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The Macro Show Replay | January 15, 2016


Fact Or Fiction? Stocks Headed For A Crash

Takeaway: If you're into Old Wall fiction close this post right now.

Fact Or Fiction? Stocks Headed For A Crash - Bubble bear cartoon 09.26.2014  1


Still with us? Okay. Here's the (unfortunate) painful reality for investors who were long U.S. equities heading into 2016. (Note: We've been avoiding equities, net short, since last July.) 


It's a sea of red. 



Despite today's bounce, remember that market conviction and bearish sentiment continues to grow...



Where do U.S. equities go from here?




Click the Image below to enlarge and Understand why...

Fact Or Fiction? Stocks Headed For A Crash - EL profits



That's all from us.

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HedgeyeRetail (1/14) | NKE App Exclusives, Holiday Comps

Takeaway: Nike using SNKRS app for exclusive shoe offerings. Holiday comps slow 250bps from 2014.

NKE - Nike's newest release, the Nike Air Pressure 'OG', will be available exclusively via the Nike SNKRS app at $300


Between Brand Jordan and Nike, NKE Inc. has 10 releases on the radar for this weekend. But, the most exclusive and highest priced item can only be found on the Nike SNKR app. This is relatively new for Nike, which sold its first shoe exclusively on the Nike SNKR app on 10/31/15. This marks number 2. It makes sense that Nike would slowly test and build the exclusive sneaker release on its own platform. Which is why we see the majority of releases in conjunction with partners. But over time, as Nike builds its ecomm business from $1.2bn to $10bn by 2020, expect to see more exclusive Nike only releases. We have already seen this in the running category where Nike holds its best merch/colorways for its own stores and website. The kicker here over the near term is that everything a consumer could buy at FL, FINL, DKS, HIBB etc. is also featured prominently on nike.com.

HedgeyeRetail (1/14)  |  NKE App Exclusives, Holiday Comps - 1 14 2016 chart1



Holiday Sales Comps Down 250bps From 2014


Of the 27 retailers/concepts that have reported Holiday sales comps to date 15 have reported a sequential deceleration in the 1yr trend at an average of 7.3%, with 11 posting accelerations at an average rate of 3.3%. On a 2yr basis its more mixed with 1 being flat, 12 posting sequential improvement, and 13 posting a sequential deceleration. In total the average comp for the group is 0.3% down from 2.8% in 2014.


As we look forward to 2016, the Street’s numbers are banking on a recovery in growth and margin starting in 1Q. In other words, it’s chalking up this ‘thing’ retailers are feeling now as exactly what management teams want us all to believe – while they cross their fingers, hope and pray that the economy is not really slowing.  YTD, the XRT has marginally underperformed the broader market by 100bps. But, it’s trading at 16x earnings, and has short interest that is disproportionately low for an economy that is #LateCycle. We’re net sellers of Retail.

HedgeyeRetail (1/14)  |  NKE App Exclusives, Holiday Comps - 1 14 2016 chart2E

HedgeyeRetail (1/14)  |  NKE App Exclusives, Holiday Comps - 1 14 2016 chart3


ETSY, AMZN - Amazon and Etsy Gain in Search Exposure, eBay Tumbles


HedgeyeRetail (1/14)  |  NKE App Exclusives, Holiday Comps - 1 14 2016 chart5


NKE - Kevin Hart Reveals His Nike Signature Shoe on the Tonight Show, to be released in April

Note: Kevin Hart has 24.7mm twitter followers, Kanye West has 17.1mm



W - Wayfair.com Launches One-Stop Flooring Shop



NKE - Group of Nike Factory Workers Caught Stealing Thousand of Shoes  in Vietnam



DKS - Dick’s is partnering with predictive analytics solutions provider First Insight to get insight into merchandise



GPRO - After a disappointing holiday season, GoPro announces that it will cut 7% of its workforce



AMZN - Amazon is opening an AWS region in Montreal, Québec, Canada in the coming year



NKE, AdiBok - After turning down a pay increase and extension from Adidas, John Wall could be joining Nike and Team LeBron 



Following Ed Crenshaw's retirement announcement on Wednesday, Publix announces that current company President will become president and CEO



VSI - David Edwab, the Vitamin Shoppe's lead director since April 2011, has stepped down



Sheetz investing more than $15mm to raise employee wages between 5-10% without cutting hours


Why Old Wall's Credibility Is Crashing Faster Than The Russell 2000

Takeaway: The Russell 2000 is down -22% since its all-time bubble high in July. Wall Street Consensus credibility is down considerably more.

Why Old Wall's Credibility Is Crashing Faster Than The Russell 2000 - RussHELL cartoon 01.13.2016


REALITY CHECK: Old Wall perma-bulls flat-out missed the crash in the Russell 2000. We didn't. We warned you about this precarious setup back in July. 


Why Old Wall's Credibility Is Crashing Faster Than The Russell 2000 - rut index


"Isn’t it ironic, but not surprising, that the “U.S. is the best house in a bad hood” thesis has crashed too," Hedgeye CEO Keith McCullough wrote in a note to subscribers this morning. "The Russell 2000 is now down -22% (crash mode) from its July 2015 #Bubble high as U.S. domestic growth expectations move toward a #Recession."


You won't hear most people on Old Wall talking about the DAX this morning. Probably because that's crashing too.



Here's McCullough on the evolving Old Wall storytelling on Europe:


"Right back into crash mode goes the over-owned “this time is different” in Europe theme. The DAX is down -2% this morning and down -21.1% since the April 2015 top. ECB President Mario Draghi is going to have to defend this with Down Euro = Up Dollar = #Deflation."


As for us (and our subscribers) we'll stick with our repeatable risk management process. If you're interested in joining us click here to learn more. 

7 Key Economic Talking Points For Serious Contenders at Tonight's #GOPDebate

Takeaway: Obama argues anyone saying the US economy is in decline is "peddling fiction." We take the other side of that trade. Truth is on our side.

7 Key Economic Talking Points For Serious Contenders at Tonight's #GOPDebate - z fbn gop debate


In his final State of the Union address, President Barack Obama told the nation that anyone "claiming that America's economy is in decline is peddling fiction."




We're not in the business of "peddling fiction" here at Hedgeye. On the contrary. Our non-consensus macro team's granular 73-page slide deck released earlier this month shines the spotlight of truth on the current economic reality and outlines our current U.S. Recession call.


Let's be clear. Obama's rosy economic picture is false. This isn't a partisan, Republican or Democrat perspective, it's simply an honest appraisal of what's going on out there right now.


On a related note, GOP contenders have plenty of "non-fiction" to refute Obama's clams at tonight's Fox Business GOP Debate. Here are some key talking points any serious contender should consider ahead of the debate courtesy of our outspoken, reality-based CEO Keith McCullough.


point #1

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Fiction? More like reality...

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