Hello, dummies
It's your old pal, Fuzzy.
As I'm sure you've all noticed, a lot of the stuff that gets posted here is - to put it delicately - fucking ridiculous. More backwards-ass shit gets posted to
wallstreetbets than you'd see on a Westboro Baptist community message board. I mean, I had a look at the daily thread yesterday and..... yeesh. I know, I know.
We all make like the divine Laura Dern circa 1992 on the daily and stick our hands deep into this steaming heap of shit to find the nuggets of valuable and/or hilarious information within (thanks for reading, BTW). I agree. I love it just the way it is too. That's what makes WSB great.
What I'm getting at is that a lot of the stuff that gets posted here - notwithstanding it being funny or interesting - is just... wrong. Like, fucking your cousin wrong. And to be clear, I mean the fucking your *first* cousin kinda wrong, before my Southerners in the back get all het up (simmer down, Billy Ray - I know Mabel's twice removed on your grand-sister's side). Truly, I try to let it slide.
I do my bit to try and put you on the right path. Most of the time, I sleep easy no matter how badly I've seen someone explain what a bank liquidity crisis is. But out of all of those tens of thousands of misguided, autistic attempts at understanding the world of high finance, one thing gets so consistently - so *emphatically* - fucked up and misunderstood by you retards that last night I felt obligated at the end of a long work day to pull together this edition of
Finance with Fuzzy just for you. It's so serious I'm not even going to make a
u/pokimane gag. Have you guessed what it is yet? Here's a clue. It's in the title of the post.
That's right, friends. Today in the neighborhood we're going to talk all about
hedging in financial markets - spots, swaps, collars, forwards, CDS, synthetic CDOs, all that fun shit. Don't worry; I'm going to explain what all the scary words mean and how they impact your OTM RH positions along the way.
We're going to break it down like this. (1) "What's a hedge, Fuzzy?" (2) Common Hedging Strategies and (3) All About ISDAs and Credit Default Swaps.
Before we begin. For the nerds and JV traders in the back (and anyone else who needs to hear this up front) - I am simplifying these descriptions for the purposes of this post. I am also obviously not going to try and cover every exotic form of hedge under the sun or give a detailed summation of what caused the financial crisis. If you are interested in something specific ask a question, but don't try and impress me with your Investopedia skills or technical points I didn't cover; I will just be forced to flex my years of IRL experience on you in the comments and you'll look like a big dummy.
TL;DR? Fuck you. There is no TL;DR. You've come this far already. What's a few more paragraphs? Put down the Cheetos and try to concentrate for the next 5-7 minutes. You'll learn something, and I promise I'll be gentle.
Ready? Let's get started.
1. The Tao of Risk: Hedging as a Way of Life The simplest way to characterize what a hedge 'is' is to imagine every action having a binary outcome. One is bad, one is good. Red lines, green lines; uppie, downie. With me so far? Good. A 'hedge' is simply the employment of a strategy to mitigate the effect of your action having the
wrong binary outcome. You wanted X, but you got Z! Frowny face. A hedge strategy introduces a
third outcome. If you hedged against the
possibility of Z happening, then you can wind up with Y instead. Not as good as X, but not as bad as Z. The technical definition I like to give my idiot juniors is as follows:
Utilization of a defensive strategy to mitigate risk, at a fraction of the cost to capital of the risk itself.
Congratulations. You just finished Hedging 101. "But Fuzzy, that's easy! I just sold a naked call against my 95% OTM put! I'm adequately hedged!". Spoiler alert: you're not (although good work on executing a collar, which I describe below). What I'm talking about here is what would be referred to as a 'perfect hedge'; a binary outcome where downside is totally mitigated by a risk management strategy. That's not how it works IRL. Pay attention; this is the tricky part.
You can't take a single position and conclude that you're adequately hedged because risks are fluid, not static. So you need to constantly adjust your position in order to maximize the value of the hedge and insure your position. You also need to consider exposure to more than one category of risk. There are micro (specific exposure) risks, and macro (trend exposure) risks, and both need to factor into the hedge calculus.
That's why, in the real world, the value of hedging depends entirely on the design of the hedging strategy itself. Here, when we say "value" of the hedge, we're not talking about cash money - we're talking about the intrinsic value of the hedge relative to the the risk profile of your underlying exposure. To achieve this, people hedge
dynamically. In
wallstreetbets terms, this means that as the value of your position changes, you need to change your hedges too. The idea is to efficiently and continuously distribute and rebalance risk across different states and periods, taking value from states in which the marginal cost of the hedge is low and putting it back into states where marginal cost of the hedge is high, until the shadow value of your underlying exposure is equalized across your positions. The punchline, I guess, is that one static position is a hedge in the same way that the finger paintings you make for your wife's boyfriend are art - it's technically correct, but you're only playing yourself by believing it.
Anyway. Obviously doing this as a small potatoes trader is hard but it's worth taking into account. Enough basic shit. So how does this work in markets?
2. A Hedging Taxonomy The best place to start here is a practical question. What does a business need to hedge against? Think about the specific risk that an individual business faces. These are legion, so I'm just going to list a few of the key ones that apply to most corporates. (1) You have commodity risk for the shit you buy or the shit you use. (2) You have currency risk for the money you borrow. (3) You have rate risk on the debt you carry. (4) You have offtake risk for the shit you sell. Complicated, right? To help address the many and varied ways that shit can go wrong in a sophisticated market, smart operators like yours truly have devised a whole bundle of different instruments which can help you manage the risk. I might write about some of the more complicated ones in a later post if people are interested (CDO/CLOs, strip/stack hedges and bond swaps with option toggles come to mind) but let's stick to the basics for now.
(i) Swaps
A swap is one of the most common forms of hedge instrument, and they're used by pretty much everyone that can afford them. The language is complicated but the concept isn't, so pay attention and you'll be fine. This is the most important part of this section so it'll be the longest one.
