BEHOLD: The Earl of Muddy Waters Announces His Next Victim

Yes, indeed. The financial aristocracy has gathered to fraternize amongst each other, offering sageness and stock picks, all for the explicit benefit for kids with cancer. While talking their books with pointed malice to ‘inadvertently’ profit from their well rehearsed presentations, it would behoove me to not report on these ongoings, especially when stock market royalty announced their latest short position.

Come hither small dirty man reading the internets from this portal station, corner of the world.

Carson Block, The Earl at Muddy Waters, would like to announce his latest short sale.

Upon mentioning his ‘thesis’ behind the short sale, the stock plummeted by as much as 14%. It has, since then, rebounded with vigor, now off by a mere 4%, greatly distressing and upsetting the good earl, who had wild eyed hopes and expectations of wanton cataclysm to befall the Little Rock, AK bank.

Gold is trading down today, after soaring for the better part of 2016. I guess it’s due to the rise in the dollar, which is higher by 0.25%. Nevertheless, precious metals are down by a trifling today, just about 1%.

What is the response by the even handed folks trading in and out of gold stocks?

Complete and utter chaos.

As a whole, gold stocks are off by more than 5%, as investors run around with their heads on fire in search of a bucket of water. For the year, these stocks have gone up triple digits, even though the yellow metal is up much less than that, higher by 20%.

I suppose there’s a multiplier effect of 5 in this idiotic sector. For every 1% move in the underlying commodity, there is a 5% move in the stocks. Makes sense.

Desperation is in the air. L. Robbins, in between eating hamburgers, pleaded with the other billionaires at this year’s Sohn conference to just ‘hang on’ and to get from point A to point B. Don’t worry. Everything is going to be ok.

I haven’t kept up with Larry for quite some time. I know that he shed 18% last year and is down another 12% this year, managing an astounding $17 some odd billion.

He gave every excuse under the sun for his shitty performance, from China to oil to drug pricing to the elections to the fed, even the fucking zika virus.

Additionally, he thinks it’s unfair for people to criticize the hedge fund industry, calling it a game of dodgeball.

You know what’s unfair, Larry? Down 30% over the past year and change with your shitty stock picks, run by the moronic gorillas over at Glenview.

Just hang on,” Robbins said Wednesday. “We just want to get from Point A to Point B, and frankly, as long as the fundamentals are tracking what we want them to be doing, we will get safely through our journey.”

Don’t mind me, I’m just getting my doom on. You’ve been reading me since 2007, some earlier than that. You know that I have a flair for the dramatic, but often and usually for the bull camp. I have a bias and I’m not afraid to reveal that. Much of my life has been dedicated to offering professional guidance for financial matters. I’ve taken the things I’ve learned over the past two decades and laid them bare, here for the unwashed reader class.

A storm is coming. You’ll thank me later.

Imported merchandise declined 3.6 percent, the most since February 2009, as American companies strived to get inventories in line with weaker first-quarter demand. At the same time, shipments overseas fell for the fifth time in six months amid soft global sales.

“The most troubling thing was in the consumer sector — we’re not exactly sure what’s going on there and whether it’s sort of a one-off effect,” in terms of the slump in imports, Jay Bryson, global economist at Wells Fargo Securities LLC, in Charlotte, North Carolina, said before the report.

Still, “I think you’re going to see import growth outpace export growth as you go forward, and therefore trade will continue to be a modest headwind to growth in the U.S.,” he said.

Q2 GDP will be revised lower.

I haven’t seen an earnings warning like this in quite some time. It’s certainly noteworthy to see a bellwether, like PCLN, give guidance, so bad, it boggles the mind.

The company is guiding down by almost $3.50. This isn’t a minor blip, but a collapse.

Reports Q1 (Mar) earnings of $10.54 per share, $0.90 better than the Capital IQ Consensus of $9.64; revenues rose 16.7% year/year to $2.15 bln vs the $2.12 bln Capital IQ Consensus.

Co issues downside guidance for Q2, sees EPS of $11.60-12.50 vs. $14.96 Capital IQ Consensus Estimate.

Year-over-year increase in room nights booked of approximately 15% – 22%.

Year-over-year increase in total gross travel bookings of approximately 11% – 18% (an increase of approximately 11% – 18% on a constant currency basis).

