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Hedgeye Names The Most Interesting Investor In The World CEO; McCullough To Become Chairman Emeritus

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SOURCE Hedgeye Risk Management

NEW HAVEN, Conn., April 1 /PRNewswire/ -- Hedgeye Risk Management, a leading independent provider of real-time investment research and ideas, today announced that The Most Interesting Investor in the World has joined the firm as CEO effective immediately.

Keith McCullough, Founder and retiring CEO of Hedgeye notes, "I’m thrilled to have The Most Interesting Investor in the World accept our offer to become CEO of Hedgeye Risk Management.  He has decades of experiences across markets, and he is really the only person in the world I could envision taking over the helm at Hedgeye as I pursue my lifelong goal of playing in the National Hockey League.”

The Most Interesting Investor in The World has over 50 years experience trading global markets. His vast business experience includes: passing his entire CFA in six months; discovering the Tupi Oil Field in Brazil; teaching Henry Kravis about leverage; advising the Federal Reserve on the creation of Maiden Lane I and II; and managing Warren Buffett’s personal account.

A brief video providing the background of The Most Interesting Investor in the World can be found here:
 

http://www.youtube.com/user/hedgeye#p/u/5/z0ZwtSaAlR8 (copy and paste the link into your browser if it doesn't open)


Daryl “Big Alberta” Jones, Managing Director, adds, “This is clearly an inflection point in the growth of Hedgeye Risk Management, as our competitor, Goldman Sachs, was purportedly interviewing The Most Interesting Investor in the World to succeed Lloyd Blankfein who is rumored to be moving on to replace Timothy Geithner at the Treasury Department.”

According to The Most Interesting Investor in The World, “In fact, I share many beliefs with my new partners at Hedgeye, but most important it is our common view of Keynesian Economics.  In one word: No.  While replacing retiring CEO Keith McCullough will be no easy task, I, too, will wake up at 4:00 a.m. to manage risk for Hedgeye’s subscribers.”

In addition to his new role as CEO, The Most Interesting Investor in the World will also be recommending Dos Equis for Hedgeye’s annual summer picnic.

ABOUT HEDGEYE RISK MANAGEMENT
Hedgeye Risk Management is an online financial media and research company that operates as a virtual hedge fund.  Focused exclusively on generating and delivering actionable investment ideas, the firm combines quantitative, bottom-up and macro analysis with an emphasis on timing. The Hedgeye team features some of the world's most regarded research analysts – united around a vision of independent and un-compromised real-time investment research accessible to all market participants.  Visit www.hedgeye.com <http://www.hedgeye.com>  <http://www.hedgeye.com> for more information.


TALES OF THE TAPE: KKD, SBUX, BWLD, MSSR

Notable news items and price action from the last twenty-four hours

  • KKD shares gained on accelerating volume but fell in after-hours on the back of weaker-than-expected earnings.
  • SBUX Managing Director for the U.K. and Ireland, Darcy Willson-Rymer, spoke at a conference in London today and stated that he expects coffee supplies to expand over the next three years.
  • U.S. consumer discretionary was cut to Neutral at J.P. Morgan, citing a downturn in economic momentum and consumer discretionary relative P/S (vs S&P 500) at 15-year high pointing to diminished risk/reward.
  • BWLD and MSSR declined on accelerating volume.

 

TALES OF THE TAPE: KKD, SBUX, BWLD, MSSR - stocks 41

 

Howard Penney

Managing Director


THE M3: NEW MONTHLY GGR RECORD; HO SISTER BRAWL; CHINA PROPERTY PRICES; LANDMARK MGMT

The Macau Metro Monitor, April 1, 2011

 

MONTHLY GROSS REVENUE FROM GAMES OF FORTUNE DICJ

March GGR was MOP20.09BN (HK$19.5BN, US$2.5BN), up 48% YoY.


BRAWL BETWEEN STANLEY HO AND SISTER GOES ON macaubusiness.com

The brawl between Stanley Ho and his sister Winnie Ho Yuen Ki continued as Ms Ho’s representatives were once again barred from attending STDM's annual general meeting.  The two has been in a dispute with Ms. Ho accusing her brother of trying to oust her as a shareholder, after the shareholder registry book of the company was allegedly lost in 2001.


Ms Ho’s representatives said they were also denied access to STDM documents and are now considering to go to the courts again. They allege that STDM has not been paying Ms Ho its part of the company’s annual dividend.  SJM had approved a total dividend of HK$2.8 billion.

 

CHINA MARCH RESIDENTIAL PROPERTY PRICES UP 0.59% VS FEBRUARY WSJ

According to China Real Estate Index System, residential property prices in 100 major cities in China rose 0.59% MoM in March, faster than February's 0.48% sequential change.

 

LANDMARK MANAGEMENT GETS HK$1.8 BILLION IN LOAN Macau Daily News

New Macau Landmark gets loan to revamp the Landmark Macau and invest in Macau Fisherman’s Wharf. The project includes turning the Landmark Macau into a characteristic hotel that brings in new elements to tourism, gaming entertainment, hotel and retail industries in the area.