Swaps are derivative contracts with two counterparties (before you ask, you can't trade 'em on an exchange - they're OTC instruments only). They're used to exchange one cash flow for another cash flow of equal expected value; doing this allows you to take speculative positions on certain financial prices or to alter the cash flows of existing assets or liabilities within a business. "Wait, Fuzz; slow down! What do you mean sets of cash flows?". Fear not, little autist. Ol' Fuzz has you covered.
The cash flows I'm talking about are referred to in swap-land as 'legs'. One leg is fixed - a set payment that's the same every time it gets paid - and the other is variable - it fluctuates (typically indexed off the price of the underlying risk that you are speculating on / protecting against). You set it up at the start so that they're notionally equal and the two legs net off; so at open, the swap is a zero NPV instrument. Here's where the fun starts. If the price that you based the variable leg of the swap on changes, the value of the swap will shift; the party on the wrong side of the move ponies up via the variable payment. It's a zero sum game.
I'll give you an example using the most vanilla swap around; an interest rate trade. Here's how it works. You borrow money from a bank, and they charge you a rate of interest. You lock the rate up front, because you're smart like that. But then -
quelle surprise! - the rate gets
better after you borrow. Now you're bagholding to the tune of, I don't know, 5 bps. Doesn't sound like much but on a billion dollar loan that's a lot of money (a classic example of the kind of 'small, deep hole' that's terrible for profits). Now, if you had a swap contract on the rate before you entered the trade, you're set; if the rate goes down, you get a payment under the swap. If it goes up, whatever payment you're making to the bank is netted off by the fact that you're borrowing at a sub-market rate. Win-win! Or, at least, Lose Less / Lose Less. That's the name of the game in hedging.
There are
many different kinds of swaps, some of which are pretty exotic; but they're all different variations on the same theme. If your business has exposure to something which fluctuates in price, you trade swaps to hedge against the fluctuation. The valuation of swaps is also super interesting but I guarantee you that 99% of you won't understand it so I'm not going to try and explain it here although I encourage you to google it if you're interested.
Because they're OTC, none of them are filed publicly. Someeeeeetimes you see an ISDA (dsicussed below) but the confirms themselves (the individual swaps) are not filed. You can usually read about the hedging strategy in a 10-K, though. For what it's worth, most modern credit agreements ban speculative hedging. Top tip: This is occasionally something worth checking in credit agreements when you invest in businesses that are debt issuers - being able to do this increases the risk profile significantly and is particularly important in times of economic volatility (ctrl+f "non-speculative" in the credit agreement to be sure).
(ii) Forwards
A forward is a contract made today for the future delivery of an asset at a pre-agreed price. That's it. "But Fuzzy! That sounds just like a futures contract!". I know. Confusing, right? Just like a futures trade, forwards are generally used in commodity or forex land to protect against price fluctuations. The differences between forwards and futures are small but significant. I'm not going to go into
super boring detail because I don't think many of you are commodities traders but it is still an important thing to understand even if you're just an RH jockey, so stick with me.
Just like swaps, forwards are OTC contracts - they're not publicly traded. This is distinct from futures, which are traded on exchanges (see
The Ballad Of Big Dick Vick for some more color on this). In a forward, no money changes hands until the maturity date of the contract when delivery and receipt are carried out; price and quantity are locked in from day 1. As you now know having read about BDV, futures are marked to market daily, and normally people close them out with synthetic settlement using an inverse position. They're also liquid, and that makes them easier to unwind or close out in case shit goes sideways.
People use forwards when they absolutely have to get rid of the thing they made (or take delivery of the thing they need). If you're a miner, or a farmer, you use this shit to make sure that at the end of the production cycle, you can get rid of the shit you made (and you won't get fucked by someone taking cash settlement over delivery). If you're a buyer, you use them to guarantee that you'll get whatever the shit is that you'll need at a price agreed in advance. Because they're OTC, you can also exactly tailor them to the requirements of your particular circumstances.
These contracts are incredibly byzantine (and there are even crazier synthetic forwards you can see in money markets for the true degenerate fund managers). In my experience, only Texan oilfield magnates, commodities traders, and the weirdo forex crowd fuck with them. I (i) do not own a 10 gallon hat or a novelty size belt buckle (ii) do not wake up in the middle of the night freaking out about the price of pork fat and (iii) love greenbacks too much to care about other countries' monopoly money, so I don't fuck with them.
(iii) Collars
No, not the kind your wife is encouraging you to wear try out to 'spice things up' in the bedroom during quarantine. Collars are actually the hedging strategy
most applicable to WSB. Collars deal with options! Hooray!
To execute a basic collar (also called a wrapper by tea-drinking Brits and people from the Antipodes), you buy an out of the money put while simultaneously writing a covered call on the same equity. The put protects your position against price drops and writing the call produces income that offsets the put premium. Doing this limits your tendies (you can only profit up to the strike price of the call) but also writes down your risk. If you screen large volume trades with a VOL/OI of more than 3 or 4x (and they're not bullshit biotech stocks), you can sometimes see these being constructed in real time as hedge funds protect themselves on their shorts.
(3) All About ISDAs, CDS and Synthetic CDOs You may have heard about the mythical
ISDA. Much like an indenture (discussed in my post on $F), it's a magic legal machine that lets you build swaps via trade confirms with a willing counterparty. They are
very complicated legal documents and you need to be a true expert to fuck with them. Fortunately, I am, so I do. They're made of two parts; a Master (which is a form agreement that's always the same) and a Schedule (which amends the Master to include your specific terms). They are also the engine behind just about every major credit crunch of the last 10+ years.
First - a brief explainer. An ISDA is a not in and of itself a hedge - it's an umbrella contract that governs the terms of your swaps, which you use to construct your hedge position. You can trade commodities, forex, rates, whatever, all under the same ISDA.
