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Tyler Durden

Tyler Durden

Tyler Durden is a reference to the lead character in Fight Club. It's the pseudonym for Zero Hedge's key author(s) used to hide their identities.

Articles by Tyler Durden

The S&P’s Biggest Bear Capitulates

14 days ago

First it was Dennis Gartman shutting down his newsletter after more than three decades, lamenting a market that no longer made any sense (a lament shared by Deutsche Bank’s Aleksanda Kocic), and now the market’s QE4-driven meltup has forced Wall Street’s biggest sellside bear to capitulate on his November call that the market will drop in 2020; instead UBS’ head of US equity strategy, Francois Trahan, has joined the bullish herd hiking his year-end S&P price target from 3,000, where he set the bottom of the year-ahead market forecasts alongside Morgan Stanley’s notorious bear Michael Wilson, to 3,250.
That said, as Bloomberg notes, Trahan’s new forecast is hardly exuberant, as it indicated a market that will close the year virtually unchanged from today’s level

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Xi To Skip Davos, Collapsing Hopes Of Phase One Deal Signing Event With Trump

27 days ago

Chinese President Xi Jinping
If it was The Wall Street Journal or other US financial media outlets, for the last several weeks, pumping headlines via “people familiar with the discussions,” about how President Trump and Chinese President Xi Jinping could have a phase one trade deal signing event at the World Economic Forum in Davos, Switzerland, in January.
It turns out, after all the optimism of a potential signing event at Davos between Trump and Xi — it was just all bogus hype — as it now appears Xi is skipping the event, according to Bloomberg.
Beijing will still send its top trade negotiator Vice Premier Liu He to sign the phase one trade deal in Washington in January.
It seems that China isn’t interested in grandstanding the trade deal, unlike Trump.

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Credit Suisse Ex-Employee Says “Striking Tall Blonde” Spy Followed Her In Manhattan And Long Island

29 days ago

When Colleen Graham heard a story of investigators looking into Credit Suisse for spying on its recently departed head of wealth management, something sounded familiar.
She had recalled, years prior, when she was working on a JV between the bank and Palantir Technologies, a “striking tall blonde” had followed her in Manhattan after she refused to sign off on how revenue from the JV would be booked. She filed a complaint in 2017 alleging the bank had taken retaliatory measures against her, including the surveillance, according to Bloomberg.
Credit Suisse had “expressed strong frustration” about her stance on the revenue recognition, she claimed.
So she reached out to CEO Tidjane Thiam and Chairman Urs Rohner, offering up the details of her story. She also reached

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Repo Crisis Fades Away: For The First Time, A “Turn” Repo Is Not Oversubscribed

December 23, 2019

It looks like the year-end repocalypse that was predicted by Credit Suisse strategist Zoltan Pozsar is taking a raincheck.
Today’s Term Repo saw $26.25BN in security submissions ($15.75BN in TSYs, $10.5BN in MBS), below the $35BN in total availability. This was the first “turn” repo that was not fully subscribed (on Monday, there was $54.25BN in demand for $50BN in repos maturing on Jan 17).
As such, for the second day in a row, the Fed’s term repo operation was undersubscribed, but what was notable about today’s “temporary” liquidity injection is that this was the first term repo since the start of the Fed’s emergency repo program that covered the year-end “turn” with a maturity of Jan 2, and was not fully overalotted.

As shown in the chart below, the first

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Rosenblatt Goes Full Bear On Apple With $150 Target As China iPhone Sales Slump

December 20, 2019

Rosenblatt Securities analyst Jun Zhang maintained a sell rating on Apple with a price target of $150 per share, citing a decline in iPhone sales in China is leading to a wave of production cuts by the company.
“Based on our recent channel checks, we believe Apple’s total iPhone sales in China were down ~-30% y/y in November,” said Zhang in a note to clients on Tuesday.
Zhang stated that consumers are opting for cheaper models than the iPhone 11 Pro, which retails for around $1,100.
Rosenblatt’s sell rating on Apple has a price target of $150 per share, about -46% difference from the current price on Tuesday morning.

