What a difference a year makes: last December, just as the ECB was about to shock the market with the announcement of its first €20 billion QE tapering, macroeconomic data mattered, especially since the Fed's tightening intertia appeared to truly be data-dependent, if only for a very short period of time.
Authored by Sven Henrich via NorthmanTrader.com,
Retail investors are worshipping at the altar of FOMO (fear of missing out). It may prove to be a painful experience.
Never before has retail gotten this aggressively exposed to stocks.
It has been an odd year for retail: with an estimated 6,000 store closures, and 65,000 fewer retail jobs than at the start of the year, many have said shorting retail, and especially malls, is the next "big short" trade. Indeed, one look at the performance of the mall heavy CMBX 6 BBB- tranche confirms that the bottom has fallen out of the legacy "bricks and mortar" space.
Back in March, when we detailed the ongoing catastrophic deterioration in the US retail sector, manifesting itself in empty malls, mass store closures, soaring layoffs and growing bankruptcies - demonstrated most vividly by the overnight bankruptcy of Toys "R" Us, the second largest retail bankruptcy in US history after K-Mart - we said that "just like 10 years ago, when the "big short" was putting on the RMBX trade, and to a smaller extent, its cousin the CMBX, so now too some are starting to short CMBS through the CMBX, a CDS index which tracks the values of bonds backed
Authored by Saeculum Research's Neil Howe, via MauldinEconomics.com,
The two firms are aggressively scaling up and branching out: Who will rise as the rest of retail sinks?