End of an Era: Bill Miller Leaves Legg Mason

Baltimore is a piece of shit city anyways, Bill.

Miller will always be remembered at iBankCoin, albeit not too friendly.

I am thankful to Legg Mason for our 35-year relationship and to the many great people I’ve worked with along the way,” Miller

Bill was the prototypical bull market money manager. He enjoyed great success while things remained predictable. As soon as the teleprompter was taken away from Bill in 2008, he got his hat eaten by a raving horde of llamas and barely left the Great Recession alive.

During a 2014 interview, Bill discussed how the recession affected him and turned him into a fat fuck, gaining 40 pounds and causing him to endure sleepless nights. Truth is, this business is the worst.

The Amazon of China crushed numbers and the stock is rising in kind.

It’s actually unfair to compare them to Amazon, frankly. They’re a cash cow with a real PE of 19, compared to AMZN’s 310. Also, they trade 13x sales, like a high growth tech stock, widely different from AMZN’s 3x sales valuation.

Who knows if these numbers are even legit. There are many skeptics who believe Alibaba is a house of cards, an accounting scandal waiting to happen.

Reports Q1 (Jun) earnings of $0.74 per share, excluding non-recurring items, $0.11 better than the Capital IQ Consensus of $0.63; rev +59% to $4.84 bln vs. $5.57 bln consensus.

China retail marketplaces revenue was RMB23,383 million (US$3,518 million), an increase of 49% year-over-year; and mobile revenue of China retail marketplaces was RMB17,514 million (US$2,635 million), an increase of 119% year-over-year, representing 75% of our total China retail marketplaces revenue.

Mobile MAUs in June reached 427 million, an increase of 17 million over March 2016, while annual active buyers on our China retail marketplaces increased to 434 million, a net addition of 11 million annual active buyers from the prior quarter.

GMV transacted on our China retail marketplaces was RMB837 billion (US$126 billion), an increase of RMB164 billion (US$25 billion), or 24% year-over-year, with mobile GMV accounting for 75% of total GMV.

Our cloud computing business continued its rapid expansion, with revenue in this quarter increasing 156% year-over-year to RMB1,243 million (US$187 million).

In the June quarter, we repurchased and canceled ~27 million of our shares for US$2.0 billion, and the partners of Alibaba Partnership, acting collectively, purchased US$400 million of our shares, in a transaction with Softbank.

“The acceleration of our revenue growth reflects the deep value propositions that we bring to our customers. We are changing the way our 434 million active buyers engage with our platform, as we introduce social, community and personalization driven by smart data into our e-commerce marketplaces, realizing our vision of ‘Live@Alibaba.’ We are poised for strong profitable growth into the future.” “We delivered excellent results this quarter. The 59% revenue growth for the company overall and the 49% revenue growth of our China retail marketplaces represent the highest growth rates we’ve achieved since our IPO,” said Maggie Wu, Chief Financial Officer of Alibaba Group. “We passed an important milestone this quarter in achieving higher monetization of mobile users than non-mobile users for the first time, reflecting the success of our strategy to stay ahead of the curve by embracing mobile.

The company beat earnings, but that’s not the reason why shares are lifting by 14% this morning. The good news for shareholders is that Macy’s will seek to exist in a variety of locales across the country.

In an effort to continue to ‘cost save’ and have more money to buy back stock, they’re closing 14% of their stores, or 100 of them. For each percent of stores they close, the stock rises in tandem. Had they announced 100% of their stores would close and instead they’d become the sentinel from the movie Matrix, the stock might’ve been up 100% this morning. But we’ll take what we can get.

Reports Q2 (Jul) adj. earnings of $0.51 per share, excluding non-recurring items, $0.03 better than the Capital IQ Consensus of $0.48; revenues fell 3.9% year/year to $5.87 bln vs the $5.77 bln Capital IQ Consensus.

Comparable sales on an owned plus licensed basis were down by 2.0 percent in Q2 vs ests closer to -4.5%. On an owned basis, second quarter comparable sales declined by 2.6 percent. The difference between the year-over-year change in total and comparable sales largely resulted from the closing of 41 underperforming Macy’s stores in fiscal 2015.

