Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-58937 Sun, 07 Feb 2016 21:19:02 GMT Debt, defaults, and devaluations: why this market crash is like nothing we've seen before http://implode-explode.com/viewnews/2016-02-07_Debtdefaultsanddevaluationswhythismarketcrashislikenothingwevese.html For many market watchers, a confluence of factors - led by oil, but encompassing China, the emerging world, and financial markets - are all brewing to create a perfect storm in a global economy that has barely come to terms with the Great Recession... Unlike previous pre-recessionary eras, the current sell-off has seen commodity prices, equities and credit conditions all move in dangerous lockstep.

... a tipping point may well be approaching. According to [Oliver] Blanchard's calculations, a 20pc decline in stock markets that persists for more than six months, will translate into a decline in consumption of between 0.5pc to 1.0pc.

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Spreads on high yield US energy corporates have soared to unprecedented highs. "They make Lehman look like a walk in the park" says Thygesen.

More than a third of the entire US high yield bond index is now vulnerable to crude prices remaining low or falling even further, according to calculations from Oxford Economics.

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The question exercising the minds of economists and investors is the extent to which this contagion could metastasize beyond the energy sector, as banks cut off credit access, loans turn bad, and financial conditions enter a critical tightening phase.

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Over the last 45 years, the S&P500 has suffered a loss of more than 12.5pc on 13 occasions. Six of these have given way to a recession in the US, providing a near 50pc probability that a global downturn is just around the corner.

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What, if anything, could halt this pernicious cycle of events from unfolding?

In the short-term, analysts are unanimous: all eyes are on the US Federal Reserve. The central bank's first rate hike in seven years last December has come to look frighteningly premature in the space of just eight weeks.

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iehi-feed-58936 Sun, 07 Feb 2016 21:13:03 GMT PBOC Has Only A Few Months Left "To Stop Collapse": Edwards http://implode-explode.com/viewnews/2016-02-07_PBOCHasOnlyAFewMonthsLeftToStopCollapseEdwards.html China's Foreign-Exchange Reserves Decline to $3.23 Trillion.]]> iehi-feed-58934 Sun, 07 Feb 2016 21:04:27 GMT Why doesn't America's "4.9%" unemployment rate feel great? http://implode-explode.com/viewnews/2016-02-07_WhydoesntAmericas49unemploymentratefeelgreat.html iehi-feed-58933 Sun, 07 Feb 2016 21:01:47 GMT $100 Trillion Up in Smoke http://implode-explode.com/viewnews/2016-02-07_100TrillionUpinSmoke.html iehi-feed-58932 Sun, 07 Feb 2016 20:09:36 GMT Obscure Chinese Firm Dives Into $22 Trillion U.S. Financial Market http://implode-explode.com/viewnews/2016-02-07_ObscureChineseFirmDivesInto22TrillionUSFinancialMarket.html iehi-feed-58931 Sun, 07 Feb 2016 17:32:41 GMT China's 3 trillion dollar mistake http://implode-explode.com/viewnews/2016-02-07_Chinas3trilliondollarmistake.html iehi-feed-58930 Sun, 07 Feb 2016 15:09:52 GMT Here Are The Banks The Market Is Most Concerned About http://implode-explode.com/viewnews/2016-02-07_HereAreTheBanksTheMarketIsMostConcernedAbout.html iehi-feed-58928 Sat, 06 Feb 2016 14:58:13 GMT Chart of Doom: When Private Credit Stops Expanding... http://implode-explode.com/viewnews/2016-02-06_ChartofDoomWhenPrivateCreditStopsExpanding.html iehi-feed-58927 Sat, 06 Feb 2016 14:56:06 GMT Collapsing Federal Revenues Show US In Deepening Recession (DON'T TELL DAVID "NEAR-ZERO CHANCE" ROSENBERG!) http://implode-explode.com/viewnews/2016-02-06_CollapsingFederalRevenuesShowUSInDeepeningRecessionDONTTELLDAVID.html iehi-feed-58925 Sat, 06 Feb 2016 12:22:07 GMT Gundlach Says Financials Below Crisis Prices 'Frightening' http://implode-explode.com/viewnews/2016-02-06_GundlachSaysFinancialsBelowCrisisPricesFrightening.html iehi-feed-58924 Sat, 06 Feb 2016 12:20:26 GMT Oil Rout Threatens Vicious Cycle for Economy http://implode-explode.com/viewnews/2016-02-06_OilRoutThreatensViciousCycleforEconomy.html Rising debt costs for oil and gas companies last month pushed a ratio of corporate distress maintained by Standard & Poor's to its highest level since July 2009, when the last recession ended.

