Article: SEC Launches Review Of High-Frequency Traders’ Market Abuses

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SEC Launches Review Of High-Frequency Traders’ Market Abuses

Tyler Durden, 09 June 2021

Nearly 8 years have passed since Michael Lewis published “Flash Boys”, raising awareness of the relatively new practice of high-frequency trading and its transformative impact on markets, allowing the most technologically-advanced traders to effectively see a picture of the market that’s nanoseconds ahead of what their non-NFT peers see, giving them a massive advantage.

Now, the SEC is finally considering changing the rules of how stocks are priced and traded to stop exchanges from incentivizing brokers (nowadays, particularly retail trading brokerages that have seen an explosion of activity in the past couple of years).

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Article: Jefferies Prime Brokerage Suspends Short Sales In AMC, GameStop And MicroVision

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Jefferies Prime Brokerage Suspends Short Sales In AMC, GameStop And MicroVision

TYLER DURDEN, 03 June 2021

Pouring more fuel on what was already today’s dumpster fire of a market, Bloomberg reported that according to a memo it had seen, Jefferies told clients its prime brokerage arm will no longer allow the execution of short sells in meme stocks such as AMC, GameStop and MicroVision.

“Until further notice, Jefferies Prime Brokerage will no longer offer custody on naked options in GME, AMC and MVIS,” the memo noted. The firm will no longer allow the execution of short sells of those securities, the memo continued, noting that other stocks may be added to that list. Continue reading “Article: Jefferies Prime Brokerage Suspends Short Sales In AMC, GameStop And MicroVision”

Article: Russia’s $186 Billion Sovereign Wealth Fund Dumps All Dollar Assets

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Russia’s $186 Billion Sovereign Wealth Fund Dumps All Dollar Assets

TYLER DURDEN, 03 June 2021

Following a series of corporate cyberattacks that American intelligence agencies have blamed on Russian actors, Russia’s sovereign wealth fund (officially the National Wellbeing Fund) has decided to dump all of its dollars and dollar-denominated assets in favor of those denominated in euros, yuan – or simply buying precious metals like gold, which Russia’s central bank has increasingly favored for its own reserves.

Finance Minister Anton Siluanov made the announcement Thursday morning at the annual St. Petersburg International Economic Forum. Continue reading “Article: Russia’s $186 Billion Sovereign Wealth Fund Dumps All Dollar Assets”

Article: Michael Burry Reveals Massive Tesla Short, Huge Inflationary Bet

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Michael Burry Reveals Massive Tesla Short, Huge Inflationary Bet

TYLER DURDEN, 17 May 2021

Today is the deadline for 13F filings and while we already know what most of the marquee hedge funds have done during the quarter thanks to previously leaked investor letters (with the notable exception of the Soros Family Office which we learned over the weekend bought some $375MM of the Archegos shares liquidated by its prime brokers in late March), one filing was of particular interest, that of Scion Asset Management’s Michael “Big Short” Burry. And boy were there surprises.

First, there is not even a trace of Burry’s previous interest in Gamestop or any other “Reddit” stocks: it’s safe to assume that all profits there were monetized long ago. In fact, a comparison to Burry’s Q4 2020 13F reveals huge turnover, with just 8 of the fund’s legacy 23 positions as of Dec 31 still on Scion’s Books. Continue reading “Article: Michael Burry Reveals Massive Tesla Short, Huge Inflationary Bet”

Article: Selling Frenzy By Hedge Funds Hits Record, Offset By Surge In Buybacks

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Selling Frenzy By Hedge Funds Hits Record, Offset By Surge In Buybacks

TYLER DURDEN, 04 May 2021

Two weeks ago, Bank of America warned that it had observed a sharp reversal to “increasingly euphoric sentiment” among its institutional, hedge fund and HNW clients, all of whom sold in the previous week even as stocks continued their grind higher. This happened around the time that Goldman’s Prime Brokerage had observed a startling streak as hedge funds sold stocks for 7 days out of 8, which prompted us to warn that a short squeeze was coming… we were right, because just a few days later the S&P was back at all time highs on – you guessed it – another whopping short squeeze. Continue reading “Article: Selling Frenzy By Hedge Funds Hits Record, Offset By Surge In Buybacks”

Article: What The Boom In Fraud Says About The Current Market Environment, Part 2

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What The Boom In Fraud Says About The Current Market Environment, Part 2

TYLER DURDEN, 01 May 2021

Just about three months ago, I wrote a blog post which featured this quote, from Charles P. Kindleberger’s Manias, Panics and Crashes: “Swindles are a response to the appetite for wealth (or plain greed) stimulated by the boom.” Since then, the number of frauds, or swindles, that has been revealed has soared, a clear testament to both the breadth and degree of greed inspired by the current boom.

