Patrick Boyle On Finance

Send us a textChinese state-owned developers are rescuing cash-strapped local governments in China by stepping to the fore at land auctions previously dominated by private sector groups like Evergrande. State-owned bidders include highly leveraged local government finance vehicles, which have traditionally focused on infrastructure projects rather than real estate. LGFVs have accounted for about o...

Send us a textJP Morgan Chase is suing Tesla for $162 million over tweets in 2018 by Technoking Elon Musk that he would take the electric vehicle maker private. JP Morgan accuses Tesla of "flagrantly" breaching a deal it claims should have triggered payments to JP Morgan. JP Morgan's suit, filed in a Manhattan federal court, says that Tesla sold warrants to JP Morgan allowing the bank to purchase...

Send us a textIn China, there is no better sell-signal than when the president, starts attacking an industry. So when Xi said in March that home-schooling was a “stubborn malady” that was putting too much pressure on Chinese children and their parents, the executives of two Chinese tutoring companies dumped their shares in New York according to records found by the FT.Patrick's Books:Statistics Fo...

Send us a textThe Federal Reserve warned that fragility in China’s commercial real-estate sector could spread to the U.S. if it deteriorates dramatically, as investor focus turns to China Evergrande Group’s biggest payment test yet. The Fed’s stability report, which is meant to highlight risks that could undermine the financial system, said that “stresses in China could strain global financial mar...

Send us a textFederal regulators requested more power from Congress to regulate stablecoins, a fast-growing type of cryptocurrency that they warn could result in bank runs and consumer abuse unless lawmakers act quickly, according to a report issued Monday by the Treasury Department. The report, which was undertaken by the President’s Working Group on Financial Markets, called on Congress to pass...

Send us a textZillow, the digital real estate company, said on Tuesday that it’s exiting Offers, its business that buys and flips homes, and eliminating 25% of its workforce. The announcement was attached to Zillow’s third-quarter earnings report. The company’s revenue and earnings missed analysts’ estimates.“We’ve determined the unpredictability in forecasting home prices far exceeds what we anti...

Send us a textThe anonymous scammers behind a Squid Game cryptocurrency have officially pulled the rug on the project, making off with an estimated $2.1 million. Investors were able to purchase the crypto but couldn’t sell it. The SQUID cryptocurrency peaked at a price of $2,861 before plummeting to $0 around 5:40 a.m. ET., according to the website CoinMarketCap. This kind of theft, commonly calle...

Send us a texthttps://teamseas.org/ The Tragedy of the Commons is an economic idea made popular by the American ecologist Garrett Hardin, who used the analogy of ranchers grazing their animals on a common field. Individual ranchers will seek to add additional livestock, to increase their profits. The benefit of adding additional animals accrue to the rancher alone, while the costs are shared. The...

Send us a textIn this video we look at meme coins and learn about the Elon Markets Hypothesis. Patrick explains why he is all in on Shibu Inu. Patrick's Books:Statistics For The Trading Floor: https://amzn.to/3eerLA0Derivatives For The Trading Floor: https://amzn.to/3cjsyPFCorporate Finance: https://amzn.to/3fn3rvC Patreon Page: https://www.patreon.com/PatrickBoyleOnFinanceVisit our website: www.o...

Send us a textDo Companies Buy S&P500 Membership? A new working paper attempts to figure out why some companies make it into the blue-chip stock market index. In recent years there has been a huge shift away from active asset management and towards passive, index-tracking funds. The indices that these funds follow have in turn gained enormous power, becoming gatekeepers to the flow of trillion...

Send us a textThe SEC published its report on GameStop $GME this Monday, which focuses on the January 2021 trading activity of GameStop Corp (GME), the most famous of the "meme stocks." Because the meme stock episode raised several questions about market structure, the staff report also provides an overview of the equity and options market structure for individual investors. The SEC Report on Game...

Send us a textThe first bitcoin-linked ETF is scheduled to make its NYSE debut officially on Tuesday morning. The new ETF from ProShares, will track the bitcoin futures market and trade on the NYSE under the ticker “BITO.”According to ProShares a multitude of investors have been eagerly awaiting the launch of a bitcoin-linked ETF after years of efforts to launch one, BITO will open up exposure to...

