DJIA, NYSE, S&P = CRASH!!!

[presence]

Traders start pricing Glencore bonds like junk

CNBC‎ - 11 hours ago

Can anyone explain what is going to keep glencore and trafigura from collapsing? Also wtf are these companies? What is their function? Why should I care again? And how bad is their combined 50+ Billion in debt?

good question


Glencore is a commodity trader. Just like a hardware store sells lumber and nails; except fucking massive; each of these companies is worth 1/10th of a trillion dollars. Glencore sells copper, coal, and oil. Most of their "debt" is covered by oil or other commodities in hand. The problem here is commodities are crashing; they need to dump inventory before its worth less than they paid.

Trafigura, Mercuria, Glencore, and Vitol are the big players in commodities. Commodities are fucked; hence big players are caught holding the bag with excess inventory/debt.

Only 3 commodities have managed to escape 2015 carnage
MarketWatch‎ - 1 day ago

Bad quarter for stocks; dire one for commodities
CNBC‎ - 1 day ago



Moody's is calling Glencore Bonds Baa2; which means they're half a step better than junk.
https://en.wikipedia.org/wiki/Moody's_Investors_Service

As devil21 said:

A shell company that is used by TPTB to develop infrastructure or extract resources in foreign countries, then leave the investors holding the bag.

Its bag holding time.


Now the deal with Trafigura is that they're not publically traded; its a private company... what they do issue is bonds; aka debt. The problem with their debt is that its currently 10X earnings if you're being kind. Thats pretty nasty.

A rewind on the way equity vs bonds move:

to make matters a little more urgent... The big boss of Trafigura just died this morning of cancer complications; he was the deal maker till the very end.

The impeccably dressed Frenchman was the driving force behind Trafigura’s ascension to the top ranks of the commodity trading sector. Armed with a reputation as a hard-driving boss, he asked the same of Trafigura employees who rewarded him with fierce loyalty.

http://www.bloomberg.com/news/artic...sses-as-trafigura-tested-by-commodities-slump

 

[presence]

A comparison of trifugura 2015 vs lehman 2008

https://www.boerse-stuttgart.de/en/Trafigura-Funding-SA-bond-XS1222731215-Chart-263

The key here; bonds are NOT linear; they reach a point of no return... then almost INSTANTLY they're junk.

kinda sketch, but they'll pay it back
yeah it'll take time but they'll pay it back
piss poor, but they'll pay it back

then BOOM; fucking hell... this shit is worthless.

 

[devil21]

If all that wasn't bad enough, Hurricane Joaquin has a very possible track directly to NYC. I'm sure an 8 foot storm surge into Manhattan is market positive....

 

[fatjohn]

So jobs are disastrous -60k below expectations, august was 30k off. Market rallies.

 

[RonPaulIsGreat]

Commodities horrible.
Debt rising.
Interest rates near or at all time lows.

What could go wrong.

 

[devil21]

So jobs are disastrous -60k below expectations, august was 30k off. Market rallies.

Days like today are when I'm glad I'm not a trader and instead try to focus on the bigger picture. A lot of people got flat ripped off by the PPT today.

Nasdaq closed at 4707.77. I cringe every time that number comes up in closing numbers.

 

[DFF]

It was indeed a helluva intraday reversal. Zerohedge said it was the biggest such reversal since 2011.
As far as where we go from here....with China/commodities carnage you would think down.
But since pretty much everybody's thinking this exact same thing, this could be a bullish counter-intuitive indicator.
Granted there's no real fundamental reason for a rally here....but short squeezes brought on by PPT pump can do incredible things.

 

[kfarnan]

why are they (PPT) allowed to manipulate the market still? Seems illegal.

 

[dannno]

why are they (PPT) allowed to manipulate the market still? Seems illegal.

The official name is the President's Working Group on Financial Markets. Ron Paul tried to shine some light on them, besides mentioning them in the media, also in the GOP debates by asking McCain a question about them, which he dodged and nobody else paid attention to because they are retarded. I'm sure he also tried to take some action in congress.

 

[timosman]

why are they (PPT) allowed to manipulate the market still? Seems illegal.

 

[devil21]

Deutsche Bank has some minor issues and is about to post a $7 billion Q3 loss.

http://www.businessinsider.com/deut...down-and-the-stock-is-getting-crushed-2015-10

Anybody seen zippy lately? When he bugs out...


The next week will be interesting. Oct 13th is an important religious calendar date.

eta:
I'm probably wrong so don't take this as advice but a lot of signs point to a big announcement made on Columbus Day involving a large bank, when the US government, banks and markets are closed, that results in Oct 13 being a market bloodbath. Hopefully I'm misreading tea leaves but signs are not good.

eta2: No announcement today, bank earnings start the 13th. A local bank that was closed for business held a bank-wide staff meeting today. Couldn't get info on what exactly was said but timing is curious. Next couple days are going to be important!

 

[devil21]

CNBC talking about black swan events on a pretty negative day after Wal-mart report. Next leg down starting?

 

[presence]

Next leg down starting?

indeed, my gut of guts puts the bottom at djia 5200 out towards spring 2018. I sense a market ugliness that few can fathom.

The Boeing Co. (NYSE: BA) traded down 4.36% at $134.17. The stock’s 52-week range is $115.14 to $158.83. Trading volume was about 80% above the daily average of around 3.8 million. Investors appear to be reacting to a report that Delta Air Lines is looking to buy


used, rather than new, airplanes.