Co reaffirms guidance for FY17, sees EPS of $3.15-3.40, excluding non-recurring items, vs. $3.26 Capital IQ Consensus; comps down 3-4%.

“We are encouraged by the distinct improvement in our sales and earnings trend in the second quarter. Over the past few months, we have been saying that a setback is a setup for a comeback, and we now believe we are set up well to proceed to a comeback. Our sales strengthened month-by-month throughout the second quarter. This trend improvement gives us confidence in our plans for the back half of the year, and in our strategic planning for improvements to our business model going forward. A number of factors worked in our favor in the second quarter, including a normalized weather pattern, which contributed to a sales lift in our apparel business in particular.

We also saw a smaller decrease in tourist spending during prime summer travel months, supported by strengthened promotional events designed to increase customer traffic and conversion.”

Co intends to close ~100 Macy’s full-line stores (out of a current portfolio of 728 Macy’s stores, including 675 full-line locations). Most of these stores will close early in 2017, with the balance closing as leases and certain operating covenants expire or are amended or waived. In a number of cases, stores will be closed as the value of the real estate exceeds their value to Macy’s as a retail store. The locations of the 100 stores to be closed will be announced at a later date, once the company makes final decisions.

Together, annual sales volume of the ~100 closed locations, net of sales expected to be retained in nearby stores and online, is expected to be roughly $1 billion. The reduction in EBITDA is expected to be offset by expense savings beyond those associated with store closings.

Macy’s will invest in improvements in ongoing stores and digital vehicles. These investments will take a range of forms.
The company continues to pursue opportunities to generate value from its real estate portfolio, consistent with our commitment to stores as a critical element of our long-term omnichannel strategy and balance sheet leverage objectives.

Fantastic. The company will close the stores in an effort to build out its digital store and also generate value from its real estate portfolio. Where have I heard this before (cough: Sears).

This is a must watch interview for those of you living with their ugly heads stuck inside cocaine tubes. Tom Keane discusses the unbelievable drop in U.S. productivity, explicitly accelerated through the expansion of globalism under the Obama regime. Professor Kim Schoenholtz, from NYU Stern School of Business, Donald Straszheim, Head of China at Evercore, and Gina Martin, Wells Fargo Equity Strategist, drops gems of knowledge on the fucking morons who drool over their teevee dinners, watching Bloomberg in the morning.

Plainly and without equivocation, the globalization of American industry will lead to a dystopian society, one wrought with Bernie Sanders protesters running about the avenues with their shirts off, lighting themselves on fire. The education system will be depleted and the jobs outlook will turn especially grim, as our big, giant, traitorous corporations seek the cheapest form of labor, effectively turning wide swaths of America into wasteland. On top of that, the government regulatory and tax situation is making matters, inexorably, worse.

It’s almost as if a foreign entity seized control of America and has been trying to slowly rot this country from the inside on purpose. It’s only by the grace of space alien magicians that we haven’t driven off the cliff yet, into the rocks and into a fucking nuclear death storm.

Please understand there is a distinct difference between the actual economy and the stock market. The vast majority of companies in the S&P 500 derive profits and growth overseas and no longer represent the actual health and trends of the American economy.

Watch it all, through the end.

Shares of SHAK are getting their brains blown out–thanks in large part to patrons not really giving a shit about their hammed burgers. The stock has been running up lately and has now bequeathed said gains back into the matrix of the market, from which it came.

The blood is flowing heavily after the company reported a 37% jump in revenues and earnings of 0.14 cents per share.  The gist of the report lies in the fact that same store sales climbed by just 4.5%, which was much worse than the 5.4% expected. Granted, these numbers are gargantuan erections, when compared to the flaccid -30% pin action at Chipotle. Nonetheless, investors expected MOAR.

In addition, the company raised guidance to $253-256m for 2016, from 251m.

“Domestically, given favorable development tailwinds in our 2016 pipeline, we have increased guidance to open 18 domestic company-operated Shacks this year,” CEO Randy Garutti said. “Next week we will reach a milestone of our 100th Shack opening worldwide. We have never been more excited about the opportunities ahead of us and are committed to investing in our team as we envision and execute the next 100 great Shacks.”

All very nice and wonderful sentiments, but the stock is heading lower by double digits now, so shut the fuck up.

