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The only six charts you need to know why the Amazon dream is over and why AMZN stock is currently crashing after hours to fresh 52 week lows.
Total employees and global sales growth:
Quarterly Operating and Net Income
Operating Margin: whoosh
LTM Operating Margin: at 0.1% it is pretty much the lowest ever.
Q3 over time for profit and net income
And for operating margin
via Zero Hedge http://ift.tt/1xeqcWf Tyler Durden
Way back on August 30, I did a post called Past Fear, Present Fear, which offered up an analog of the VIX (please read it if you don’t remember; it’s a pretty good post). I would daresay it was one of the best posts I did in 2014, and things certainly unfolded as I hoped they would (although today was no fun for me). I followed up on October 9th with my Moment of Truth post, which was just before the markets started really falling hard. Thus – so far, so good.
I’ve hacked together an update of the analog (although much more sloppily, and with different colors). Below we see, in yellow, the “throw-under” low, followed by the green burst, the cyan mega-burst, and – – what we’re in right now – – the magenta decline. Historically, this was followed (in grey) by another push higher.
Below is the present VIX, which is panning out similarly, except in a sped-up fashion (e.g. fewer bars). The big question, of course, is how long we stay in “magenta mode” (where the markets get complacent again and grind slowly higher) before we return to another surge in the VIX. It goes without saying I’ll be waiting for the grey rather impatiently.
via Zero Hedge http://ift.tt/1rogk8P Tim Knight from Slope of Hope
Buyback-manipulated earnings produced the low-volume opening face-ripper everyone wanted and stocks took off, recovering yesterday's late losses and not looking back.Trannies were the big winners, led by a resurgence in Airlines (as Ebola in US is fixed) and, despite drastically lower than average volume, stocks kept lifting after EU close on a bed of AUDJPY and USDJPY… until 1450ET (when NYC Ebola headlines hit). Airlines were hit hard, S&P futures dumped back to VWAP, VIX was whacked back above 17, and the exuberant day transformed into merely a great day for stocks. Weakness in Treasuries and the HY bond ETF (despite notable compression in HY spreads) had the smell of a lot of HY issuance being hedged and unhedged but TSYs ended the day up 6-7bps (off their highs post-NYC-Ebola headlines). The USD rose for the 3rd day in a row taking gold lower. Copper (China) and Oil (Saudi) rose on the day (oil unch on the week).
Tale of two headlines…
Airlines ripped and dipped…
As traders instantly reached for VIX…
and S&P naged back top VWAP (on heavy volume)
Credit and bond markets seemed very driven by rate-locks and hedge needs after Europe closed. After Ebola TSY yields and stocks/HY dropped
Treassuries once again surged in yield during the European session but held those losses thru most of the NY session until Ebola hit…
The USD rose once again – 3rd day in a row, led by EUR weakness
And USD Strength took the shine off gold, silver ended flat but copper rose (China data) and Oil (Saudi supply cut)
Intrday historical volatility is surging…
Charts: Bloomberg
Bonus Chart: 7 Year Itch (well 30 quarters)…?
via Zero Hedge http://ift.tt/1FKoWAo Tyler Durden
Forbes contributor Alice Walton has
written a terrific roundup of the anti-Common Core expert
consensus. Numerous education researchers and academics have
reservations about greater classroom standardization—particularly
in the early grades, where excessive testing and homework is most
deleterious for kids.
Walton
writes:
David Elkind, long-time child development expert at Tufts
University and author ofThe Hurried Child, says that a
related problem with the Common Core standards is that “children
are not standardized.” Between ages 4 to 7, he says, kids are
undergoing especially rapid changes in cognitive ability, but this
neurological and psychological development occurs at all different
rates. “Some children attain these abilities—which enable them to
learn verbal rules, the essence of formal instruction—at different
ages.