Read more: The 4 Stocks That Tanked the DJIA on Wednesday
​

That news would've made Howard Hughes' eye twitch.

 

[devil21]

indeed, my gut of guts puts the bottom at djia 5200 out towards spring 2018. I sense a market ugliness that few can fathom.



That news would've made Howard Hughes' eye twitch.

A Boeing exec, iirc, said "widebodies are in a huge bubble" on CNBC yesterday.

 

[Zippyjuan]

CNBC talking about black swan events on a pretty negative day after Wal-mart report. Next leg down starting?

Dow up about 150 so far today.

As for "Black Swans": http://www.theguardian.com/money/us-money-blog/2014/mar/06/stock-market-drop-black-swan-event-fears

'Black swan events': don't sell your stocks out of panic

<snip>

That’s what happens when markets are confronted with one of former defense secretary Donald Rumsfeld’s infamous “unknown unknowns”. Anything that resembles a black swan causes even the most grizzled veteran trader to recoil in fear and stage a terrified dash toward the exits. It’s an instinctive reflex; the same kind that you display when the doctor whacks your knee with a little rubber hammer.

Most of us aren’t professional traders, however. Yes, whatever happens during ugly sell-offs like that we witnessed on Monday – or similar market meltdowns triggered by events like the “flash crash” of 2010 or the 9/11 terrorist attacks – is going to have some kind of impact on our portfolios. That doesn’t mean that we should allow our kneejerk response to be reflected in our investment decisions, however.

Black swan events are dramatic precisely because they’re so unexpected and so improbable – just as the European discovery that such things as black swans existed in Australia and New Zealand was in the 18th century. Natural scientists of that era may have been forced to overhaul their most basic principles to take the new discoveries into consideration, but that’s not necessarily true for ordinary investors with a long-term horizon.

If you’re a trader who’s trying to capture profits or avoid even a transitory loss every minute of every trading day, you’d probably want to try to figure out a way to respond on a minute-by-minute basis to what’s going on.

But the best approach for most of us, says Andy Kapyrin, director of research at RegentAtlantic, a Morristown, NJ wealth advisory firm, is not to panic at all. “Black Swans happen more often than you really expect and the majority – 90% of them ––have no lasting impact,” Kapyrin adds.

more at link.

 

[devil21]

Goldman and JPM miss estimates? MOONSHOT ON THEIR STOCKS! Tons of big companies miss estimates? RALLY ON! Wal-mart declares retail is fucked now and next year. RALLY ON! All news is good news when the PPT shows up. What a joke.

Buy metals and forget trading.

And what's with CNBC's fixation with Tesla? Every time I turn it on they're talking about some Tesla that costs $130k and few people will buy.

 

[angelatc]

And what's with CNBC's fixation with Tesla? Every time I turn it on they're talking about some Tesla that costs $130k and few people will buy.

Government subsidized it.

 

[Zippyjuan]

Tesla has had some big fans on this forum.

 

[fatjohn]

I'll be honest. I couldnt help but shorting this market and piling on as it went lower and higher because in my heart i know im right. In doing so i was succesful at timing it as bad as one could do it.
And so some stop losses were hit on facebook, amazon and the dow in the past days and i tried to keep my exposure.

To add insult to injury, i did it with bitcoins, which have only risen in value while i was losing them hand over fist.

I recommend everyone to never lever up. Even if it looks so clear. Even if the market turns on monday and falls 20% over the week I'll have a huge profit, but the agony wont have been worth it.

I just want to know why a fb profile is valued at 200$ a pop. Or why uber is as valuable as airbus, you know the cab app vs the company that makes half of the worlds planes and satellites.



If this is not the intermediate top with a further downswing to come, i dont know where this rally will end up. Maybe 30000. Ffs.

 

[Zippyjuan]

http://www.marketwatch.com/story/wall-street-looks-for-signs-sp-500-can-hang-onto-2000-2015-10-16

U.S. stocks score third straight weekly rise

U.S. stocks ended a choppy session slightly higher on Friday, posting a third consecutive week of gains as investors appeared to shrug off lackluster corporate earnings and mixed economic data.

The S&P 500 SPX, +0.46% switched between small gains and losses, but managed to close higher, rising 9.21 points, or 0.5%, to 2,033.07, its highest finish since Aug. 20. The benchmark index gained 0.9% over the week, with most of the gains concentrated in defensive sectors such as utilities, health-care and telecoms.

The Dow Jones Industrial Average DJIA, +0.43% gained 74.09 points, or 0.4%, to settle at 17,215.84, and booked a 0.8% weekly gain. Nike, Inc. NKE, +1.30% and Exxon Mobil Corp XOM, +1.23% were the top gainers over the week, rising more than 4%. Wal-Mart Stores, Inc. WMT, -0.08% plunged 12% over the week, most of the losses coming after disappointing quarterly results.


The Nasdaq Composite COMP, +0.34% ended the day up 16.59 points, or 0.3%, at 4,886.69 and gained 1.2% over the week.

While stocks logged weekly gains, a measure of implied volatility on the S&P 500 dropped 11% this week. The CBOE Volatility Index VIX, -6.23% dropped to 15, well below long-term average of 20.

Compared to numbers in the OP warning us of the crash, Dow was 17,550 meaning it is still down by 335. S&P 500 from 2093 is still down 60.