Category: zerohedge

Two days after we posted a note by a commodity trader according to whom “What Is Happening Has Absolutely No Reasonable Explanation” late last night we received another warning from a futures trader, one which is applicable to everyone who also trades futures and may be unfamiliar with the recent changes in Nymex and Globex “price banding.”  This is what he said yesterday.

Hi, I’m a daytrader and I read your site almost every day. Something disturbing happened this morning. I bought a nymex copper contract with an attached stop limit and take profit. My stop got rejected by the exchange. I think it was in pending mode. I ignored it and when the market moved up, i moved the stop up. Then the exchange accepted it. My take profit order got hit instead. Then, I shorted an ES. Again, the market rejected my stop limit.

 

Luckily the market went down so I was able to play around with the stop to see what worked – i moved it within 4 points of the market, the exchange accepted it, and when it reversed, the stop got filled.

 

I have been attaching stop limits to all my trades forever. They are always initially placed the same percentage away from the entry trade. I did not change anything today. There has never been a problem. Apparently, Globex & Nymex have introduced something called ‘price banding’ and on ES, the band for stop limits is now only 6 points.

 

That is not far enough away for me and I’m sure it’s the same for many other traders.

 

The price bands are also apparently dynamic, so if the price moves, the stop which was accepted by the exchange could now become invalid and will not get filled on a reversal. This has major implications, I don’t think I need to explain them to you.

Not to us, but certainly to all those other daytraders who see a sudden spike or dip in the market (or any given commodity), only to have their tight stop threshold triggered and be forced out of the original trade, even as the market immediately returns to its original, pre-momentum ignition level, leading many to scream in powerless fury at their computer screens over a loss that was the result of what may appear to have been a senseless move.

Some additional words of warning from us: whether trading futures or plain vanilla securities with attached stops, all the data is ultimately sold by either internalizers or exchanges to HFTs who pay lots of money to find the critical “pin” points that inflict the most pain and force the biggest market squeezes, either to the up or downside. While this may not be a major issue for long-term investors, day traders should beware as this is the activity that tends to result in violent algo-generated intraday spikes that stop out the most traders – there is nothing more that algos love than market orders, and right after that, converting a limit order into a market order – are then accelerate the direction move by covering their trade, allowing HFTs to pocket the incremental spread. 

This is also why increasingly more trading is shifting to dark pools (where HFTs also dominate activity), and why lit market liquidity has collapsed over the past few years, as HFTs are directionally unbiased, but will promptly frontrun any “whale” order – most of these are upward biased – and will just as violently cause a market “stop out” any time there is a critical mass of stop orders at key levels.

via http://ift.tt/1SWX27q Tyler Durden

It's not just Halliburton ("What we are experiencing today is far beyond headwinds; it is unsustainable") and Intel (12,000 layoffs amid re-evaluation of programs) that are facing up to a new normal very different from expectations. As Avondale Asset Management notes, having poured over 100s of earnings transcripts, while most CEOs don’t see signs of an imminent downturn, the environment still feels a little fragile. It seems that almost everyone is on high alert for a macro curve-ball…

There are some green shoots that capital markets are opening back up, but there are also signs of sluggishness. Overall the economy appears to be ok, not deteriorating, but not robust either.

The Macro Outlook:

Even though things have gotten better, people are still waiting for a curveball

“I’m a superstitious person and I think the minute I think this is starting to go well, for some reason we’re going to get smacked down with some change in the market…Call it the curve ball discount there, I’m just waiting to see another quarter. And right now, I’d say all indicators are looking favorable for improvement as the year goes on. I actually want to see some of that improvement sustained; meaning, economic conditions and exchange.” —Abbott Labs CEO Miles White (Healthcare)

The environment still feels a little fragile

“many of the factors that were impacting the market in the first quarter…seem to have abated and although the market feels a little fragile from all that, it feels like – for the most part, that’s behind us. But we’ll see how the year progresses.” —Goldman Sachs CFO Harvey Schwartz (Investment Bank)

But while many are uneasy, few see signs of a downturn

“We believe that the global economy will continue to be uneasy…at this time we don’t see any signs of a broad-based global downturn. In fact, many companies expressed difficulty finding the right talent as evidenced by the findings of our 2015 talent shortage survey published late last year” —Manpower CEO Jonas Prising (Temp Staffing)

“the economy. It is what I would call good but not great. It’s okay…We see no practical possibilities of recession, notwithstanding the fact there’s been a lot of conversation about that. And the reason is because we think there is a very, very strong solid pent-up need for continuing investment. When I talk to business people…they’re not excited enough about the future to go out and make major expansions and so forth. But they’re driving trucks that have 250,000 miles on it. They got ten-year old equipment, and so stuff just wears out. And so, that’s why you have to keep investing.” —BB&T CEO Kelly King (Regional Bank)

Most agree that the economy isn’t great, but it hasn’t deteriorated

“things haven’t deteriorated, but things haven’t improved” —Visa CEO Charles Scharf (Credit Cards)

There are some green shoots

“The M&A pipeline is strong and some green shoots suggest the equity underwriting calendar may open up. The S&P level at the end of the first quarter will help with asset pricing in our Wealth Management business” —Morgan Stanley CEO James Gorman (Investment Bank)

The second quarter is feeling robust for loan growth

“we already know what quarter two is starting to look like, and it’s feeling pretty robust…we are on all cylinders on loans. Mortgages particularly are growing nicely as they – they didn’t a year ago” —US Bank CEO Richard Davis (Regional Bank)

But there are also a lot of areas that just feel sluggish

Intel projected a greater than expected decline in PC markets

“We now expect the PC markets to decline in the high single digits in 2016 versus our prior forecast of mid-single-digit decline. Our projection of the PC market remains more cautions than third-party estimates.” —Intel CFO Stacy Smith (Semiconductors)