Some of the experts cited by Walton argued the long hours of
standardized testing that kindergartners must endure under Common
Core are wholly inappropriate:
Diane Ravitch,
education historian at NYU and vocal criticof
the Common Core, says that in particular, “the early grades are
developmentally inappropriate. Children of 5 and 6 and 7 need time
for play, not a forced academic march. They will have 6-hour,
8-hour tests. That is nuts…. The American ideal was always a
well-rounded child prepared for citizenship and life. Now it is all
test prep.”
While others disputed the notion—vehemently asserted by Core
supporters—that the standards are internationally benchmarked:
[2013 New York High School Principal of the Year Carol Burris]
adds that exactly which countries to which the Common Core is
benchmarked remains a mystery. “What’s so fascinating is that many
of the high-performing countries children start much later. In some
countries, like Singapore, there are two years of Kindergarten. In
Finland, another high performing nation, students start much later.
In Canada, which uses provincial standards, the early years are a
time for play and exploration. No one can find to what country
these Standards are benchmarked.”
Full article
here.
There are of course many experts who dispute the above notions
and believe that Common Core is an improvement over what is being
offered in many American schools. They may even be right; it’s
perfectly possible that Common Core is bad and what it’s replacing
is worse. This is the public school system we are talking about,
after all.
But why waste tons of time, money, and effort enacting an
across-the-board reform that makes kids miserable, relies on deeply
unsettled science, has no demonstrable benefit, and deals a death
blow to federalism (at least as far as national education policy is
concerned)?
More choice, not less, is what will save public education. As
Elkin observed, kids don’t come standard.
from Hit & Run http://reason.com/blog/2014/10/23/experts-attack-common-core-children-are
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Less than two weeks away, the midterm elections
seem like an episode of Seinfeld: They’re
about nothing.
I’ve got
a new Daily Beast column up about the midterms. Here’s
a snippet:
The most riveting stories so far deal with trivial matters that
sound like deleted scenes from a George Costanza fever dream. Did
Charlie Crist break the rules by having a fan blowing on his
crotch during the Florida guberntorial debate? Is Texas’ Greg
Abbott anti-dildo and anti-interracial marriage? Did Colorado
Congressman Cory Gardner really play high school football?Neither the Democrats nor the Republicans mustered the
strength to articulate a unified vision for the country, and
individual candidates are mostly running on a variation of the
theme that they’re not as completely contemptible as their
opponent. Sadly, but predictably, most of them are lying.The tragicomedy of U.S. politics is that we really do get the
government we deserve. But even a nation of idiots that is
paying Social Security to Nazi war criminals deserves
better than the content-free snarkfest that will come to a pause on
November 4—before starting up again on November 5, as the
preparations for the 2016 presidential election get underway.
The short version is this: Politicians are refusing to talk
about serious issues because they can get away with it.
Read the
whole thing to see a surprise endorsement of Hillary Clinton
and Bernie Sanders.
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Presented with no comment…
Q: “Who is going to defend the country without the Army?”
Zappa: “From what? The biggest threat to America is its own federal government… Will the Army protect anybody from the FBI? The IRS? The CIA? The Republican Party? The Democratic Party?… The biggest dangers we face today don’t even need to sneak past our billion-dollar defense systems… they issue the contracts for them.”
via Zero Hedge http://ift.tt/1FKlmX8 Tyler Durden
Submitted by Raul Ilargi Meijer via The Automatic Earth blog,
Reuters has had a busy day today reporting on Europe’s banks and the stress tests the European Banking Authority is set to unveil on Sunday. And which put the EU and ECB on a see-saw like balancing act between credibility and panic.
The news bureau started off in the early morning citing a report by Spanish news agency Efe, which said 11 banks would fail the tests:
11 Banks To Fail European Stress Tests
At least 11 banks from six European countries are set to fail a region-wide financial health check this weekend, Spanish news agency Efe reported, citing several unidentified financial sources. The results of the stress tests on 130 banks by the European Central Bank are due to be unveiled on Sunday.
