Submitted by Simon Black via SovereignMan.com,
It’s news that seems ripped from the pages of The Onion. Or perhaps Atlas Shrugged.
But incredibly enough it’s actually true: earlier this week, Congress proposed a new law authorizing the US Postal Service to provide banking and financial services.
It’s called the “Providing Opportunities for Savings, Transactions, and Lending” Act, abbreviated as… wait for it… the POSTAL Act.
We’ve written quite a bit about US O&G producers’ dependence on capital markets to plug funding gaps.
In short, the entire space is free cash flow negative, which means without access to liquidity, the whole thing falls apart. That, Citi wrote last September, is shale oil’s “dirty little secret.”
As noted earlier today, BofA's chief credit strategist Michael Hartnett is anything but bullish: in his own words, he remains a seller "into strength in coming weeks/months of risk assets at least until a coordinated and aggressive global policy response (e.g. Shanghai Accord) begins to reverse the deterioration in global profit expectations and credit conditions."
Submitted by Eric Bush via Gavekal Capital blog,
The S&P 500 is currently down a little over 7% YTD and 11% of the May 2015 high. Unfortunately, all signs coming out of the bond market are signalling a further fall in equity prices.
The spread between AAA rated corporate bonds and the 10-year treasury bond has blown out to 213 basis points over the past couple weeks. This is the widest spread since September 2011, during another period of market turmoil.
You know the world is turning to shit when a retired baseball star can (relatively eloquently) explain the sheer folly of negative interest rates.
In a torrent of tweets, the Cuban-American "Bash Brother" started to rage after BoJ's NIRP decision...
Negative interest rates in Japan is blowing my mind
— Jose Canseco (@JoseCanseco) February 4, 2016
Then questioned their sanity...