Macro Links Feb 6th – Short VIX Waterloo

Macro Links Feb 6th – Short VIX Waterloo

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CALM SHATTERED, RECORDS BROKEN

Market Rout Shatters Lull in Volatility – WSJ

Volatility roared back into the stock market Monday, rattling traders and wrong-footing scores of investors caught wagering that share-price swings would remain muted. The Cboe Volatility Index, or VIX, posted its largest-ever one-day increase, more than doubling by Monday’s close to 37. That is the highest closing level since August 2015, when U.S. markets briefly went into free-fall following a surprise devaluation of the Chinese yuan.

Stock Rout Shatters Years of Calm in Markets – Bloomberg

The VIX more than doubled from Friday’s close, reaching 38.80 at its highest point before closing at 37.32. Those are staggering figures given the historically low volatility of recent years.

Dow’s nearly 1,600-point plunge marks its biggest one-day point drop ever – CNBC

The Dow Jones industrial average marked its biggest single-day point drop on Monday afternoon, plunging nearly 1,600 points during trading hours before recovering to close down 1,175.

Dow Jones stock index hit by record falls – BBC News

Monday’s decline is the largest decline in percentage terms for the Dow since August 2011, when markets dropped in the aftermath of “Black Monday” – the day Standard & Poor’s downgraded its credit rating of the US.

Japan’s Nikkei stock index falls more than 1,200 points — about 5 percent – CNBC

The Nikkei’s losses on Tuesday extended the index’s more than 1.5 percent declines in the Monday session, but few blamed domestic factors. “There are few factors to pull down Japan[‘s] stock market except [the] U.S. stock correction,” said Masaki Motomura, an equity strategist at Nomura.

Trump Lauds ‘Tidal Wave of Good News’ While Dow Plummets – Bloomberg

Trump often boasts about the stock market in speeches — “how’s your 401k doing?” has become a favorite refrain. But he didn’t mention the market during his remarks on Monday at Sheffer Corp., a factory in Blue Ash, Ohio, where he recounted “a tidal wave of good news” about the economy — even as stocks tumbled.

Market Rout Wipes $114 Billion From Fortunes of World’s Richest – Bloomberg

A plunge in U.S. stocks Monday cut the fortunes of the world’s 500 richest people by $114 billion as the optimism over tax cuts that fueled January’s gains gave way to worries about inflation.

More Than $1 Trillion Wiped From U.S. Equities in Market Rout – Bloomberg

The worst day for U.S. equities in 6 1/2 years came with a price — namely $1.25 trillion. That’s roughly how much was wiped from the value of American stocks in the frenzied selling Monday that took the Dow Jones Industrial Average down almost 1,200 points. That was enough to undo all the market capitalization added to equities in the aftermath of the Republican tax cuts.

The Market Calm Is Suddenly Gone and Correction Watch Is On – WSJ

The drop has been severe in China as well. The country’s main benchmark, the Shanghai Composite Index, last week suffered its worst fall since December 2016, falling 2.7%. And it declined more on Monday. The Shenzhen Composite Index, the country’s second-largest market, has fallen 7% since Jan. 26. Neither have suffered declines of at least 10% since the market rout that kicked off in the summer of 2015 and lasted through early 2016.

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SHORT VIX WATERLOO

VIX at 38 Is Waterloo for Short Vol Trade That Everyone Adored – Bloomberg

Of all the harrowing things seen in the stock market Monday, one was a special nightmare for investors in what has become one of the stock market’s favorite strategies. Estimates of how much money is tied up in the tactic overall vary but one estimate from Chris Cole of the Artemis Capital Advisers hedge fund puts the total at more than $2 trillion.

XIV, Exchange-traded security linked to volatility, plummets 80% – CNBC

The XIV dropped just 14 percent during regular trading. But then after hours trading began and the security, popular with hedge funds betting on an ever-placid market, was off by 80 percent in extended trading.

Volatility Jump Has Traders Asking About Poison Pill in VIX Note – Bloomberg

The Cboe Volatility Index’s biggest rally ever is raising thorny questions about the future of exchange-traded products tied to the gauge. An ETP meant to mirror moves in the front of the VIX’s futures curve plunged more than 75 percent in after-hours trading following an 80 percent spike in contracts that comprise its underlying index during the trading day, potentially putting in play triggers that would enable the fund’s owners to liquidate it to avoid losses.

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SEXUAL HARRASSMENT

Steve Wynn Set Up LLC to Pay His Accuser – WSJ

Steve Wynn and his legal representatives set up a company separate from his Wynn Resorts Ltd. that helped conceal a $7.5 million payment to a woman who had accused the casino mogul of forcing her to have sex.

