Feb.16 -- Ken Moelis, founder, chairman, and chief executive officer at Moelis & Co., discusses his concerns about leverage in the current market. He speaks on "Bloomberg Markets."
Feb.16 -- Ken Moelis, founder, chairman, and chief executive officer at Moelis & Co., discusses his concerns about leverage in the current market. He speaks on "Bloomberg Markets."
Billionaire Thomas Tull — who runs a holding company Tulco modeled in part after Buffett's — described a piece of advice from Buffett that 'impacted' his decision-making.
Commodity trader Olam International, which is dividing its portfolio of diverse products into two new operating businesses, said on Friday that it plans to list its food ingredients segment by the first half of next year. The carve-out and separation of Olam Food Ingredients (OFI), which includes its cocoa, coffee and edible nuts businesses, and Olam Global Agri (OGA), which includes grains and animal feed, edible oils, rice and cotton, is estimated to be completed by the end of 2021. The company will decide on the venue for the listing of the food ingredients business by June or July, Chief Executive Officer Sunny Verghese said, adding that the IPO would be of "substantial size and quite significant in any exchange" in which it would be listed.
The daughter of Huawei's founder lost a similar case in the UK just days ago. She is fighting a US extradition request from Canada.
We calculated the returns you'd have gotten by investing your first $1,200 check in April.
A medical graduate who had about $440,000 in student debt saw 98% of his loans cancelled by a bankruptcy court in California, according to a recent filing.
(Bloomberg) -- To see the gulf between China’s ambitious carbon-neutral goals and the desire of its companies to maintain breakneck growth, look at Shandong’s oil refineries.The coastal province, a hub for private factories with an economy the size of Indonesia’s, issued a notice urging local industry, and especially oil and petrochemical firms, not to carry out plant maintenance between April 15 and Oct. 15 in an effort to reduce the area’s awful summer smog. Yet only one of about 10 independent refineries set to do maintenance has agreed.The refineries, known as ‘teapots’ because of the shape of early plants, are usually cleaned and renovated during that period in preparation for an annual hike in prices and demand for diesel and gasoline in the second half. The cleaning process tends to release large quantities of volatile organic compounds that are a major contributor to local air pollution.It’s no small contribution. Shandong’s oil refineries account for a quarter of China’s total processing capacity. Making last-minute changes to maintenance works would raise their costs and may disrupt cash flow for upcoming tax payments in March, industry consultancy FGE said in a note.The conflict illustrates the tightrope the government has to walk in balancing the need to reduce emissions with maintaining economic growth as it strives to meet the 2060 carbon neutrality target set by President Xi Jinping. China is the largest crude oil importer in the world, and its refining capacity is expected to keep growing this decade even as its overall consumption of fossil energy is set to decline.READ MORE: China Needs to Hit Peak Oil Long Before It Reaches Net ZeroIn this case, the private oil refiners are expected to seek an exemption from the government guidance or simply go ahead with maintenance as planned, according to four oil traders familiar with the production schedules and FGE. Shandong’s advisory isn’t mandatory and “teapots have the freedom to decide when to carry out maintenance based on their profitability,” said Wang Luqing, an analyst at Chinese industry researcher SCI99.Ten private oil refiners in the province, with a combined processing capacity of over 1 million barrels per day, planned to shut all their units for maintenance at some point during the government’s blockout period, with nine of them aiming for outages in the second quarter, according to SCI99. Only one teapot has rescheduled to comply with the authority’s request, said the traders, who asked not to be named as they aren’t authorized to speak publicly.READ MORE: China’s Climate Goals Face Pushback On the Ground: Green InsightIn the Jan. 15 notice, Shandong’s ecological environment department said it issued the guidance to reduce emissions of ozone during the summer. The province also encouraged local gas stations to offer promotions at night, according to the notice seen by Bloomberg News, to help spread out evaporation during refueling. Five of Shandong’s municipalities were on the environment ministry’s list of cities with the worst air pollution last year.The department didn’t respond to an email seeking comment about the advisory. The Shandong Refining and Petrochemical Industry Association, whose members include about 30 refiners, didn’t respond to phone calls.Rescheduling maintenance in an attempt to curb pollution has previously been implemented for some state-run refiners. China National Petroleum Corp., the country’s biggest energy company, skipped planned work last summer, according to a press release on its website. For many of Shandong’s refiners, a maintenance outage is overdue. After a dip caused by the Covid-19 outbreak, demand for most oil products in China returned to normal as early as May. As global crude oil prices slumped because of the spread of pandemic in the U.S., Shandong’s teapots went into overdrive to take advantage of the low rates and a government policy setting minimum fuel prices, causing many to postpone work till this year.They’ve been operating at a record 74% capacity on average since May -- compared with an average of 51% over the past decade, data from consultancy Oilchem.net show.Persuading them to keep going for another eight months could be a tall order.