Qualcomm lowered its expectations for mobile phone growth

“We are adjusting our estimate of calendar 2016 global 3G/4G device shipments to 1.625 billion to 1.725 billion devices, with year-over-year unit growth of approximately 8% at the midpoint, down from our previous midpoint estimate of approximately 10% growth.” —Qualcomm President Derek Aberle (Semiconductors)

Steel industry capacity utilization is only 71%

“For the steel platform as a whole, driven by the our flat roll operations, our production utilization rate for the first quarter 2016 increased to 88% as compared to overall industry utilization of approximately 71%.” —Steel Dynamics CEO Mark Millett (Steel)

Union Pacific expressed some doubt about whether the auto industry could meet sales expectations

“Turning to autos, light vehicle sales are forecasted at 17.8 million vehicles, a 2% increase above the 2015 seasonally adjustable annual rate of 17.5 million vehicles…While we expect low gasoline prices will continue to sustain demand, we remain cautious with respect to auto sales supporting these levels.” —Union Pacific EVP Eric Butler (Railroad)

Venture lenders are focusing a little more on credit quality

“There’s been a lot of discussions about things actually pulling back a little bit in [Technology & Life Sciences]…Today, we’re probably focusing more on credit quality, more on granularity.” —Comerica CEO Ralph Babb & EVP Patrick Faubion (Regional Bank)

The market for IT jobs may be slightly softer

“I would describe the demand for IT skills to still be healthy, maybe slightly softer.” —Manpower CEO Jonas Prising (Temp Staffing)

The market may be a little slower to open all the way back up

“I think after a tough first quarter like the whole market has experienced, I think that there may be a slow reaction function in terms of how various market participants engage the marketplace. But it feels like, as I said before, the most significant factors impacting the first quarter seem to have abated, at least for now.” —Goldman Sachs CFO Harvey Schwartz (Investment Bank)

International:

The weakened dollar is turning into a slight tailwind for companies

“Last year, we had a lot of headwinds, especially on the international revenue line…This year, we’re seeing the reverse of that with the weakening of the dollar…International contribution margin is benefiting from that.” —Netflix CFO David Wells (Movie Studio)

The dollar is still high in any relative sense though

“I’m not a central banker, but I would say the dollar is still very high in any relative sense. It has dropped a little from the peak, but it still is very high…The dollar is still a headwind. The strong dollar is still a headwind to U.S. exports.” —Union Pacific EVP Eric Butler (Railroad)

Pepsi is incrementally less optimistic about South America and Eastern Europe

“I think the two places where we’re probably incrementally less optimistic, number one is South America…And then number two is Eastern Europe.” —Pepsi CFO Hugh Johnston (Sugar Water)

Canadian Pacific said that it feels like the Canadian economy is bottoming

“So that said the Canadian economy though on a positive note appears to be stabilizing and recessionary fears seem to be subsiding. So we do feel that the second-quarter is going to be the bottom. Q3, Q4 obviously are going to be stronger on a demand standpoint.” —Canadian Pacific Railway COO Keith Creel (Railroad)

March was a disappointing month for Las Vegas Sands in Macau

“March was obviously disappointing. We had a really great January, February. March certainly softened up. Worldwide, I think Chinese tourism and consumer numbers are pretty depressing across the globe. And certainly, it was a little bit soft than we hoped in Macao. That was not the case in Singapore, but in Macao, we saw a downturn.” —Las Vegas Sands CEO Sheldon Adelson (Casino)

Low cost labor will continue to struggle vs. automation

“As you know, call centers are a very high turnover rate for employees. And with our decrease in calls coming in from our Wireless customers because of more online, more chat, more self-service, we will not hire as many customer call centers…So there’s opportunity to reduce force just through the attrition rate.” —Verizon CFO Fran Shammo (Telecom)

Financials:

It’s not easy being a bank these days

“Before getting into our quarterly results, I’d like to directly address the recent discussions of our fundamental performance. I’ve talked to many of our shareholders over the past several months…I want to make sure everyone recognizes that…[we] hear and understand the desire for improved returns…I know that we must earn our right to remain independent every day, and our management team and board are committed to doing what is in the best interest of our shareholders.” —Comerica CEO Ralph Babb (Regional Bank)

BB&T had been strategically acquiring banks, but is now applying the brakes

“I’m not trying to say that we wouldn’t dare do any tiny little bitty something. But as a practical matter, we are just not focusing on M&A now in insurance or bank…there’s a time to buy, and there’s time to run. And the last 24 months was a time to buy, because the times were right…now is the time to take time and to adjust” —BB&T CEO Kelly King (Regional Bank)

The flattening yield curve negated the benefit of higher short term rates

“make sure you guys are watching the slope of the curve too…the moment – the short end came up, the long end came down. And that has the same kind of impact on interest income that you would see on lack of rate movement.” —US Bank CEO Richard Davis (Regional Bank)

It’s not easy being an asset manager either

“the asset management industry in its current form is no longer a growth industry for a majority of traditional active asset managers. Overcapacity, chronically poor investment performance, high fees, competition from passive strategies, growing barriers to entry for access to distribution and the rapidly growing cost of regulatory compliance, taken together will challenge future growth and profitability for most legacy investment managers.” —Coen and Steers CEO Bob Steers (Real Estate Investment Management)

Consumer:

We have now lapped the sharp declines in gas prices, which should impact retail sales comps

“We have now lapped the sharp gas declines from last year…we had hoped that this would provide a tailwind for U.S. domestic volumes in the second half of fiscal 2016. This has not happened, as gas prices remain below the lows of last year.” —Visa CFO Vasant Prabhu (Payments)

Technology:

Technology startups have done a great job of marketing, but are still working on proving their business models

