18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
15,840 Blog Posts

China Cracks Down on Muslim Districts, Bans the Name ‘Muhammad’

This isn’t really anything new out of ‘secular’ China. But it demonstrates the scumitude of an authoritarian communist regime. Marxism is only a mode to centralize power. Once consolidated, it corrupts the government and disconnects them from the people they rule over.

In this instance, China wants to do away with the ‘Arabization’ of their muslim districts, in the Xinjiang region. To accomplish this, they’ve ordered officials to bring the people in line with traditional Han chinese culture, which entails banning the following names.

Muhammad, Jihad, Islam, Imam, Hajj, Turknaz, Azhar, Wahhabi, Saddam, Arafat, Medina, Cairo.

There are approximately 10 million Uighurs in the region, a Turkic sunni people. A communist party chief said the region had been radicalized, resulting in ‘hundreds of lives’ being lost. As such, they’re taking measure to eliminate the core issue: religion.

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Another Hit to Steel Stocks: $CLF Misses, Shares Are Heading Lower

Prepare to get lit up again, Trumpfags. After yesterday’s catastrophic decline of 26% in X, investors in the steel sector, many of which are long due to Trump, are about to get lit up again — because CLF just reported a worse than expected quarter.

The company has been reducing debt, so their long term viability looks plausible now. However, the business hasn’t picked up to match the enthusiasm exhibited in the shares.

Reports Q1 (Mar) earnings of $0.16 per share, excluding a $72 mln, or $0.27 per share, loss on extinguishment/restructuring of debt attributable to the liability management activities, $0.04 worse than the Capital IQ Consensus of $0.20; revenues rose 51.1% year/year to $461.6 mln vs the $412.71 mln Capital IQ Consensus

Total debt at the end of the first quarter of 2017 was $1.6 bln, ~$900 mln lower than $2.5 bln total debt at the end of the prior-year quarter
U.S. Iron Ore pellet sales volume in the first quarter of 2017 was 3.1 mln long tons, a 63% increase when compared to the first quarter of 2016 as a result of increased customer demand
As Cliffs’ management previously guided, first-quarter revenues per ton of $79.35 decreased by 5 percent compared to the prior-year quarter.

The decrease is a result of carryover pricing impacts from both 2015 and 2016, and changes in customer mix. The majority of tons sold in the first quarter are from products shipped under the prior-year contract pricing. Contracts that have been priced based on 2017 pricing have been favorable to prior year due to higher benchmark iron ore and hot-rolled coil steel pricing
Asia-Pacific: First-quarter 2017 Asia Pacific Iron Ore sales volume increased 9% to 3.0 mln metric tons, from 2.8 mln metric tons in the first quarter of 2016. The volume increase was primarily related to the timing of shipments

Based on the assumption that iron ore and steel prices will average for the remainder of 2017 their respective April month-to-date averages, Cliffs expects to generate ~$380 mln of net income and $700 mln of adjusted EBITDA for the full-year 2017

This new outlook incorporates revised assumptions around Asia Pacific Iron Ore revenue realizations, which are impacted by the lower IODEX price, larger iron ore content discounts, and lower lump premiums

U.S. Iron Ore Outlook (Long Tons):

Cliffs full-year sales and production volumes expectation is unchanged at ~19 mln long tons. Cliffs’ full-year 2017 U.S. Iron Ore cash cost of goods sold and operating expense2 expectation is unchanged at $55 – $60 per long ton

Asia Pacific Iron Ore Outlook (Metric Tons, F.O.B. the port):

Cliffs’ full-year 2017 Asia Pacific Iron Ore expected sales and production volume is unchanged at ~11.5 mln tons. The product mix is expected to contain 50 percent lump ore and 50 percent fines

My take: the quarter wasn’t all bad. The stock is up 85% over the past 12 months, but lower by 14% for 2017. We’re definitely seeing stronger numbers out of China and hopefully the Trump plans to stoke growth will come to fruition, which would certainly help the stock price in steel and steel related names. The stock is indicating lower by 5%. I wouldn’t buy today. It’s probably a buy sometime next week.

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Under Armour Surges on Better Than Expected Quarter

No one expected anything out of this company. Better than expected margins were the driver here, down 70bps, which was better than the 100bps estimate that the Wall Street gurus has expected. Revenues are plodding along and revenues fucking soared in Asia. But the bottom line is, this stock is so fucking hated right now, with the shares in the dumpster, it was ripe for a reversion to the mean.

The fact that margins came in a little better than expected tells you that pricing power is improving and the business is starting to recover.