Let me explain. Remember when we talked about swaps? Right. So. You can trade swaps on just about anything. In the late 90s and early 2000s, people had the smart idea of using other people's debt and or credit ratings as the variable leg of swap documentation. These are called
credit default swaps. I was actually starting out at a bank during this time and, I gotta tell you, the only thing I can compare people's enthusiasm for this shit to was that moment in your early teens when you discover jerking off. Except, unlike your bathroom bound shame sessions to Mom's Sears catalogue, every single person you know felt that way too; and they're all doing it at once. It was a fiscal circlejerk of epic proportions, and the financial crisis was the inevitable bukkake finish. WSB autism is absolutely no comparison for the enthusiasm people had during this time for lighting each other's money on fire.
Here's how it works. You pick a company. Any company. Maybe even your own! And then you write a swap. In the swap, you define "Credit Event" with respect to that company's debt as the variable leg . And you write in... whatever you want. A ratings downgrade, default under the docs, failure to meet a leverage ratio or FCCR for a certain testing period... whatever. Now, this started out as a hedge position, just like we discussed above. The purest of intentions, of course. But then people realized - if bad shit happens,
you make money. And banks... don't like calling in loans or forcing bankruptcies. Can you smell what the moral hazard is cooking?
Enter synthetic CDOs. CDOs are basically pools of asset backed securities that invest in debt (loans or bonds). They've been around for a minute but they got famous in the 2000s because a shitload of them containing subprime mortgage debt went belly up in 2008. This got a lot of publicity because a lot of sad looking rednecks got foreclosed on and were interviewed on CNBC. "OH!", the people cried. "Look at those big bad bankers buying up subprime loans! They caused this!". Wrong answer, America. The debt wasn't the problem. What a lot of people don't realize is that the real meat of the problem was not in regular way CDOs investing in bundles of shit mortgage debts in
synthetic CDOs investing in CDS predicated on that debt. They're
synthetic because they don't have a stake in the actual underlying debt; just the instruments riding on the coattails. The reason these are so popular (and remain so) is that smart structured attorneys and bankers like your faithful correspondent realized that an even
more profitable and efficient way of building high yield products with limited downside was investing in instruments that profit from failure of debt
and in instruments that rely on that debt and then hedging
that exposure with other CDS instruments in paired trades, and on and on up the chain. The problem with doing this was that everyone wound up exposed to everybody else's books as a result, and when one went tits up, everybody did. Hence, recession, Basel III, etc. Thanks, Obama.
Heavy investment in CDS can also have a warping effect on the price of debt (something else that happened during the pre-financial crisis years and is starting to happen again now). This happens in three different ways. (1) Investors who previously were long on the debt hedge their position by
selling CDS protection on the underlying, putting downward pressure on the debt price. (2) Investors who previously shorted the debt switch to
buying CDS protection because the relatively illiquid debt (partic. when its a bond) trades at a discount below par compared to the CDS. The resulting reduction in short selling puts upward pressure on the bond price. (3) The delta in price and actual value of the debt tempts some investors to become NBTs (neg basis traders) who long the debt and purchase CDS protection. If traders can't take leverage, nothing happens to the price of the debt. If basis traders
can take leverage (which is nearly always the case because they're holding a hedged position), they can push up or depress the debt price, goosing swap premiums etc. Anyway. Enough technical details.
I could keep going. This is a fascinating topic that is very poorly understood and explained, mainly because the people that caused it all still work on the street and use the same tactics today (it's also
terribly taught at business schools because none of the teachers were actually around to see how this played out live). But it relates to the topic of today's lesson, so I thought I'd include it here.
Work depending, I'll be back next week with a covenant breakdown. Most upvoted ticker gets the post.
*
EDIT 1\* In a total blowout, $PLAY won. So it's D&B time next week. Post will drop Monday at market open.
The following story, all names, characters, and incidents portrayed in this post are fictitious. No identification with actual persons (living or deceased), places, buildings, and products is intended or should be inferred.
However, the
LINKS to real-life events and inspiring sources are placed here and there throughout the story.
--------
Truth is the Only Light --------
INTRO ☞ [As of 2019] there are plenty of reasons to think the Chinese system will implode spectacularly without Japanese feeling the need to do a thing. — Peter Zaihan,
Disunited Nations (Mar 03, 2020)
It's apparent that two nations have been engaged in a high-stakes military & economy
arms race. The current US admin has been hitting China with waves of tariffs, but that was merely a small part of what's actually going on. [
1] [
2] [
3] [
4] [
5] [
6] [
7] [
8]
On Oct 11, 2019, when they reached a tentative agreement for the first phase of a trade deal, the fact that China made the concession actually made my jaw drop. From where I sit, it was a worrisome scene. Aren't people saying, when challenging situations are bottled up, they will just grow and mutate into another terrible complications?
Admittedly I was not certain how they are going to adhere to the agreement: It left most of the US tariffs (on China's exports) in place, and at the same time, came with an additional USD $200 Billion burden for China over the next two years. This agreement might seem a bit insignificant, but now China would need to purchase
almost twice the size of the US products & services they did before the trade war began.
With their current
economic climate? I murmured, "No way."
While watching Trump brag and boast around with said agreement, I expected China would soon come out and fling some improvised excuses in order to delay the document-signing process. It wouldn't be their first time. More importantly, even if China does so, there wouldn't be many (real) counterattack options left for the Trump admin during this year, the US presidential election year.
Then, on Jan 16, 2020, the world’s two largest economies actually signed a partial trade agreement aimed at putting the brakes on an 18-month trade war. China would almost surely not sit down but come back to bite, I thought.
Enter the worldwide chaos following so called the COVID-19 outbreak.
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BACKGROUND ☞ Globalists have been heavily investing in China's economy and its components overseas.
• Here are a couple of well known names: the Great Old
One; George Soros; Koos Bekker; and
Bill Gates.