Send us a textA small London based crypto asset trading platform called DeversiFi got quite a shock two weeks ago when it mistakenly paid out a $24m fee to a large crypto miner. Transferring crypto deposits generates a fee, known in the industry as a “gas fee”, to compensate miners for the computing energy used to verify transactions on the blockchain. DeversiFi should have paid out around $5, but...

Send us a textPricewaterhouseCoopers earned over forty million dollars in fees auditing China Evergrande and signed off on the accounts presented to them by management for all of those years. PWC is likely to face criticism over the level of push back they gave to management over accounting policies that could have shown warning signs about the company’s financial health many years before the coll...

Send us a textChina’s crackdown on property developers threatens the London property market. Evergrande, the world’s most indebted developer, sparked fears across global markets as it missed a crucial interest deadline on its offshore debts. This week, another developer, Fantasia, defaulted on an offshore bond. A property consultant close to London’s development market was contacted in the wake of...

Send us a textRevelations from nearly 12 million leaked confidential financial records have thrown light on the concealed wealth of powerful public figures around the world. How do they hide their money, and why is this information important? The Pandora Papers were released this week showing that Jordan’s King - Abdullah II amassed $100 million in property including homes in The United States and...

Send us a textOn the heels of Evergrande’s debt crisis, there are increasing signs of stress in China’s real estate market after Fantasia Holdings failed to make a bond payment. Fantasia Holdings, a Chinese developer of luxury apartments missed $315 million in payments to lenders on Monday, sparking fears that financial strains in the country's outsized property sector are spreading beyond the tro...

Send us a textOver the last month the news has been dominated by stories of energy shortages around the world. China has seen major industrial output cuts caused by power outages over the last year, European gas prices are trading near record highs and the UK is reeling from the political fallout of a surge in energy prices. US oil prices rose to the highest level in seven years after OPEC and its...

Send us a textIn the latest of a series of crypto crackdowns, Chinas central bank announced on Friday that overseas facilities offering cryptocurrency services inside China are “illegal”. It warned that any local staff who help these businesses operate, or even provide marketing and technical support, “shall be investigated”. This is the most direct crackdowns by a major regulator against “offshor...

Send us a textThe financial woes of Evergrande the once-mighty Chinese property developer highlight a showdown between two competing objectives for China's Communist Party. They aim to force China's private sector away from speculative and risky lending practices while avoiding a financial meltdown and the collapse of the property sector, in which more than 70% of the nation's urban wealth is lock...

Send us a textIn an interview with local media, an Evergrande financial adviser said the products were a type of “supply chain finance”. While the money from retail investors may in years past have gone to its suppliers, the Evergrande executives in Shenzhen receiving retail investors said this was no longer the case. One of the executives of Evergrande’s wealth management division said Hubei Gang...

Send us a textThe liquidity crisis at Chinese property developer Evergrande shook global markets this morning with stocks falling in Asia, Europe and New York. The S&P 500 fell 2.1 per cent in afternoon trading, while the Nasdaq Composite slipped 2.6 per cent. The Vix, which measures expected volatility on the S&P, hit 26.5 — around its highest level since May. Monday’s sell-off came after...

Send us a textThe implosion of Lehman Brothers, 13 years ago this week, showed the world how the collapse of a single company can send shockwaves around the world. Echoes from that event are resounding today as a massive Chinese property developer teeters on the brink of default. The collapse of Evergrande Real Estate Group - China's second-largest property developer with $310 billion of debt outs...

Send us a textThe Beanie Babies Bubble is a particularly entertaining story which highlights all the hallmarks of a mania. Mass delusion. Speculation. Out of control expectations. The herd mentality. Right now, it might appear that we are in another collectibles boom, in February this year, a Michael Jordan basketball card sold for $738,000 at auction. The exact same card had traded for more than...

Send us a textIn today's podcast Patrick discusses the famous Warren Buffett quote “calling someone who trades actively in the market an investor “is like calling someone who repeatedly engages in one-night stands a romantic.” from his 1991 letter to investors. Topics covered are: what is the difference between trading and investing? Is one better than the other, and does it make sense to discoura...