THE WORLD’S LARGEST PENSION FUND GOT REAL AGGRESSIVE…THEN LOST $64 BILLION

Unbelievable clownery taking place in Tokyo these days. Last October the Samurai at GPIF decided to double its equity exposure to over 20% of assets, divesting from old boring bonds in the process. Everything was swell, until markets pounded them into dust and absconded with $64 billion of Japanese savings.

The world’s biggest pension fund posted its worst quarterly loss since at least 2008 after a global stock rout in August and September wiped $64 billion off the Japanese asset manager’s investments.

The 135.1 trillion yen ($1.1 trillion) Government Pension Investment Fund lost 5.6 percent last quarter as the value of its holdings declined by 7.9 trillion yen, according to documents released Monday in Tokyo. That’s the biggest percentage drop in comparable data starting from April 2008. The fund lost 8 trillion yen on its domestic and foreign equities and 241 billion yen on overseas debt, while Japanese bonds handed GPIF a 302 billion yen gain.

The loss was GPIF’s first since doubling its allocation to stocks and reducing debt last October, and highlights the risk of sharp short-term losses that come with the fund’s more aggressive investment style. Fund executives have argued that holding more shares and foreign assets is a better approach as Prime Minister Shinzo Abe seeks to spur inflation that would erode the purchasing power of bonds.

“Short term market moves lead to gains and losses, but over the 14 years since we started investing, the overall trend is upwards,” Hiroyuki Mitsuishi, a councilor at GPIF, said at a press conference in Tokyo. “Don’t evaluate the results over the short term, as looking over the long term is important.”

It really was a bad quarter, truth be told. I’m not sold on the idea that pension funds should be so aggressive, unless of course it’s worth betting it all on black. I’m a fan of that approach. Go big or go home. In this case, unfortunately, the kamikazi dive bombers at GPIF went home with a big fat zero, no pun intended.

It’s all fun and games until your book is on fire.

This one goes out to all of you river boat gamblers out there, super-degenerate drug addled alcoholics, who spend their days smoking bacon wrapped cigars and tweeting out their latest acts of genius.

“The Fly” is a man for the people, by the people. Bless his house.

Data provided by Exodus

Just when you thought things couldn’t get worse, news out from China, for the entrepreneurial elevator industry, is dire and getting worse by the second.

After peaking at 600,000 units last year, sales in China may drop to about 500,000 next year amid a surplus of apartments and slowdown of people moving to big cities, Otis Elevator Co. President Philippe Delpech, who heads the world’s largest maker of elevators, said in an interview in Tokyo this month. After that, the market in China, where more than two-thirds of elevators are sold, may stabilize, he said.

When will this market recover, you ponder?

“It could be never,” Delpech said. “We will have to adjust the output of the factories to the market. You will have a consolidation in the market and some small companies will disappear.”

WHAT?! Holy shit.

UTX is the only publicly trades elevator company. Otis cowers in the private markets, secretly getting ravaged from a quickly sinking Chinese’d effect.

“It’s like when they built New York up over 20 to 30 years. They delivered more elevators than they will ever deliver again,” Delpech said. “It’s kind of that type of construction.”

They’re trying to spin year over year deceleration in sales as a positive, caveating how onerous online retailers are to brick and mortar and how they should be content with a very small draw down from last year.

Losers think like that.

Sales at U.S. brick-and-mortar stores on Thanksgiving Day and Black Friday were down slightly from last year, but the performance was still seen as strong in a holiday shopping season where discounts spread well beyond the weekend and many shoppers moved to the web.

Online sales were up by double digits, according to data released on Saturday.

Data from analytics firm RetailNext showed overall sales for both days fell 1.5 percent on flat customer traffic, while average spending per shopper dropped 1.4 percent.

Preliminary data from ShopperTrak showed sales at stores totaled about $12.1 billion on Thursday and Friday. The company said it is an “estimated decrease from last year” but did not give the percentage decline due to an internal change in the way it calculates data. Last year, it reported sales of $12.29 billion for the same period.

Sepaaretly, online retailers aka Amazon, posted 18% growth for total sales of $4.4 billion. In a twisted world, a -1.4% growth rate is “good”. In the real world, it fucking sucks. The shopping mall is deal. Long live the deflationary vortex of the internet, aka Amazon and Google.

I can’t wait for Cyber-Monday. My wife just told me “it already started.”

Putin’s spokesman is upping the rhetoric today, casting aspersions and chastising the Turks for their “traitorous” behavior.

“Nobody has the right to traitorously shoot down a Russian plane from behind,” Peskov told Russia’s “News on Saturday” TV programme, calling Turkish evidence purporting to show the Russian SU-24 jet had violated Turkish air space “cartoons”.