• For the sake of convenience, from here on, let's call these globalists, who are foreign investors in China's top tier state-owned/sponsored/controlled enterprises,
Team-Z. • Team-Z has adopted big time lackeys like Henry
Kissinger or small time ones like Larry
Summers, Stephen
Hadley, or Bill
Browder as
matchmakers to court Team-Z for China's top tier enterprises. When Israel's highest echelons chimed in, it has been through
Israeli IT companies and the
BRI projects.
• Naturally, multinational
investment banks have also been employed; such as Morgan Stanley, Goldman Sachs, Royal Bank of Scotland (RBS), UBS Group AG (formerly Union Bank of Switzerland), Blackstone Group, Canaccord Genuity, BlackRock, Hermitage, or Mirae Asset.
☞ Note: The Great Old One didn't use any matchmakers, something peasants would need. Because the Great Old One's power level is over 9000.
• China's
Shanghai clique used to keep the nation's state-sponsored enterprises under their firm grip: Enterprises such as Alibaba Group, Tencent, Baidu, Wanda Group, HNA Group, Anbang Group, Evergrande Group, CEFC Energy and
Huawei, all of which Team-Z has massively invested in.
•
Here is how Shanghai clique and Team-Z, esp. Bill Gates, started to get together: [LINK] • However, in the name of anti-corruption
campaign, Xi Jinping & his Princelings have been taking those businesses away from Shanghai clique's hand, and
transforming those state-sponsored private enterprises into the state-owned enterprises, declaring the
國進民退 movement.
• Slaying Shanghai clique's control = [
1] [
2] [
3] [
4] [
5] [
6]
• 國進民退 + Slaying Shanghai clique's control = [
A] [
B] [
C]
• Xi's reign didn't arrive today without challenges though: the BRI projects' poor outcome has
frustrated Israel's great
expectations. And since the US-China trade war has started, the problems of China's economic systems started to
surface, not to mention China's economy has long been
decaying.
• Coupled with the US-China trade war, the current US admin has been trying to block Huawei from accessing the international financial systems that the US can influence, as well as
the US banking systems. This is a good time to remind you again that Bill Gates has had a very close-knit relationship with Huawei.
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TRADE WAR & INTERNET-BASED COMPANIES ☞ It's the trade war, but why were internet-based companies such as Tencent and Baidu suffering losses?
Answer: The state-sponsored companies like Tencent, Baidu, or Huawei have heavily invested in international trade and commodity markets, which are easily influenced by aspects that IMF interest rates, the US sanctions, or trade war can create.
Example: Let's say, Tencent invests in a Tehran-based ride-hailing company. Then, through said ride-hailing company, Tencent invests in Iran's petroleum industry. Now, China's most valuable IT company is in international petrochemical trade. The business is going to make great strides until the US imposes trade embargoes oand economic sanctions against Iran.
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TL;DR China's economy going down = Team-Z losing an astronomical amount of money. ★ Wednesday, Sep 26, 2018 ★
"Gentlemen, you guys might want to do something before it's too bloody late, no? His speech last night was .... (sniggers) Mr. Gates, now is as good a time as any. Mr. Soros, hm, don't look at me like that." ".... But," "Yes, Mr. Soros, your HNA is going down, too. .... Ah, Schwarzman xiansheng, we're very sorry to learn about Blackstone's Iran & SinopecChina situation. So, we're guessing, you'd be happy to join Mr. Gates's operation, yes? Of course, We already contacted Kissinger xiansheng. .... Okay then, Gentlemen?" • Now you can take a guess why
George Soros has recently been sending out confusing messages regarding Xi Jinping.
• Wait, how about Wuhan Institute of Virology? Doesn't this story concern the COVID-19 outbreak? Is the Wuhan Institute also associated with Shanghai clique?
Yes, indeed. Here's How Wuhan Institute of Virology and Shanghai Clique are related: [LINK] --------
EIGHT OBJECTIVES ☞ Calling for the tide to be turned, Team-Z and Shanghai clique started to devise the plan. The objectives are:
① By shutting down international trade, crashing world economy, and exploiting its aftermath, the plan should produce an outcome letting Team-Z
earn back their loss from the trade war & the US sanctions, and collect additional profits from China's BRI projects & stock markets
worldwide, including the US stock markets.
•
Don't forget this: This point number
① also concerns the developing
nations on the BRI with the large deposits of natural resources that Team-Z has invested in through China. If everything comes together nicely, Team-Z will
pick up trillions of dollars from those nations alone
as if they are light as a feather. Ironically this will reinforce the BRI project governance and mitigate fraud & corruption risks inherent to the international development projects.
② By utilizing the aftermath in the US, a new US administration consisted of pro-Beijing personnels should be fostered at the 2020 election. In a worst-case scenario, the aftermath should be abused enough to make Robert
Lighthizer to leave the admin. Mr. Mnuchin could stay.
③ Sometime next year, the phase one trade deal must be reassessed with the new US admin. The reassessment should help China take the upper-hand at the second phase trade
talk.
④ The pandemic crisis should yield a situation which allows China to
delay the payments for its state-firm offshore
debts. With the point number
①, this will give China a breathing room to manage its steadily-
fallen forex reserves.
⑤ Since their current
turf (in China) is education industry & medical science industry, Shanghai clique will have no issue with earning hefty profits by managing China's export of medical equipments & health care products which can be supplied worldwide mainly by
China. People in the west will bent the knees for the clique's support.
☞ Regarding Jiang Zemin's son and medical science industry in China [
LINK]
⑥ The outcome should weaken Xi & his Princelings' political power considerably in favour of Shanghai clique & Team-Z. This will let Jiang's Shanghai clique
(A) reclaim some of political status & business interest controls they have lost to Xi & his Princelings.
• And once this point number
⑥, with the point number
② , is realized, it would be much easier for the clique to
(B) recover their huge assets
hidden overseas that the current
US admin or Xi & his Princelings have frozen.