Steve Wynn reportedly pressured granny into sex to ‘see how it feels’ | New York Post

Creepy casino tycoon Steve Wynn allegedly pressured a grandma working in one of his casinos into having sex — saying he had “never had a grandmother before” and wanted “to see how it feels,” according to a new report.

Vincent Cirrincione closes Hollywood agency after accusations of sexual harassment – The Washington Post

Vincent Cirrincione, who helped propel Halle Berry and Taraji P. Henson to Hollywood stardom, shut his management agency on Monday following allegations that he sexually harassed aspiring black actresses over a period of two decades.

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BITCOIN, CRYPTOCURRENCY, INITIAL COIN OFFERINGS

Bitcoin bombs below US$7,000 as sell-off accelerates amid bank bans and regulation concerns | South China Morning Post

Bitcoin sank below US$7,000 for the first time since November as it continued its longest run of losses since Christmas Day. The cryptocurrency so far seems to be struggling to live up to any comparison with gold as a store of value, which is an argument made by some of its supporters.

Cryptos Not Like Gold as a Haven During Stock Rout – Bloomberg

Bitcoin tumbled for a fifth day, dropping below $7,000 for the first time since November and leading other digital tokens lower, as a backlash by banks and government regulators against the speculative frenzy that drove cryptocurrencies to dizzying heights last year picks up steam.

As Bitcoin Bubble Loses Air, Frauds and Flaws Rise to Surface – The New York Times

Hackers draining funds from online exchanges. Ponzi schemes. Government regulators unable to keep up with the rise of so-called cryptocurrencies. Signs of trouble have appeared at nearly every level of the industry, from the biggest exchanges to the news sites and chat rooms where the investment frenzy has been discussed.

China to stamp out cryptocurrency trading completely with ban on foreign platforms | South China Morning Post

“To prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs,” said an article published on Sunday night by Financial News, a publication affiliated to the People’s Bank of China (PBOC).

The Latest Victim of China’s Great Firewall: Cryptocurrency Websites – WSJ

Regulators are planning “a list of measures” aimed at cryptocurrency trading, including “dealing with domestic and international websites,” according to a report Monday by Financial News, a publication affiliated with China’s central bank.

College Student Commits Suicide After Mounting Cryptocurrency Loses – Hapskorea

A 20-year-old college student from Busan committed suicide this week after losing nearly 200 million won in cryptocurrency. Korean media reports the student had dropped out of college and was working as a social worker, but he was suffering from depression and insomnia due to the recent drop in cryptocurrency in the country.

Russia Drafts Bill to Create Offshore Companies to Trade Cryptocurrencies – Bitcoin News

“The Ministry of Finance proposed to create offshore companies in Russia for trading with cryptocurrency,” Ria Novosti reported. Deputy Finance Minister Alexei Moiseev told journalists that his ministry is “considering the possibility of implementing organized trades of cryptocurrencies on the Russky and Oktyabrsky islands,” according to Tass.

The Cost of Crypto Is Turning Miners Towards Green Power – Bloomberg

Renewable energy is becoming the preferred way of mining digital currencies like Bitcoin as prices surge and the industry seeks more computing power. While traditional fuels like coal remain staples for many utility grids, big miners including Bitmain Technologies Ltd., HIVE Blockchain Technologies Ltd. and Bitfury Group are tapping clean power in places like Canada, Iceland and Paraguay — and luring investors worried about the industry’s carbon footprint.

China’s Crypto Crackdown Sends Miners Scurrying to Chilly Canada – Bloomberg

China’s clampdown on its crypto industry is sending miners scurrying for a new home. They’re finding one in Canada, lured by its cold climate, lots of clean, cheap power and a welcoming market for raising capital. China — home to about three-quarters of the machines plumbing the blockchain — dominated the scene until the Communist government halted trading of virtual currency, banned initial coin offerings and shut down mining in recent months.

Cryptocurrency Rules From Congress Sought by U.S. Market Cops – Bloomberg

Cryptocurrency exchanges roiled by the rout in Bitcoin prices may face more turbulence as the two top U.S. market regulators ask Congress to consider federal oversight for the trading platforms. To the extent that virtual currency exchanges are regulated at all in the U.S., they are governed by state rules designed for money transmission services.

Steve Wozniak Liquidates Majority of His Bitcoin Holdings

After having likely closed his position at a more than 1000% profit, Mr. Wozniak is at peace with his decision to liquidate the majority of his bitcoin stash. “If I died and had all this wealth and yachts and all this stuff, would I be as happy as when I laugh? And I thought about pranks I played and jokes I had told and music I would hear that would make me smile, and I came up with my formula that life is about happiness.”

Lloyds Bank in Bitcoin crackdown: credit card owners banned from buying cryptocurrency – UKT

Britain’s biggest bank has become the first to announce a ban on customers using credit cards to buy Bitcoin amid fears they could run up huge losses. Lloyds Banking Group will on Monday tell its 9 million credit card customers that it will block any attempts to buy Bitcoin after the digital currency lost more than half its value in just two months.