As of now, the company is operating under the finance to grow model. The core issue with this narrative is same store sales plunging to just 4.5%, compared to the +12.9% it enjoyed just 52 weeks ago.

At 7x sales, SHAK is at the very top of the restaurant valuation pecking order, second only to WING, which trades at 9x. This is the polar opposite to the YELP quarter, which smashed estimates and was catapulted off low valuations. This disappointment from high valuations will lead the shares to ruin.

It’s a sell.

The price of palladium rose by 4.5% today, upping its monthly gains to a little more than 20%. Unlike gold, which is mostly a useless commodity owned by the end of world types, palladium actually has an industrial use, found mostly in the auto sector. When auto sales struggle, so does the price of palladium.

Up until recently, the price of palladium was knee-jerked around, based solely on US auto sales. Now that the Chinese are ditching their bicycles in favor of Buicks, everyone is paying close attention to their auto market as a catalyst for palladium.

Two days ago, Chinese auto sales came in super hot, up 23%, 1.6m units in July, and recorded inventory levels at 11mo lows. This, alongside the fervent run in gold and silver, has speculators diving in headlong, without swimming trunk or protective eyewear.

The best way to play this trend is via PALL or  SWC, which is a miner that has some palladium exposure.

The bicycle class in China is reminiscent of the Samurai in Japan, who ardently held onto their idiot swords as the Gatling guns mowed them down like sweet grass. Eventually, they will be a relic of the past and General Motors will rule the middle earth with factories the size of small eastern european countries.

Its been long talked about that the end of the world will begin when the yen trades under 100 v the dollar. The book of the Lord speaks of half boar, half man roaming the earth to bring about a dystopian society, only after the yen-dollar cross dislocated under 100.

Bad news for you high society types out there.

A fucking storm is coming. The yen carry trade unravel will bring forward a risk off environment that will make you rue the day you started to buy marijuana stocks.

Fuckers, trade accordingly.

Let’s see if this blog and my Twitter following has any correlation with the real world or not. My suspicion is that finance, naturally, attracts a more conservative brand of person. Most capitalists that I know aren’t too political. But they tend to lean towards whoever they believe will provide the best environment for sustained economic growth.

I am running a poll on Twitter, which will last a day, to see who people will vote for this Presidential election.

Partake, if you don’t mind.

Who will you vote for?

— The_Real_Fly (@The_Real_Fly) August 10, 2016

I feel like I’m living in the bizarro world. How the fuck does an Olympic judo medalist get robbed and beaten up by some random asshole on a beach in Brazil?

He’s a fucking blackbelt in judo, at he highest levels. He could’ve taken this guy and twisted him up in a pretzel and then snapped his neck like a dry twig.

Dirk van Tichelt won his first Olympic judo medal Monday.

Dirk Van Tichelt probably didn’t envision one of the greatest days of his life ending in the hospital. But that’s exactly where the Belgian judoka found himself Monday night hours after winning his first-ever Olympic medal.

Van Tichelt won bronze in the 73-kg judo competition on Monday. Naturally, he went off to Copacabana Beach that night to celebrate the achievement. And that’s where things went awry.

Van Tichelt was reportedly assaulted by a thief on the famous beach, and was struck in the face. He was taken to the hospital after the incident.

The thief, who was reportedly Brazilian, came away with a cellphone, but, crucially, not with a bronze medal.

These fucking people are so delusional, in their monarchy of terror, corruption and mental illness. Now all asset managers in America who manage just $1b can invest in their fucking asshole stocks, which is completely based on crude oil.

Or, maybe you can just buy USO and avoid having to support a regime that is the single biggest supporter of terrorism, which has infected the world with their brand of Islam that threatens the very fabric of the western world.

The regulations — which will cut the amount of assets foreigners must have under management to invest directly in the nation’s stocks to 3.75 billion riyals ($1 billion) from 18.75 billion riyals — will be enacted on Sept. 4, according to a statement from the Capital Market Authority on Wednesday. They will also allow individual foreign investors to own not more than 10 percent of shares outstanding in a single company, up from 5 percent.

The Riyadh-based regulator said in May the changes would take effect before the end of the first half of 2017.

Over the past year, the Saudi Tadawul is down 25.4%.