⑦ Combining good old
bribery with
sex, the outcome should support China to
re-secure control over the US governors. Once the plan is executed successfully, those governors would desperately need solutions to local economic problems and unemployment.
⑧ Lastly, implementing an e-ID system in the US similar to
Beijing's Alipay and WeChat could be the cherry on top of the operation's entire outcomes.
Who's supporting such a system worldwide? None other than Microsoft and Rockefeller Foundation. ಠ_ಠ
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OLD COMRADE BECOMES A NEW RECRUIT ☞ They were afraid more talents were needed. The main target was the world’s largest economy with the most powerful military capability, after all.
They ended up asking
Mr. Fridman to see Lord
Putin about that. The old Vova was going through a lot nowadays, people said. It could be because his nation's energy business to
Europe seems to be hitting wall after wall. He is said to have enough on his plate with no end in sight, so maybe he'll join.
★ Monday, Jan 15, 2018 ★
"(pours a drink for himself) I know, but. ... What would happen if Bashar falls? How long you think you can keep it up? .... Erdogan is many things (sniggers) but he's never gentle. (sips his drink slowly) When Benji's EastMed Pipeline starts to actively compete, then what? They got the China money now. .... Vagit and his buddies will be very unhappy. You know that. Not great, Vova." "...." "Ah, you mean what are we going to do? Hm? Hm. I'll tell you what we're going to do. This time, we're going to bankrupt the US shale gas sector. Then, of course, we can maybe convince Benji to take their time with the pipeline. Perhaps for good. (sips his drink slowly) Don't worry, Vova, It'll work. You worry too much. We'll come out the other side stronger." "So, how long until they set it off? "Hahaa, yes. They'll soon put all things in place. While marching in place, they'll play the tune a couple of months before the next sochelnik." "Nearly 20 months to brace things here, then?" "(nod slowly in happiness) Hm. Оторви́сь там, оттопы́рься, Vova" --------
USEFUL IDIOTS ☞ When the directive came, these idiots answered claiming they would be gladly "on it." All in the name of rejuvenating China's economy without grasping the real objective prevailing throughout the entire operation. Thing is, they would never realize what they are to Team-Z & their Asian overlord until it’s too late.
Who are they? It's A and B, not A or B:
(A) the American corporations that are
too big to fail and have suffered a considerable loss because of the US-China trade war. Among those corporations,
(B) the ones that have been structured with massive interest-profit relationships in/with China.
"We need China in order for the US as a nation to continue being prosper," they've been shouting. No surprise there, because they've enjoyed the strides of extraordinary profits over the years while the US middle class has continued to shrink.
But, in 2019 when China's stock markets nosedived for the first time since 2015 and China's authorities in financial stability & resiliency fumbled their response; it wiped that
smile off their face. Still, they'll keep behaving not to offend their Asian overlord, nonetheless.
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PERFECT PLAN ☞ Many crucial components had to come into play all at once in order to cause World War I. If one of the components were missing or different, it is unlikely that the World War I as we know of could be produced.
① The US in 2019: Overbought bubbles + Over borrowed corporations
② The US in 2020: It's an
Election Year.
③ Russia has been
dumping US Treasuries for the past few years.
④ Russia has been
hoarding golds as if they were recreating Inca Empire.
⑤ China in 2019: Immense & long term financial
troubles has started to surface.
⑥ China in 2020: The phase-one
deal has been signed; leaving most of tariffs on China intact and adding another $200 Billion burden for China.
⑦ Team-Z sets up a situation in the US where some
event(s) would freeze the US supply chains & demand for the next three to ten months.
• Just like the 9/11, the event will be initiated at the clique's own region. However, unlike
in China, the US will report multiple epicentres
simultaneously.
• And the CDC and the US medical task force will carry on with a number of sabotage acts, to secure enough time for the infected yet untested in those US epicentres to spread plenty. [
1] [
2] [
3]
• Here's a feasible
timeline of the operation.
⑧ Then,
the BOOM: Team-Z
(a) manipulates the markets to make sure MM will have liquidity concerns
(b) when they need it most. The
(c) bottomed out oil price will be an enforcement, which will also wreck the US energy sector as a kicker. The
(d) WHO will also
join as a disinformation campaign office.
• Then a couple of big name investment managers will lead a movement that (will try to) bring back foreign money back to China. [
1] [
2]
• Meanwhile, in US, the disinformation campaign will continue to be pushed until the second wave of attack arrives.
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MEASURABLE SHORT-TERM OUTCOME ☞ We're now going through World War III. The global structure laid down by World War II had been shaken by globalization and the rise of China. This pandemic event will shock the structure further. Human history will be divided into Before 2021 and After 2021.
① Outcome pt. 1: Immediate Aftermath [
pt.1] [
pt.2]
② Outcome pt. 2: The US economy goes deep dive along with world economy, and the only thing Team-Z has to do is to exploit the aftermath which has been thoroughly calculated and eagerly anticipated. —
Favoured assessment: There won't be a V curve ever, unless drastic measures taken within the timeframe of four months. Unprecedented market crash, the rapid unemployment acceleration because of the supply-chain shut down, and the near-death security which in turn forces consumer confidence to plummet. We're looking at a super long L shape curve unless the US prepares fast for the second wave of their asymmetric warfare.
③ Outcome pt. 3: Arguably the most important outcome. — Because of the unprecedented shutdown of international trade, the nations heavily rely on exporting natural resources will face the extreme financial threats. What if some of those are emerging markets
AND massively in debt to China? What do you think China would do to said nations while the aftermath is hitting the globe hard?
[PDF] Something comparable to Latin American Debt
Crisis will happen.
④ Outcome pt. 4: Not that significant compared to the others but still notable outcome. — The world will need Shanghai clique's help to get medical products and equipments.