All Eyes on Tether Amid Crypto Pull Back | Cointelegraph

The problem is that because one Tether token equals one dollar, it has been used to buy other cryptocurrencies because of its standardized value. This culminated in suggestions that the price of Bitcoin and other cryptocurrencies had been inflated because people had been buying cryptocurrencies with Tether and not actual US dollars. If Bitfinex does not have an equal reserve of dollars to back up the amount of Tether tokens in existence, things could end badly.

Newly Discovered Vulnerability In All Ledger Hardware Wallets Puts User Funds At Risk | Cointelegraph

According to the report, а “man in the middle” attack can be performed when the user attempts to generate an address to receive bitcoins to their Ledger wallet. If the computer that is used in this process is infected by malware, the attacker can secretly replace the code responsible for generating the address, causing “all future deposits to be sent to the attacker.”

Bitcoin Not Giving a Big Enough Hit as ‘Gateway Drug’ | Cointelegraph

“Bitcoin is considered the gateway drug to all cryptos and it has acted exactly that way. Right now [the Google search data] is telling me there’s not really that next leg up in Bitcoin because there’s not that interest that leads to wallet growth that leads to price appreciation.”

  1. Korean Finance Minister: Blockchain Can ‘Revolutionize The World’ | Cointelegraph

While on trip to China for economic talks, South Korea’s Finance Minister Kim Dong-yeon spoke positively about the potential for Blockchain, saying that “Blockchain technology can disrupt and revolutionize the world,” according to the South Korean-based Yonhap News Agency.

Most Korean Crypto Exchanges Unable to Use Government-Mandated System – Bitcoin News

The majority of cryptocurrency exchanges in South Korea are unable to use the new government-mandated system which was recently implemented. Six major banks have installed the real-name system, but only three have decided to offer the service to crypto exchanges. In addition, only the country’s top four exchanges receive this service from banks.

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BLOCKCHAIN, FINTECH DIGITAL PAYMENTS

Buffett’s BNSF railroad eyes blockchain for shipping freight – Reuters

BNSF Railway Co, a unit of the billionaire’s conglomerate Berkshire Hathaway Inc, on Monday said it has become the first major U.S. railroad to join the Blockchain in Transport Alliance. The alliance is a group of more than 200 companies examining how best to use the digital ledger technology behind bitcoin and other cryptocurrencies in the transport industry.

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FOREX, CARRY TRADES, EXCHANGE RATES

Venezuela Devalues Bolivar More Than 80% in Currency Auction – Bloomberg

Venezuela’s bolivar plunged more than 80 percent as the central bank restarted currency auctions for the first time since August as part of its efforts to ease a severe shortage of dollars and clamp down on hyperinflation. The devaluation — even if it falls short of the street rate — represents a last-ditch effort by President Nicolas Maduro to remedy the dire economic crisis plaguing this oil-rich nation amid a scarcity of foreign exchange.

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TAXATION, WEALTH HAVENS, INEQUALITY

Tech Giants Are in No Rush to Spend Overseas Cash – WSJ

With the passage of the new U.S. tax law, the nation’s tech giants can now more freely dip into their stockpiles of overseas cash. They don’t seem to be in any hurry. Most don’t need to use that cash because they have been able to borrow low-cost capital—a practice known as synthetic repatriation—to return cash to shareholders.

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RUSSIA PROBE

Trump Accuses Democrats of ‘Treason’ Amid Market Rout – The New York Times

President Trump on Monday accused Democrats who did not clap during his State of the Union address of being un-American and even treasonous. His remarks came in a rambling, discursive speech at a factory in Ohio, during which he celebrated his revival of the American economy as the stock market plummeted by more than 1,000 points.

House panel backs release of Democrats’ memo on FBI – POLITICO

The House Intelligence Committee voted unanimously Monday in favor of publicly releasing a classified memo that Democrats say undermines allegations by President Donald Trump and his allies that the FBI abused its spying powers while investigating his campaign.

Committee Votes to Release Democratic Rebuttal to G.O.P. Russia Memo – The New York Times

The vote gives Mr. Trump five days to review the Democratic memo and determine whether he will try to block its release. A decision to stop it could lead to an ugly standoff between the president, his top law enforcement and intelligence advisers and Democrats on Capitol Hill.

Trump’s Lawyers Want Him to Refuse an Interview in Russia Inquiry – The New York Times

Mr. Trump’s decision about whether to speak to prosecutors, expected in the coming weeks, will shape one of the most consequential moments of the investigation. Refusing to sit for an interview opens the possibility that Mr. Mueller will subpoena the president to testify before a grand jury, setting up a court fight that would drastically escalate the investigation and could be decided by the Supreme Court.