If a lending slowdown "were to broaden out beyond just energy and mining, that would be a concern," Mr. Rosenberg said...

Economic gauges already indicate an industrial recession. The Federal Reserve reported this month that its index of industrial production had fallen 1.8% over the year ended December, a drop that has always been accompanied by a recession since the 1970s.

Even though the U.S. economy has grown far more focused on providing services than producing goods, it is more exposed to commodity-price declines because "a lot of the services conducted in our economy are done in support of produced materials," said Mr. Alpert. Ultimately, deflation in the goods sector could squeeze service providers, too.

... others worry shifts in the global economy have made the U.S. is less insulated today, which means models from the Fed and others may overemphasize domestic activity and inadequately capture cross-border spillovers.

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iehi-feed-58922 Fri, 05 Feb 2016 23:35:57 GMT Chicago Stock Exchange Says It's Being Sold to Chinese-Led Group http://implode-explode.com/viewnews/2016-02-05_ChicagoStockExchangeSaysItsBeingSoldtoChineseLedGroup.html The deal values the Chicago Stock Exchange at less than $100 million, according to a person familiar with the matter, who asked to not be identified because the terms weren't disclosed publicly. The exchange expects the deal to close in the second half of the year, though that will require regulatory approval... The acquisition would be the first of a U.S. exchange by a Chinese company. The 134-year-old bourse only handles about 0.5 percent of U.S. stock trading, but a deal gives a buyer a beachhead in the $22 trillion American equity market. There's also the potential for growth given that regulations require trades to be routed to whichever exchange has the best price for a stock at a given moment.

... Casin Group's offer comes amid an unprecedented overseas shopping spree by Chinese companies. Businesses from Asia's largest economy have announced $70 billion of cross-border acquisitions and investments this year, on track to break last year's record of $123 billion, according to data compiled by Bloomberg.

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iehi-feed-58921 Fri, 05 Feb 2016 22:52:34 GMT The Nasdaq Bloodbath Led by LinkedIn, Tableau http://implode-explode.com/viewnews/2016-02-05_TheNasdaqBloodbathLedbyLinkedInTableau.html Some bears have long been warning that valuations in the "cloud" computer sector have been sky-high with investors focused on fast revenue growth rather than profitability. According to venture-capital firm Bessemer Venture Partners' cloud index, the average $1 billion-plus valued cloud company was trading at 7 times 2015 revenue as of yesterday's close.

If the pessimists are right, then these companies are very vulnerable to any suggestion that revenue growth might slow. Unlike other companies, they don't have a profit lever to pull to make up for any drop off in revenue growth.

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iehi-feed-58920 Fri, 05 Feb 2016 22:44:28 GMT HSBC Reaches $470 Million Accord Over Foreclosure Abuses http://implode-explode.com/viewnews/2016-02-05_HSBCReaches470MillionAccordOverForeclosureAbuses.html iehi-feed-58919 Fri, 05 Feb 2016 18:55:08 GMT Stocks Solidly Lower Following Weak Jobs Report http://implode-explode.com/viewnews/2016-02-05_StocksSolidlyLowerFollowingWeakJobsReport.html U.S. employers added 151,000 jobs in last month, a sharp deceleration from recent months as companies shed education, transportation and temporary workers. That was below economists' forecasts of a creation of 185,000 jobs, according to data from Factset.

On the positive side, the unemployment rate fell to 4.9 percent from 5 percent, the lowest level since February 2008. Average wages jumped 2.5 percent over the past year to $25.39 an hour, evidence that the past years of job growth are helping to generate larger pay raises.

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``We're not falling off the cliff, but it clearly shows the U.S. economy is not immune to the global slowdown," said Russ Koesterich, global market strategist with asset manager BlackRock.

Of course, there's no real confusion: the "unemployment" headline number is a jury-rigged joke; with the underemployment stats more telling.

