…The meeting was conducted in conditions hostile to transparency. It lacked a monitoring webcam. There were no pictures or recordings. One shareholder activist, the continuously plucky Stephen Mayne, daringly asked if there would be a transcript. “No,” fumed Alexander…
Wed, 09/02/2020 – 15:52A few months ago, we publishedan amusing account of how the Ken Griffin-owned HFT firm Citadel sicced its army of white-shoe lawyers on Zero Hedge after we dared to explain to our audience exactly why RobinHood – and now its discount brokerage predecessors, all of whom have followed RH’s lead and abandoned trading fees – can afford to charge its clients nothing: Because the company takes all of that retail order flow and auctions it off to the highest HFT bidder, enabling them to profit by – and we want to be very careful with our language here – “trading ahead of customer orders,” a practice otherwise known as “front-running”.
With so many mom-and-pop traders parlaying their stimulus checks and enhanced unemployment benefits in the stock market, our warnings were promptly ignored (hardly a surprise – nobody cares when things are going good).
But as the S&P 500 roars to yet another record high – accompanied this time by a disconcerting rebound in the VIX – WSJ reports that the SEC is almost ready to slap Robinhood with a $10 million fine for failing to disclose to its customers exactly how their order flow would be packaged and sold to the HFT firms.
…Hedge Funds Start Piling Into “The Big Short 3.0” Tyler Durden Fri, 08/28/2020 – 11:56 Back in June we said that as we had reported previously, with commercial real estate failing to benefit from the record rebound in overall risk since the March lows as a result of a tidal wave of retail bankruptcies, CMBX…
South Korea Extends Short-Selling Ban To 2021 As Volatility ‘Explosion’ Could Be Nearing Tyler Durden Thu, 08/27/2020 – 20:45 South Korea’s financial regulator on Thursday extended a ban on short-selling of listed shares for another six months, as COVID-19 cases jump to the highest level since the pandemic. The current ban on short-selling Korea Composite…
Tesla’s valuation seems a bit over the moon considering on Friday it closed for the second time over $2,000. With the stock at a whopping P/E ratio of 1,066 times earnings, Tesla sports a market cap of over 373 billion dollars. Those of us without a great love for Tesla or Elon Musk see this as the poster child of absurdity. By comparison, Volkswagen, which sold over 10 million vehicles last year has a market cap of $82 billion and auto giant Toyota around $218 billion. Simply put, Tesla’s market cap has risen 244% this year while the market cap of the industry, excluding Tesla, is down 17%.
Source – charleshughsmith.blogspot.com
– “…The masses are awakening to what insiders have known all along: Wall Street is nothing but a skimming machine for insiders, and this is generating a fulsome hatred of Wall Street, Big Tech monopolies and the billionaires who’ve added half a trillion dollars in wealth in the current stock market rally while the rest of America crumbles”
Two simple regulations would drive a stake through Wall Street’s corrupt, evil heart:
1. A substantial tax on every single transaction of any kind, whether
it’s on an exchange or off-exchange, and most importantly, whether the
bid for a transaction was executed or not. This would kill
high-frequency trading (HFT) and various other front-running games
(spoofing the system with bids that are withdrawn in milliseconds,
A transaction tax wouldn’t affect Mom-and-Pop investors or mutual
funds, as they trade infrequently. It would only kill the parasitic Wall
2. A ban or even limit on corporate share buybacks would kill the stock market’s primary engine of relentless insider gains: corporations
buying back their own shares to goose their stocks higher even as their
sales and profits stagnate. It’s estimated that up to 75% of all stock
market gains can be traced back to the hundreds of billions of dollars
corporations have borrowed to buy back their own shares.
… it has led to the value of US financial assets (Wall Street) now hitting an all time high 6.2X size of GDP (Main Street). In other words, not only is Wall Street now “even bigger to fail”, but in its attempt to “fix” inequality, the Fed has made it greater than ever,..
… In a sale which we are confident will be defended as just “selling for tax purposes” or “considering charitable giving” and certainly not “an admission that Amazon is overpriced”, Jeff Bezos took to the open market this week to dump a million shares of Amazon stock, worth just over $3 billion, company SEC filings revealed on Wednesday...
The 54.5 million shares that Bezos still owns are worth about $174 billion.
The only way to get top-dollar for one’s overvalued shares is to play distribution games: sell a little each day on the upticks, and buy back shares when they threaten to drop below the key support levels followed by trading algos.
When insiders have finished distributing their shares to naive and trusting bagholders at the top, then the price can flush lower with a velocity that shocks the complacent bagholders who saw only the inevitability of an endless rally rather than the inevitability of a collapse of bubble valuations.
Thu, 07/16/2020 – 09:12UBS’ head of global family offices told Reuters, the surge in equities from March to May netted significant returns for its wealthiest clients. Now they’re disposing of equities by locking in gains and moving money into “illiquid and private assets.”