“the technology companies that I’m aware of, they have done a good job of sizzle in terms of the marketing but I don’t think that they have done as well a job in the execution of the plan where they are able to make money over a period of time.” —Brown and Brown CEO Powell Brown (Insurance Broker)

Data is the new oil

“data is the new oil. Like those who have the data, those who have the understanding of the consumer, we believe are the ones that are going to win.” —Under Armour CEO Kevin Plank (Apparel)

Google’s CEO says that they’ve only scratched the surface of what’s possible

“Google’s mission is to organize the world’s information and make it universally accessible and useful. And after 17 years, we have just scratched the surface of what’s possible.” —Google CEO Sundar Pichai (Internet)

Reed Hastings thinks that VR will probably be primarily a gaming format for at least a couple of years

“I think it’s mostly going to be an intense gaming format for a couple of years…So think of it like the PlayStation 5 or the XBox 2 or something…I think the center point for VR will be other sorts of things than watching a TV show in a VR headset. I don’t think that’ll be very popular” —Netflix CEO Reed Hastings (Movie Studio)

China is more digitally advanced than one might expect

“I’m constantly amazed at how advanced China is digitally. It’s got twice the number of cell phones, smartphones, as the U.S. population. And even in our offices, people go up and down the elevator to go to lunch, they’re looking up where the offers are available and where they can book a table, et cetera.” —YUM! China CEO Micky Pant (Restaurants)

Healthcare:

UnitedHealth is pulling out of a number of public exchanges

“The smaller overall market size and shorter-term higher risk profile within this market segment continue to suggest we cannot broadly serve it on an effective and sustained basis. Next year we will remain in only a handful of states, and we will not carry financial exposure from exchanges into 2017.” —United Health CEO Stephen Hemsley (Health Insurance)

Industrials:

Flat rolled steel prices are rising thanks to positive trade case filings to prevent Chinese dumping

“for the first time in well over a year, we’ve begun to experience rising metal pricing for carbon steel products as well as stainless steel flat-rolled products. This pricing improvement, which accelerated towards the end of first quarter, was mainly result of the recent trade case filings by U.S. steel producers.” —Reliance Steel CEO Gregg Mollins (Steel)

Materials, Energy:

Core Labs believes that we will see a V bottom in oil markets

“Core believes crude oil markets rationalize in the second half of 2016…our second quarter 2016 results should mark the bottom of our anticipated V-shaped commodity recovery that should lead to increased crude oil prices followed by increased industry activity levels.” —Core Labs CEO David Demshur (Oil Service)

However, overbuilt industries don’t alway enjoy V shaped recoveries

“We have believed since the outset of this housing recovery that it would be more gradual than the V-shaped rebound, typical of most housing cycles. Our thesis is unchanged as we expect an extended recovery will continue to unfold for the next several years.” —Pulte Home CEO Richard Dugas (Homebuilder)

Distressed oil companies have been able to sell assets rather than make “defensive draws” on credit lines

“the vast majority of our borrowers are doing the opposite. They’re selling assets. They’re raising capital to make sure that they are staying within the confines of what they expect the new borrowing base to be. So we’re really pleased to see that.” —Comerica CCO Peter Guilfoile (Regional Bank)

Surprisingly, they are even able to sell assets at significant premiums to where lenders have them marked

“Since really last summer, our borrowers have sold about $1.7 billion of assets…on average the premium has been 93% above what we have those assets valued at in the borrowing base and in 2016 that premium is even higher. It’s about a 120%. So not only is there a lot of opportunity for our borrowers to sell assets to raise liquidity, but it’s a very accretive process when they’re doing it.” —Comerica CCO Peter Guilfoile (Regional Bank)

Oil companies are eager to turn production back on, but cautious

“I think that they’re being cautious about their next move. I think they want to see generally they wanted to see some additional recovery and see some stability in that recovery. I also think that as a group they’ve made themselves very, very flexible. I mean they are updating their outlook and updating their decision making. It’s no longer an annual process. It seems like it’s a biweekly process or something now as they’re looking at things which suggests that when they do decide to turn things back up, they’ll be able to turn it back up relatively quickly” —Kinder Morgan CEO Steve Kean (Oil Pipeline)

Miscellaneous Nuggets of Wisdom:

Have the courage to go after the right customers, not just any customer

“[we worked] to have the courage to go out there and get the right customers. I think there might have been a mentality here and maybe perhaps in other companies, where you’re trying to show some number to Wall Street, but at the end of the day it hurts you long term financially.” —Dish CEO Charlie Ergen (Satellite Television)

Laziness can help create an effective moat

“Our biggest enemy is inertia. The issue is that most people with a brokerage account do not want to bother with switching it. So therefore, even if they are — even if we succeed in convincing them that they would have a financial advantage, a large financial advantage, by bringing their account to us they still don’t want to do it, because of just laziness.” —Interactive Brokers CEO Thomas Petterfly (Retail Brokerage)

There are a finite number of experts in a given field

“if the world created 5,000 cognitive experts, we would hire 5,000 cognitive experts…But there is a rate at which it doesn’t make sense for us to keep putting money into these because the world doesn’t create them anymore. It’s not a problem that can be solved by spending more money. It’s a problem that is constrained by the kinds of skills the world’s creating. So we have a global search on for talent.” —IBM CFO Martin Schroeter (Enterprise Tech)

The best organizations have a gravitational pull to attract those experts

“What we find is that skills have gravity and highly skilled people want to work with others in their fields who are also highly skilled. So they come here to work with our unique data sets, with our unique technologies, with our unique industry expertise, in order to change the way the world works in order to change the way industries operate, in order to change professions.” —IBM CFO Martin Schroeter (Enterprise Tech)

*  *  *

Source: Avondale Asset Management

via http://ift.tt/1SDNG6K Tyler Durden

Amid surging supply of crude and the world's biggest traffic jam of tankers, we suspect more images like the following will be seen going forward. A Russian tanker has caught fire in the Caspian Sea near the territorial waters of Turkmenistan, leaving one dead.

