Several days ago, following the latest M&A deal to blow up and rock the hedge fund world when the US Treasury ended the Pfizer-Allergan deal, we were wondering with event/arb funds would be most impacted. We now of know at least one, and it's a name that has been hit not only on M&A arbs blowing up, but also on some core hedge fund hotel names such as Allergan getting crushed in the 2016.
Submitted by Arthur Berman via OilPrice.com,
Natural gas prices should double over the next year.
Over-supply plus a warm 2015-2016 winter have resulted in low gas prices. That is about to change because supply is decreasing (Figure 1).
(Click to enlarge)
Figure 1. EIA U.S. natural gas supply balance and forecast. Production, consumption and supply balance values are 12-month moving averages. Source: EIA and Labyrinth Consulting Services, Inc.
The US Oil rig count continues to track lagged oil prices perfectly, falling 8 rigs in the last week to 354 - its lowest since Nov 2009. Oil rigs have now declined 15 of the last 16 weeks. While gas rigs rose by 1 this week, the total rig count slipped 7 to 443 - yet another fresh record low. While the reaction was delayed, crude prices are sliding from their exuberant rally highs.
Oil Rigs dropped to Nov 2009 lows...
As the total US rig count plunged to fresh record lows...
When trying to time the next US recession, most economists - as one would expect - look at economic data. The problem with such "data" as last year's farcical double seasonal GDP adjustments have shown, is that if the government is intent on putting lipstick on the pig that is US GDP, it will do just that over and over, unleashing non-GAAP GDP if it must, to avoid revealing the truth until it is prepared to do so.
Even with today's 3% surge - the most in a month - on the heels of Unicredit's CEO proclaiming that EU banks are "intensely" looking for fundin solutions, European banking stocks have collapsed for a 4th straight week for the worst losses since 2012.
Following the brief exuberance after Draghi unleashed his latest bazooka - which it seems was all front-run - European banking stocks have collapsed almost 20% - the biggest loss since April 2012.