Apple sales, 2017-2020 – Click to enlarge
It was only last week when Credit Suisse warned about declining iPhone shipments in China:
CS said

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UBS Has No Choice In Passing Negative Rate Pain To Customers

November 22, 2019

There’s been talk that the Federal Reserve will slam interest rates to zero or even negative when the next recession strikes. President Trump’s support for negative interest rates has quickly increased in the last several months as the latest tracking estimates for Q4 GDP have tumbled to sub 0.4%.
It seems that policy rates in the US are too high — and will likely conform to the rest of the world, which is near zero to negative territory. This has undoubtedly alarmed UBS CEO Sergio Ermotti, who said banks have “no choice” but to pass on the negative rate pain to customers.
Ermotti said UBS “will not pass negative rates to smaller clients, the personal banking clients,” that’s because if UBS and other EU banks actually passed along negative rates to poor and

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World’s Ultra-Rich Preparing For Market Crash, UBS Warns

November 16, 2019

A synchronized global slowdown, with no end in sight, has spooked some of the wealthiest investors around the world, according to a new survey from UBS Wealth Management, seen by Bloomberg. UBS polled wealthy investors, who are preparing for a significant stock market correction by the end of next year.

S&P 500 Index, 2013-2021 – Click to enlarge
In the survey of more than 3,400 high net wealth respondents, 25% said they’ve sold risk assets, such as equities, commodities, and high-yield bonds, and have transitioned into cash. The synchronized global slowdown, coupled with a US-China trade war, were some of the greatest concerns of respondents.
“The rapidly changing geopolitical environment is the biggest concern for investors around the world,” said Paula

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Swiss National Bank Now Owns Record $94 Billion In US Stocks After Q3 Buying Spree

November 14, 2019

In the third quarter of 2019, one in which the global economy continued to cycle lower, global central banks across the world continued to slash interest rates and launched/expanded quantitative easing programs with very little success at troughing global growth. Still, US equity indices powered to new highs, climbing a wall of worry of President Trump’s “trade optimism” tweets.
It seemed quite evident over the quarter that President Trump’s tweeting of constant fake trade news and record stock buybacks juiced the market to new highs, however, what was really taking place was the Swiss National Bank (SNB) printing money out of thin air buying stocks with no regard for price or cost. 
SNB’s motive was to boost market confidence that a 2016-style rebound in the

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Billionaire Boom “Has Now Undergone A Natural Correction”

November 11, 2019

Over the last five years ending in 2018, the billionaire boom created more billionaires than the world has ever seen.
These financial elites saw their wealth increase by more than a third over the same period, but as soon as 2018 rolled around, the billionaire boom deflated, according to a new UBS/PwC Billionaires Report.
Global central banks pumped trillions of dollars into global financial markets and helped produced nearly 589 billionaires during the period, increasing the billionaire population by 39% to 2,101.

Fifteen Years of asset growth, 2003-2018 – Click to enlarge
It was only when the Federal Reserve started to tighten aggressively, and a global synchronized upswing transformed into a downswing, the billionaire boom went into a period of

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Robinhood’s “Infinite Money Cheat Code” Gives Traders Access To Unlimited Funds

November 6, 2019

If one is a central bank – such as the SNB and BOJ – life is easy: you just print as much money as you need out of thin air, and buy whatever you want, without regard for price. For those who are not central banks, having access to unlimited borrowed money may be the next best thing.
It now appears that the millennial-targeting brokerage Robinhood, which offers its users “free” online trades in exchange for quietly selling their orderflow to frontrunning HFTs, has a “glitch” that affords its users to experience just what being a central bank means, by allowing users to trade stocks with virtually infinite leverage, giving them access to what amounts to free money.
First discussed on Reddit’s WallStreetBets forum, the bug was called the “infinite money cheat

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A “Hawkish Cut”? Traders’ Sleepless Nights Dominated By Indecision & Confusion

September 22, 2019

Central Banks Remain Calm, Investors Not So Much
The avalanche of central bank meetings is rapidly winding down. We’ve had cuts, holds and a raise. The surprises have been minimal. Yet it didn’t prevent the inevitable knee-jerk reactions in the market. In truth, put together as a whole, we are no wiser nor better or worse off. I count that as a success. Especially because there was no projection of panic in any of the decisions. Despite on-going, and universal, expressions of concern for the global economy. Special hat tip to the SNB and Norges Bank.