The Palflot-2 vessel in distress is currently drifting in Turkmenistan’s territorial waters some 800 kilometers from Russia’s nearest port, Astrakhan.

As RT reports,

The Southern Regional Center of Russia’s Emergency Ministry has confirmed the fire on Palflot-2 tanker claimed the life of a ship’s mechanic, reportedly a citizen of Kazakhstan.

 

“We confirm the death of a single person. It was a mechanic. There were 11 crewmembers onboard, and 10 of them have been evacuated by a vessel belonging to the same company. They will be delivered to Astrakhan,” a source in the Emergency Ministry said.

 

Crew members of the Palflot-2 are citizens of Russia and Kazakhstan.

 

According to the Emergency Ministry, the tanker was not transporting any oil products and its tanks are filled with seawater as ballast.

 

The Emergency Ministry and the company owning the burning tanker agreed that extinguishing the fire on a vessel drifting so far from Russian shores is unpractical. It has been decided the ship should burn out, and its fate will be decided later.

So, on the bright side (for conservationists), the ship's tanks were loaded with seawater only (as ballast), but for crude bulls this does nothing to ease the global oil glut…

via http://ift.tt/218hfgY Tyler Durden

Following his anti-Brexit Op-Ed which sparked much controversy and confusion as to just why the US president was interfering with yet another domestic issue, Obama held a press conference with UK PM David Cameron in which he in no uncertain terms threatened the UK with trade retaliation if the country were to exit the EU.

He said that “it’s fair to say that maybe some point down the line there might be a UK-US trade agreement but that’s not going to happen anytime soon because our focus is negotiating with a big bloc, the European Union, to get a trade agreement done. And the UK is going to be in the back of the queue, not because we don’t have a special relationship but because given the heavy lift on any trade agreement, us having access to a big market with a lot of countries rather than trying to do piecemeal trade agreements is hugely efficient.”

Friday’s full press conference can be watched below:

Incidentally, as reported earlier, thousands of Germans are protesting precisely the kind of “big trade deal” that Obama wants to entice the UK with, as support for the TTIP there has plunged from 55% in 2014 to only 17%. Germany is not alone: support for Obama’s “fair trade” deal has also tumbled in the US, with those supporting it tumbling from 53% to just 18%.

While it is unclear if Obama’s latest diplomatic snafu has hurt the anti-Brexit camp, what is clear is what Obama did the day after. He played golf with David Cameron, perhaps a hint of the “benefits” that any future premier will be deprived of should the democratic UK vote be against remaining in Europe.

It was Obama’s 286th round of golf in office, but the first time that Obama has golfed during an international trip, according to CBS News’ Mark Knoller.

As Reuters reports, Obama played a round of golf with British Prime Minister David Cameron at an exclusive course north of London on Saturday, making time in a busy overseas travel schedule for his favorite weekend pastime. Obama’s motorcade raced 20 miles (32 km) to The Grove after a meeting with the leader of Britain’s opposition Labour party, Jeremy Corbyn.

“The game at The Grove, a resort that is due to host the British Masters tournament later this year, is a sign of the close personal relationship between the two leaders: Obama rarely mixes business with his preferred way to take a break, and almost always golfs with friends and staff.“

Reporters were allowed to watch as Obama, ignoring damp and chilly weather, emerged from the long grass near a duck pond.

“Ooooh!” Obama groaned as he narrowly missed what appeared to be a 12-foot shot.

“Did you see that?” he shouted to reporters. “Robbed!”

There was no official word on the score.

Saturday is golf day for Obama, who usually plays on Andrews Air Force Base, near Washington.

He also plays in places where he travels, such as the stately Olympic club in San Francisco when he was in the Pacific coast city earlier this month.

He golfs most days of his summer vacation on Martha’s Vineyard, and during the winter holidays in Hawaii, where he has played against the prime ministers of Malaysia and New Zealand.

He has played Tiger Woods, and occasionally golfs with other sports stars, but rarely against other politicians. While on holiday in 2014, he delivered a somber statement on the murder of an American journalist by Islamic State militants – and then proceeded directly to a golf course to play 18 holes.

* * *

On Sunday, Obama heads to Hanover, Germany for talks with Chancellor Angela Merkel, where he will pitch the TTIP, his legacy “free trade deal”, precisely the kind of deal that he is threatening the UK with. The reason: support for said mega trade deal in Germany has cratered.

via http://ift.tt/1YNayPn Tyler Durden

Submitted by InsideSources via Valuewalk.com,

Government watchdogs and outside experts have long warned that Google had unprecedented and unfiltered access to the Obama White House, which has been a major beneficiary of Google’s massive campaign coffers.

Now, for the first time, two key parts of that entangled relationship, the extensive White House visits and revolving door between Google and the Obama administration, have been documented by the Campaign for Accountability and the Intercept, an investigative news outlet.

“It’s a relationship that bears watching,” Anne Weismann, the head of the Campaign for Accountability told the Intercept. Weismann’s group is starting a project that will bring more attention to Google’s role in Washington. Their joint findings are a vivid reminder of Google’s growing influence in Washington, DC.

From the start of his first term until last October, Google officials met in the White House with Obama administration officials once a week on average for a total of 427 visits. More than 180 White House officials attended those meetings. No other public company comes even close to that many White House visits.

(click image for link to interactive version)

A senior Google lobbyist visited the White House 128 times over that time period. Far more than any other lobbyist from major companies.

Close to 250 Google employees or government officials have travelled through the Google/Obama administration revolving door. Either from Google to the government or the reverse. There were 55 cases of Google officials coming to work for the federal government and 197 cases documented of government employees going to work for Google.