The Times Asks Court to Unseal Documents on Surveillance of Carter Page – The New York Times

President Trump lowered the shield of secrecy surrounding such materials on Friday by declassifying the Republican memo about Mr. Page, after finding that the public interest in disclosing its contents outweighed any need to protect the information. Because Mr. Trump did so, The Times argues, there is no longer a justification “for the Page warrant orders and application materials to be withheld in their entirety,” and “disclosure would serve the public interest.”

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NORTH / SOUTH KOREA, IRAN, NUCLEAR WEAPONS

How Mattis changed his mind on nuclear weapons – The Washington Post

The nuclear weapons policy his team rolled out at the Pentagon last week offered full-throated support for the military’s current and planned nuclear capabilities, including the new cruise missile and the ICBM fleet he once questioned. The strategy marks a resounding win for backers of the U.S. nuclear enterprise and a setback for disarmament advocates.

Tillerson won’t rule out possible Pence meeting with North Koreans at Olympics – The Washington Post

Secretary of State Rex Tillerson on Monday dangled the possibility of direct contact between U.S. and North Korean officials at the Olympics when he declined to shoot down a question about a meeting with Vice President Pence in PyeongChang.

U.S., Russia Say They Have Met Nuclear-Reduction Targets Under Treaty – WSJ

The U.S. and Russia said they have fulfilled obligations under a 2010 treaty to reduce the number of strategic nuclear warheads, meeting the requirement by a Monday deadline.

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RATES, LIQUIDITY, SYSTEMIC RISK, BALANCE SHEETS

Dow’s 15-Minute Plunge Had Elements of a ‘Flash Crash,’ ISI Says – Bloomberg

“We can officially call the last 20ish minutes a flash crash,” said Dennis Debusschere, head of portfolio strategy at Evercore ISI. Loosely defined, the term “flash crash” denotes a phenomenon in electronic markets in which the withdrawal of stock orders rapidly exacerbates price declines.

M&A boom heightens fear of credit cycle nearing peak

Leverage levels on Thomson Reuters and Dr Pepper Snapple deals raise concerns for investors

Machines Had Their Fingerprints All Over a Dow Rout for the Ages – Bloomberg

While it’s impossible to say for sure what was at work when the Dow Jones Industrial Average fell as much as 1,597 points, the worst part of the downdraft felt to many like the machines run amok. For 15 harrowing minutes just after 3 p.m. in New York a deluge of sell orders came so fast that it seemed like nothing breathing could’ve been responsible.

18G06 - HIGH TRADING VOLUMES

Market downturn: ‘an accident waiting to happen’

More rapidly rising wages suggested a hot US economy running into the normal capacity constraints and ultimately requiring action by the authorities to cool it down. Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: “We can’t stress enough that a sustained upside break in wage growth will greatly empower Fed hawks and weaken the doves. This has been an accident waiting to happen.”

18G06 - FASTER GROWTH WAGES IN US MARKETS

Credit Traders Are Hedging Like Mad Amid the Stock-Market Plunge – Bloomberg

The move to insure debt comes as investors across markets grow increasingly concerned about the potential for rising U.S. wages to spur inflation and more Federal Reserve rate hikes. Investment-grade and high-yield credit derivative indexes saw trading volume soar past 300 percent of average trading volume for Mondays, according to data compiled by Bloomberg.

18G06 - CDS SWAP SPIKES

China’s Willingness to Defend Its Stock Markets Put to the Test – Bloomberg

While the Shanghai gauge’s correlation with U.S. equity indexes is low, it will be hard for mainland investors to ignore a record points plunge in the Dow Jones Industrial Average. China’s stock market was already looking shaky after tighter scrutiny of the asset management industry sparked the biggest loss since 2016 last week.

S&P Warns High Corporate Debt Could Trigger Next Default Cycle – Bloomberg

Easy liquidity and underwriting together with low interest rates have contributed to a spike in the number of highly leveraged firms, creating a risk masked by relatively low default rates. Removing the “easy money punch bowl” could trigger the next default cycle since high corporate debt levels have increased the sensitivity of borrowers to elevated financing costs, the ratings agency said in a Feb. 5 report.

Chinese capital controls hit Silicon Valley tech investors

Chinese technology investors in Silicon Valley are being thwarted by the country’s capital controls, in a sign of the unintended consequences of Beijing’s move last year to curb cash outflows. Despite Beijing’s official policy of encouraging tech investments, several venture funds and companies in the Bay Area have been caught in the crosshairs of a policy that made it harder to move money out of China and into US dollars.

Frenzy of Fines for China’s Banks Is Only Just Getting Started – Bloomberg

China’s banking regulator is increasingly showing its teeth, slapping a record amount of fines on financial institutions in the past several months for transgressions such as lax lending procedures and manipulating bad-loan data. Expect the unprecedented frenzy to continue.