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WHAT'S NEXT? ☞ Several analysts have discussed
off the record that next it'd be a proxy warfare not using armed conflicts but with spreading a galaxy of counterfeit-currency across every possible channels.
Coincidently, on Dec 13, 2017, Business Insider reported in an
article "A $100 counterfeit 'supernote' found in South Korea could have been made in North Korea" that:
"It was the first of a new kind of supernote ever found in the world," Lee Ho-Joong, head of KEB Hana Bank's anti-counterfeit centre told Agence France-Presse.
Reporting the same news, The Telegraph published an
article on Dec 11, 2017:
"It seems that whoever printed these supernotes has the facilities and high level of technology matching that of a government", said Lee Ho-jung, a bank spokesman from KEB Hana Bank in South Korea. "They are made with special ink that changes colour depending on the angle, patterned paper and Intaglio printing that gives texture to the surface of a note".
ಠ_ಠ
--------
•
Tale of How Shanghai clique and Globalists Got Together •
Wuhan Institute of Virology, Wuhan City, & Shanghai Clique •
Feasible Timeline of the COVID-19 Operation •
Immediate Aftermath — pt.1.b
•
Immediate Aftermath — pt.2.a
•
Remdesivir, Gilead Sciences, Its Shareholders, & Silly Concern •
Cases Displaying the Recent Climate of Chinese Economy •
Compliance Report by the US State Department on China regarding Biological Weapons Convention — Click "2019 August Unclassified Compliance Report" and see p45.
•
Jiang Zemin's son & Medical Science Industry in China •
What is Guanxi (關係)? •
Israeli IT Companies & China •
Opinion article "Cancel All Debt to China" •
Fun Trivia about Bush Family and China --------
I want to use this thread to present the key findings of going through recent Wayland news releases. Everything shown here is public accessible. I have no intention to accuse someone of fraud or something like this, just asking questions ....
Feb 20 2019: Wayland Group Provides Corporate Update I do not want to speak about the well below average generated revenues nor the revenue forecasts. Just as a side note: Ben had a forecast of ~ $15,000,000 for Q4 2018 (October – December 2018). The corporate update states $1,305,033 for Q4 2018 (< 10 percentage of the forecast). In addition, you cannot whitewash the 480% increase to the previous quarter.
“Wayland has also entered into an agreement to obtain additional funds to support the expansion of the Company’s global footprint and fund development of its flagship Langton facility. This agreement is with certain investment funds managed by Alpha Blue Ocean Inc. (“Alpha Blue”) a money manager based in London, United Kingdom with a strong track record of partnering with public companies and delivering meaningful value to their shareholders.”
Founder and CEO of Alpha Blue Ocean Inc. is Pierre Vannineuse (
https://www.linkedin.com/in/piervan/)
Ok let’s have a look at their strong track record:
JUN 21 2018
QuickCool AB (Publ) ("QuickCool" or the "Company") has entered into a financing agreement with European High Growth Opportunities Securitization Fund through its financial advisor Alpha Blue Ocean Inc.
See:
http://news.cision.com/quickcool/quickcool-ab-enters-into-a-financing-agreement-with-european-high-growth-opportunities-securitizatio,c2554476
See performance since financing:
https://i.imgur.com/j7HxzPk.png
Okay next
MAR 28 2018: CybAero and European High Growth Opportunities Securitization Fund (“EHGO”), advised by Alpha Blue Ocean Advisors Ltd, member of the Alpha Blue Ocean Investment Group (“ABO”), has now signed an agreement regarding a financing solution of up to SEK 52.5 million in the form of thirteen convertible loans, the first loan of SEK 4.5 million and the following twelve loans each of SEK 4 million.
See:
http://news.cision.com/cybaero/cybaero-signs-agreement-with-alpha-blue-ocean-for-up-to-sek-52-5-million,c2483046
Seriously? Just 3 months later:
June 22 2018: Sweden’s largest military drone maker files for bankruptcy
“CybAero had provisionally negotiated a financing solution with the Luxembourg-based European High Growth Opportunities Securitization Fund, or EHGO, to raise $6 million in the form of 13 convertible loans. The EHGO had hired the London-based Alpha Blue Ocean Advisors to mediate a deal. The first tranche in this solution involved a bridge loan amounting to $227,000.
Nasdaq First North rejected this first tranche arrangement and insisted that, in order for trading in its share to resume, CybAero needed to place a minimum of $114,000 in escrow on a authorized bank account. Moreover, Nasdaq First North launched an investigation to determine if the negotiated financing solution violated stock exchange rules.”
See:
https://www.defensenews.com/newsletters/unmanned-systems/2018/06/22/swedens-largest-military-drone-maker-files-for-bankruptcy/
Also see:
https://simplywall.st/stocks/se/capital-goods/sto-cba/cybaero-shares/news/will-you-be-burnt-by-cybaero-abs-stocba-cash-burn/
Okay next
Feb 20 2018: MOLOGEN AG enters into financing agreement with Alpha Blue Ocean's European High Growth Opportunities Securitization Fund
See:
https://www.dgap.de/dgap/News/corporate/mologen-enters-into-financing-agreement-with-alpha-blue-oceans-european-high-growth-opportunities-securitization-fund/?newsID=1053753
See performance since financing:
https://i.imgur.com/JXVJ7yq.png
Okay next
19 March 2018: Cereno Scientific enters into a financing agreement with European High Growth Opportunities Securitization Fund through its advisor Alpha Blue Ocean
See:
https://www.cerenoscientific.se/en/en/ehgo_agreement
See performance since financing:
https://i.imgur.com/CS7rq5y.png
Okay next
10 Jan 2018: FIT Biotech's EUR 10 million financing agreements' share loan and first part of commitment fee related shares have been handed over today to Alpha Blue Ocean
See:
https://www.pm360online.com/fit-biotech-oy-fit-biotechs-eur-10-million-financing-agreements-share-loan-and-first-part-of-commitment-fee-related-shares-have-been-handed-over-today-to-alpha-blue-ocean/
See performance since financing:
https://i.imgur.com/N0XhSQp.png
FIT Biotech Oy Company release 20.02.2019 at 14:30 EET
Liquidity crisis, request for a tranche and changes to financial calendar and date of the Annual General Meeting
Despite the financing agreement in force, Alpha Blue Ocean (”ABO”) has not paid tranches envisaged by the agreement since 12 November 2018. This has resulted in a liquidity crisis in FIT Biotech Oy (”Company”). The Company has today filed a latest request for a tranche with ABO. Unless ABO pays this tranche by 22 February 2019, Company will have to file for bankruptcy.
