by Wolf Richter • • Comments Off on Explosive Hidden Leverage Threatens To Blow Up the Markets
We don’t know what hedge fund manager Steven Cohen will do with the money he borrowed from Goldman Sachs. We don’t even know how much it is, though it’s a lot; the personal loan is backed by his $1 billion art collection. But we know how he’ll use it: cheap leverage.
by Wolf Richter • • Comments Off on Banks And Hedge Funds Make Curious Deal On New Structured Toxic-Waste Securities
New regulations force banks to get rid of CLOs. They’re similar to subprime-mortgage-backed CDOs that blew up in 2008. But CLOs are backed by junk corporate loans, including malodorous “leveraged loans.” And they’re booming again. So the banks made a deal.
by Wolf Richter • • Comments Off on Biggest Credit Bubble in History Cracks, Trips Up The Smart Money
For years, nothing could slow the tsunami of junk debt. But suddenly, something happened, and investors in leveraged-loan mutual funds, where the crappiest junk debt accumulates, ran scared and started pulling their money out. Consequences were immediate.
by Wolf Richter • • Comments Off on The Last Two Times This Happened, The Stock Market Crashed
It happened in 2000 and in 2007. With spectacular consequences. Now, it happened again. And hidden beneath the blue-chip highs, parts of the market are already crashing.
by Wolf Richter • • Comments Off on Housing in Six Cities in the West
That’s how it always starts: with a deadly mix. Home sales are collapsing while inventories are soaring in six housing markets that had been white-hot just a few months ago.
by Wolf Richter • • Comments Off on This chart is a hair-raising picture of Canadian home prices that makes the torrid excesses of the US housing bubble look banal
The gap between Canadian and US home prices is at an all-time record, with prices in Canada now 66% higher than in the US. And risks are piling up.
by Wolf Richter • • Comments Off on Putin Parties With German Ex-Chancellor, Sanctions Be Damned
Putin is a master at this game. Even as the sanction spiral is supposed to strangle his ambitions for the Ukraine, he set up a photo op of incomparable ingenuity. And his confidant, ex-Chancellor of Germany Gerhard Schröder stepped in it with gusto.
by Wolf Richter • • Comments Off on Who Is Getting Crushed in This Bull Market?
By now, this wondrous bull market constantly gets benchmarked against the dotcom bubble. It’s different this time, we’re told, even on NPR. But the wholesale destruction of financial assets has already started, one pocket at a time.
by Wolf Richter • • Comments Off on Japanese Doomsday Machine Socks It To The Middle Class (But Shorting JGBs Remains A Terrible Idea)
The miracles performed by Abenomics – an economic religion touted with blinding exuberance around the world – and the endless wonders performed by the Bank of Japandemonium, are now coming home to roost.