House Republicans eye defense spending boost, complicating plan to avoid second shutdown – The Washington Post

House Republican leaders are proposing a long-term boost to military funding in a bill that would give other federal agencies only a short-term extension of current spending levels, a move that stands to heighten tension with Democrats and complicate plans to keep the government open past Thursday.

Betterment and Wealthfront crash during market bloodbath – Business Insider

Roboadvisers entered the markets soon after the financial crisis, and some market watchers have questioned whether robos, which rely more on automation than human financial advisers, could survive a correction. The skeptics argue that if investors don’t have someone to hold their hand when the going gets tough, then they’ll pull out.

Robo-Adviser Websites Crash, Cutting Off Access to Accounts – Bloomberg

The glitches represent a setback for a niche of the financial market industry that has been booming of late as people have become more comfortable making investment decisions without speaking to human advisers.

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MACRO OP-EDS, INSIGHT, EVENTS AND TRENDS

Bob Mueller’s Investigation Is Larger—and Further Along—Than You Think | WIRED

We speak about the “Mueller probe” as a single entity, but it’s important to understand that there are no fewer than five separate investigations under the broad umbrella of the special counsel’s office. If anything, the Mueller investigation appears to have been picking up steam in the past three weeks—and homing in on a series of targets.

The Nunes memo vindicates our worst fears about the GOP – The Washington Post

The attack on the Russia probe is backfiring big-time. Nunes, chairman of the House Intelligence Committee, packed so much half-truth and distortion into four short pages that it’s hard to know where to begin. His hope must have been that everyone would get lost in thick weeds of arcane detail, losing sight of the big picture. Which is not a picture at all.

Reality is catching up with Trump — everywhere – The Washington Post

Stocks rise and fall, but the recent sell-off shows the ultimate folly of the president’s fact-free existence. For a year, he took credit for stock market gains that were the continuation of a nine-year bull market (a market he had called a “bubble” before assuming the presidency). Now, the market is, arguably, beginning to react to Trump’s actual policies — a tax cut that added fuel to an already strong economy, raising fears it will overheat, causing inflation, higher interest rates and recession.

Amazon/Berkshire/JPMorgan Health Venture: Incumbents Should Fear – Bloomberg

Insurers and PBMs now must worry about other companies following this blueprint. Even scarier for them is the idea that the Amazon/Berkshire/JPMorgan company will eventually recruit other employers to join it. That’s a real possibility, given the venture’s ambition and the fact that it’s creating a new company rather than a less-formal alliance. In the release, JPMorgan CEO Jamie Dimon teased the idea of potentially helping “all Americans.”

Brexit chaos shatters Theresa May’s illusion of unity

As she resumes work in London on Monday after a week in which chaos — at times bordering on farce — has enveloped her Brexit policy, Mrs May is rapidly facing the crunch point where she has to finally articulate what sort of relationship Britain wants with the EU. “To govern is to choose,” said Lord Bridges, former Brexit minister, urging Mrs May to get a grip as her cabinet holds two key meetings this week to discuss the Brexit “end state”. The cover of the Conservative-supporting Spectator magazine said simply: “Lead or go.”

To the World, They’re Crypto Bros. To Each Other, a Brotherhood – Bloomberg

The outside world sees them as bros, and some do indeed fit the stereotype of anarchists trying to crush the world’s central banks by day while partying in strip clubs by night. But many reject that scene and are, above all else, wonks—driven by passion for the potential to turn coding, public ledgers and complex mathematics into a revolutionary technology. They hope to dramatically change the world for the better and unleash money from the control of a ruling elite. Some don’t even care about getting rich in the process. They’d rather “hodl,” crypto slang for holding their investments.

How Bell Pottinger, P.R. Firm for Despots and Rogues, Met Its End in South Africa – The New York Times

How Bell Pottinger went bankrupt is a tale of corporate skulduggery that seems lifted from “House of Cards,” the P.R. edition. During the Gupta disaster, a vicious boardroom struggle unfolded, one that pitted a co-founder, Tim Bell, against James Henderson, 53, who ran the firm in the years before it went under. Their conflict centered on the perennials of business potboilers, namely power and money.

Water, Water Everywhere Can’t Quell a Western Drought – WSJ

Many Western reservoirs are full, and downpours have triggered floods and deadly mudslides in parts of California. But all that water isn’t enough to save the West from another drought. Most of the region has slipped back into the drought conditions that have plagued it on and off for the past two decades—alarming water managers across several states. The dry conditions are fueling wildfires, threatening agriculture and hurting ski resorts.

