he can’t understand what he’s saying, so the grocery man doesn’t know where he is wrong.
Exactly. Trump never ran for archbishop, so you never saw anything in his behaviour that was saintly, and that was fine. Whereas Obama behaved like the Archbishop of Canterbury, and was going to do good but people didn’t feel their lives were better. As I said, if it was a shopkeeper from Aleppo, or a grocery store owner in Mumbai, people would have liked them as much as Trump. What he says makes common sense, asking why are we paying so much for this rubbish or why do we need these complex taxes, or why do we want lobbyists. You can call Trump’s plain-speaking what you like. But the way intellectuals treat people who don’t agree with them isn’t good either. I remember I had an academic friend who supported Brexit, and he said he knew what it meant to be a leper in the U.K. It was the same with supporting Trump in the U.S.
Well, if you’re a businessman, for example, what Trump said didn’t bother you. The intellectual class of no more than 2,00,000 people in the U.S. don’t represent everyone upset with Trump. The real problem is the ‘faux-expert problem’, one who doesn’t know what he doesn’t know, and assumes he knows what people think. An electrician doesn’t have that problem.
Well, with Trump, Modi, Brexit, and now France, there are some similar problems in those countries. What you are hearing is people getting fed up with the ruling class. This is not fascism. It has nothing to do with fascism. It has to do with the faux-experts problem and a world with too many experts. If we had a different elite, we may not see the same problem.
I often say that a mathematician thinks in numbers, a lawyer in laws, and an idiot thinks in words. These words don’t amount to anything. I think you have to draw the conclusion that there is a global riot against pseudo-experts. I saw it with Brexit, and Nigel Farage [leader of the U.K. Independence Party], who was a trader for 15 years, said the problem with the government was that none of them had ever had a proper job. Being a bureaucrat is not a proper job.
I don’t understand how a left-wing person can defend Salafism, or religious extremism. In a democracy, you can allow people to have any view, but they can’t come with a message to destroy democracy. Why should people who come to the West come with a message to finish the West? This is where the discourse goes haywire. So in Yemen, the [Saudi] intervention is good, but the intervention [by Russia] in Aleppo shouldn’t be allowed. I don’t think Trump was racist when he said Mexican criminals shouldn’t be allowed into the U.S.; he was targeting criminals. If you are Naziphobic, you are not against Germans. If I oppose Salafism, I am not an Islamophobe. Obama also deported Mexicans and refused to accept immigrants.
I am not anti-globalisation, but I am against big global corporations. One of the reasons is what they cost. Today, every project sees cost overruns because these projects have to factor in global risks as well. In nature there is an ‘island effect’. The number of species on an island drops significantly when you go to the mainland. Similarly, when you open up your small economies, you lose some of your ethnicity or diversity. Artisans are being killed by globalisation. Think of the effect on so many artists who have been put out of work while people are buying wrinkle-free shirts and cheap mobile phones. I’m a localist. The problem is globalisation comes through large global corporates that are predatory, and so we want to counter its ill-effects.
I don’t think it will go left or right, and I don’t know about the short term. But I think in the long term, the world can only survive if it lives like nature does. Many smaller units of governance, and a collection of super islands with some separation, quick decision-making, and visible implementation. Lots of Switzerlands, that’s what we need. What we need is not leaders, we don’t need them. We just need someone at the top who doesn’t mess the system up.
- At the end of 2015, total pension assets were estimated at USD 35.4 trillion, which represents a decrease of 0.5% compared to USD 35.6 trillion at the end of 2014
- Pension assets relative to GDP reached 80% in 2015, which represents a decrease of 4% from the 2014 ratio of 84%
- The largest pension markets are the US, UK and Japan with 62%, 9% and 8% of total pension assets in the study, respectively
In what may be the most stunning move in the asset management space in years, the WSJ reports that Harvard University’s endowment, which manages just shy of $36 billion, will undergo a "radical overhaul" in the way the world’s wealthiest school invests its money by outsourcing management of most of its assets and lay off roughly half the staff in the process.According to the WSJ, about half of the 230 employees at Harvard Management Company will leave as part of a sweeping change by the university’s new endowment chief, N.P. “Narv” Narvekar. This means that the endowment will shut down its internal hedge funds and let go traders by the middle of the year. Additionally, the internal team in charge of direct real-estate investments is expected to spin out into an independent entity that Harvard is expected to invest with. Only management of Harvard’s natural resources portfolio and passively managed exchange-traded funds will remain in house.
