THE MACAU METRO MONITOR, NOVEMBER 4, 2013
SJM EXPANDS SHARE OF GAMING MARKET LAST MONTH Macau Business
SJM Holdings Ltd extended its lead in the gaming market last month. SJM Holdings had 26% GGR share and Galaxy had 21% share. Sands China fell to third place after its share shrank by two % points to 20%.
OKADA'S UNIVERSAL SELLS PART OF MANILA BAY PROJECT Macau Business
Kazuo Okada’s Universal Entertainment Corp has signed a deal with a Philippine developer that appears to be meant to calm a legal storm over a US$2-billion (MOP16 billion) gaming project in Manila.
Century Properties Group Inc signed a deal to develop 5 hectares of a 44-hectare site earmarked for an entertainment and gaming project. It also acquired a 26% interest in the Universal subsidiary that controls the Manila land. Universal’s move appears to be meant to undermine allegations that it broke Philippine law by setting up dummy companies to get around a rule that limits foreign ownership of land to 40%.
In a separate deal, Universal sold another parcel of shares in its Philippine subsidiary to First Paramount Holdings 888 Inc.
The combined effect of both deals means 60% of the project is in Filipino hands, Universal said.
TODAY’S S&P 500 SET-UP – November 4, 2013
As we look at today's setup for the S&P 500, the range is 16 points or 0.38% downside to 1755 and 0.53% upside to 1771.
CREDIT/ECONOMIC MARKET LOOK:
MACRO DATA POINTS (Bloomberg Estimates):
WHAT TO WATCH:
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
The Hedgeye Macro Team
Hedgeye CEO Keith McCullough handpicks the “best of the best” long and short ideas delivered to him by our team of over 30 research analysts across myriad sectors.
This note was originally published at 8am on October 21, 2013 for Hedgeye subscribers.
“Ideas are incapable of confinement or exclusive appropriation.”
One of the biggest push-backs I’ve been getting from both US stock market bulls and bears throughout the 2nd half of 2013 is one and the same – “I can’t buy that up here – I missed the move.” And my response continues to be that Mr. Market doesn’t care about what you did or did not miss. The market’s price is both dynamic and non-linear. As Jesse Pinkman would say, ‘it’s evolution, yo.’
Pinkman is not Jefferson. The aforementioned quote comes from a great book on the evolution of entropy economics that I’m still reviewing: George Gilder’s Knowledge And Power. If you are a growth investor (and/or you just want to be long growth as a Style Factor right now), read Chapter 10: “Romer’s Recipes and Their Limits” (Paul, not that raging Keynesian, Christina Romer).
“Still, change keeps coming, fueled by technology, as Romer’s 1990 paper reminded the economics fraternity. As productivity grows, technology keeps freeing people. And this … really is, in some sense, the scarcest commodity: the power of the human intellect.” (Knowledge and Power, page 96)
Back to the Global Macro Grind…
BREAKING: the Global Macro call of 2013 is basically baked into the cake. You were either long growth, or you were not. With the Russell 2000 closing at another all-time high on Friday (1114 = +31.2% YTD), long virtually anything growth has absolutely pulverized the #EOW (end of the world) “new normal” thing (Gold, Bonds, Utilities, etc.).
In terms of 2013 US Equity Market Style Factors, here’s how awesome growth, as a style, looks at the all-time highs:
To be clear, growth (as an investing style) can be very frustrating to A) embrace and B) capitalize upon. I think the reasons for that are bountiful (it’s called a cycle), but here are three big ones:
That last one is really tough for people to swallow, primarily because there are just so many people managing money these days. How many people do you know short stocks because they’re “expensive”?
I’d argue that part of Carl Icahn’s resurgence as an activist has a lot to do with being mucho long Style Factors 4 and 5 (HIGH BETA + HIGH SHORT INTEREST). With what was working locked into his sights, all he needed was Bill Ackman pumping those factors live @CNBC.
How many investors break the market down by Style Factors?
I’d say a lot fewer than you might think. And, to a degree, this makes Institutional Investing a lot like Moneyball was before Billy Beane did Moneyball. In the end, a chubby 1st baseman with a high on base % beats a pretty boy “highly concentrated” activist long ball hitter.
So what if my writing this note top-ticks growth vs. slow growth for 2013?
This is why the 1994 Global Macro Market metaphor (bond market blew up) really matters to me. As you can see in the Chart of The Day:
How many investors are positioned for 2013 being 1993? How about 1995?
I don’t know if this is the top of growth investing. If it is, it ends with the Twitter IPO. But I do know that The Scarcest Commodity out there right now is being a raging growth bull. And that’s all I have to say about that.
Our immediate-term Global Macro Risk Ranges are now:
UST 10yr Yield 2.58-2.69%
Best of luck out there today,
Keith R. McCullough
Chief Executive Officer
Solid and in-line quarter but should've been better. VIP volumes were huge but were offset by lower Mass/Slot (not surprising) and higher fixed costs (surprising) which had been trending lower.
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