Year-over-year increase in revenue of approximately 7% – 14%.
Year-over-year increase in gross profit of approximately 9% – 16% (an increase of approximately 9% – 16% on a constant currency basis).

Adjusted EBITDA of approximately $740 million to $795 million.

Gross profit for the quarter Priceline Group was $2 billion; +21% y/y US dollars and by about +27% on a constant currencyior year.

Gross profit was helped by performing in Q1 this year versus Q2 last year.

Estimate the early Easter timing shift of about $40 million of gross profit in adjusted EBITDA into Q1 that would’ve been recognized in Q2.

The timing shift benefits Q1 gross profit operating profit adjusted EBITDA net income and operating margins and will exert pressure on those metrics in Q2 in both cases compared to the prior year.

This is one of the greatest performers I’ve ever seen. The stock has steadily risen to new heights, under the radar, and mostly without pause. I’ve seen misses in high price stocks have minor effects on the share price, due to a strong and fervent shareholder base. There aren’t many people willing to fork over $1,200 per share. Mostly, this stock is owned institutionally and those fuckers aren’t likely to sell after one bad quarter.

Thus far, the stock is lower by 10%. I’d expect any other stock to be down 25-30% on guidance this bad.

Because it’s May, coupled with the fact that corporate earnings are wretched and our beloved hedge fund community are selling like mad ahead of a fun filled summer of cocaine parties, stocks continue to exhibit signs of a top.

S&P futs are off by 13 and the Dow are down 100.

Everything you knew about the world is correct. Ted Cruz is a loser. China is shitting their collective beds at a Trump presidency. And, lastly, our economy isn’t prepared for a nationalist whose economic policy is to place American interests first. Dare I say, a policy such as that would jar stocks, as most of their profits are born overseas.

The best way to play a Trump win is to enact a Google search, looking for companies who complain of anti competitive practices in China. Moreover, you want to be long coal and other companies who’ve been damaged by the FDA.

Think domestic and eschew globalized plays immediately.

The oil industry is feigning pain. These Texans and Sauds are liars of the first magnitude. Steers and queers.

CRZO just reported earnings, beating estimates. Oh and by the way, they’re upping production guidance by 9%. This is the predominant trend for all of the oil producers this quarter, both domestic and abroad. They’re all enjoying a resplendency of production growth to new record highs. The glut increases.

Via Briefing.com

• Reports Q1 (Mar) earnings of $0.16 per share, $0.02 better than the Capital IQ Consensus of $0.14; revenues fell 11.2% year/year to $132.42 mln vs the $127.57 mln Capital IQ Consensus.
• Production Guidance
  • Carrizo is increasing its 2016 oil production guidance to 24,800-25,300 Bbls/d from 24,700-25,300 Bbls/d previously. Using the midpoint of this range, the Company’s 2016 oil production growth guidance is 9%. For natural gas and NGLs, Carrizo is increasing its 2016 guidance to 54-60 MMcf/d and 4,000-4,200 Bbls/d, respectively, from 45-60 MMcf/d and 3,700-4,000 Bbls/d. For the second quarter of 2016, Carrizo expects oil production to be 23,600-24,000 Bbls/d, and natural gas and NGL production to be 56-60 MMcf/d and 3,700-3,900 Bbls/d, respectively. The forecast sequential decline in production during the second quarter results from the planned shut-in of a significant number of wells in the Eagle Ford Shale due to offsetting completion activity coupled with a limited number of wells brought online in the prior quarter.
• Borrowing Base
  • On May 3, 2016, Carrizo’s banking syndicate, led by Wells Fargo as administrative agent, completed its semi-annual borrowing base redetermination,resulting in a borrowing base of $600.0 million, down from $685.0 million previously. The reduction in the borrowing base results primarily from a bank price deck significantly below the one used in the prior redetermination. In connection with the redetermination, the Company’s Net Debt to Adjusted EBITDA covenant was removed, while a Secured Debt to Adjusted EBITDA covenant of no more than 2.0x and an Adjusted EBITDA to Interest Expense covenant of no less than 2.5x were added. For the first quarter, the ratios of Secured Debt to Adjusted EBITDA and Adjusted EBITDA to Interest Expense were 0.1x and 4.8x, respectively. The next redetermination of the borrowing base is expected in the fall of 2016.
  • As of March 31, 2016, Carrizo had total debt outstanding of $1,285.0 million and cash and cash equivalents of $2.2 million. Net Debt to Adjusted EBITDA was 2.9x for the first quarter. As of April 29, 2016, Carrizo had $51.0 million drawn on the facility.