You probably won’t own a self-driving car, but you’ll ride in them a lot | Popular Science

The autonomous car revolution is coming—and in the near future, you’re most likely to ride in one if it is part of a fleet of cars operated by a company. Experts say that in an uncertain future filled with more cars that can pilot themselves most of the time—referred to as level 4—the shared fleet idea has a clear appeal. “A lot of their benefits will hinge on them being shared,” Manville says. “There is a sustainability-based logic to saying that the benefits of these coming revolutions in automobility will be larger if the cars that come are more shared than privately-owned.”

U.S. Farmers Are Producing Too Much Food. Here’s Why They Can’t Stop – Real Time Economics – WSJ

“We call this the irreversible supply curve,” said Chris Hurt, an agriculture economist at Purdue University. “You get a period of higher prices where there becomes a feeling among producers that it’s a new era, and they’re willing to make big investments. It is the big fixed cost once you have invested in [new land or equipment], and you can’t reverse it.”

From Oil to Solar: Saudi Arabia Plots a Shift to Renewables – The New York Times

The world’s largest oil exporter is embarking, under Prince Mohammed bin Salman, on an ambitious effort to diversify its economy and reinvigorate growth, in part by plowing money into renewable energy. The Saudi government wants not just to reshape its energy mix at home but also to emerge as a global force in clean power.

The Death of Clothing

The apparel industry seems to have no solution to the dwindling dollars Americans devote to their closets. Many upstarts promising to revolutionize the industry drift away with barely a whimper. Who needs fashion these days when you can express yourself through social media? Why buy that pricey new dress when you could fund a weekend getaway instead? Apparel has simply lost its appeal. And there doesn’t seem to be a savior in sight.

Journalists are fleeing for their lives in Mexico. There are few havens – LA Times

Last year, reporters and photographers turned up dead in Mexico at a rate of about one per month, making it the most dangerous country in the world for journalists after war-torn Syria. They were some of the country’s most fearless investigators and sharp-tongued critics, shot down while shopping, while reclining in a hammock, while driving children to school. In January, 77-year-old opinion columnist Carlos Dominguez was waiting at a traffic light with his grandchildren when three men stabbed him 21 times. Less known are more than two dozen journalists, who, like Gutierrez and Gomez, have given up their work, their homes and their families to save their lives.

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CENTRAL BANKS & MONETARY POLICY

Market sell-off overshadows Powell’s first day as Fed chair

Mr Powell is facing a rocky introduction to his new post as equity markets erase their gains for the year following a stellar run. In interviews on her final day in the post last week, outgoing Fed chair Janet Yellen flagged up high asset prices, confirming that the Fed sees values as “elevated” while declining to talk of bubbles.

Market Turmoil Greets New Federal Reserve Chairman – WSJ

The Fed was an indirect player in the recent market tumult. A Friday report of strong January wage gains prompted investor worries that rising inflation would force the central bank to raise interest rates more aggressively than previously anticipated.

The Fed – Jerome H. Powell sworn in as Chairman of the Board of Governors of the Federal Reserve System

Jerome H. Powell on Monday took the oath of office as Chairman of the Board of Governors of the Federal Reserve System, succeeding Janet L. Yellen. The oath was administered by Vice Chairman Randal K. Quarles in the Board Room.

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USA ECONOMY DATA, CITIES AND STATES

A decade after recession, a jump in U.S. states with wage gains – Reuters

The kind of pay raises for which American workers have waited years are now here for a broadening swath of the country, according to a Reuters analysis of state-by-state data that suggests falling unemployment has finally begun boosting wages. Average pay rose by more than 3 percent in at least half of U.S. states last year, up sharply from previous years. The state-level data could signal an inflection point muffled by national statistics.

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POT BOOM, MARIJUANA LEGALIZATION, DRUG POLICY

Fed Backs Marijuana-Focused Credit Union – WSJ

A Federal Reserve Bank has given conditional approval to a Colorado credit union to serve marijuana-related businesses, though to win the Fed’s backing it agreed to step back from its original plan to serve state-licensed dispensaries.

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COLOR, EARNINGS, SENTIMENT, VALUATIONS

Arby’s, Buffalo Wild Wings Merge to Compete in Fast-Changing Industry – WSJ

The combination of privately held Arby’s and Buffalo Wild Wings Inc., known as Inspire Brands Inc., aims to acquire more chains to mitigate the threat of consumers losing their appetite for any one type of restaurant concept or cuisine.

Pile-of-Cash Dilemma for Mining Industry Once Crippled by Slump – Bloomberg

Three years after a commodity slump left their finances in shambles, mining companies are swimming in so much cash that investors aren’t sure where the industry will spend it all. Where the rest of the money goes — into new mine projects, acquisitions or a bank account — remains one of the big unanswered questions for executives, investors and bankers attending Africa’s biggest mining conference, which begins Monday in Cape Town.

