Trying to dig deep and understand what happened between the 2nd and 5th of August of such magnitude to trigger a crash in Japanese markets worse than 1987, a name kept being mentioned: “Capula”. Let me be honest, I have never dealt with this hedge fund before, and my direct…
IF THE FED CUTS RATES, THE DAMAGES WILL BE FAR GREATER THAN THE BENEFITS
Two weeks ago, traders assigned a 60% probability to a FED emergency rate cut, potentially up to 75 basis points. Let me stress this point: an emergency rate cut isn’t an ordinary one. What was the “emergency” that required such a swift and powerful action from the FED two weeks…
NORINCHUKIN BANK CHAOS CAN TRIGGER AT ANY MOMENT
I started to cover Norinchukin Bank many months ago already (“WHY IS THE FED PREPARING TO BAIL OUT A JAPANESE BANK? BECAUSE OF THE “NORINCHUKIN” DANGER”) and since then the situation of one of the biggest Japanese banks has become worse and worse: A few weeks ago Norinchukin released its…
IS A LARGE BROKER USING CLIENTS’ FUNDS TO COVER ITS LOSSES?
Even if everything is “back to normal” and everyone is behaving as if the events from two weeks ago were just a bad nightmare, with the VIX free-falling in a way never seen before (from 66 below 18 in 7 trading days, while every time before it took months to…
UBS’ GAMES OF SMOKE AND MIRRORS TO HIDE ITS GIANT PROBLEMS
UBS reported its Q2-24 earnings, and after a brief moment of selling pressure at the open, the stock started soaring, ending the day up more than 5%. Yes, on the surface, UBS reported a net profit more than double what Wall Street analysts expected, and that was enough to feed…
DEAR BOJ, WHAT’S THIS SOUND ABOUT? “TIC TOC TIC TOC”
On 14 October 2008, the BOJ entered the bailout arena in full force with its “Introduction of Measures regarding Money Market Operations to Ensure Stability in Financial Markets.” Among the four “temporary” initiatives announced, the last one was the most crucial one… and remains the most crucial one today. “Expansion…
FINANCIAL MARKETS REACHED A “SINGULARITY” NO ONE WANTS TO DEAL WITH
Last week I wrote the provocative, but substantiated, “THIS IS NOT 1987, 2000, 2008 OR 2020, BUT A WHOLE NEW MARKET MONSTER” with the main goal of bringing to everyone’s attention how the current financial market is presented with many “unknown unknowns.” Today it’s worth looking a little deeper in…
THE JPY CARRY TRADE IMPLOSION CONTAGION IS ALREADY SPREADING INTO THE UK
While doing my best to untangle the mess of the Bank of Japan (BOJ), in particular, to figure out which financial institution/s could be in danger after what happened on Monday this week, I stumbled upon something very interesting. Please have a look. This chart represents the Bank of England…
THE LONGER THE BOJ TAKES TO CUT RATES BACK TO ZERO THE GREATER THE DAMAGE TO JAPAN’S BANKING SYSTEM.
On Monday last week in my preview of FOMC and BOJ policy meetings “FED AND BOJ WILL DO EVERYTHING THEY CAN THIS WEEK TO SAVE THE STOCKS BUBBLE ONCE AGAIN” I assumed the BOJ would be cognizant of the overall situation, hence I saw zero possibilities they would have hiked…
DID A CREDIT EVENT TRIGGER ON MONDAY? THERE IS A GOOD CHANCE TO KNOW THE ANSWER IN THE FOLLOWING HOURS
I wonder why not many people are currently asking themselves a very simple question: “Who lost money in #Japan’s stock market crash between Friday and Monday?” One very peculiar thing about the 1987 crash is that many brokerages went bust. So how is it possible that Japan suffered a stock…