Tag Archives: False Sense Of Security

The SEC Pulled the Plug on Stop-Loss Orders – What You Can Do About It

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“The policy, subject to U.S. Securities and Exchange Commission (SEC) rule filings, goes into effect on Feb. 16, 2016, so there’s plenty of time to prepare. Besides, GTC orders usually expire in 90 days, anyway. And of course the brokerages will continue to offer these types of orders. They’ll simply trigger in-house and then be sent as limit or market orders for execution.  But it is a very big deal. Partly for its effect on investors – though I’m going to show you how to get around it – but even more so for what the NYSE and its regulator, the SEC, are telegraphing with this decision: That they’re essentially washing their hands of what’s about to happen.”

http://moneymorning.com/2015/12/04/the-truth-behind-the-nyses-decision-to-end-stop-orders/

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China stocks up after circuit breaker rule axed, yuan fixed higher

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“Chinese markets have had a turbulent start to 2016, buffeted by the PBOC’s lower yuan fixings against the dollar, two days of stock exchange suspensions, weak factory and service sector surveys, and worries about looming share sales by major stakeholders once a ban on such sales expires. The circuit breaker came under fire for kicking in too soon with its initial pause in trading, and then encouraging a rush to sell before a second trigger halted the day’s trade permanently. Sources told Reuters that China’s foreign exchange regulator has ordered banks in some trading hubs, including Shenzhen, to limit clients’ dollar purchases this month, the latest attempt to stem capital outflows.”

http://www.reuters.com/article/us-china-markets-idUSKBN0UM02K20160108

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Shanghai Fund Manager Dumps All Holdings in ‘Insane’ Market

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“‘This is insane,’ Chen Gang, chief investment officer at Shanghai Heqi Tongyi Asset  Management Co., said in an interview on Thursday. ‘We were forced to liquidate all our holdings this morning,’ said Chen, whose firm manages about 300 million yuan ($45.5 million).  Many private funds and hedge funds in China have agreements with investors spelling out mandatory liquidation levels if their holdings drop below a certain value. The CSRC capped the size of stakes that major investors are allowed to sell at 1 percent of a company’s shares for three months effective Jan. 9, the regulator said in a statement on Thursday. The restriction replaces an existing six-month ban that is due to expire Friday.”

http://www.bloomberg.com/news/articles/2016-01-07/shanghai-fund-manager-dumps-all-holdings-as-market-goes-insane–ij3q4f91

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U.S. Probes Treasuries Niche That Investors Claim Is Rigged by Big Banks

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“Traders at global banks colluded to artificially inflate the price of instruments that allow them to sell U.S. debt before they own it, and then bought the debt at auctions for an artificially suppressed price, unfairly profiting at investors’ expense, according to several lawsuits filed against the banks. The banks haven’t responded to those allegations in court. The probes and lawsuits come as many primary dealers’ bond-trading businesses have been squeezed by recent capital requirements from regulators, which have limited how much risk banks can take. This year, dealers’ purchases at Treasury note and bond auctions for their own trading books represent the smallest share on record.”

http://www.bloomberg.com/news/articles/2015-11-09/u-s-probes-treasuries-niche-that-some-investors-claim-is-rigged

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China halts stock market again after CSI 300 plunges more than 7%

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“China’s stocks were suspended from all trade on Thursday after the CSI300 tumbled more than 7 percent in early trade, triggering the market’s circuit breaker for a second time this week.  That drop-kicked stock markets across Asia, which were already wallowing after a weaker open amid concerns over China’s swooning currency and economic slowdown as well as falling oil prices.  China’s securities regulator also issued new rules to restrict the percentage of shares major shareholders in listed companies can sell every three months, in an attempt to stabilize markets. Shareholders are not allowed to sell more than 1 percent of a company’s share in that period.”

http://www.cnbc.com/2016/01/06/china-slowdown-low-oil-prices-and-north-korea-h-bomb-weigh-on-asian-stock-markets.html

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Chinese official jumps to his death after garbage landslide kills dozens

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“A former official in charge of regulating a massive waste dump that collapsed in the southern Chinese city of Shenzhen has killed himself, local police said Monday.  The former director of the Urban District Administrative Enforcement Bureau in the city’s Guangming district where the landslide disaster took place December 20, jumped off a residential building Sunday night, the Shenzhen Nanshan District public security bureau said on its official Weibo social media account. Police and state media have not said whether Xu had been directly responsible for authorizing the dump.”

http://www.cnn.com/2015/12/28/asia/china-landslide-suicide/

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Chinese state begins buying stocks after Monday’s rout

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“China’s stocks rose in volatile trade as state-backed funds were said to intervene after a plunge on Monday wiped out $590 billion of market value. Trading was halted on Monday after the gauge plunged 7 percent, triggering new market circuit breakers that some analysts said exacerbated the sell-off.  State-controlled funds bought equities and the securities regulator signaled a selling ban on major investors will remain beyond this week’s expiration date, according to people familiar with the matter. The China Securities Regulatory Commission also suggested it’s open to tweaking the circuit breakers, while the central bank conducted the biggest reverse-repurchase operations since September.”

http://www.chicagotribune.com/news/sns-wp-blm-china-stocks-96e94030-b397-11e5-8abc-d09392edc612-20160105-story.html

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Puerto Rico Defaults On Bonds: Return Does Not Come Without Risk

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“Many American investors bought Puerto Rican bonds over the past five years as we all searched desperately for yield in the face of the Federal Reserve pushing interest rates down to historic lows. Normally, investors understand that higher yields come with greater risks. However, during the past six years of extraordinary interventions by the Fed into all sorts of financial markets, many investors may have decided that those higher yield investments weren’t really all that risky.  Puerto Rico’s problems may serve as a much-needed wake up call to investors. As rates rise, capital will move back toward safety and the risk premium demanded of higher risk projects is likely to increase.”

http://www.forbes.com/sites/jeffreydorfman/2016/01/04/puerto-rico-bond-defaults-early-reminder-to-investors-return-does-not-come-without-risk/

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China stocks rout on first market day of 2016 trips national trading halt

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“China’s major stock exchanges tanked on the first trading day of the year, triggering a ‘circuit-breaker’ that suspended equities trade nationwide for the first time and putting at risk months of regulatory work to restore market stability. The collapse, which followed the release of weak economic data on Monday, raises fresh doubts about regulators’ capacity to wind back heavy trading restrictions implemented in the wake of a massive summer stock market crash in which major indexes lost as much as 40 percent before top leadership intervened.  Analysts attributed the decline to the imminent end of a 6-month lockup period on share sales by major institutional investors.”

http://www.reuters.com/article/us-china-stocks-trading-halt-idUSKBN0UI0CU20160104

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With Permanent Squad, New York Police Step Up Fight on Terrorism

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“With the new unit, Chief Waters’s bureau has ballooned this year in size and in equipment, with new cars fitted to hold Colt M4 semiautomatic assault rifles. He said the attacks last week had accelerated the pace of procuring equipment and training officers in counterterrorism tactics, including courses that include undercover ‘hostile surveillance’ to detect those who might be gathering information about potential targets, and the use of new devices. In addition to the Critical Response Command, the department recently created a citywide unit of roughly 700 patrol officers — the Strategic Response Group — who are also trained to use and are outfitted with semiautomatic rifles.”

http://www.nytimes.com/2015/11/21/nyregion/new-york-police-form-counterterrorism-force-with-more-firepower-and-training.html

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