Reports Q1 (Mar) loss of $0.01 per share, $0.03 better than the Capital IQ Consensus of ($0.04); revenues rose 6.7% year/year to $1.12 bln vs the $1.11 bln Capital IQ Consensus. North American revenue declined 1 percent as new distribution was more than offset by the absence of business lost to bankruptcies in 2016. International revenue, which is comprised of our EMEA, Asia-Pacific, and Latin America regions, represented 20 percent of total revenue in the quarter, and was up 52 percent (up 57 percent currency neutral). By region, revenue was up 55 percent in EMEA, 60 percent in Asia-Pacific and 30 percent in Latin America. Apparel revenue increased 7 percent to $715 million including strength in training, golf, and team sports. Footwear revenue grew 2 percent to $270 million, against last year’s same period which was up 64 percent due to significant strength in basketball sales and the timing of liquidations. Accessories revenue increased 12 percent to $89 million with strength in men’s training, running, youth, and global football.

Gross margin was down 70 basis points (vs. 100 bps guidance) to 45.2 percent as benefits from channel and product mix were offset by continued efforts to manage inventories appropriate to market demand.

Co reaffirms guidance for FY17, sees FY17 revs +11-12% to nearly $5.4 bln vs. $5.35 bln Capital IQ Consensus. Gross margin expected to be slightly down compared to 46.4% in 2016 with benefits in product costs being offset by changes in foreign currency and shifts in overall sales mix, as the footwear and international businesses continue to outpace the growth of the higher margin apparel and North American businesses; Operating income expected to reach ~$320 million.

Shares of $UAA are down 32% for 2017 — but indicating higher by more than 10% this morning.

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ECB Keeps Rates Unchanged; Oil Hammered

No surprises out of the ECB. They’re due to stop the madness in December of 2017, and then beginning hiking in April of 2018 — based off market odds.

Separately, WTI is getting hammered, off by 2%. I wouldn’t base this move off the inventory numbers. The fact of the matter is, crude has been weak and ebbing lower for months now. Perhaps we need a flush out to price in a hard bottom.

Dow futures are +33.

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Deutsche Bank Beats Estimates; Trading Business Continues to Struggle

This earnings report is literally useless. The trading business continues to struggle. The media is fascinated with the announcement that the company might move 4,000 jobs out of Great Britain because of BREXIT. The real reason has less to do with BREXIT and more to do with the bank losing market share — because they suck.

Bear in mind, I am long the stock.

Litigation costs were estimated to come in at 336m euros, but they only took a 31m euro charge.

Income before taxes rose 52% year-on-year to €878m, net income up 143% to €575m — but they missed on revenues.

“I am pleased with the start we have made to 2017. Client engagement is strong, asset flows are returning across the bank and activity is picking up. Our cost-cutting efforts are starting to pay off, while we have reduced complexity significantly. We have laid firm foundations upon which Deutsche Bank can once again deliver good results.”

Here’s Bloomberg’s take.

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Poverty: Saleforce CEO Undergoes 60% Haircut in Compensation After Shareholder Revolt

God damned ingrates. For all Marc Benioff has done for Salesforce.com, transforming it from a piece of shit, low level, retard tier software company, into a Madoff like profit making machine, shareholders don’t want him to have a lot of their money.

The board SLASHED his pay by 60%, from $33.4m to a paltry $13.2m, hardly enough to finance a proper yacht, to be stored, raced, and flaunted when summering in Newport, RI.

The board approved this draconian measure by 53% majority.

“After the 2016 meeting, we sought additional feedback from our stockholders,” the compensation committee said in the filing. “The two main themes we heard were that, notwithstanding recognition of the enormous contributions and leadership provided by our CEO, the overall magnitude of CEO pay remained high, and that it would be beneficial to expand’  the use of performance-related stock units for Benioff and other executives.

Poor Benioff only owns 5% of his companies shares — putting his net worth barely above $4b. Year to date, the stock is higher by 24% to all-time, record, highs, yet Marc’s compensation is down by 60%.

Hardly appropriate for a man of his stature.

This is what his leadership has produced over the years.

Good luck finding a replacement.

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HAPPENINGS: U.S. Military Moves Controversial Anti-Missile Defense System into S. Korea

Angering local “villagers”, President Trump and his beautiful, tremendous, military, moved in a controversial anti-missile defense system, THAAD (terminal high altitude area defense system).

The system pisses off the “villagers” because they enjoy to be seen a defensless cucks to the insane North Koreans, like dogs rolling over on their back to another dog, demonstrating servitude.

“The American military is completely ignoring us,” said Kim Choong Hwan, head of a group of villagers protesting the THAAD deployment. “We will continue to fight with all means.”

Hilariously, the U.S. military took over a S.Korean golf course and set up the batteries there, escorted by 8,000 S. Korea police and soldiers. The decamping onto the course pissed off locals, who resorted to throwing plastic bottles at the THAAD to demonstrate their displeasure.