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REAL ESTATE, HOUSING, REITS, COMMERCIAL

Try Selling Three Towers of Condos in NYC’s Jammed Luxury Market – Bloomberg

Selling pricey condos in Manhattan these days is an uphill climb, as developers keep splashing the landscape with ever more units for buyers to choose from. This year, 4,600 newly developed apartments are expected to reach the sales market, with nearly half of them priced at $2,400 per square foot or higher, according to data compiled by Corcoran Sunshine. That’s on top of the 3,323 new units that were listed for sale in Manhattan last year.

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HEDGE FUNDS, PRIVATE EQUITY, MONEY MGMT

‘Wizard of Oz’ plans return with $2bn hedge fund

Mr Coffey, who has decided to cap the size of the fund at $2bn but had commitments from investors of about $3.5bn, is staging a comeback following several years of poor performance for so-called global macro hedge funds, which make trades in currencies, commodities and other assets. He declined to comment on the launch.

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GEOPOLITICS, CRIME, TERRORISM

Saudi Campaign Seeks to Calm Investors Shaken by Anticorruption Drive – WSJ

The Saudi government is embarking on a campaign of damage control after the abrupt detentions of wealthy businessmen spooked the foreign investors it needs to diversify its economy and list the world’s largest energy company.

Syria Airstrikes Hit Hospitals in Rebel Territory – WSJ

Two hospitals were bombed out of service and several others damaged in 24 hours of airstrikes on an already hard-hit area of Syria, as the last pockets of rebel resistance in the long-running war find themselves increasingly cornered.

Thousands of ISIS Fighters Flee in Syria, Many to Fight Another Day – The New York Times

As some militants go into hiding and others slip into Turkey, the flow risks tarnishing American declarations that the Islamic State has been largely defeated.

Isis ‘far from finished’ as jihadi fighters regroup in Syria – FT

“Isis is far from finished — and there is probably a willingness on many sides to leave its remainder alone so it can attack their enemies for them,” one Syrian opposition figure said.


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PROPAGANDA, CORRUPTION, AUTHORITARIANISM

Kenya’s About-Face: Fear for Democracy as Dissent Is Muzzled – The New York Times

Just months ago, Kenya was praised for its democracy. Now the most widely watched television stations in Kenya are shuttered, and the government has defied a court order to return them to the air. Opposition politicians are under arrest, and journalists have also been threatened with jail. And the government has officially designated some of its opponents “an organized criminal group.”

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TRUMP WORLD

Alt-Right Trump Fanboys: Dow Drop Is a ‘False Flag’

After the Dow Jones Industrial Average suffered its largest single-day point decline in history on Monday, some of the president’s most dedicated followers were positive that the erasure of 2018’s market gains is anyone’s fault but his. “Is the historic -1500 DOW drop a false flag by the big banks?” tweeted InfoWars host Alex Jones, a moon-landing denier who counts President Trump among his fans. “Should we investigate Goldman Sachs?!”

White House Official Called Trump ‘a Deplorable’

The communications obtained by New York provide a window into the complex drama of the Trump White House, where the operatives who serve at the pleasure of the outsider president have in the past expressed contempt for him — and sometimes still do. “Holy shit,” a source who advised Trump said, “plenty of people in the West Wing hate him right now. You hear them say things like, I’m serving the country. That’s code for, I hate the fucker.” On the campaign, the former adviser said, “we all thought he was a moron. He’s by no means a stupid guy, but he was such a pain in the ass and stubborn.”

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ELECTORAL POLITICS

Justices Won’t Block Pennsylvania Gerrymandering Decision – The New York Times

The latest decision, from the Pennsylvania Supreme Court, struck down the state’s congressional map, saying it “clearly, plainly and palpably” violated the state’s Constitution. The court told state lawmakers to redraw the state’s 18 House districts, which currently favor Republicans, and it left open the possibility that it would impose its own map.

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BANKS, BROKERS, INSURANCE, EXCHANGES

Banks Shutter 1,700 Branches in Fastest Decline on Record – WSJ

Banks are closing branches at the fastest pace in decades, as they leave less profitable regions and fewer customers use tellers for routine transactions. The number of branches in the U.S. shrank by more than 1,700 in the 12 months ended in June 2017, the biggest decline on record, according to a Wall Street Journal analysis of federal data.

Fed Rebuke Costs Wells Fargo About $29 Billion in Lost Market Value – WSJ

Shares tumbled 9.2% on Monday amid a broader selloff in stock prices, as analysts ratcheted down earnings estimates for the third-largest U.S. bank by assets. The decline, its sharpest one-day drop since April 2009, was especially painful because the recently bright outlook for banks was also thrown into question Monday.