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iehi-feed-58918 Fri, 05 Feb 2016 16:11:17 GMT Portugal's anti-austerity budget provokes Brussels showdown http://implode-explode.com/viewnews/2016-02-05_PortugalsantiausteritybudgetprovokesBrusselsshowdown.html Portugal's new Socialist government faces an embarrassing rejection of its first "anti-austerity" budget by the European Commission on Friday after eleventh-hour talks failed to break a stalemate over additional cuts needed to bring Lisbon in line with EU deficit rules.

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The commission announced it would hold a special meeting on Friday afternoon to decide whether Portugal's 2016 budget -- submitted three months late after protracted post-election coalition negotiations -- would be rejected. If it is, it would mark the first time a eurozone government has had its spending plan vetoed by Brussels since the new crisis-era rules went into effect in 2011.

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Under eurozone rules, a country that misses its deficit target must at least demonstrate it is undertaking significant economic reforms. But the Portuguese budget reins back such measures, prompting a warning from Brussels that its efforts were "well below" target.

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iehi-feed-58917 Fri, 05 Feb 2016 16:06:51 GMT Bass Predicts 30-40% Yuan Deval; Asks Why China is So Concerned With Him http://implode-explode.com/viewnews/2016-02-05_BassPredicts3040YuanDevalAsksWhyChinaisSoConcernedWithHim.html iehi-feed-58916 Fri, 05 Feb 2016 16:00:38 GMT Whistleblowers: Market "Flash Crash" Disease Mystery Solved--It's Toxic ETFs/ETPs http://implode-explode.com/viewnews/2016-02-05_WhistleblowersMarketFlashCrashDiseaseMysterySolvedItsToxicETFsET.html iehi-feed-58915 Fri, 05 Feb 2016 15:57:27 GMT Chinese Buying Silver To Escape Yuan? http://implode-explode.com/viewnews/2016-02-05_ChineseBuyingSilverToEscapeYuan.html iehi-feed-58914 Fri, 05 Feb 2016 15:46:14 GMT New York's New High-End Rentals Multiply Above As Homeless Youths Do Below http://implode-explode.com/viewnews/2016-02-05_NewYorksNewHighEndRentalsMultiplyAboveAsHomelessYouthsDoBelow.html A slew of high-end, high-profile rental buildings are poised to open across Manhattan and Brooklyn this year, adding more than 8,000 units at a pace not seen in years, and in the process, redefining what rental housing in the city can be... Prices, too, are lofty, with studios in some of the buildings renting for about $5,000 a month.

While any softness in the rental market -- new leasing activity has slowed in recent months, and vacancies are up -- could spell challenges going forward, most developers say they are undeterred.

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"We have apartments with a lot of character to them," said Jonathan Drescher, a Durst senior vice president. And those apartments seem tailored to younger, unattached renters, as 85 percent are studios, starting at $2,770 a month, or one-bedrooms, starting at $3,880. In contrast, the median price of a studio in Manhattan in December was $2,562 a month, while that of a one-bedroom was $3,375, according to a market report from Douglas Elliman Real Estate.

... Traditionally, in New York, the dividing line between a robust and not-so-great market is a 2 percent vacancy rate. Since June of last year, the rate has been higher, with November's at 2.87 percent, the highest in nine years, Mr. Miller said. In December, the rate was 2.74 percent.

Meanwhile, the young homeless are multiplying and underserved...

They are sitting on the floor at the Port Authority Bus Terminal and charging their phones as if they were college students awaiting a bus home. They are huddled on the sidewalk, hanging out. They sleep on friends' couches and in strangers' beds. They stay with "Uncle A.C.E.," code for the long route of the A train, where they can spend hours unbothered and unnoticed.

Mostly, they just blend in, people in their late teens or early 20s, navigating a treacherous path into adulthood... groups serving young homeless people said recently that the efforts fell far short of the need. The problem, they said, is how "homeless" is defined.

Young people staying temporarily with friends and extended family are "technically homeless, but they are not sleeping under a bridge," said Douglas O'Dell, the executive director of the SCO Family of Services, a nonprofit focused on ending homelessness and helping low-income people and troubled young people.

Last year, the total number of sheltered and unsheltered homeless people in the city was 75,323, which included 1,706 people between ages 18 and 24. The actual number of young people is significantly higher, according to the service providers, who said the census mostly captured young people who received social services. The census takers were not allowed to enter private businesses, including many of the late-night spots where young people often create an ad hoc shelter by pretending to be customers.

Suggestion: fake your documents and bounce from luxury rental to luxury rental on a 2-months-free deals...

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