Daily Trading Ranges

20 Proprietary Risk Ranges

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The Winds of Change

This note was originally published April 01, 2011 at 08:15 in  

“There is nothing wrong with change, if it is in the right direction.”

-Winston Churchill

 

We are starting today’s Early Look on a more administrative note.  Our Founder and CEO Keith McCullough will be retiring as CEO of Hedgeye effective today, and going forward will be Chairman Emeritus of Hedgeye.   Keith’s decision was motivated by a desire to spend more time with his family and to pursue some long standing personal interests.  Later this morning, we will be announcing our new CEO, someone who we think will be able to rightfully build and grow on Keith’s legacy.  We wish you the best Keith! (If you would like to send Keith a personal note, you can email sales@hedgeye.com and we will forward it to him.)

 

With that, we’ll now turn back to the daily morning macro grind.  

 

Continuing on the theme of change, we want to highlight three key areas of risk management change that have been percolating over the last few weeks:

 

1.  TRADE Duration Change – 3 Weeks or Less – A key investment theme over the past two years, and really since the inception of the U.S. government’s weak dollar policy, has been the high negative correlation between the U.S. dollar and both U.S. equities and global commodities.  As we noted earlier this week in an Early Look, this has changed on a shorter duration.  In fact, currently the 3-week correlation between the USD and SP500 is +0.29.  So, while it is not strongly positive, it is positive and this is new.  We’ve long submitted that a stronger USD is ultimately positive for the U.S. economy and stock market and, on the margin, we are starting to see this reflected in market prices.  As you manage risk in your portfolios in the coming weeks, this is an inflection point of change to keep front and center.

 

2.  TREND Duration Change – 3 Months or More – Over the course of the last eight weeks, we’ve witnessed an extreme acceleration and deceleration in volatility (as measured by the VIX), which has been reflected in the price movements of U.S. stocks.   While the market has recovered from its March lows, the risks of The Inflation, sovereign debt, and interconnected global risk remain.  The obvious next potential negative catalyst is potentially earnings season in the United States, which will begin in fervor in mid-to- late April, where we will potentially see the impact of The Inflation tax on both consumer demand and corporate earnings. 

 

In the Chart of the Day, attached below, we’ve shown the volatility in the U.S. stock market from February 18th to the close yesterday.  In effect, we had a more than 10% move, which was 5%+ down and then 5%+ up.  At the same time, volatility in stock market prices, as measured by the VIX, had a comparable move up and then down.  While the last couple of quarters saw a steady climb in the stock market, beginning with the catalyst of The Bernank’s announcement of The Quantitative Easing Part Deux in Jackson Hole, the last 6+ weeks seems to be a new paradigm of price volatility both up AND down.

 

3.  TAIL Duration Change – 3 Years or Less – A longer term theme, or risk, that has developed over the course of the last month is accelerating geopolitical uncertainty in the Middle East and North Africa.  In early January, this all began with the Jasmine Revolution in Tunisia, which, at the time, was perceived to be limited in scope.  Since then civil unrest has spread throughout the MENA region and the threat of regime change is becoming the norm.  While some regime changes have been largely peaceful, like in Egypt, others have been much more violent, like Libya.  As the Obama administration continues to evolve their foreign policy strategy real time, these outcomes will remain largely uncertain. 

 

We wrote a note to our Macro subscribers earlier this week titled “Obama’s Foreign Policy . . . Bush Doctrine Take Two”, which compared Obama’s preemption, as he articulated in his speech earlier this week with the expression “refusing to wait”, to the Bush Doctrine, whose primary objective was to preempt threats.  As the Obama strategy continues to evolve, it is likely increasingly difficult that he can both “refuse to wait” in humanitarian interventionist situations, but also abide by his promise of “no boots on the ground”.  In any event, despite early gains by the Libyan rebels, Gadafi’s forces appear to be taking ground back, which suggests the Libyan conflict will continue much longer than was expected after the initial NATO intervention.  Oil, which is hitting a 30-month high this morning, implies as much and is also signaling that future stability in the Middle East is far from certain.

 

As we analyze the changes highlighted above that we have seen over the last few months and contemplate how to utilize them in making future investment decisions, it certainly seems that this is not change “in the right direction”.  This is true in that heightened price volatility and increasing geopolitical uncertainty are not positive.  That said, as it relates to future monetary and fiscal policy in the U.S., the positive correlation between a strong USD and equity prices is a positive change and hopefully a signal that The Bernank will heed accordingly. 

 

On the U.S. dollar front, our view, unlike perhaps the Obama foreign policy, has been quite clear and consistent. As Winston Churchill also said:

 

“When you have an important point to make, don't try to be subtle or clever. Use a pile driver. Hit the point once. Then come back and hit it again. Then hit it a third time - a tremendous whack.”

 

Best of luck out there today.