Four banks in Greece, three Italian lenders and two Austrian ones are among those that preliminary data showed had failed the tests, Efe said. It gave no details of how much capital the banks would have to raise and said this could yet change as numbers could be revised at the last minute. The euro fell on the report. Efe also identified a Cypriot bank and possibly one from Belgium and one from Portugal.
That’s right, the journalist lists 12 banks there, not 11. But anyway, that text is, miraculously, not available anymore, since at the same URL you now get the following article. Jean-Claude ‘When it gets serious, you lie’ Juncker’s first act in his first day in office as European Commission head may well have been to give Reuters a call. Make that a shout.
ECB Cools Speculation Over Bank Health Checks Ahead Of Results
The European Central Bank cautioned on Wednesday against speculation over the outcome of its stress tests after a media report said at least 11 banks had failed the landmark financial health checks, driving some banking shares lower. Austria’s Erste Group rejected the report from Spanish newswire Efe, which said that it along with banks from Italy, Belgium, Cyprus, Portugal and Greece, had failed the ECB review based on preliminary data, but it gave no details of the size of the capital holes at the banks.
The ECB, which will publish the test outcomes for 130 banks on Sunday, said final results had not yet been sent to the lenders involved, and it could not comment on individual institutions. “Any inferences drawn as to the final outcome of the exercise would be highly speculative until the results are final on 26 October,” said an ECB spokesman. The European Banking Authority, the EU watchdog coordinating the Europe-wide stress test, said the results would not be final until they are endorsed on Sunday just prior to publication. It had no comment on individual lenders.
Erste told Reuters it had no reason to believe it would fail the test. Banks have already had some feedback on the outcome of the tests through ‘supervisory dialogs’ with the ECB. They get the results on Thursday, three days ahead of the public announcement. The ECB becomes supervisor of the euro zone’s banks on Nov. 4. “Out of the supervisory dialogue we have no indication we won’t pass,” an Erste spokesman said. [..]“The bigger, more important question is not which banks have failed but which banks have achieved only a marginal pass,” said Jeremy Batstone-Carr at Charles Stanley.
Sources told Reuters that German public sector lender HSH Nordbank – which was not named in the Efe report – was set to pass the health checks. HSH was seen as the German lender most likely to fall short of requirements. Other than Erste, the banks listed by Efe were Italy’s Banco Popolare, Monte dei Paschi and Banca Popolare di Milano; Greece’s Alpha Bank, Piraeus Bank and Eurobank; Portugal’s Millennium BCP and Belgium’s Dexia. The agency also said a second, unnamed Austrian bank and a Cypriot bank were set to fail.
Looks like Brussels thinks it’s free of leaks to the media. Look, it’s Wednesday, and the banks will get results tomorrow. These are known, and can and will therefore be leaked. It’s 2014. Get with it.
Do note the words I bolded. Banks that only just slipped through the test are a major topic in this. If only because they’ve all had many months to shore up their capital by whatever means possible.
Those who still fail after that should probably have been long gone, while those who make it by a narrow margin are in bad shape. There are many ways to shore up your capital, including some that are temporary, just shy of being 100% legal and/or simply based on accounting tricks.
And of course many problems will remain hidden, for now, behind the veil of ultra cheap credit, either from central banks or corporate bond investors. Because that’s one of the damaging effects of ZIRP: it keeps zombies alive.
Then later in the day Reuters followed up with this interview with Pimco global banking specialist Philippe Bodereau, who says 18 banks will fail. Juncker must have thrown a hissy fit, and then lied about it.
Pimco’s Banking Expert Expects 18 Lenders To Fail ECB Stress Test
Fixed income investment firm Pimco’s global banking specialist, Philippe Bodereau, expects 18 banks will be seen to have failed the European Central Bank’s stress test of 130 regional lenders when results are published by the ECB on Sunday. Bodereau said in an interview on Wednesday the failures would likely include some German and Austrian cooperative and public sector banks, as well as weak regional lenders in the southern periphery.[..]