The Fed is said to have orchestrated a “hawkish cut.” Not really. – Click to enlarge
[ZH: Stocks once again decouple from bonds, the dollar, and gold]
Keeping the expansion alive remains a top priority. And while

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Since 2014, European Banks Have Paid €23 Billion To The ECB… And Now Face Disaster

September 15, 2019

Earlier this morning, there was an added wobble in European bond prices after an unconfirmed MNI report said the ECB could delay the launch of QE on Thursday and make it data dependent. While skeptics quickly slammed the story, saying it was just a clickbait by MarketNews…

About this MNI story on a possible delay in ECB QE announcement:
1) No substance, including from the ECB “sources”
2) Let’s hope the story is as accurate as the previous ones
— Frederik Ducrozet (@fwred) September 10, 2019
… it does highlight just how sensitive the bond market is to an announcement of aggressive easing by the ECB when it meets on Thursday, Sept 12, where consensus generally expects a significant easing package, including a -20bp rate cut (followed by -10bp cut later on),

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UBS To Start Charging Rich Clients With Negative 0.75 percent Interest Rate

August 2, 2019

For years, European banks were leery of passing on the ECB’s negative -0.40% deposit rate to their clients for fears of deposit flight and other unintended consequences, in the process being forced to “eat” the difference and impacting their interest income.
However, after five years of NIRP, and with the ECB set to unleash even more negative rates in the immediate future, one bank has finally taken a stand: according to the FT, UBS plans to charge a negative interest rate on wealthy clients, those  who deposit more than CHF 2 million with the largest Swiss bank.
While several, mostly smaller, banks in Switzerland and the eurozone already pass on the cost of negative official rates to corporate depositors, most large

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World’s Central Banks End Pact That Limited Selling Of Gold

July 29, 2019

In a surprising announcement on Friday morning, the European Central Bank said the 21 signatories of the 4th Central Bank Gold Agreement (CBGA) “no longer see the need for formal agreement” as the market has developed and matured, and as a result the signatories “decided not to renew the Agreement upon its expiry in September 2019.”
For readers unfamiliar, the first CBGA was signed in 1999 to coordinate planned gold sales by the various central banks. When it was introduced, the ECB notes that “the Agreement contributed to balanced conditions in the gold market by providing transparency regarding the intentions of the signatories. It was renewed three times in 2004, 2009 and 2014, gradually moving towards less

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UBS Tells Managers They Can Hire 1 Employee For Every 5 Who Leave

May 4, 2019

Like the other lagging European investment banks (Deutsche and SocGen immediately spring to mind), UBS is resorting to the last resort of the embattled megabank CEO when shareholders are demanding higher profits ‘or else’.

After a decade where UBS cut thousands of jobs in its investment bank unit, Sergio Ermotti is turning to one of the few business lines where fat can feasibly be cut: UBS’s once legendary asset-management business.
Before the crisis, the Swiss bank held the title of world’s largest asset manager. But it has seen its stature diminish during the intervening years, largely thanks to rise of passive managers like BlackRock (the current title-holder). Though the number of employees at UBS’s

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Gold & Basel 3: A Revolution That Once Again No One Noticed

April 11, 2019

Via The Saker blog,
By Aleksandr Khaldey
Translated by Ollie Richardson and Angelina Siard
cross posted with
Real revolutions are taking place not on squares, but in the quiet of offices, and that’s why nobody noticed the world revolution that took place on March 29th 2019. Only a small wave passed across the periphery of the information field, and the momentum faded away because the situation was described in terms unclear to the masses.
No “Freedom, equality, brotherhood”, “Motherland or death”, or “Power to Councils, peace to the people, bread to the hungry, factories to the worker, and

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Rothschilds To Take Swiss Bank Private In 100 Million Francs Bid 

March 16, 2019

Benjamin de Rothschild’s family plans to take Swiss Bank Edmond de Rothschild (Suisse) S.A. private as it consolidates and simplifies the bank’s legal structure.

According to Bloomberg,  Edmond de Rothschild Holding SA will acquire all publicly held Edmond de Rothschild (Suisse) bearer shares at 17,945 francs per share, a 6.7% premium to Tuesday’s closing price, in a deal worth about $100 million. The Swiss bank, which has long been linked with managing the wealth of countless uber-wealthy families, offers a variety of wealth management service for private and institutional clients, is expected to be delisted from the Zurich exchange. The stock, which traded on Wednesday around 17,500 francs, jumped by more than 8%

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UBS Shares Tumble As French Judge Slaps Bank With $5.1 Billion Tax Evasion Fine

February 20, 2019

In a landmark ruling that sent a clear message to other banks battling misconduct investigations in French courts, a Paris court on Wednesday found UBS guilty of having actively helped some of its wealthy French clients hide money from French tax authorities in undeclared Swiss bank accounts, and ordered the bank to pay a $5.1 billion fine. The fine represents a record sum in France, and isn’t too far below the $6 billion maximum allotted by French law.