(click image for link to interactive version)

The massive increase in access to the upper echelons of the federal government has corresponded with the loosening of Google Inc. and its employees’ campaign contributions and lobbying purse strings. A few years back Google paid virtually no interest in Washington. In 2015, it spent $16.7 million lobbying, according to opensecrets.org, and it gave President Obama more than $800 thousand during his last presidential campaign.

It is still not precisely clear what Google gets in return, but watchdog groups claim it is plenty. Jeff Chester, Executive Director of the Center for Digital Democracy told the Intercept that “Google has been able to thwart regulatory scrutiny in terms of anti-competitive practices, and has played a key role in ensuring that the United States doesn’t protect at all the privacy of its citizens and its consumers.”

…

Read the full story here at The Intercept…

via http://ift.tt/1XOztlx Tyler Durden

Less than two weeks ago we documented that Toronto based Urbancorp, one of Canada’s largest residential developers, was having significant issues. Its attorney’s had taken the highly unusual step of terminating their contract, it hadn’t released 2015 financials due to the audit committee having “open issues and questions”, and most intriguing, a board member quit just two weeks after being appointed specifically to provide expertise in accounting.

For those unfamiliar with the company, Urbancorp was launched in 1993 by Alan Saskin, a former Cadillac Fairview executive, and has built dozens of condos and other housing developments in the Greater Toronto Area. This is how it describes itself on its website:

Urbancorp is proud to have created some of the most visionary home and condominium communities in the GTA.

 

As the premiere developer of the King West neighbourhood, Urbancorp transformed the old industrial lands of King Street West into the vibrant residential community of King West Village, including Bridge, Fuzion and ,the latest, Kingsclub Condominium. In the West Queen West neighbourhood, Urbancorp built Westside Gallery Lofts, Curve and, most recently, Edge and Epic on Triangle Park.

 

Urbancorp has built thriving new communities in other up-and-coming Toronto neighbourhoods. The Neighbourhoods of Queen Street East is comprised of three stunning new home communities along the Queen Street East corridor. With locations in Riverdale, Leslieville and The Beach, The Neighbourhoods of Queen Street East bring a fresh, modern vibe to the urban renaissance currently underway in Toronto’s east end.

And while the Greater Toronto Area may not be exactly Vancouver (where the real estate situation is getting more outlanding by the day), the local housing market has been consistently portrayed as sufficiently resilient and an indication of Canada’s economic stability.

But perhaps it isn’t, because late last night we learned that Urbancorp has filed for bankruptcy.

The filing which is seeking court approval to sell assets “to maximize real estate values for the benefit of creditors and other stakeholders,” came just four months after the company issued roughly $48 million in debt traded on the Tel Aviv Stock Exchange, and eight months after reportedly taking out at $225 million loan. To the best of our knowledge, the company failed to pay interest on its new debt even once (also known as a NCAA or No Coupon At All). As The Globe and Mail reports, several contractors have registered construction liens against a project in Toronto’s Leslieville neighborhood, and there are many lawsuits pending against the corporation as a result of contractors and brokers not being paid.

“We determined, after much consideration and consultation, that a court-supervised process is the best way to deal with current cash flow issues. This will allow us to reduce debt in an efficient manner while continuing to focus on our core business.” CEO Alan Saskin said in a statement.

Ironically, in filings with the Tel Aviv securities commission late last year, Urbancorp presented itself as a top ten developer with a “AAA credit rating.” Come to think of it, that’s Canada’s credit rating too…

Urbancorp has more than 1,000 homes under construction in the Toronto area, and the restructuring is meant to ensure the successful completion of those homes.

However, new projects may be a different story. As Bloomberg points out, government regulator Tarion Warranty Corporation has proposed to revoke Urbancorp’s registration. If the registration is ultimately revoked, it would mean that the company wouldn’t be able to build properties. An appeal has been filed.

From Tarion

Tarion has issued a Notice of Proposal (NOP) to revoke the registration of 17 Urbancorp related companies.  As the Registrar, Tarion has a duty to protect new home buyers by requiring builders to adhere to certain requirements in order to obtain registration, and ensure they continue to abide by ongoing obligations under the Act in order to maintain their licence.  The decision to issue this NOP was made due to the builder’s failure to meet Tarion’s ongoing registration requirements.

 

As with all builders who are issued an NOP by Tarion, Urbancorp companies have the right to appeal this proposal to the Licence Appeal Tribunal (LAT), which they have done.  This appeal is currently in process.  During this time, Urbancorp remains registered under Tarion until the LAT appeal process is concluded. 

 

Despite the NOP, Urbancorp remains obligated to fulfill its commitments to its customers.  This includes addressing warranty claims, seeking registration for any current condominium projects and completing any existing sales.

 

It is important for home buyers and homeowners to know that they remain protected under the warranty, and Tarion will step in to fulfill the warranty obligations if Urbancorp fails to do so.  This includes deposit protection, delay compensation and construction warranties that can last up to seven years on a new home.

The bankruptcy filing of Urbancorp is the second major bankruptcy we have reported in the luxury residential space. Recall two weeks ago Manhattan’s Bauhouse Group filed for bankruptcy after defaulting on $147 million in debt.

The sudden and very rapid deterioration in the high-end real estate segment has received little attention so far. With everyone focusing on energy companies and their cash flow issues, few are paying attention to the fact that luxury real estate is collapsing, and not just in the US but as of last night, in Canada – at least in those cities where Chinese money laundering isn’t encouraged by the authorities – as well.

