Macro Meets Micro: Behind The Bursting Biotech Bubble

In this excerpt from The Macro Show earlier today, Hedgeye CEO Keith McCullough and Healthcare analyst Andrew Freedman discuss the macro and micro fundamentals behind the bursting biotech bubble.


Subscribe to The Macro Show today for access to this and all other episodes. 


Subscribe to Hedgeye on YouTube for all of our free video content.

Around The World In 5 Charts

Takeaway: "No need and no possibility for helicopter money," BOJ's Kuroda told BBC. Add in the ECB presser today, central planning nonsense abounds.

Around The World In 5 Charts - World Market No 12.16.14 large large 


As the hopes and whims of investors swing wildly through markets, these delusions become increasingly disconnected from economic reality. 


A case study in delusion: Japan. "No need and no possibility for helicopter money," BOJ head Haruhiko Kuroda said in a BBC Radio 4 program that was broadcast Thursday. “At this moment, the Bank of Japan has three options with quantitative and qualitative easing with negative interest rates."


The Yen jumped 1.1% on the news. Now the WSJ reports this broadcast was recorded in June and FX markets backed off.


This is all getting rather silly...


We reiterate today that the supposed catalyst "helicopter money or bust" is not a risk management process. Here's analysis from Hedgeye CEO Keith McCullough in a note sent to subscribers earlier today: 


"Heli-Ben money hits a wall with Kuroda saying “no need or possibility for helicopter money” – doesn’t that suck. Reiterating short Nikkei as the Yen just popped +1.1% on that after failing to break-down through 108 vs. No support for Nikkei to 14,993."


While We're on Central planning nonsense...


ECB head Mario Draghi kept rates on hold today but had a number of innocuous things to say about the Euro-area economy, like this gem:


"Headwinds to economic recovery in euro area include outcome of UK referendum and other geopolitical uncertainties."


And then Draghi suggested that a "public backstop" would be "very useful" to help struggling European banks. Furthermore, Draghi added that the bad debts in Italy’s banking sector are a “very big problem.” Italian bank UniCredit popped 4% on the news (after falling more than -60% in the past year) along with other bank related stocks pushing the FTSE MIB index up marginally today. 


Around The World In 5 Charts - Italian bank cartoon


McCullough dissects the latest out of Europe:


"Protracted recession pending in Europe? What’s the catalyst to get Italy, France, etc. out of one? Reiterating the short call on both European Equities (Germany, Spain, and Italy… in that order) and the Euro vs. USD (Italian stocks haven’t joined the helicopter party, -0.3% this am and -30% vs. where you could have bought them at this time last year)."


It's getting ugly out there...


"Turkey's president has declared a state of emergency for three months following Friday night's failed army coup," the BBC reports. "The emergency allows the president and cabinet to bypass parliament when drafting new laws and to restrict or suspend rights and freedoms." (For more analysis on what to expect out of Turkey, check out Hedgeye Potomac National Security analyst LTG Dan Christman USA Ret.  "What Comes Next After The Failed Coup In Turkey.")




The #StrongDollar ravaging continues.



Meanwhile, Here at home...


Equity markets are within spitting distance of all-time highs. But, as we've pointed out before, the recent stock market rallies have come on declining total market volume. Not good.



In these uncertain times, What do you buy?


On pullbacks... Gold (GLD), which has developed a seemingly antithetical correlation of 0.9 to the U.S. dollar over the last 30-days. Note: Gold has been working all year (and remains a Hedgeye Long call):



As our outspoken CEO Keith McCullough is fond of saying, "Risk happens slowly at first, then all at once."

To be crystal clear, market risk is rising.

Daily Market Data Dump: Thursday

Takeaway: A closer look at global macro market developments.

Editor's Note: Below are complimentary charts highlighting global equity market developments, S&P 500 sector performance, volume on U.S. stock exchanges, rates and bond spreads, key currency crosses, and commodities. It's on the house. For more information on how Hedgeye can help you better understand the markets and economy (and stay ahead of consensus) check out our array of investing products




Daily Market Data Dump: Thursday - equity markets 7 21


Daily Market Data Dump: Thursday - sector performance 7 21


Daily Market Data Dump: Thursday - volume 7 21


Daily Market Data Dump: Thursday - rates and spreads 7 21


Daily Market Data Dump: Thursday - currencies 7 21


Daily Market Data Dump: Thursday - commodities 7 21

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.

CHART OF THE DAY: The Top 10% vs Everyone Else

Editor's Note: Below is a brief excerpt and chart from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more.


"... In today’s Chart of The Day is slide 48 of our current Q3 Macro Themes deck. It’s titled “The High-End Matters” and it shows that the Top 20% of US Households account for 39% of US Consumer Spending. That’s not a typo."


CHART OF THE DAY: The Top 10% vs Everyone Else - 07.21.16 EL Chart

Cartoon of the Day: Groovy, Man!

Cartoon of the Day: Groovy, Man! - All time high cartoon 07.20.2016


What are the bulls smoking buying the all-time high in stocks?

Capital Brief: What It Will Take For Trump To Unify The GOP

Editor's Note: Below is a brief excerpt from Hedgeye Potomac Chief Political Strategist JT Taylor's Capital Brief sent to institutional clients each morning. For more information on how you can access our institutional research please email


Capital Brief: What It Will Take For Trump To Unify The GOP - JT   Potomac under 1 mb


“Ideas control the world.”

-James A. Garfield


With the fallout from the RNC’s first day still lingering, Donald Trump’s historic day two moved to right the ship, with key members of the Republican leadership, Trump’s family and inner circle moving into the spotlight. Speeches by Senate Majority Leader Mitch McConnell and Speaker Paul Ryan offered up lukewarm support of the party’s nominee (better than cold, huh?) and largely focused on their agendas for Congress as well as unity without tipping their hats too far in Trump’s direction.


And, in a preview of what to expect this fall, Governor Chris Christie delivered a blistering assault on Hillary Clinton and her record dusting off his prosecutor’s badge. If Trump and Co. execute the next two days flawlessly, a largely unified party could be within reach by the end of the week, but don’t hold your breath. Trump’s formal nomination drew mixed reactions with some delegates chanting enthusiastically, while others shouted in protest - but most left confused due to the lack of focus on the theme of the day - Make America Work Again.


Going into it’s sixteenth month, Trump’s campaign has been unscripted, unpredictable and undermanned from the start - and the bizarre rollout of Governor Mike Pence and the early missteps of the convention - especially Melania’s speech and ill-conceived response - were bound to happen. Stepping all over her big moment without holding anyone accountable illustrates the level of disorder ingrained in Trump’s world.


The campaign’s lack of organization, infrastructure, and skeletal staff are all symptoms of a much larger problem augmented by Trump’s continued focus on himself.  


In a surprise move, Republicans threw a wrench in the works of the financial services community by including a call to reinstate the Glass-Steagall Act in their convention platform – a law repealed by President Bill Clinton in 1999. Our view is that the passage is Trump’s attempt to generate populist appeal as well as woo voters who view Clinton is too close to Wall Street and too timid on financial reform.


We would typically discount a platform move of this sort, but with some Republicans hopping on board a Democratic ideal - it’s worth keeping on the radar for 2017.

the macro show

what smart investors watch to win

Hosted by Hedgeye CEO Keith McCullough at 9:00am ET, this special online broadcast offers smart investors and traders of all stripes the sharpest insights and clearest market analysis available on Wall Street.