Shares of the bank slumped 5% on the ruling.
Regarding the penalty, which followed trials of UBS and its French subsidiary,  trials where the bank was ultimately found guilty, the judge said it reflected the serious nature of the charges.
“The criminal wrongdoings

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Albert Edwards: Investors Should Brace For A World Of Negative Rates, 15percent Budget Deficits And Helicopter Money

February 8, 2019

Eariler this week, when the San Fran Fed published a paper that suggested that the recovery would have been stronger if only the Fed had cut rates to negative, we proposed that this is nothing more than a trial balloon for the next recession/depression, one in which the Federal Reserve will seek affirmative “empirical evidence” that greenlights this unprecedented NIRPy step (in addition to QE of course).
Today, in his latest note to clients after returning from a 2 week vacation in Jamaica, SocGen’s Albert Edwards picks up on this point and cranks it up to 11 writing that “as central banks thrash around for new tools, I have long thought the next recession would trigger the adoption of helicopter money and deeply

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Swiss National Bank Suffers $15 Billion Loss On 2018 Market Rout

January 10, 2019

SNB US Stock Holdings
In the third quarter of 2018, the hedge fund known as the Swiss National Bank did something it had not done in years: it sold stocks. As we showed in November, the overall value of the SNB’s US listed long holdings rose by over $2 billion to $90 billion, but all of this was due to the price appreciation as the central bank sold around $7bn of equities in Q3. This compares to purchases during 1H18 of around $6bn.

SNB US Stock Holdings, Jun 2014 – 2018(see more posts on SNB US Stock Holdings, ) – Click to enlarge

SNB Holdings
Alas, it did not sell enough, and as the next chart showed, some of the SNB’s top holdings would be the stocks that ended up getting hammered the most in the fourth

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Hedge Funds, ETFs, Central Banks Suffer Billions In Losses On Apple

January 4, 2019

It wasn’t that long ago that Apple was the most beloved stock by the hedge fund community, and although in recent months the company’s popularity faded somewhat among the 2 and 20 crowd it is still one of the most popular names among the professional investing community. Which on a day that saw AAPL stock tumble as much as 10% is clearly bad news.
As Bloomberg notes, eight hedge funds that own large stakes in Apple have seen the value of their holdings plunge about $2.13 billion since the company cut its revenue outlook, with AQR Capital Management suffering some of the biggest losses as it saw its holdings decline by about $732 million on Thursday. The firm held 8.8 million shares as of Sept. 30, according to data

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The World’s Biggest Hedge Fund Is Getting Whacked, And Why “Moneyness” Matters

December 12, 2018

Authored by John Rubino via,
A few years ago the Swiss National Bank (SNB) – which traditionally held “monetary assets” like government bonds, cash and gold to back up the Swiss franc – decided to branch out into common stocks.
This was a departure, but for a while a brilliant one. The SNB loaded up on Big Tech like Apple, Amazon and Microsoft, and rode them to massive profits, which enriched both the Swiss people and the SNB’s stockholders (in another departure, it’s a publicly traded company as well as a central bank).
But live by the sword, die by the sword. Turning your central bank into the world’s biggest hedge fund means outsized profits in good times, but potentially serious losses if those

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For The First Time In 25 Years, China Has To Make A Choice Between External Stability And Growth

November 28, 2018

Back in August 2 we reported of a historic event for China’s economy: for the first time in its modern history, China’s current account balance for the first half of the year had turned into a deficit. And while the full year amount was likely set to revert back to a modest surplus, it was only a matter of time before one of the most unique features of China’s economy – its chronic current account surplus – was gone for good.
Fast forward to this weekend, when as part of its summary of Top Macro Trades for 2019, UBS wrote that the loss of China’s current account cushion, softening domestic activity, and upcoming tariffs mean that “for the first time in 25 years, China would have to make a choice between external

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Swiss National Bank Unexpectedly Sold US Stocks In Q3, Dumping Over 1 Million Apple Shares

November 12, 2018

The SNB’s latest 13-F form filings (yes, the Swiss central bank lists its US equity holdings like the hedge fund that it is) to the SEC were released this week. And, like every other quarter, we take a closer look to see what stocks the world’s only hedge fund central bank that prints money out of thin air bought, and on rare occasions, sold. This was one of those rare quarters.
After some modest fluctuations earlier this year, the SNB’s reported equity allocation was unchanged in 3Q at 21% (and includes no bank stocks to avoid conflicts of interest, yet somehow owning a chunk of equity of virtually every other US public company is not a conflict of interest?). This is notable because as JPMorgan writes, the SNB’s

