prev

This Week In Hedgeye Cartoons

Our cartoonist Bob Rich captures the tenor on Wall Street every weekday in Hedgeye's widely-acclaimed Cartoon of the Day. Below are his five latest cartoons. We hope you enjoy his humor and wit as filtered through Hedgeye's market insights. (Click here to receive our daily cartoon for free.)

 

Enjoy!

 

1. Just Believe (4/22/2016)

This Week In Hedgeye Cartoons - central bank cartoon 04.22.2016

 

Central banker credibility is slowly waning.

   

2. A Closer Look At NIRP (4/21/2016)

This Week In Hedgeye Cartoons - negative interest rate cartoon 04.21.2016

 

BOJ governor Haruhiko Kuroda has been defending the central bank's negative interest rate policy recently, even stressing his readiness to expand monetary policy still further. "Good luck with that," Hedgeye CEO Keith McCullough wrote recently. "These guys just don't get it. The #BeliefSystem is breaking down."

 

3. Painting Themselves Into A Corner (4/20/2016)

This Week In Hedgeye Cartoons - Central bankers in corner cartoon 04.20.2016

 

The #BeliefSystem that central planners can arrest economic gravity is breaking down.

 

4. A Holy Mess (4/19/2016)

This Week In Hedgeye Cartoons - Brazil cartoon 04.19.2016

 

Amid the impeachment process of Brazilian President Rouseff, Brazil's Bovespa Index is up +39.4% over the past 3 months. Setting aside widespread corruption in the country, Hedgeye Senior Macro analyst Darius Dale had this to say about Brazil in this morning's Early Look, "We think Brazilian capital and currency markets are priced to perfection and anticipate another flush down alongside other reflation assets over the intermediate term."

 

5. No Oil Freeze (4/18/2016)

This Week In Hedgeye Cartoons - OPEC cartoon 04.18.2016

 

On Friday, Hedgeye colleague and Potomac Research Group Senior Energy analyst Joe McMonigle wrote, "We believe there is no chance Saudi Arabia reverses its position and agrees to freeze production on Sunday," after Iran announced it would skip the much-hyped oil "freeze" meeting in Doha. That proved prescient. Over the weekend, OPEC members, including Saudi Arabia, and non-OPEC countries, like Russia, failed to reach an agreement to freeze oil production.


The Week Ahead

The Economic Data calendar for the week of the 25th of April through the 29th of April is full of critical releases and events. Here is a snapshot of some of the headline numbers that we will be focused on.

 

CLICK IMAGE TO ENLARGE.

The Week Ahead - 04.22.16 Week Ahead


About Everything | The Golden Age of Home Improvement

 

In this complimentary edition of About Everything, renowned demographer and Hedgeye Sector Head Neil Howe explores why consumer spending on home improvement is outstripping GDP growth and the key demographic trends behind this shift.

 

For more, click here to read the associated About Everything writeup.


Hedgeye Statistics

The total percentage of successful long and short trading signals since the inception of Real-Time Alerts in August of 2008.

  • LONG SIGNALS 80.64%
  • SHORT SIGNALS 78.61%

Cartoon of the Day: Just Believe

Cartoon of the Day: Just Believe - central bank cartoon 04.22.2016

 

Central banker credibility is slowly waning.


Under 60 Seconds: Starbucks Earnings Report | $SBUX

Hedgeye Restaurants analyst Howard Penney highlights three key points from Starbucks’ lackluster earnings report. Earlier this month, Penney advised our subscribers to short the stock.


Here's Why You Stay Short Junk Bonds

Here's Why You Stay Short Junk Bonds - junk pile

 

It's the #CreditCycle.

 

Despite the recent rally, we're holding the line on our short Junk Bonds (JNK) call. Here's analysis and a chart via our Macro team from a note sent to subscribers earlier this morning:

 

"Junk bonds have rallied +3% in the YTD, inclusive of a +6% squeeze over the past 3M alone. Option adjusted spreads continue to narrow dramatically, compressing -30bps in the past week alone to 586bps wide. This is down from a peak of 839bps on February 11th.

 

Is the trough of the domestic credit cycle in the rear-view mirror, leaving us holding the bag on a stale thesis? Not at all. Our work has shown that once the horse leaves the barn on the domestic credit cycle, there is no recovery until HY spreads are north of 1,000bps and corporations have sufficiently delivered their balance sheets – neither of which has occurred."

 

Click on the chart below to enlarge. Note: We think we're headed for a nice, big red dot (a.k.a. a blowout in high-yield credit spreads).

 

Here's Why You Stay Short Junk Bonds -  CreditCycle Bubble Chart DD

 

More on the credit cycle...

 

According to Standard & Poor's, there were 5 more corporate defaults this week, bringing the grand total to 51 year-to-date. FYI, that's the most since 2009.

 

Here's Why You Stay Short Junk Bonds - defaults

 

There you have it...

 

We're sticking with our short Junk (JNK) call.


Early Look

daily macro intelligence

Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

next