With the Urbancorp bankruptcy filing, and the first official canary death in Canada’s real estate “coal mine”, we anticipate that the near future for Canada’s real estate sector will be a far more volatile one. Excluding Vancouver of course: that particular Chinese money laundering hub will continue humming until the locals finally decide they have had enough of having their city sold to criminal Chinese oligarchs.

via http://ift.tt/1SqtsI1 Tyler Durden

Whether it is due to Trump’s increasingly vocal anti-free trade rhetoric or due to the ongoing deterioration in the global economy, there has been a big change in the public’s perception toward the transatlatnic deal known as TTIP in the recent months, with support for the agreement which was drafted by big corporations behind closed doors tumbling.

As Reuters reported last week, support for the transatlantic trade deal known as TTIP has fallen sharply in Germany and the United States, a survey showed on Thursday, days before Chancellor Angela Merkel and President Barack Obama meet to try to breathe new life into the pact.

The survey, conducted by YouGov for the Bertelsmann Foundation, showed that only 17 percent of Germans believe the Transatlantic Trade and Investment Partnership is a good thing, down from 55 percent two years ago.

 

In the United States, only 18 percent support the deal compared to 53 percent in 2014.

 

Nearly half of U.S. respondents said they did not know enough about the agreement to voice an opinion.

 

To be sure, as Michael Krieger wrote on Thursday, “the writing was already on the wall a year ago, which is why politicians were scrambling to pass TPP fast track as quickly as possible, which, of course, they did. So the good news is the public is clearly waking up. What’s a bit depressing is that it’s taken so many decades. Yes, decades.”

But while Americans seemingly have more important things to be concerned about, in Germany the activists are once again making themselves heard. Recall that it was just last October when a stunning quarter million Germans packed the street of Berlin to protest Obama’s “Free Trade” deal.

 

Fast forward to today when one day before Obama visits Angela Merke in Germany to pitch the trade agreement, thousands of German protesters have once again come out on the streets of Hannover to say ‘No’ to the controversial TTIP US-EU trade deal. Many in Germany fear it will reduce consumer protection and undermine workers’ protection.

While the Transatlantic Trade and Investment Partnership (TTIP) between the US and Europe is set to create the world’s largest free trade zone, many Europeans worry that the agreement would elevate corporate interest above national interest. TTIP opponents say that cheaper goods and services would only hurt the EU and help the US.

“People say the deal is going to compromise the European Union sovereignty, and would create much more secrecy, with one of the biggest concerns being that the agreement is wrapped in a big veil of secrecy that people are not happy with,” RT’s Anastasia Churkina reported from Hannover.

 

According to BBC, German police estimate that about 30,000 people are taking part in the peaceful protest rally in Hannover. Many are carrying placards with slogans that read: “Stop TTIP!”

The demonstrators have also been voicing their anger over the secrecy surrounding the ongoing TTIP negotiations.

“The
TTIP between the American continent and Europe is very dangerous for
the democracy, for our nature and for the rights of the workers,”
protester Florian Rohrich told the BBC.

“The rights in America for
workers are much lower. It’s like the Trojan horse. They can’t change
our whole system. But they will – because TTIP is written by the groups,
by the companies, not by the politicians,” he added.

The negotiations were launched three years ago, and the next round is due to open on Monday in New York.

Obama’s visit to Germany, which is the US’ biggest trading partner, takes place two days after Obama stood next to the UK’s David Cameron and threatened that if the country votes for Brexit it would be pushed to the “back of the queue” when it comes to trade with the US, confirming Obama increasingly sees the threat of lost trade as a diplomatic weapon. German Chancellor Angela Merkel is set to discuss the TTIP deal with Obama when he visits a trade show in Hannover on Sunday and Monday. We expect comparable threats to Friday’s to emerge with Obama making it clear that Germany stands to lose if it does not endorse the TTIP.

Sure enough, in an interview with Bild, Obama said that “the Transatlantic Trade and Investment Partnership is one of the best ways to promote growth and create jobs.” Ironically, this comes just as support for the TTIP is tumbling on both sides of the Atlantic.

Wrapping up a deal would be a “win-win situation,” Angela Merkel announced in her weekly podcast, adding that “it is good for us as we will be able to appraise our competitors.”

In the best-case scenario, TTIP could cover over 40 percent of global GDP and account for large shares of world trade and foreign direct investment. Washington’s ambassador to Germany, Anthony L. Gardner, said in an exclusive interview with EurActiv in 2014 that “we need this deal to help solidify further the transatlantic alliance, to provide an economic equivalent to NATO and to set the rules of world trade before others do it for us.”

Meanwhile, as Americans mostly disapprove of the TTIP as of this moment if refuse to do anything about it, this is what took place in Hannover.

Breaking News: 90.000 Menschen auf @TTIP_Demo gegen #TTIP & #CETA!! https://t.co/tVQdOMxfw5 #StopTTIP #Hannover http://pic.twitter.com/RJX6NZgThc

— Mehr Demokratie e.V. (@Volksentscheid) April 23, 2016

YES WE CAN – STOP #TTIP mit @greenpeace_de – #TTIPDEMO #Hannover #TTIP & #CETA STOPPEN http://pic.twitter.com/CE4oDWMwMk

— Castor Nix Da (@castornixda) April 23, 2016

#Hannover auf den Beinen gegen #TTIP und #CETA. http://pic.twitter.com/5Nft8xyLp0

— Aaron Priegnitz (@AaronPriegnitz) April 23, 2016

Hannover right now #TTIP #CETA http://pic.twitter.com/xQnHOZ5TQ1

— Marcel Böttcher (@73inches) April 23, 2016

Endlich: Der Demozug setzt sich in Bewegung! 5 km quer durch Hannover liegen vor uns. #StopTTIP & #CETA #TTIPDemo http://pic.twitter.com/RJm8wtTpbT