Most recently, we saw the collapse of Greensill Capital as the result of fraud. Like WireCard, Greensill was a relatively young finance company looking to disrupt its more mature competitors which took a few (illegal) short cuts in the process. Continue reading “Article: What The Boom In Fraud Says About The Current Market Environment, Part 2”

Article: The Fall Of Turkey, The Rise Of Bitcoin

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The Fall Of Turkey, The Rise Of Bitcoin

TYLER DURDEN, 26 April 2021

It never ceases to amaze me how tone deaf those with power are.

Turkish President Recep Tayyip Erdogan is in serious trouble for the first time in his political career. He’s a man staring at a massive electoral problem coming this fall.

Erdogan is currently presiding over an economy in complete freefall. With recent reports of food riots over government handouts of potatoes and onions the news only seems to be getting worse there on the eve of national elections. Continue reading “Article: The Fall Of Turkey, The Rise Of Bitcoin”

Article: German Regulator Accuses Deutsche Bank Board Member Of Insider Trading Linked To Wirecard

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German Regulator Accuses Deutsche Bank Board Member Of Insider Trading Linked To Wirecard

TYLER DURDEN, 20 April 2021

For a minute there, it appeared that Credit Suisse might have snatched Deutsche Bank’s crown as the most dysfunctional bank in Europe as the Swiss lender struggled with the fallout from the Archegos blowup and the collapse of Greensill (a scandal that has set off a massive corruption scandal in the UK, and triggered renewed calls for regulatory reform in the European financial system). CS has announced billions of dollars worth of losses tied to the scandals, fired its head of risk and nearly half a dozen other senior employees, and taken other steps in an attempt at penance. But on Monday, Deutsche Bank, which seemingly can’t go more than couple of quarters without a scandal, has found itself in the headlines once again. Continue reading “Article: German Regulator Accuses Deutsche Bank Board Member Of Insider Trading Linked To Wirecard”

Article: Meet The Tiny California Town “Full Of Dirt” That Snagged Elon Musk’s Boring Company

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Meet The Tiny California Town “Full Of Dirt” That Snagged Elon Musk’s Boring Company

TYLER DURDEN, 20 April 2021

Elon Musk is taking his Boring Company circus on the road to Adelanto, California.

Adelanto is a town of 37,000 where the mayor, Gabriel Reyes, works part time and the city manager, Jessie Flores, is the full time chief executive of the city, according to a recent Bloomberg report.

The county supervisor mentioned to Flores recently that Musk’s Boring Company was looking for a place to practice digging tunnels, so Flores reached out. “Steve, we’re the ones you’re looking for. When can we meet?,” Flores texted Boring’s President Steve Davis. Flores suggested meeting at SpaceX’s headquarters, which was about 2 hours away from Adelanto. Continue reading “Article: Meet The Tiny California Town “Full Of Dirt” That Snagged Elon Musk’s Boring Company”

Article: Credit Suisse Prime Brokerage Heads Fired Over Archegos Blowup

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Gary Gensler is now head of the SEC. What comes next?

TYLER DURDEN, 19 April 2021

Apparently, firing half a dozen executives including its head of risk management (Lara Warner, also one of the most high-ranking women in the global financial services industry) hasn’t done enough to quiet shareholders’ demands for change atop Credit Suisse, the Swiss banking giant that reported a $4.7 billion loss from the collapse of Archegos Capital Management, with billions of losses likely to follow from the collapse for Greensill.

