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Opening Bell: 6.14.17

Jeff Gundlach would like you to please panic now; sentient humans make up just 10 percent of stock trading; apparently the old I'm-only-shoplifting-as-a-sociological-experiment excuse doesn't fly anymore; and more.

Jeff Gundlach sees trouble, says traders should raise cash ‘literally today’ (CNBC)
Short-term investors should sell stocks and get ready for a drop in the market this summer, Jeffrey Gundlach, CEO and CIO of DoubleLine, said Tuesday. "If you're a trader or a speculator I think you should be raising cash today, literally today. If you're an investor you can easily sit through a seasonally weak period," Gundlach said on a call discussing DoubleLine's Total Return Bond Fund.

GundlachExplainsItAll

Elizabeth Warren Calls for Targeted Deregulation of Community Banks (WSJ)
While House Republicans and the Trump administration have unveiled plans to unwind various postcrisis financial regulations, many of them require legislative actions that are only possible with the support of at least some Senate Democrats. That gives leverage to senators like Ms. Warren who lead debates on regulating banks. “We can work together when you are not changing the law,” she said.

Uber director David Bonderman resigns from board following comment about women (Reuters)
During Tuesday's meeting, Uber board member Arianna Huffington spoke to employees about the importance of adding more women to the board of directors. "There's a lot of data that shows when there's one woman on the board, it's much more likely that there will be a second woman on the board," Huffington said. In response, Bonderman said: "Actually, what it shows is that it's much more likely to be more talking."

Ex-Traders in Britain to Face Currency-Rigging Charges in U.S. (NYT)
According to a letter filed in their court case on Monday, the three defendants — Christopher Ashton, a former Barclays trader; Rohan Ramchandani, the former head of G-10 FX spot trading at Citigroup; and Richard Usher, a former JPMorgan Chase trader — have all agreed to waive extradition and appear next month in the Federal District Court in Manhattan.

Death of the human investor: Just 10% of trading is regular stock picking, JPMorgan estimates (CNBC)
"While fundamental narratives explaining the price action abound, the majority of equity investors today don't buy or sell stocks based on stock specific fundamentals," Marko Kolanovic, global head of quantitative and derivatives research at JPMorgan, said in a Tuesday note to clients. Kolanovic estimates "fundamental discretionary traders" account for only about 10 percent of trading volume in stocks. Passive and quantitative investing accounts for about 60 percent, more than double the share a decade ago, he said.

Reuters takes fresh swing at Bloomberg chat service with Symphony tie-up (FT)
Symphony, the start-up messaging platform, has teamed up with data and trading group Thomson Reuters in a move the two hope will finally topple Bloomberg’s position as the dominant network for chat in financial markets. From later this year the 200,000 licenced users of Symphony’s messaging network will be able to share charts, news and data found on Thomson Reuters’s Eikon terminals, if they are also Thomson Reuters users.

Barclays Upgrades and Downgrades Same Company -- On Same Day (BBG)
If only analysts at Barclays had measured twice, perhaps they wouldn’t have had to cut once. Analyst Christine Cho cut her rating on SemGroup Corp. to equal weight -- normally an unremarkable change for a $1.9 billion company whose stock plunged more than 15 percent over two days last week. But Cho’s downgrade Tuesday came just hours after she had told clients the prior week’s rout left the energy-transportation company at an attractive valuation, warranting an overweight rating.

Hidden in Plain Sight: A Powerful Way to Beat the Market (WSJ)
Harvard Business School economist Lauren Cohen and economists Christopher Malloy and Quoc Nguyen downloaded all the 10-K and 10-Q filings with the Securities and Exchange Commission from 1994 through 2014 and used textual-analysis software to create a similarity score showing how the language in corporate filings differed one period to the next. They then looked at stock performance following filings. The finding: Shares of companies that had significant changes did much worse than those of companies that didn’t. This was particularly true when it came to changes in the risk factors section of 10-Ks.

When a Bank Sells for One Euro, Who Gets the Euro? (WSJ)
Who gets that notional amount of €1 that Santander is paying? Theory suggests it would be holders of Banco Popular’s Tier 2 subordinated bonds. In fact, it was the Spanish regulator that ended up with it, getting an electronic bank transfer of the money from Santander. As overseer of the auction, the regulator has first rights to any proceeds to help cover its costs. Not surprisingly, they quickly exceeded €1.

