Business

On Monday, China’s government and president Xi blessed the merger between the country's top coal miner, Shenhua Group and China Guodian Group, one of the country’s top five state power producers, in a deal that will create the world’s largest power company, worth 1.8 trillion yuan, or $278 billion. Putting the sheer size of the two merged behemoths in context, the resulting entity will be the world’s second-biggest company by revenue and largest by installed capacity.

According to the latest Conference Board survey, 80% of Americans surveyed believe that stock prices will not be lower in the next 12 months. The last time the nation was so convinced of the market's 'permanently high plateau' was in the fall of 2007, as the S&P topped...

Only 20% of Americans believe stocks will fall in the next 12 months - that is the lowest number since mid-2017

What happened next was not pretty (oh and in 1999/2000...)

And don't forget that speculators have never been more net long Dow futures...

Having melted up on a sea of momentum since the US open, the stock market just broke...

At 1322ET, BATS declared self-help against Chicago Stock Exchange...

And VIX and Nasdaq reacted...

And chaos breaks out...

Instead of finding new and creative ways of BTFD, overnight the BofA credit team did something so few finance professionals bother with these days: they looked at fundamental data to reach a conclusion that is independent of how much AAPL stock the SNB will have to buy to send the Dow Jones green. Specifically, the bank looked at the liquidity situation in the bond market (specifically the IG space), and found that while for the time being there is little to worry about, once the central bank put melts away, that's when the real test will take place.

Authored by Simon Black via SovereignMan.com,

Quite literally as a I write these words to you, the heads of the world’s largest central banks are packing their bags and heading home after a three-day symposium in Jackson Hole, Wyoming.

Central bankers aren’t exactly mega-celebrities, so their conferences don’t make international news outside of financial circles.

But if people understood what was at stake, they’d probably pay more attention.