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UBS Warns Trump’s Trade Fights Are ‘Reversing 15-Years Of Global Progress

October 25, 2018

Protectionism has cross-party support in the U.S., and nationalist parties continue to gain traction in Europe. Where there is inequality, there is a surge in protectionism; a risk that could trigger the next global economic crisis sometime around 2020.
The Trump administration’s trade war and a hard Brexit could send tariffs to levels not seen in 15 years, according to UBS economist, as per Market Watch.
The Swiss bank views the U.S. tariffs, along with retaliatory measures (tit-for-tat with China), as the most significant factors boosting the metric. Second, are fears of a hard Brexit, which refers to the potential split between the U.K. and the European Union.
“Combined, these two would add 142 [basis points] to

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Swiss Banks Curb China Travel After UBS Banker Arrested

October 22, 2018

Two major Swiss banks imposed restrictions on staff travel to China after a UBS employee was detained in the country, underscoring the challenges of doing business in a country which is a mecca for banks eager to capture and manage (for a generous fee) the fastest growing fortunes in the world, yet are challenged by a regime that tramples over civil rights.
According to Bloomberg, UBS asked some bankers not to travel to China after the incident, with fellow Swiss bank Julius Baer also imposing a travel ban while Credit Suisse said that so far there was no travel ban in place. The travel restrictions have only affected those bankers who help manage money for clients and haven’t been imposed on the securities unit.

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Swiss Bank Freezes $5 Billion In Russian Money

August 23, 2018

For years, Russian oligarchs and robber barons seeking to park their “unsourced” capital offshore and away from the sticky fingers of the Kremlin, treated Swiss bank accounts (preferably anonymous) with their “no questions asked” customer policies as, well, Swiss bank accounts.
No more.
One of Switzerland’s largest banks, Credit Suisse, has frozen roughly 5 billion Swiss francs ($5 billion) of money linked to Russia to avoid violating U.S. sanctions, according to its accounts, further increasing pressure on Moscow which today saw the ruble tumble to the lowest level in over two years.
The crackdown on Russian funds by the second largest Swiss bank, which owned aircraft surrendered by Russian tycoon Oleg Deripaska and

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Capital Controls Next? Lira Rebounds After Turkey Bank Regulator Limits FX Swap Operations

August 14, 2018

In the first tentative step toward the final option available for Erdogan to halt the Lira’s accelerating collapse – which crashed as low as 7.2362 earlier after the Wellington FX open following the the Turkish president’s latest belligerent comments – namely capital controls, the Turkish Banking Regulation and Supervision Agency imposed a limit on the amount of foreign currency and lira swap and swap-like transactions, which are not to exceed 50% of the bank’s shareholder equity.
Furthermore, new transactions are halted “until current over-shootings mature.”
Whether this tentative move to limit the amount of TRY FX speculation will work remains to be seen: the kneejerk reaction to its announcement helped send the

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The Swiss National Bank Now Owns $87.5 Billion In US Stocks After Q2 Tech Buying Spree

August 10, 2018

In the second quarter of 2018, one in which the global economy was shaken by the rapid escalation of Trump’s trade war, and in which central banks were one after another hinting at their own QE tapering and rate hiking intentions to follow in the Fed’s footsteps, what was really taking place was another central bank buying spree meant to boost confidence that things are now back to normal, using “money” that was freshly printed out of thin air, and spent to prop up risk assets around the world by recklessly buying stocks with no regard for price or cost.
Nowhere was this more obvious than in the latest, just released 13F from the massive hedge fund known as the “Swiss National Bank.” What it showed is that, just like

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Goldman: You Are Asking The Wrong $1 Trillion Question

August 7, 2018

After several months of heated market speculation, to Amazon’s chagrin the question of which stock would be the first to reach $1 trillion in market capitalization was answered when Apple reported strong Q2 results (which included $21 billion in stock buybacks) and its stock soared 9% this week, rising above the very round number and elevating its YTD gain to 23% (Amazon, with a market cap of just under $900 billion, will most likely be second).
To Goldman, however, that was the “wrong $1 trillion question.” Instead, The correct $1 trillion question according to the bank’s chief equity strategist David Kostin, is: what amount of buyback will companies authorize in 2018?
Three weeks ago, we reported that according to

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