— campact (@campact) April 23, 2016

#StopTTIP http://pic.twitter.com/PzCAaM0Cpu

— Greenpeace Hamburg (@GreenpeaceHH) April 23, 2016

Der Opernplatz in #Hannover füllt sich mit #TTIP – Gegnern. http://pic.twitter.com/4bAmaXizyd

— ZDF Niedersachsen (@ZDFhannover) April 23, 2016

Protesters starting to gather for #NoTTIP #NoCETA demo in #Hanover #H2304 #HanoverMesse #TTIPStoppen #TTIP #CETA http://pic.twitter.com/86U9FOSE0S

— Alex Poucher (@alexpoucher) April 23, 2016

Zehntausende zu Demo gegen TTIP in Hannover erwartet https://t.co/ozVTB9pFZp #TTIP #Obama

— tagesschau (@tagesschau) April 23, 2016

#StopTTIP #StopCETA #ttipdemo @eci_ttip http://pic.twitter.com/MYR5XsHLRi

— Orsolya Rónaszéki (@rnszkrsly) April 23, 2016

Thanks but no thanks, Mr @BarackObama ! We don’t need no #TTIP -tens of thousands say in Hannover: #StopTTIP #NoTTIP http://pic.twitter.com/Msp1xHKfdr

— Stop TTIP (@eci_ttip) April 23, 2016

via http://ift.tt/1TpyR4G Tyler Durden

Submitted by Mike Krieger via Liberty Blitzkrieg blog, 

Police were also vague about the sign, saying only that it related to “social justice.” Bishop said two others who witnessed the shooting told him that it said, “Tax the one percent,” and that he seemed to raise it just before pulling the trigger.

 

Jim White was at the Capitol Visitor Center when the announcement of the lockdown came over the loudspeaker. He said there was no panic, just chatter about what could be going on outside. His 1:30 p.m. tour went on as scheduled. The only indication that something was amiss: The tour guide kept stretching and extending his talk.

 

Bernard called the incident “a bit unfortunate,” especially with all the tourists in town to see the cherry blossoms.

 

Yes, so unfortunate that someone blowing their brains out potentially due to economic serfdom got in the way of cherry blossom selfies.

 

– From the post: Illinois Man Commits Suicide in Front of U.S. Capitol Holding a “Tax the 1%” Sign

If you’ve lived life on this planet more than a handful of years, you’ve undoubtedly had your fair share of tough times, some of us more so than others. The fact that you’re here today reading this is a testament to your ability to overcome these struggles, and the experiences these hard times have provided you has shaped the person you are today.

For some people, a combination of life circumstances, mental and emotional difficulties, and lack of support from friends and family can lead to suicide. The thought that some people can become so overwhelmed with hopelessness and desperation they take their own lives is a haunting one.

Sadly, it is undeniable that this reality has become more and more prevalent in America as the 21st century has unfolded, and I don’t think it’s a coincidence that we’ve seen this flare up during a decade and a half characterized by a pummeling of the middle class, a decimation of civil liberties, and the entrenchment of a callous and corrupt political and economic oligarchy.

My heart goes out to the families of all those affected by this growing problem, and those who are currently struggling with suicidal thoughts. Although I can’t relate to such thoughts, I can sympathize.

The Washington Post reports:

The U.S. suicide rate has increased sharply since the turn of the century, led by an even greater rise among middle-aged white people, particularly women, according to federal data released Friday.

 

Last decade’s severe recession, more drug addiction, “gray divorce,” increased social isolation, and even the rise of the Internet and social media may have contributed to the growth in suicide, according to a variety of people who study the issue.

 

But economic distress — and dashed hopes generally — may underpin some of the increase, particularly for middle-aged white people. The data showed a 1 percent annual increase in suicide between 1999 and 2006 but a 2 percent yearly hike after that, as the economy deteriorated, unemployment skyrocketed and millions lost their homes.

Hey, at least we bailed out the bankers.

“People [were] growing up with a certain expectation . . . and the Great Recession and other things have really changed that,” said Julie A. Phillips, a professor of sociology at Rutgers University who studies the demography of suicide. “Things aren’t panning out the way people expect. I feel for sure that has had an effect.”

 

The U.S. homicide rate is also down: There are more than two suicides for every homicide. Among whites, there are more than seven suicides for every slaying.

 

 

 

Overall, the new data show, the age-adjusted suicide rate in the United States jumped 24 percent between 1999 and 2014, from 10.5 per 100,000 people to 13 per 100,000 people. The rate increased for both sexes and in all age groups from 10 to 74. The pace has continued into the first two quarters of 2015, separate data show.

 

Among white women ages 45 to 64, for example, the suicide rate jumped 80 percent, from 7 per 100,000 in 1999 to 12.6 per 100,000 in 2014.

Simply heart-wrenching.

via http://ift.tt/217Vj5m Tyler Durden

The credit-fueled speculative bubble in China’s commodity market, as we detailed previously, exploded this week as the mainstream slowly comes to realize that the gains in industrial metals are not a “sign of strength in China’s and the world’s economic recovery” but merely the next rotation of fast-money slooshing from Chinese equities to Chinese corporate bonds to Chinese real estate and now to Chinese commodity futures…

Trading in futures on everything from steel reinforcement bars and hot-rolled coils to cotton and polyvinyl chloride has soared this week, prompting exchanges in Shanghai, Dalian and Zhengzhou to boost fees or issue warnings to investors.

Deutsche Bank details the total crazinesss…

The onshore China commodity markets this week traded (conservatively) $350bn notional, a 17x increase on the $20bn notional that traded on Feb 1st 2016 i.e. a month ago (is it coincidence that the notional is about the same as at the peak of the equity frenzy?).