See:
https://www.marketscreener.com/FIT-BIOTECH-OY-22752983/news/FIT-Biotech-Oy-Liquidity-crisis-request-for-a-tranche-and-changes-to-financial-calendar-and-date-o-28037452/
I think you are able to recognize the pattern. However the best is yet to come. Just google “alpha blue ocean death spiral”. Same type of financing for Element ASA – a Norwegian based mining company.
“The Induct Manager will demand a million dollar compensation from the "Death Spiral Mortgage Company" Alpha Blue Ocean Stock Exchange and Finance”
See:
https://vaaju.com/norway/the-induct-manager-will-demand-a-million-dollar-compensation-from-the-death-spiral-mortgage-company-alpha-blue-ocean-stock-exchange-and-finance/
Why Would a Company Want Death Spiral Financing?
“A company that seeks death spiral financing basically has no other option to raise money to survive.”
See:
https://www.investopedia.com/terms/d/deathspiral.asp
See also:
Biotech Firms Run Away After Industry Party With Topless Dancers
See:
https://www.bloombergquint.com/business/after-biotech-party-features-topless-dancers-firms-pull-support#gs.RO9Bf8oK
https://i.imgur.com/oQ4n3TC.png Haha … Sean?
Also have a look after Pierre Vannineuse other investing company Bracknor IG. I did not check, but it possibly has a similar track record.
I could go on like this, but I think you got it. So this means “strong track record and delivering meaningful value to their shareholders.” for Ben?
Next news release:
Feb. 07, 2019: Wayland Group Receives EU-GMP Certification for German Facility
“Wayland Group is pleased to announce that it has received both Good Manufacturing Practices and Good Distribution Practices certifications from the national authority in the State of Saxony for the Company’s Ebersbach facility in Germany.”
See:
https://globenewswire.com/news-release/2019/02/07/1711837/0/en/Wayland-Group-Receives-EU-GMP-Certification-for-German-Facility.html
Welcome to EudraGMDP EudraGMDP is the name for the Union database referred to in article 111(6) of Directive 2001/83/EC and article 80(6) of Directive 2001/82/EC. It contains the following information: ·
Manufacturing and import authorisations ·
Good Manufacturing Practice (GMP) certificates. ·
Statements of non-compliance with GMP ·
GMP inspection planning in third countries See:
http://eudragmdp.ema.europa.eu/inspections/displayWelcome.do
https://i.imgur.com/W2zdxqH.png
Looks promising
https://i.imgur.com/c6yVRxu.png
SCOPE OF AUTHORISATION
Name and address of the site : Maricann GmbH, Moritzburger Weg 1, Ebersbach OT Naunhof, Sachsen, 01561, Germany
Human Medicinal Products
Authorised Operations
IMPORTATION OF MEDICINAL PRODUCTS (according to part 2)
Part 2 - IMPORTATION OF MEDICINAL PRODUCTS
2.3 Other importation activities
2.3.1 Site of physical importation
2.3.2 Importation of intermediate which undergoes further processing
But where is the GMP certificate? Latest GMP certificates for Germany:
https://i.imgur.com/bZxouN0.png https://i.imgur.com/ZOlvlwo.png
Just for their facility in Canada. Maybe the missing of the announced GMP certificate is because of the german tender process. Maybe not, who knows …
“These certifications provide Wayland with the foundation to start selling product into the lucrative German and other developing European markets …”
Oh really? Not in my view …
Next news release:
Jan. 31, 2019: Wayland Group Comments on Recent Promotional Market Activity
“Since September 1, 2017 the Company has engaged MJM Markets and Consulting (Toronto, Canada; Follow The Money Investor Group, o/a 2632436 Ontario Limited (Toronto, Canada); Harbor Access LLC (NY, USA); Investing News Network; M. Davis & Associates Capital Inc (Vancouver, Canada); ERPR AS (Oslo, Norway); BlackX GmbH (Germany); Tycona Media (Vancouver, Canada); DiePRBerator (Germany); Global Financial Network (Toronto, Canada), and Prosdocimi (London, UK) at various times to provide investor relations services, public relations services, marketing, native advertising or other related services including the promotion of the Company, its business and/or its securities.”
See:
https://globenewswire.com/news-release/2019/01/31/1708838/0/en/Wayland-Group-Comments-on-Recent-Promotional-Market-Activity.html
Really? What is your business model @ Wayland?!
Just to give you one example:
BlackX GmbH received 1,300,000 shares (each $1.50 = $1,950,000) for the creation/translation of pump articles. See:
https://webfiles.thecse.com/CSE_Form_9_-_Notice_of_Issuance_of_Securities_BlackX_12Nov2018.pdf?4gdPoHHl03IN_5qafloB2.0FP4zHeqYb=
For what exactly? Example:
https://www.dgap.de/dgap/News/dgap_media/maricann-group-inc-mit-volldampf-die-zukunft-ceo-ben-ward-gibt-ausblick-ueber-hervorragende-entwicklung-der-wayland-group/?newsID=1110809
A template lacking in content with share price predictions of 3 to 5 Euro (4.5 – 7.5 CAD).