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Overstock.com Inc is an online retailer offering closeout and discount brand and non-brand name merchandise, including bed-and-bath goods, home décor, kitchenware, watches, jewelry, electronics and computers, apparel, and designer accessories.Overstock.com Inc. is based out of Salt Lake City, UT and has some 1,900 employees. Its CEO is Patrick M. Byrne.
Overstock.com, Inc. (OSTK) has reached a new milestone in its efforts to bring Wall Street and bitcoin pioneered crypto-revolution closer. The world's first trading portal for the exchange of securities on blockchain technology is ready and has been built by Overtstock.com's majority-owned fintech subsidiary t0. Overstock.com recently announced approval of a non-transferable rights offering by its board of directors which allows its stockholders of record to purchase shares of its preferred stock, including preferred shares to be issued and traded exclusively on a registered alternative trading system using the t0 issuance and trading platform.
Santiago, who was arrested in January and waiting to stand trial in March on criminal charges, recently showed up to an F.B.I. office in Anchorage unannounced seeking help.Santiago told the F.B.I. he thought he was being mind controlled, possibly by the U.S. government or the C.I.A. and admitted hearing voices, which Santiago said told him to study “extremist materials on the Internet,” the New York Times reports.
“There has been a massive blowback from public pension funds and private endowments,’’ said Craig Effron, who co-founded his Scoggin Capital Management nearly 30 years ago. An investor told him recently that many chief investment officers are so fed up that they would prefer to entrust their cash to a trader who charged no management fee, over one who did, even if they expected the latter to make them more money.Public retirement plans from Kentucky to New York, New Jersey and Rhode Island have decided to pull money from hedge funds. So did a state university in Maryland and other endowments. MetLife Inc. and other insurers followed suit. Money-losing firms were forced to reduce their fees. Client withdrawals ($53 billion in the last four quarters) drove some managers out of business, including veteran Richard Perry, who until recently had managed one of the longest-standing and better-performing firms.
The California Public Employee Retirement System (CalPERS) is about to report the world’s largest public employee pension suffered an actuarial investment loss of $30.8 billion last year.CalPERS manages the defined pension plan investments and record keeping for 3,007 California state and local government entities. The pension plan is also responsible for paying the pension benefits to 611,078 retirees and will eventually be responsible for paying retirement benefits to another 868,713 active and 335,908 inactive government workers.Despite Governor Jerry Brown last summer demanding CalPERS immediately “lower its investment risk and volatility of returns” by reducing its “assumed” annual investment return from 7.5 percent to 6.5 percent, the CalPERS board voted 7- 3 on November 15, 2015 only to slowly reduce the investment return expectation over the next decade.
While clients have only pulled a net 2 percent of assets so far, Tony James, the president at Blackstone Group, the largest investor in hedge funds, predicted in May that the industry would shrink by roughly a quarter over the next year. Hedge fund closures (782 in the first nine months) are on track to be the most since 2008, and startups (576) the fewest.Any manager still standing applauds a smaller industry. Less money under management means fewer crowded trades and more chances to find the elusive alpha. Interest rates on the rise in the U.S., while still near zero or negative in the rest of the world, should also help. The Trump presidency, which promises less regulation, more infrastructure spending and the potential return of prop trading by banks, could also be a boon.
Today is Black Friday, America's commercial holiday - the 'real' Thanksgiving. Today, millions of Americans will buy things they don't need with money they don't have to impress people they don't know. Well, if you want to avoid the melee, shop online at Pleaseorderit.com checkout our Black Friday specials here. Pleaseorderit.com also has free stuff, online specials, free trials - and more!