Friday , December 13 2019
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Tag Archives: Companies & Markets

Financialization of the US Economy: Insurance & Finance Boom and Get Even Bigger

We can all just sue each other to boost GDP. By Wolf Richter for WOLF STREET. Services-producing industries – not including government services – dominate the US economy, amounting to the equivalent of 70% of overall GDP by value added, and to 80% of the private sector economy. As long as the services-producing industries grow enough, it’s tough for the US economy to fall into a recession. And in the third quarter, according to the Commerce Department’s Quarterly Selected Services...

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Is the Corporate-Debt Bubble Ripe Yet?

What does it mean when the Fed and other central banks jointly bemoan the effects of their own policies? Worried about not being able to keep all the plates spinning? This is the transcript from my podcast last Sunday, THE WOLF STREET REPORT: The Federal Reserve, the ECB, the individual central banks of Eurozone countries, such as the Bundesbank and the Bank of France, the central banks of negative-interest-rate countries outside the Eurozone, such as in Switzerland and Sweden, they’re...

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Accounting Fraud & Freight Recession Topple Celadon, Largest Truckload-Carrier Bankruptcy in US History

Creditors trying to repossess trucks over the weekend. Thousands of drivers on the road, some stranded. Employees left in the dark. Shares plunge 93% this morning from nearly nothing to practically nothing. By Wolf Richter for WOLF STREET. Celadon Group, one of the larger full-truckload operators in the US with about 3,000 drivers and about 2,700 tractors, said today – confirming days of rumors – that it filed for Chapter 11 bankruptcy and is ceasing operations. This is the largest...

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When Losses Don’t Matter: How Japanese Conglomerate Mitsubishi Blows Billions on a Jet Nobody Really Wants

On paper, this looked like a no-brainer. By MC01, a frequent commenter on WOLF STREET: At the 2007 Paris Air Show, Mitsubishi Heavy Industries announced to much fanfare a brand-new regional airliner. The fantastically named Mitsubishi Regional Jet (MRJ) was to be certified for commercial operations by 2012 and to set a number of firsts for the technologies employed in its construction, including an airframe made with over 80% in composites. The MRJ was the culmination of a ¥50 billion...

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Inflation Is Coming: All the Trends That Were Deflationary Are Slowly Going in Reverse

But of all potential economic outcomes, the one least anticipated and least priced in, is an uptick in inflation. By Harris “Kuppy” Kupperman, founder of Praetorian Capital, Adventures in Capitalism: Investing is all about probabilities. If the perceived odds of an event are high, certain securities will be priced based on those expected probabilities. The corollary is that when an event is perceived as almost impossible, securities do not price in any chance of it occurring. If that...

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Trucking “Thrives on Stability, But We’re Now on a Rocky Road”

Orders for heavy trucks re-plunged, after false bounce off the bottom. This was not supposed to happen. November was supposed to be the second month in what would be the upturn from the historic collapse in 2019 for orders of heavy trucks. Orders in 2019 had plunged by as much as 80% from a year earlier. That collapse in orders followed a historic boom in orders in 2018. But in October, orders had bounced, and though still down by 48% from a year earlier, it was a big move. So November...

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Over-Indebted European Telecom Giant Tries to Dump its Latin American Empire

Telefonica, with operations in Venezuela, Argentina, Chile, Peru, Ecuador, Colombia, and Mexico, is on the verge of “junk,” and the ECB holds some of its debt.  By Nick Corbishley, for WOLF STREET: Telefonica, the telecommunications and internet giant headquartered in Spain and with operations in numerous countries and burdened by enormous debts, has announced plans to stage a historic retreat from one of its core markets, Latin America, in a bid to generate much-needed funds. Like...

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After Years of Threats, Schwab Joins Exodus, to Move Headquarters from San Francisco to Texas

It has been shrinking its way out of the City for years. And it’s not the first major company to make the move. By Wolf Richter for WOLF STREET. “As we’ve said previously, our strategy is to maintain our headquarters in San Francisco, where the firm was founded,” said a Charles Schwab spokeswoman in December 2016. The company had threatened to leave San Francisco in an arm-twist tactic with its landlord as its office lease was coming up for renewal. It worked apparently, and Schwab...

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Fracking Blows Up Investors Again: Phase 2 of the Great American Shale Oil & Gas Bust

Including billionaires who thought they’d picked the bottom in 2016. By Wolf Richter for WOLF STREET. In 2019 through third quarter, 32 oil and gas drillers have filed for bankruptcy, according to Haynes and Boone. Since the end of September, a gaggle of other oil and gas drillers have filed for bankruptcy, including last Monday, natural gas producer Approach Resources. This pushed the total number of bankruptcy filings of oil and gas drillers since the beginning of 2015 to over 200....

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Chinese Stock Collapses 98% in Hours After MSCI Flip-Flops: How Index Providers Saddle US Pension Funds with Stock Scams

Despite my assurances that “Nothing Goes to Heck in a Straight Line,” a Chinese stock just did. I’m infamous for saying that “Nothing Goes to Heck in a Straight Line.” This piece of immortal wisdom even made it onto our official beer and iced-tea mugs. But today, I was proven wrong. A Chinese stock just went to heck in a straight line. ArtGo Holdings, a Chinese company that mainly quarries marble and processes it into blocks and polished slab and that has recently been trying to expand...

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