(Updates with CNPC’s rescehduling maintenance last year in 10th paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- WeDoctor is planning to file for an initial public offering in Hong Kong as soon as next month after fetching a valuation of $6.8 billion in its latest funding round, according to people familiar with the matter.The Tencent Holdings Ltd.-backed company raised about $400 million in a pre-IPO round from investors including Sequoia Capital China and Millennium Management LLC at the end of last year, the people said. The company is in the process of hiring joint global coordinators, paving the way for a filing in as early as March, said the people, requesting not to be named because the matter is private.Jeff Chen rejoined the company as chief strategy officer looking after capital markets and the listing process following a stint at Singapore’s Fullerton Healthcare Corp., they added.WeDoctor is part of a growing contingent of technology giants trying to transform China’s health-care system. In preparation for the listing, the Hangzhou-based company is splitting its business into two parts, with plans to list its health-care services operations, which include online and on-the-ground consulting, people familiar have said.Its more sensitive data business that handles personal medical records will be spun off and kept private to comply with regulatory demands.WeDoctor declined to comment on its fundraising and IPO plans in an emailed statement. It declined to comment on behalf of Chen. Sequoia Capital China declined to comment in an email. A New York-based spokesman for Millennium didn’t immediately respond to an email seeking comment late Wednesday local time.Citigroup Inc., JPMorgan Chase & Co. and CMB International Securities Ltd. are arranging the share sale, which was initially targeted for the end of last year. WeDoctor was seeking to raise $500 million to $1 billion through its listing at the time. The company is now in the process of hiring joint global coordinators, the people said.The medical platform’s operations span insurance policies, medical supplies, online appointment-booking and clinics. The national health-care operator, which covers more than 95% of the population, is working with the firm to provide insurance-covered health care.WeDoctor operated 16 facilities and 30 online internet hospitals, connecting 7,600 hospitals and 250,000 physicians as of October. It was valued at about $5.5 billion in a 2018 funding round.Chen was former CSO at WeDoctor before he joined Fullerton Health as chief innovation officer and head of capital markets, according to an announcement in February 2019. WeDoctor’s chief financial officer departed the company late last year.(Updates with Sequoia, Millennium investment in second paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Oil climbed to the highest in more than a year amid optimism of swiftly depleting global oil inventories.Futures in New York closed 0.5% higher on Thursday. The oil futures curve continues to signal a tighter market. U.S. crude inventories are near the lowest levels in about a year, while exports of five key crudes in the North Sea fields are seen slumping in April. As a result, crude timespreads are strengthening in a bullish structure known as backwardation.“Looking forward in the market, we’re seeing a significant backwardation, which signals that there is an anticipation of an easing of virus restrictions coming,” said Gary Cunningham, director at Stamford, Connecticut-based Tradition Energy. “The market is looking toward more normal inventories heading into the summer, if we don’t see a flooding of markets.”U.S. crude futures are up nearly 22% in February with expectations of shrinking supplies and as economies worldwide begin to reopen, signaling a further rebound in consumption. Still, the market is facing a possible supply increase in April from OPEC+. The producer group meets next week to discuss its strategy with key members differing on the path forward.See also: North Sea Oil Field Work to Cut Supply From Already Tight Market“By the summer, leisure travelers who haven’t been able to travel who are now vaccinated,” will be driving an uptick in demand, said Jay Hatfield, CEO at InfraCap in New York. “Supply is not going to respond like it has in the past,” with U.S. production likely remaining restrained.Shale explorers reported almost 6 million barrels of combined oil-output losses during the freeze last week. Occidental Petroleum Corp. and Pioneer Natural Resources Co., two of the largest producers in the Permian Basin, alone had a combined loss of about 3.8 million barrels, according to Bloomberg News calculations based on fourth-quarter earnings reports and calls. Meanwhile, refineries along the U.S. Gulf Coast are in the process of restarting, though some plants are facing lengthy repairs to key processing units.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
A day after Warren Buffett's partner Charlie Munger bashed Robinhood, the company responds.