“The president is mobilised, fully mobilised, mobilised to the extent that circumstances demand,” said Peskov.

“The circumstances are unprecedented. The gauntlet thrown down to Russia is unprecedented. So naturally the reaction is in line with this threat.”

He then added an important note to the dialogue, regarding Edrogan’s interest in ISIS controlled oil, why they buy it from them, and perhaps providing the sane people of the world with a motive for doing so.

Peskov, according to the TASS news agency, also spoke of how Erdogan’s son had a “certain interest” in the oil industry. Putin has said oil from Syrian territory controlled by Islamic State militants is finding its way to Turkey.

NATO should cut Turkey loose from its alliance. But they won’t, since for some reason, our interests are aligned with theirs.

Fuckery.

Update: The Kremlin announces a wide swath of sanctions against the bedlamites in Turkey.

President Vladimir Putin signed a decree imposing a raft of punitive economic sanctions against Turkey on Saturday, underlining the depth of the Kremlin’s anger toward Ankara four days after Turkey shot down a Russian warplane.
The decree, which entered into force immediately, said charter flights from Russia to Turkey would be banned, that tour firms would be told not to sell any holidays there, and that unspecified Turkish imports would be outlawed, and Turkish firms and nationals have their economic activities halted or curbed.

Has a better thriller ever been made?

If you haven’t seen this movie, you must watch it tonight. It is the ultimate tale of mystery, revenge, power, wrapped up in a giant web of fuckery. When I saw this movie, many years ago, I was take aback by it, as most people who’ve seen it are. There is a cool twist in the plot that makes it one of the most memorable movies you’ll ever see.

Morons.

Enjoy your day.

This is giant fuckery on a level never seen before. Instead of conciliatory gestures, the arrogant Turks, in the face of reports of Turks being arrested in Moscow– and a growing consensus to punish Turkey for shooting down a Russian warplane– the Turks take jerk and kick it up a notch (bam, Extra Emeril).

“It is playing with fire to go as far as mistreating our citizens who have gone to Russia,” Erdogan told supporters during a speech in Bayburt, in northeast Turkey. “We really attach a lot of importance to our relations with Russia… We don’t want these relations to suffer harm in any way.”

He said he may speak with Russian President Vladimir Putin at a climate summit in Paris next week. Putin has so far refused to contact Erdogan because Ankara does not want to apologize for the downing of the jet, a Putin aide said.

Erdogan has said Turkey deserves an apology because its air space was violated.

This is a very public humiliation of Russia. As a point in fact, 2015 has been the year to mock, jeer, and ridicule Russia. It’s as if the official US policy was to fuck with them, provoke them, until a new war was established, settling old debts.

Say what you want about M. Shkreli, but he’s channeling Jay Gould and Commodore Vanderbilt with his recent actions in KBIO.

Him and his friends cornered the market in a micro cap stock, caused a great spike in volume, drove shares up to absurd levels, and now he’s calling in all shorts.

What does that mean?

According to Markit, 49% of KBIO’s shares are short, up from 5%. In order to short sell, one must borrow from a long. Well, what is Shkreli decided to stop lending to shorts, forcing them to buy in?

Forcing them to buy in.

Some lesser sites will reference the great Volkswagon squeeze. But “The Fly” keeps it real and always keeps it old school. Let’s go back to when the squeeze all started, back in the 19th century Harlem Railroad corner.

What the fuck am I talking about?

This.

Everyone is going to burn in hell. China dry cleaned their markets and the clothing got fucked up.

China’s securities regulator has urged domestic brokerages to cease financing clients’ stocks purchases through swaps and other over-the-counter contracts, two sources with direct knowledge told Reuters, its latest move to reduce leveraged financing risk in its stock markets after a summer plunge.
“After rebounding over 20 percent from its bottom, you need fresh capital to maintain the upward momentum (in Chinese stocks), but recent government measures to deleverage have sparked fears,” said Zhou Lin, analyst at Huatai Securities.
“In addition, I don’t see signs that the economy has bottomed out.”

Further weighing on sentiment was data on Friday showing that profits earned by Chinese industrial companies fell 4.6 percent in October, declining for the fifth consecutive month.
The Chinese yuan also came under pressure, weakening to its lowest level in almost three months as investors braced for a decision on Monday by the International Monetary Fund on whether to include the currency in its reserve basket.

You see the news and I can mull over it with you; but it’s all bullshit. China is a giant steaming pile of horseshit on the side of the road. I anticipate complete and utter ruin in the Chinese streets, vagabonds running wild selling dry noodles to tourists who don’t know any better.

US and European futures are slightly lower, effectively erecting a giant middle finger to the orient.