In The News Today

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Bill Holter’s Commentary

Economics in 5 minutes from Erik…sort of.

The World Will Return To A Golden Rule_001

The World Will Return To A Golden Rule_002

Bill Holter’s Commentary

“This is a perfect environment for gold to take center stage,” the letter said, as spot gold traded at about $1,741 an ounce. Fair value for the metal, the fund believes “is literally multiples of its current price.” Paul Singer

Exclusive: Hedge Fund Elliott Says Stocks Could Fall 50% From February Highs – Letter
April 16, 2020

BOSTON (Reuters) – Billionaire Paul Singer’s Elliott Management said global stocks could tumble further, ultimately losing half or more of their value from February’s high, as the world braces for the deepest recession since the 1930s-era Great Depression.

The New York-based hedge fund firm, in a letter to clients on Wednesday seen by Reuters, wrote that the sharp market decline seen between late February and late March “provided a heavy bookend to a dozen years of basically nonstop positive returns in global stocks, bonds and real estate.”

And the rout is likely not yet over.

“Our gut tells us that a 50% or deeper decline from the February top might be the ultimate path of global stock markets,” said Elliott, which controls $40.4 billion in assets and is closely watched for its views on markets and economics.

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Bill Holter’s Commentary

As per today’s subscription article…

Historic Oil Crash Sends Canadian Oil Prices Negative
April 20, 2020

When Goldman’s crude oil analysts turned apocalyptic last month, writing that “This Is The Largest Economic Shock Of Our Lifetimes”, they echoed something we said previously namely that the record surge in excess oil output amounting to a mindblowing 20 million barrels daily or roughly 20% of the daily market…

crude demand crashing

… the result of the historic crash in oil demand (estimated by Trafigura at 36mmb/d) which is so massive it steamrolled over last week’s OPEC+ 9.7mmb/d production cut, could send the price of landlocked crude oil negative: “this shock is extremely negative for oil prices and is sending landlocked crude prices into negative territory.”

We didn’t have long to wait, because while oil prices for virtually all grades have now collapsed below cash costs…

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Bill Holter’s Commentary

May crude is now NEGATIVE $7 per barrel! Can you imagine the margin calls…not to mention the OTC derivatives in all this? As I wrote in my earlier article, the “ripple” effects will be fascinating in a horrifying way! Negative oil I can understand because of the storage issue, negative interest rates not so much… (As of 11:21AM PST)