I can’t wait for our overlords to decree that online media sites, like iBankCoin, need to offer ‘fair and balanced’ slants on news topics, imposing government employees onto my board in order to fetter out all of my subversive activities. You know, providing the good people of this fat land with information and opinion that isn’t concocted by a person with an acute mental illness.

The red fucking state of China is going to do exactly that. But don’t worry. China is our friend.

China is considering taking board seats and stakes of at least 1 percent in operators of some Internet portals and mobile apps in exchange for granting news licenses, according to people familiar with the plan.

The government would issue the licenses in exchange for stock and a board seat, according to the people, who asked to not be identified because the details haven’t been made public. Government representatives could monitor and block content distributed by Internet providers, although they wouldn’t be involved in other day-to-day business decisions, according to the people.

The proposal would give authorities the ability to block news from reaching the Web and coincides with a broad government clampdown on information distributed online. The move could affect operators of major Internet portals such as Tencent Holdings Ltd. and NetEase Inc. along with mobile apps that provide current affairs and news on a daily basis.

See, this is very kind of them, permitting people to post shit online, so that other people can read it. They’re going to grant them licenses, in exchange for a piece of the action. The Italian mafia calls that extortion. I suppose, in China, it’s called the cost of doing business.

Free Hong Kong.

The Brazilian government is suing Samarco, who is owned by both BHP and VALE. As a result, shares of BHP are plummeting in Asian trade this evening, off by more than 8%. This is a massive decline for a mega cap stock.

The reason for the suit: Samarco caused a fucking dam collapse that resulted in the death of 19 people and subsequent pollution of the entire region.

The 359-page lawsuit, which is also against the two states impacted by the spill and the Federal Government, is the result of a six-month investigation led by a task force set up after the disaster, prosecutors said in a statement.

The total damages, prosecutors said, were calculated based upon the cost of the Deepwater Horizon oil spill in the United States — BP’s total pre-tax charge for that spill reached $US53.8 billion ($71.89 billion).

Prosecutors demanded an initial payment of 7.7 billion reals ($2.89 billion).

Vale and Australia’s BHP both said they had not received formal notice of the claim.

However, BHP said in a statement to the Australian Securities Exchange that it was “committed to helping Samarco to rebuild the community and restore the environment affected by the failure of the dam”.

It said that a separate lawsuit that Samarco, Vale and BHP settled with Brazil’s Government in March, in which the companies would pay an estimated 20 billion reals ($7.51 billion), was the best way to repair damage caused by the spill.

Samarco’s ‘continual negligence’
Four Corners reveals evidence of problems at the mine dating back almost a decade.
“We believe that the agreement (once approved by the court) provides the long-term remedial and compensation framework for responding to the impact of the Samarco tragedy and the appropriate platform for the parties to work together,” BHP said.

Federal and state prosecutors did not form part of that settlement, which they criticised, saying it was insufficient and lacked the legal mechanisms to ensure the companies would fulfil their obligations, making it little more than a “letter of intent”.

Nothing to see here, other than criminal negligence on a monumental scale.

Both Asian markets and U.S. futures are indelibly lower.

“Equity market sentiment seems to be rolling over globally as the wind begins to come out of the oil price rally,” said Angus Nicholson, market analyst at spreadbetter IG, in a note Wednesday.

I have to be honest with you, I expected a little more piss and vinegar. After all, Ted Cruz has capitulated and the trap has been set for Trump during this year’s GOP convention. Make no mistake, this nomination process isn’t over.

That being said, Trump gave a rather milquetoast, low energy, acceptance speech tonight. Not once did he mention that greatness of the coming wall and how the Mexicans were going to pay for it. Instead, he praised LYIN’ Ted and said he had a very bright future.

Really?

Trump is becoming a politician and has begun to pander to fuckheads in order to curry their votes.

Paint me UNIMPRESSED.