Describing the exercise as a milestone for cleaning up the banks, he said the test was “reasonably credible” when compared with previous tests and provided investors with a starting point to evaluate banks. “It’s pretty clear that not that many banks are going to fail it. A fair amount of balance sheet strengthening has taken place over the last six to nine months in anticipation of this exercise,” Bodereau told Reuters.
Big national champions across northern Europe and also in Southern Europe should pass quite easily, he said, although he expected almost a third of those tested to pass by a narrow margin. This group would likely include many medium-sized banks. “Probably the market will ask questions about their dividend policies, about their ability to grow balance sheet, etcetera. They will be under pressure to remain quite conservative on capital management and on deleveraging,” said Bodereau. [..]
Given recent market volatility, he said it was more likely there would be a positive than negative market shock after the results are released, and that share prices for the region’s biggest banks could be a market winner on Monday.
130 banks are being tested. 12-18 will fail. And on top of that, almost a third of 130, that’s over 40, will pass while still getting their feet wet. That means anywhere between 40% and 44% of Eurozone banks either fail or are in bad shape. And Bodereau suggests this will lead to a positive market shock on Monday morning. You might want to ask yourself what market position he has taken, how short he is exactly, and what book he’s talking.
If 40% of your banks are either dead in the water or barely floating, I’d say you have a major problem. ECB head Mario Draghi is undoubtedly still stuck in misplaced confidence on account of how well his ‘whatever it takes’ speech worked out, and ‘fresh’ EC head Juncker is as we speak emptying several bottles of champagne at once to celebrate his new job. He’s known to like his drinky.
And the ECB, under current conditions, seems almost entirely powerless to do anything about this, since, as Tyler Durden, using Barclay’s numbers, summarizes, it can only purchase $10 billion or so in ABC/Covered bond purchases per month, and another $5 billion per month in corporate bonds. There is simply not more eligible debt available for it to buy. Its mandate would have to be changed in drastic ways, and that doesn’t seem to be in the cards at all.
To keep markets afloat, however, as Bloomberg notes, $200 billion a quarter in QE from the central bankers is needed. The Fed is almost out, China has mostly withdrawn, Japan has too many domestic problems to look out the window, and the ECB can do just $15 billion a month. Confused? You won’t be .. after next week’s episode of .. the Eurosoap.
We all know our world, be it politics or economics, consists almost exclusively of spin these days, but in the face of these numbers I very much wonder how many people will be willing to bet their own money that Europe can get away with another round of moonsmoke and roses come Monday.
via Zero Hedge http://ift.tt/1FKfJYV Tyler Durden
Just when you thought it was safe to assume that Ebola-in-America was fixed (one day into Ron Klain’s tenure as Ebola Czar), NYPost reports some rather disquieting news. A New York City doctor – who returned from treating Ebola patients in Guinea 10 days ago – has been rushed under police escort to Bellevue Hospital… He is being tested for Ebola. Market liquidity has dried up instantly!
Full Statement on Patient at Bellevue Hospital
Today, EMS HAZ TAC Units transferred to Bellevue Hospital a patient who presented a fever and gastrointestinal symptoms.
The patient is a health care worker who returned to the U.S. within the past 21 days from one of the three countries currently facing the outbreak of this virus.
The patient was transported by a specially trained HAZ TAC unit wearing Personal Protective Equipment (PPE). After consulting with the hospital and the CDC, DOHMH has decided to conduct a test for the Ebola virus because of this patient’s recent travel history, pattern of symptoms, and past work. DOHMH and HHC are also evaluating the patient for other causes of illness, as these symptoms can also be consistent with salmonella, malaria, or the stomach flu.
Preliminary test results are expected in the next 12 hours.
Bellevue Hospital is designated for the isolation, identification and treatment of potential Ebola patients by the City and State. New York City is taking all necessary precautions to ensure the health and safety of all New Yorkers.
