About a decade ago, Christian Leone's Luxor Capital was one of the biggest brand names in the industry, and alongside Harbinger and DB Zwirn, every trader and analyst on Wall Street wanted to work there. Since then things have changed.
With Europe back from Easter break, we are seeing a modest continuation of the dollar strength witnessed every day last week, which in turn is pressuring oil and the commodity complex, and leading to some selling in US equity futures (down 0.2% to 2024) ahead of today's main event which is Janet Yellen's speech as the Economic Club of New York at 12:20pm, an event which judging by risk assets so far is expected to be far more hawkish than dovish: after all the S&P 500 is north of 2,000 for now.
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Gold, the Misery Index and Insanity
Posted with permission and written by Gary Christenson, The Deviant Investor (CLICK FOR ORIGINAL)
In late September, during the peak of fall borrowing base redetermination , many oil and gas companies got their first glimpse of just how bad their liquidity would get when as a result of collapsing commodity prices, the value of their collateral crashed when PV-10s plunged by up to 80% Y/Y as of December 2015...
... and resulted in plunging access to secured liquidity as borrowings bases were eviscerated as much as 38% (for those unfamiliar with the basics of the semiannual redetermination process, the WSJ has a handy and brief 101).