 

My calculations are pretty basic; I’ve trawled the screens and chosen 32 commodities in agri, metals and coke/coal and done a quick (contracts x value)/CNY for a dollar amount. I have not used the largest day’s volume either (e.g. Deformed Bar, RBTA has traded close to $100bn, but I used closer to $60bn). Cotton (VVA Comdty) has been trading $15bn, up from $500mm in Feb. In the US, the long established cotton contract (CT1 Comdty) trades $600mm. China listed Sugar (CBA Comdty) has traded $14bn versus the US listed sugar beet at $850mm.

This is what insanity looks like!!

 

The extreme measures China adopted to counter its stock market crash and unfolding crisis have now incited precarious speculative Bubbles in commodities. As CreditBubbleBulletin’s Doug Noland notes, this creates extraordinary uncertainties for China and the world.

A deepening Credit crisis would seem to ensure the usual cautious official measures to counter speculative excesses. So the world has of late been contemplating booming China: ongoing loose financial conditions with 2016 Credit growth in the neighborhood of $3.0 TN – providing extraordinary fuel for a rather destabilizing speculative blow-off.

 

Keep in mind that The Mighty World of Speculative Finance has been positioned long “defensive,” long “deflation,” long “duration” and long sold balance sheets. This world has been short commodities, energy, yields, cyclicals, financials and bad balance sheets. Moreover, many of these (Crowded) macro themes have been combined into leveraged portfolios (“risk parity”, etc.). China with $3.0 TN of Credit growth fueling unpredictable housing and commodities speculative Bubbles upsets the applecart.

 

…

 

At this point, China – as the “marginal source of global Credit and liquidity” – is exacerbating what had already evolved into a powerful central-bank induced short squeeze dynamic. Despite the collapse of Doha talks over the weekend, crude’s march higher ran unabated again this week. Industrial metal prices have been surging. Silver jumped 4.4% this week, with copper up 5.4%. The week saw nickel prices rise to a five-month high and aluminum to eight-month highs. Platinum, palladium, zinc and lead prices have all shot higher. Some iron ore prices have jumped to highs since early 2015.

 

The problem is that China’s newfound commodities speculation is underpinned by historic Credit growth – say, more than $3.0 TN annualized. Meanwhile, global short-squeeze dynamics are bolstered by $2.0 TN of annualized QE (ECB and BOJ). Moreover, there’s the massive pool of speculative finance – including a $3.0 TN hedge fund industry – with large leverage positions throughout global markets. In an extraordinary development, as scores of trades continue to unwind, a destabilizing global dynamic feeds on itself and gathers momentum. It’s monetary disorder on steroids.

 

The “marginal source of global Credit and liquidity” is short-term supportive of global risk markets. Yet its Credit system is self-destructing – and doing so rather conspicuously. If any other country employed a similar policy mix the world would be sprinting from that currency.

 

Thus far, Chinese officials have been determined to carefully manage China’s pegged currency regime. Yet current Credit and market dynamics are inconsistent with a stable currency. I would furthermore argue that breakneck Credit growth in the face of rapidly deteriorating underlying fundamentals is a proven recipe for a crisis of confidence. Global markets are in the midst of a destabilizing adjustment to China’s resurgent booms in Credit and speculation. This ensures real havoc when global markets are confronted with a Chinese Credit and/or currency dislocation.

How much impact is this having on global markets?

At first, very little. Many of the China listed futures started to bottom and rally in Nov and Dec last year, with very little relationship to global peers. This very crude chart below is a simple aggregation of all the prices of the 32 commods that I could find, but many of the underlying constituents are exactly the same. The performance looks inversely correlated with the performance of the underlying economy (and demand) but nicely related to the injection of credit.

But, in recent sessions, some of the US based commods have started to squeeze higher, presumably because the dog and the tail are changing places (clearly these are not apples-for-apples, as it were, in terms of contracts).

There is no correlation between the explosion in interest in Chinese commodity futures and any Chinese economic activity (and it should be a reminder to all who gaze lovingly at the commodity charts of the last decade that credit, rather than true demand, can be the most influential factor in financial markets). Volumes have increased 17 fold in a month. The economy has not. This is simply another speculative excess that will probably (already has) run way beyond fundamentals. It is probably creating a false picture of global demand for commodity stocks of all types, which themselves have rallied far beyond their earnings potential.

Eventually, the excesses will need to be curbed and maybe that starts a new phase of risk-off within China. We leave it to Tiger Shi, a managing partner at Bands Financial Ltd in Hong Kong to conclude:

“The market is moving so quickly, yesterday felt just like the stock market in June last year before the crash… I think how it goes up, that’s how it will come down.”

via http://ift.tt/1WN7mF4 Tyler Durden

At the end of January, when looking at the positioning in the oil futures market, we warned that there is a a “Constant Short Squeeze Threat“ because “Oil Shorts Are At All-Time Highs.“

Everyone knows what happened next; for those who missed it we explained precisely two months later, following an epic surge in the price of oil, in: “It’s Official: The Oil Surge Was Driven By The Biggest Short-Squeeze Ever.”

In other words, just as we had warned, the oil trade so far in 2016 has been all about positioning, and the sparking of a historic short squeeze in oil.

We bring this up because less than three months following our warning about a “constant oil short squeeze”, it is time to unveil the next warning: one of a potentially big drop in the oil price as now record speculative oil longs proceed to cover on the other side, unleashing a selling scramble lower.

Is that possible?

Well, according to Deutsche Bank’s latest investor positioning and flow report last night, “oil speculative net longs are at record highs as gross longs rose and shorts fell last week.”

 

So just as the crowd has shifted quickly from one side of the boat, to the other, the risk now is that all those who are long oil are forced to liquidate and since there are virtally no shorts left to cover, we fail to see what major catalysts will be able to prop up the price of oil especially now that all OPEC “oil freeze” headlines are ignored by everyone, even the algos.

via http://ift.tt/1Vt9Glb Tyler Durden