As a further precaution, beginning today, the Health Department’s team of disease detectives immediately began to actively trace all of the patient’s contacts to identify anyone who may be at potential risk. The Health Department staff has established protocols to identify, notify, and, if necessary, quarantine any contacts of Ebola cases.
The Health Department is also working closely with HHC leadership, Bellevue’s clinical team and the New York State Department of Health to ensure that all staff caring for the patient do so while following the utmost safety guidelines and protocols.
Bellevue and the New York State Department of Health to ensure that all staff caring for the patient do so while following the utmost safety guidelines and protocols.
The chances of the average New Yorker contracting Ebola are extremely slim. Ebola is spread by directly touching the bodily fluids of an infected person. You cannot be infected simply by being near someone who has Ebola.
* * *
A doctor who returned to New York City from Africa 10 days ago was rushed in an ambulance with a police escort from his Harlem home to Bellevue Hospital on Thursday, sources said.
He was suffering from Ebola-like symptoms — a 103-degree fever and nausea, sources said.
While he was in Africa, the doctor had been treating Ebola patients in Guinea, sources said.
He’s undergoing testing at Bellevue to see if he has the deadly virus, sources said.
* * *
NBC reports that…
He was transported from a building on 147th Street between Broadway and Amsterdam Avenue to Bellevue, law enforcement source said.
* * *
USDJPY was first to move then stocks…
and VIX was well bid…
…and S&P futures liquidty disappeared…
EMini liquidity fell off a cliff $ES_F $SPY http://ift.tt/1tgm1LC
— Eric Scott Hunsader (@nanexllc) October 23, 2014
And then another exchange Breaks…
via Zero Hedge http://ift.tt/1nAWeMx Tyler Durden
The Common Core
education standards have become increasingly controversial since
their creation in 2009. Supporters have pointed to the need for
higher, more consistent standards; much of the opposition has
focused on the
confusing new method of teaching math. But both of these
arguments ignore the fundamental problem with Common Core: federal
involvement.
By using heavy-handed incentives to compel states to adopt the
standards, the federal government destroyed the notion that Common
Core was a legitimately state-led effort. Washington’s actions made
it nearly impossible for education leaders to adjust the standards
to meet the needs of states and school districts, and prevented
them from testing the standards against alternatives. In short,
they created a rigid, one-size-fits-all approach to education
policy.
This problem has now been recognized by education experts across
the Common Core divide. Chris Minnich, chief executive of the
Council of Chief State School Officers and a prominent Common Core
supporter, acknowledged as much on Wednesday at a
panel discussion hosted by the American Enterprise
Institute (AEI), when he said:
“The federal involvement in this has just been not helpful, in
every scenario…I think it’s pretty clear that most of us, I can’t
say ‘all of us who support the standards,’ but most of us, believe
that declaring our independence [from federal involvement], making
sure it is and remains to be state-led, is critical.”
Frederick Hess, director of education policy studies at AEI,
agreed with Minnich, pointing out that that federal involvement was
not only unhelpful but also unnecessary:
“If the federal government had never waded in to this, back in
2009, I think…about 15 states probably would have gone ahead and
done the Common Core on their own. I think they would have figured
out a way to do a common assessment…and I think what we would have
seen was a truly and genuinely state-led effort, which, if it was
working and if it was being implemented well, other states would
have wanted in [on].”
Had Common Core remained a voluntary, ground-up initiative, it
would be far less controversial. States would have the freedom to
tailor its implementation according to their needs, and comparing
outcomes would offer evidence on whether the new method of teaching
math is actually worth the hassle.
This would have meant that Common Core was not a set of national
standards, but that is not a bad thing. On the contrary, having
state rather than federal standards allows for experimentation and
competition. That’s a feature of competitive federalism, and it’s
why education policy was never meant to be the federal government’s
responsibility.
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from Hit & Run http://reason.com/blog/2014/10/23/ebola-took-the-cdc-by-surprise-fat
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