“The fact that it happened so abruptly when everyone thought it would wait until after the [presidential] elections bothers me, that our defense ministry does not consider the opinion of Korean people important,” student Kang Ha-rim said.

In response to the THAAD being deployed in S. Korea, China banned travel agencies from setting up travel to the soon to be war ravaged peninsula, resulting in a 40% drop in Chinese tourists. Analysts estimate S. Korea stands to lose $9.63b in Chinese tourism revenues because of the deployment.


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Coulter Drops Out of Berkeley Speech, Citing Cowardice Amongst Conservative Groups; Based Stickman and Others Promise to Beat Down ANTIFA Regardless

The great civil war of 2017 was supposed to commence on April 27th, at Berkeley. The lightening rod was going to be Ann Coulter, vehemently hated conservative firebrand by the left, who would’ve induced sheer and utter panic amongst the ANTIFA thugs who are, seemingly, unable to deal with freedom of speech.

Unfortunately, Coulter canceled the speech, blaming conservative sponsors are the reason for her change of heart.

“There will be no speech,” she wrote in an email to Reuters on Wednesday, saying two conservative groups sponsoring her speech were no longer supporting her. “I looked over my shoulder and my allies had joined the other team,” she wrote.

The group accused of acquiescing to ANTIFA demands are the YAF (Young America’s Foundation), who said in a statement issued today that they were afraid of violence purported by the left.

“As of 4:00 p.m. today, Young America’s Foundation will not be moving forward with an event at Berkeley on April 27 due to the lack of assurances for protections from foreseeable violence from unrestrained leftist agitators,” they continued. “Berkeley should be ashamed for creating this hostile atmosphere.”

“Ms. Coulter may still choose to speak in some form on campus, but Young America’s Foundation will not jeopardize the safety of its staff or students,” they concluded. “For information on Ms. Coulter’s plans, please contact her directly.”

This prompted a series of tweets, designed to both shame YAF and Berkeley.

And here is the final kick in YAF’s small balls, Coulter thanking liberals for advocating for the first amendment.

Other conservatards have pledged to show up at Berkeley without Coulter, citing other firebrands who will be attending the rally in the hopes of striking death blows to ANTIFA.

The Based Stickman, aka An American Hero, will be in attendance, so maybe, just maybe, the civil war will commence, as previously scheduled.

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Reminder: Lower Taxes Lifts All Investment Boats

Today’s winners were found in aluminum, healthcare, and industrials. The Trump administration announced plans to examine aluminum imports. It certainly looks like protectionist policies will be abundant in both steel and aluminum industries. With X getting slammed today, the discount makes for an enticing buying opp.

A wide array of healthcare stocks lifted higher today, such as PRGO, TARO, ALNY and KITE. I wouldn’t boggle the mind over trying to figure out why. We’re in a bull market and sectors will take turns breaking out higher. The key now, obviously, is to find the next one to go.

Top rated sectors in Exodus include a sundry of basic material plays, financials and services. Retail shot higher today, not for any discernible reason. It was merely oversold and time to revert back to the mean.

One of my favorite chart patterns is the long consolidation, edging towards breaking higher. I’ve digitized the formula that produces a screen to find these stocks. It’s in Exodus (join you misers).

Here are a few on my radar.


There are many oil and gas plays dying to break out. But oil has been stubborn and range bound for months — leaving the sector out in the cold as everything heats up around it. If I might propose a scenario that might change things, consider Saudi Aramco is scheduled to IPO in 2018. I can see no environment, other than a raging hot one, that the Kingdom would permit its crown jewel to go public. The valuation will be of the record varietal, upwards of $1.5t. You’d be wise to trade ahead of that eventuality and start by accumulating oil stocks — now — with great vigor and tenacity.

Top oil pick: OAS

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Mnuchin Nearly Loses His Cool During Unveiling of Trump’s Tax Reforms

I loved this press conference with Sec. Mnuchin, with his tight upper lip condescending retorts, while fielding questions from abject morons in the White House press pool. You can see him physically recoiling from the low level thinkers, trying to refrain himself from losing his shit and having a Tourette’s episode.

Let’s make an obvious point here. Any tax cut on business will benefit a billionaire and put more money into his pockets. That shouldn’t even be a subject worth discussing, yet here are the knuckle-draggers in the media asking for Trump’s tax returns and accusing him of cutting taxes to just ingratiation himself with a little more cash before departing into the sunset.

Mnuchin informs the media of ‘MASSIVE’ tax cuts, which help everyone.

Mnuchin then tries and fails to contain his seething hatred for stupid people asking dumb questions.

Mnuchin nearly tells reporter to fuck off after fielding a ‘when will the President release his tax return’ question.


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