Next news release:
Jan 30 2019: Wayland Group Corporation: European Cannabis Giant Wayland is said to be in advanced talks to purchase and re-open the Voss Water bottling plant in Norway
See:
https://www.ftmig.com/company-news-releases/european-cannabis-giant-wayland-is-said-to-be-in-advanced-talks-to-purchase-and-re-open-the-voss-water-bottling-plant-in-norway/
The not named London based Norwegian investor in the last paragraph is probably Lars Christian Beitnes (also mentioned in the second paragraph). After reading his name in a Wayland press release again, I got excited. Again? Yes, I have done some DD about Beitnes when Wayland announced the first Malta LOI with Medican Holdings (USD$10.1MM for a recently created shell company in Malta) - see:
https://www.newcannabisventures.com/maricann-to-pay-10-million-to-acquire-malta-licensed-cannabis-producer-medican-holdings/
I was glad when Malta Enterprise terminated this LOI “Malta Enterprise then contacted Maricann to request the Company make its own application, as their preference was to work through Maricann rather than Medican.“ – see:
https://www.newcannabisventures.com/maricann-to-pursue-malta-medical-cannabis-license-independently/
Why am I shocked to see the name Beitnes and Wayland in a press release?
In my view Beitnes is far away from being a person you should do deals with. He is being accused to be part of several frauds/scams in the past/present and recently left as a Chairmen of Element ASA – see:
https://www.dn.no/bors/element/lars-christian-beitnes/rikard-storvestre/avtroppende-styreleder-far-100000-kroner-i-maneden-for-radgivning/2-1-498862
Element ASA … wait … yea the norwegian based mining company who is the victim of the death spiral financing by Alpha Blue Ocean Inc.!!!
There is a long thread about him in a Norwegian stock community with everything mentioned why you should avoid him – see:
https://forum.hegnar.no/thread/16282/view/0/0?page=1
Because of the length of the thread, see some highlights:
- Allegation of forex scam AstonMarkets / AstonForex - see: https://www.forexpeacearmy.com/forex-reviews/10709/www.astonmarkets.com?page=1&per-page=10
- Breach of contract Oxxy Group PLC and Merkur market – see: https://www.oslobors.no/Oslo-Boers/Regelverk/Merkur-Market-klagenemnd
- Swedish pensions authority has filed noticed in court holding Beitnes responsible for various losses Swedish pensioners incurred in the Falcon Funds bust – see: https://www.maltatoday.com.mt/business/business_news/90881/swedes_chasing_falcon_funds_pensions_in_malta_warn_norwegian_director#.XFLsdFxKi9L
- The Falcon Funds bust is a big thing. See also Malta Civil Court https://www.gov.mt/en/Government/DOI/Government%20Gazette/Court%20Notices/Pages/2018/09/CourtNotices2009.aspx. “By the present, the Agency, refers to your involvement inter alia as the final person in control, director and/or shareholder of Oxxy Group Polc, Rock Energy AS, Element ASA (previously known as Intex Resources AS) and White November Fund, in respect of which a number of transactions have been carried out to the detriment of the Sub-Funds and any other direct or indirect involvment in the investments made in the name of the Sub-Funds. It results that these Sub-Funds have suffered a loss, and there could be futher substantial loss, and this loss is, inter alia, the direct or indirect result of your actions and/or omissions, resulting from your negligence, and/or fraud, and/or carelessness, lack of skill and/or for your failure to observe the laws and rules applicable and also because of default in your obligations.”
- https://www.gov.mt/en/Government/DOI/Government%20Gazette/Court%20Notices/Pages/2019/02/CourtNotices0502.aspx
- main defendant is MAX EMIL SERWIN searched for Gross Fraud by Interpol – see: https://www.interpol.int/notice/search/wanted/2018-91323
- more: https://www.expressen.se/dinapengafalcon-funds-grundaren-har-bytt-sitt-namn-igen/
- more: https://www.expressen.se/dinapengapension/nu-sprids-nya-bilden-av-efterlyste-affarsmannen/
- more: https://www.expressen.se/dinapengapension/forsvunne-affarsmannens-liv-i-londons-lyxkvarte
- Alpha Blue Ocean Death spiral: violation against security act – see: https://aksjelive.e24.no/article/OnOd63 and https://www.dn.no/marked/oslo-bors/finanstilsynet/abo/pierre-vannineuse-27-er-mannen-bak-dodsspirallanene/2-1-476012
- Misleading / false information of main shareholder of Element – see: https://e24.no/boers-og-finans/storaksjonaer-i-element-ga-uriktige-opplysninger-i-boersmelding/24520036 - said person has the same address like Beitnes
- Allegations against Global Vision Trading Ltd (Beitnes involvement) receiving excessive amounts for consulting from Element
- https://www.vg.no/nyhetei/9mdxkq/svindeljeger-og-eks-redaktoer-vil-slaa-seg-opp-som-cannabis-investor
- Scam alert for Frode Aschim of Element (responsible for the crypto currency project at Element for getting new money) – see: https://forum.ethereum.org/discussion/16441/scam-alert-ethwallet-co-uk-will-pay-anyone-who-can-help-me-in-recovering-my-wallet and https://www.elementasa.com/assets/uploads/pdf/Element-ASA_Corporate-presentation_October-2018.pdf
I know this is much content, but if you want to make your own picture of Beitnes just dig into this whole Element ASA debacle starting last year. Two auditors (EY & PwC) and the CFO left Element … Then Beitnes left as Chairmen but now serving as external consultant for Element receiving 100.000 NOK monthly.
https://www.dn.no/bors/element/lars-christian-beitnes/rikard-storvestre/avtroppende-styreleder-far-100000-kroner-i-maneden-for-radgivning/2-1-498862 would be a good start. Or dig deeper into the Swedish Pensions Authority lawsuit against Beitnes.
Finally … just ask yourself why does Ben deals with such shady persons? Did Ben no DD on those guys or did he not want to … And that is just the top of the iceberg.
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