 

Keep your head up and stick on the ice,

 

Daryl G. Jones

Managing Director

 

The Winds of Change - Chart of the Day

 

The Winds of Change - Virtual Portfolio


The Winds of Change

“There is nothing wrong with change, if it is in the right direction.”

-Winston Churchill

 

We are starting today’s Early Look on a more administrative note.  Our Founder and CEO Keith McCullough will be retiring as CEO of Hedgeye effective today, and going forward will be Chairman Emeritus of Hedgeye.   Keith’s decision was motivated by a desire to spend more time with his family and to pursue some long standing personal interests.  Later this morning, we will be announcing our new CEO, someone who we think will be able to rightfully build and grow on Keith’s legacy.  We wish you the best Keith! (If you would like to send Keith a personal note, you can email and we will forward it to him.)

 

With that, we’ll now turn back to the daily morning macro grind.  

 

Continuing on the theme of change, we want to highlight three key areas of risk management change that have been percolating over the last few weeks:

 

1.  TRADE Duration Change – 3 Weeks or Less – A key investment theme over the past two years, and really since the inception of the U.S. government’s weak dollar policy, has been the high negative correlation between the U.S. dollar and both U.S. equities and global commodities.  As we noted earlier this week in an Early Look, this has changed on a shorter duration.  In fact, currently the 3-week correlation between the USD and SP500 is +0.29.  So, while it is not strongly positive, it is positive and this is new.  We’ve long submitted that a stronger USD is ultimately positive for the U.S. economy and stock market and, on the margin, we are starting to see this reflected in market prices.  As you manage risk in your portfolios in the coming weeks, this is an inflection point of change to keep front and center.

 

2.  TREND Duration Change – 3 Months or More – Over the course of the last eight weeks, we’ve witnessed an extreme acceleration and deceleration in volatility (as measured by the VIX), which has been reflected in the price movements of U.S. stocks.   While the market has recovered from its March lows, the risks of The Inflation, sovereign debt, and interconnected global risk remain.  The obvious next potential negative catalyst is potentially earnings season in the United States, which will begin in fervor in mid-to- late April, where we will potentially see the impact of The Inflation tax on both consumer demand and corporate earnings. 

 

In the Chart of the Day, attached below, we’ve shown the volatility in the U.S. stock market from February 18th to the close yesterday.  In effect, we had a more than 10% move, which was 5%+ down and then 5%+ up.  At the same time, volatility in stock market prices, as measured by the VIX, had a comparable move up and then down.  While the last couple of quarters saw a steady climb in the stock market, beginning with the catalyst of The Bernank’s announcement of The Quantitative Easing Part Deux in Jackson Hole, the last 6+ weeks seems to be a new paradigm of price volatility both up AND down.

 

3.  TAIL Duration Change – 3 Years or Less – A longer term theme, or risk, that has developed over the course of the last month is accelerating geopolitical uncertainty in the Middle East and North Africa.  In early January, this all began with the Jasmine Revolution in Tunisia, which, at the time, was perceived to be limited in scope.  Since then civil unrest has spread throughout the MENA region and the threat of regime change is becoming the norm.  While some regime changes have been largely peaceful, like in Egypt, others have been much more violent, like Libya.  As the Obama administration continues to evolve their foreign policy strategy real time, these outcomes will remain largely uncertain. 

 

We wrote a note to our Macro subscribers earlier this week titled “Obama’s Foreign Policy . . . Bush Doctrine Take Two”, which compared Obama’s preemption, as he articulated in his speech earlier this week with the expression “refusing to wait”, to the Bush Doctrine, whose primary objective was to preempt threats.  As the Obama strategy continues to evolve, it is likely increasingly difficult that he can both “refuse to wait” in humanitarian interventionist situations, but also abide by his promise of “no boots on the ground”.  In any event, despite early gains by the Libyan rebels, Gadafi’s forces appear to be taking ground back, which suggests the Libyan conflict will continue much longer than was expected after the initial NATO intervention.  Oil, which is hitting a 30-month high this morning, implies as much and is also signaling that future stability in the Middle East is far from certain.

 

As we analyze the changes highlighted above that we have seen over the last few months and contemplate how to utilize them in making future investment decisions, it certainly seems that this is not change “in the right direction”.  This is true in that heightened price volatility and increasing geopolitical uncertainty are not positive.  That said, as it relates to future monetary and fiscal policy in the U.S., the positive correlation between a strong USD and equity prices is a positive change and hopefully a signal that The Bernank will heed accordingly. 

 

On the U.S. dollar front, our view, unlike perhaps the Obama foreign policy, has been quite clear and consistent. As Winston Churchill also said:

 

“When you have an important point to make, don't try to be subtle or clever. Use a pile driver. Hit the point once. Then come back and hit it again. Then hit it a third time - a tremendous whack.”

 

Best of luck out there today.

 

Keep your head up and stick on the ice,

 

Daryl G. Jones

Managing Director

 

The Winds of Change - Chart of the Day

 

The Winds of Change - Virtual Portfolio



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