Gamma Games

Single stock open-interest at all-time-high levels, which is why today’s expiry is important for stocks, especially for names with large open interest in at-the-money (ATM) 15-Jan options, At the close, the market is down 0.7% while gamma exposure spiking up all time high as the following chart from Sundial Research shows. “Dealers are short callsContinue reading “Gamma Games”

The Big Short 2.0

Per MarketWatch, Michael Burry of “The Big Short” fame is back and all-in on a TSLA short. As of January 11, 2021, Tesla is now trading at about 29x sales. Burry observed that showed the company’s sale of regulatory credits was necessary for profitability. He also pointed out the company’s flat revenues and Tesla’s “inferiorContinue reading “The Big Short 2.0”

Office Apocalypse

As reported in Bloomberg, new leases in the fourth quarter dropped 64% YoY to 4.6 million square feet. Average asking rents for the highest-quality offices fell 8.6% to $90.42 a square foot, a decline that doesn’t capture concessions such as free months or tenant-improvement allowances. And, as the graph above indicates, this may just beContinue reading “Office Apocalypse”

Random Walk Down Wall Street

Jeremy Grantham (GMO): “My confidence is rising quite rapidly that this is, in fact, becoming the fourth ‘real McCoy’ bubble of my investment career.  The great bubbles can go on a long time and inflict a lot of pain, but at least I think we know now that we’re in one.” Ask any sailor whenContinue reading “Random Walk Down Wall Street”

Canary in the Mine: Car Wreck Portends November Retail Crash

November dive followed by a return to the rolling-over trend. Christophe Barraud: confirms my view that, at best, 4Q GDP growth will slow dramatically compared to 3Q while another GDP contraction still looks possible at this stage. The fact is the rapid spread of Covid-19 will force more states to implement restrictive measures before quarter-end.Continue reading “Canary in the Mine: Car Wreck Portends November Retail Crash”