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SILICON VALLEY, UNICORNS, STARTUPS, VC

There’s Never Been More Money Pouring Into Mobility Startups – Bloomberg

The shift in technology that has drawn billions of dollars into autonomous driving has also spurred investors to pile into businesses that specialize in sharing cars, summoning rides, and even borrowing bikes. Taken together, this new model for the mobility-as-a-service business continues to grow at a startling pace and move into new markets.

18G06 - MOBILITY FUNDING

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CONSUMER TECH, SOCIAL MEDIA, E-COMMERCE, MOBILE

Facebook North America DAUs drop for first time – CNBC

The number of people in the U.S. and Canada who check Facebook every day dropped between the third and fourth quarter of 2017, the first such quarterly drop in company history. Facebook usage in North America has been largely flat for the last several years, leaving international growth to pick up the slack. But the drop suggests that Facebook usage has reached a saturation point in its first and most lucrative market, and could foretell similar usage drops around the world.

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MEDIA, CABLE, SPORTS, ENTERTAINMENT

Newsweek Guts Its Top Edit Staff Amid Legal Turmoil – Daily Beast

Newsweek on Monday fired all of its top staff amid turmoil that has upended the newsroom. Though the editors did not elaborate on why the top staff left the company, three staffers who spoke to The Daily Beast on the condition of anonymity pointed out that Li, Katz, Saul, and Keefe had all published pieces reporting on the company’s recent troubles.

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AUTOS, ELECTRIC, SELF-DRIVING

Elon Musk Says SpaceX’s New Falcon Heavy Rocket Unlikely to Carry Astronauts – WSJ

SpaceX chief Elon Musk said his company has essentially shelved plans to use its Falcon Heavy rocket to transport humans around the Moon or deeper into space, opting instead to focus on developing an even larger booster announced just last year.

SpaceX aims big in ever-evolving rocket environment

SpaceX, Elon Musk’s private space company, hopes to launch its Falcon Heavy rocket from Florida’s Kennedy Space Center on Tuesday. Made from three boosters of the Falcon 9 launch vehicle strapped together, it would be the biggest rocket to make it to space since the final launch of Nasa’s monster Saturn V in 1973.

SpaceX to launch Elon Musk’s Tesla roadster into space on Falcon Heavy rocket

The private space company, headed by Tesla CEO Musk, hopes to launch what it calls “the most powerful operational rocket” from Florida’s Kennedy Space Center on Tuesday. On the social media site Instagram, Musk posted an image of his car fixed to a part of the rocket with a dummy figure at the wheel.

Start of Waymo-Uber trial highlights vicious competition

The high-stakes trial between Waymo and Uber over self-driving cars kicked off on Monday in San Francisco, with new evidence showing that Uber believed the technology at the centre of the case was worth between $836m and $3.9bn. Opening statements highlighted the vicious competition between Uber and Waymo, a subsidiary of Alphabet, which both see autonomous taxi services as a core part of their future business.

Waymo Calls Uber a ‘Cheater’ as Driverless-Car Trial Begins – WSJ

Silicon Valley’s biggest legal battle in years began on Monday as lawyers from Alphabet Inc.’s Waymo and Uber Technologies Inc. traded barbs in a federal case that could have significant implications for the race to bring robot cars to the streets.

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SCIENCE, NATURE, PSYCHOLOGY

This Mutant Crayfish Clones Itself, and It’s Taking Over Europe – The New York Times

Before about 25 years ago, the species simply did not exist. A single drastic mutation in a single crayfish produced the marbled crayfish in an instant. The mutation made it possible for the creature to clone itself, and now it has spread across much of Europe and gained a toehold on other continents. In Madagascar, where it arrived about 2007, it now numbers in the millions and threatens native crayfish.

In Australia, Arsonists May Have Wings – The New York Times

The idea that birds intentionally manipulate fire has long been greeted with skepticism in scientific circles. But a recent paper published in Journal of Ethnobiology gathers reports that all three species do spread wildfires for hunting purposes. Raptors are already well known for “smart” hunting approaches, including following human vehicles that might flush prey to dropping stones on tough eggs, said Steve Debus, an adjunct lecturer at the University of New England in Armidale, Australia.

Scientists may have discovered the first planets outside the Milky Way – The Washington Post

Using data from a NASA X-ray laboratory in space, Xinyu Dai, an astrophysicist and professor at the University of Oklahoma, detected, for the first time ever, a population of planets beyond the Milky Way galaxy. The planets range in size from Earth’s moon to the massive Jupiter.

‘Extraordinary’ fossil sheds light on origins of spiders – BBC News

A fossil preserved in amber for 100 million years is shaking up ideas about the evolution of spiders. “We have known for a decade or so that spiders evolved from arachnids that had tails, more than 315 million years ago,” said Dr Russell Garwood of The University of Manchester, a co-researcher on the study. “We’ve not found fossils before that showed this, and so finding this now was a huge (but really fantastic) surprise.”

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