As CEO Thomas Gottstein clings to his position, the Wall Street Journal reported Monday that John Dabbs and Ryan Nelson will immediately step down as co-heads of prime services, the prime-brokerage unit responsible for extending all that credit to Archegos (as a reminder, for an explainer on how Archegos built its $100 billion massively leveraged position. Continue reading “Article: Credit Suisse Prime Brokerage Heads Fired Over Archegos Blowup”

Article: US Financial Markets Have Become A Giant Mirage Built On A Foundation Of Fraud

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US Financial Markets Have Become A Giant Mirage Built On A Foundation Of Fraud

TYLER DURDEN, 17 April 2021

Would you pay more than 100 million dollars for a single deli in rural New Jersey that had less than $36,000 in sales during the last two years combined? I know that sounds like a completely ridiculous question, but the stock market apparently thinks that deli is worth that much. On Thursday, the Dow Jones Industrial Average closed above 34,000 for the first time in history, and investors all over the country cheered. But this financial bubble is not real. It is a giant mirage that is built on a foundation of fraud. Continue reading “Article: US Financial Markets Have Become A Giant Mirage Built On A Foundation Of Fraud”

Article: Is China Preparing A Gold-Backed Yuan: Beijing Greenlights Purchases Of Billions In Bullion

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Is China Preparing A Gold-Backed Yuan: Beijing Greenlights Purchases Of Billions In Bullion

TYLER DURDEN, 16 April 2021

In 2018, the Chinese launched a gold-backed, yuan-denominated oil futures contract. These contracts were priced in yuan, but convertible to gold, raising the prospect that “the rise of the petroyuan could be the death blow for the dollar.”

Two weeks ago, The IMF reported that the global share of US-dollar-denominated exchange reserves dropped to 59.0% in the fourth quarter, according to the IMF’s COFER data released today. This matched the 25-year low of 1995. Continue reading “Article: Is China Preparing A Gold-Backed Yuan: Beijing Greenlights Purchases Of Billions In Bullion”

Article: BLM Threatens Legal Action Against One Of Their Own Activists After Call For Probe Into Finances

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BLM Threatens Legal Action Against One Of Their Own Activists After Call For Probe Into Finances

TYLER DURDEN, 15 April 2021

As we highlighted yesterday, Hawk Newsome, who heads up a Black Lives Matter group in Greater New York City, made the call for an investigation, telling the New York Post “If you go around calling yourself a socialist, you have to ask how much of her own personal money is going to charitable causes.”

Newsome said “black firms and black accountants” should conduct an audit on BLM Global Network Foundation to “find out where the money is going.”

“It’s really sad because it makes people doubt the validity of the movement and overlook the fact that it’s the people that carry this movement,” Newsome added. Continue reading “Article: BLM Threatens Legal Action Against One Of Their Own Activists After Call For Probe Into Finances”

Article: Einhorn: “The Market Is Fractured And In The Process Of Breaking Completely”

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Einhorn: “The Market Is Fractured And In The Process Of Breaking Completely”

TYLER DURDEN, 15 April 2021

In many ways, David Einhorn’s Greenlight appears to be back to its “new normal” – in a letter sent to investors, Einhorn writes that Greenlight again underperformed the market and returned -0.1% in the first quarter, badly underperforming the 6.2% return for the S&P 500 index, before proceeding to bash the Fed, broken markets, Chamath and Elon, the basket of short stocks and much more.

That said, even though as Einhorn writes Greenlight made only a handful of portfolio changes and essentially broke even, “a lot happened. In general, the investment environment – especially from mid-February through the end of the quarter – was favorable as value outperformed growth, and interest rates and inflation expectations rose.” Continue reading “Article: Einhorn: “The Market Is Fractured And In The Process Of Breaking Completely””

Article: BoJo Launches Investigation Into Cameron’s Lobbying On Behalf Of Greensill

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BoJo Launches Investigation Into Cameron’s Lobbying On Behalf Of Greensill

TYLER DURDEN, 13 April 2021

For British PM Boris Johnson, the fallout from the collapse of Greensill has been akin to being gifted a golden saucer filled with excrement. At the time, BoJo apparently didn’t see anything wrong with facilitating the lobbying objectives of one of his predecessors, former PM David Cameron. But now that the British tabloid press has sicced the hounds on the PM, he has apparently realized it’s time for some damage control.

To wit, the FT reports that Downing Street and the Cabinet Office have launched a wide-ranging investigation after acknowledging that there was “significant interest in this matter.” Continue reading “Article: BoJo Launches Investigation Into Cameron’s Lobbying On Behalf Of Greensill”