Woman caught shoplifting said she was studying kleptomania (AP)
A Wyoming college student who told officers she was working on a term paper on kleptomania after she was caught shoplifting faces three felony charges. The Gillette News Record reports 23-year-old Lydia Marie Cormaney was arrested on June 5 after trying to leave Walmart with nearly $1,900 worth of merchandise.

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GundlachExplainsItAll

Opening Bell: 1.11.17

Gundlach speaketh; AQR mad as hell, not going to take it anymore; FDA tells hipsters to knock it off with the camel milk; and more.

Lloyd Zoom

Opening Bell: 8.22.17

Lloyd Blankfein can't quit trolling Trump; Jeff Gundlach could use a friend right now; Steve Mnuchin's wife is apparently reprising her role as Marie Antoinette; and more.

GundlachExplainsItAll

Opening Bell: 8.18.17

Truth Gundlach strikes again; Leon Cooperman has some strong words for Bill Ackman; Trump is worth $2 billion to Twitter; Marilyn Monroe sex dolls are not kosher; and more.

By Jones7224 (Own work) [CC BY-SA 3.0], via Wikimedia Commons

Opening Bell: 8.1.16

Gundlach says sell everything; Goldman is making Olympics predictions; Lawsuit filed in New York over handling of dachshund's $100,000 trust fund; and more.

By Nordenfan (Own work) [CC BY-SA 4.0], via Wikimedia Commons

Opening Bell: 9.9.16

Gundlach gets defensive; Deutsche Bank nears settlement; Investors prefer computers to traders; Judge cracks food jokes during Chipotle exec’s court appearance; and more.

Photo: Getty Images.

Opening Bell: 6.20.16

Visium to shut funds amid probe; Gundlach fears Trump; Credit Suisse puts 5 on leave; Colorado company releases wine for cats; and more.

By D J Shin (Own work) [CC BY-SA 3.0 or GFDL], via Wikimedia Commons

Opening Bell: 10.18.17

Rejoice, humans, quant funds are failing; buuuuut you're still getting replaced by robots; SEC says Rio Tinto lied to investors; "Master, please brand me, it would be an honor"; and more.

Opening Bell: 06.07.13

‘This Will be the Most Important Payroll Release in Years’ (WSJ MoneyBeat) Every payrolls day is a hype-fest, but particularly today. Today’s release will be the “most important payroll release in years”, wrote Michael Hartnett, chief investment strategist at Bank of America Merrill Lynch. It follows “the seventh-worst month of returns for fixed income since ’85 and the largest week of bond fund redemptions since Oct ’08,” the bank says. So, no pressure. The consensus forecast gathered by Dow Jones Newswires is for a rise of 169,000 in the reading for May, with an unchanged employment rate of 7.5%. Draghi lauds ‘most successful’ ECB action (FT) A combative Mario Draghi, president of the European Central Bank, strongly defended one of his bank’s most unorthodox and controversial moves of the eurozone crisis as “probably the most successful monetary policy measure undertaken in recent times”. Pressure in Britain Over What to Do With Bailed-Out Banks (DealBook) “As we move closer to an election, the share prices of R.B.S. and Lloyds will become more scrutinized,” said Peter Hahn, a banking professor at the Cass Business School in London. “Whoever is in government, selling shares in these banks will be a top priority.” ... The British government’s quandary over the banks stands in contrast with the experience of the United States Treasury Department, which reduced the government’s stakes in the big banks more quickly. Criminal Cases Loom in Rate Rigging (WSJ) U.S. and British authorities are preparing to bring criminal charges against former employees of Barclays for their alleged roles trying to manipulate benchmark interest rates, according to people familiar with the plans, marking an escalation of a global investigation now entering its sixth year. The charges are likely to be filed this summer, these people said, roughly a year after the big British bank became the first institution to settle over allegations that it attempted to rig the London interbank offered rate, or Libor, and other widely used financial benchmarks. NSA taps in to user data of Facebook, Apple, Google and others, secret files reveal (Guardian) The files also reveal terrible PowerPoint skills. ‘Hey, gals – be a ho!’: Pimps’ lawyer hails great pay, benefits (NYP) “I’m trying to find a job myself that pays me 10 grand a week,” defense lawyer Howard Greenberg said as summations began in the Manhattan Criminal Court trial of Vincent George Sr. and Jr., admitted father-and-son pimps. “One wonders in this economy if a girl can make up to 10 grand a week . . . Why more women don’t do it, I don’t know,” the lawyer said, arguing that there is no proof that the Georges’ pampered staff of five hookers was forced to do anything. The Georges admit they’re pimps. But they insist that they’re really nice pimps and that their stable of five women commuted happily, six nights a week, from their employer-provided houses in Allentown, Pa., to the bars of fancy Midtown hotels, where they’d hand out “masseuse” cards to randy male tourists. “The girls wanted for nothing. There was maternity leave — can you imagine that? In short, the benefits package was great,” Greenberg said. S&P cuts outlook on Brazil sovereign rating (FT) S&P said slow economic growth, expansionary fiscal policy that was likely to lead to an increase in the government’s debt burden, and “ambiguous policy signals” in decision-making were among the factors behind the surprise move. “The negative outlook reflects the at least one-in-three probability that a rising government debt burden and erosion of macroeconomic stability could lead to a downgrade of Brazil over the next two years,” the agency said. Japan's Pension Fund to Buy More Stocks (WSJ) The Government Pension Investment Fund, at a joint news conference with Japan's welfare ministry, said it has raised its target portfolio allocation of domestic stocks to 12% from the current 11%. The fund also said it would increase its allocation of overseas assets and cut back on low-yielding Japanese bonds. The GPIF is the world's largest public pension with ¥112 trillion yen ($1.16 trillion) in assets. It is closely watched by many investors for hints about potential portfolio rebalancing, which could have broad implications for financial markets. Record outflows from US junk bond funds (FT) US high-yield funds saw a record $4.63bn in outflows for the week ending on Wednesday, according to Lipper. Interest rate volatility has surged in recent weeks since benchmark Treasury yields have risen sharply, with selling spilling over into other key areas of the bond market. As exchange traded fund providers and mutual funds face redemptions, they are forced to sell more of their holdings, putting further pressure on prices. “We are definitely worried that the market is in a cycle where selling of bonds begets more selling,” said Steven Boyd, principal at Halyard Asset Management. Pimco Defends $8.5 Billion BofA Mortgage Accord (Bloomberg) Bank of America Corp.’s $8.5 billion mortgage-bond settlement is “outstanding” for investors, said a Pacific Investment Management Co. executive, who defended the deal against opposition. The settlement was reached after an investor group that included Pimco and BlackRock Inc. (BLK) at first demanded $12 billion, eventually coming down to a “take or leave it” offer of $8.5 billion, Kent Smith, an executive vice president at Pimco who helped negotiate the agreement, testified yesterday. “It’s an outstanding deal, and it’s in the best interest of our clients to support it,” Smith said. Smith was the first witness to testify in a trial over the agreement, which is being considered by Justice Barbara Kapnick of New York State Supreme Court in Manhattan. Forest braces for third bout with Icahn (Reuters) Forest Laboratories Inc is trying to avert yet another bitter proxy battle with billionaire investor Carl Icahn ahead of its annual investor meeting this summer, according to two sources familiar with the situation. ... Last year's proxy battle, for example, ended with just one of Icahn's four nominees being elected to the board - Pierre Legault, the former chief financial officer of OSI Pharma. Legault has since distanced himself from Icahn, telling people that he didn't know the investor well and wasn't "his guy", one of the sources said. Bono Sings to Warren Buffett (CNBC) "Home on the Range"; there is video. Russia's Vladimir Putin and wife Lyudmiladivorce (BBC) "It was a joint decision: we hardly see each other, each of us has our own life", Mr Putin said. Mrs Putin had rarely been seen in public in recent months, prompting much speculation in Russian media. She is known to dislike publicity, and told the TV reporter that flying was difficult for her. "Vladimir Vladimirovich is completely drowned in work," she said.