(Bloomberg) -- The second time proved the charm for Saudi Arabia’s foray into electric vehicles.The kingdom’s main sovereign wealth fund is sitting on paper gains of over 30-fold from its investment in Lucid Motors Inc., with the value of its stake set to rise as part of a deal to take the company public.The result is a boost for the $400 billion Public Investment Fund after missing out on an epic rally in Tesla Inc. shares when it sold much of its 5% stake in the industry leader at the end of 2019.The PIF, as the fund is known, will hold a stake of 62% in Lucid once the acquisition of the automaker by special purpose acquisition vehicle Churchill Capital IV is complete. The holding would be valued at about $32 billion, based on the current share price of Church Capital IV.The deal would represent a jackpot for the PIF, which invested $1 billion in Lucid in 2018 and is expected to provide an additional $600 million in funding for the company before the SPAC deal is completed. It also participated in a $2.5 billion private investment in public equity, or PIPE, the largest of its kind on record for a SPAC deal.Under the leadership of Yasir Al-Rumayyan, the PIF has shifted investment priorities from holdings in state-owned companies to building up stakes in companies such as Uber Technologies Inc. and Jio Platforms Ltd., the digital services business controlled by Indian billionaire Mukesh Ambani.The fund’s returns on investment increased from about 3% between 2014 and 2016 to 8% from 2018 to 2020, according to the PIF website. It has more than doubled its assets in the five years since Crown Prince Mohammed bin Salman has been chairman.The investments are part of a strategy that aims to boost returns from the kingdom’s wealth while diversifying the Saudi economy and creating jobs.Bloomberg News reported in January that Lucid was in talks with the PIF to potentially build a factory near the Red Sea city of Jeddah, although the automaker’s CEO, Peter Rawlinson, said on Tuesday there were no imminent plans to build a factory in the kingdom.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Berkshire Hathaway vice chairman Charlie Munger unloaded on bitcoin, showing that his views haven't changed since Warren Buffett and Munger last opined on the digital asset.
Charlie Munger, vice chairman of Berkshire Hathaway and long-time business partner of Warren Buffett, issued a strong condemnation of the businesses he said enabled the recent frenzy of speculative trading by retail investors.
(Bloomberg) -- Exxon Mobil Corp. erased almost every drop of oil-sands crude from its books in a sweeping revision of worldwide reserves to depths never before seen in the company’s modern history.Exxon counted the equivalent of 15.2 billion barrels of reserves as of Dec. 31, down from 22.44 billion a year earlier, according to a regulatory filing on Wednesday. The company’s reserves of the dense, heavy crude extracted from Western Canada’s sandy bogs dropped by 98%.In practical terms, the revision clipped Exxon’s future growth prospects until oil prices rise, costs slide or technological advances make it profitable to drill those fields. Exxon has enough reserves to sustain current production levels for 11 years, down from 15.5 years a year ago, based on Bloomberg calculations.The pandemic-driven price crash that rocked global energy markets was the main driver of Exxon’s reserve downgrade, along with internal budget cuts that took out a significant portion of its U.S. shale assets. The oil sands have historically been among the company’s higher-cost operations, making them more vulnerable to removal when oil prices foundered.Price SensitiveThe reserves accounting doesn’t mean Exxon is closing up shop or walking away from Canada because the company can bring them back onto its ledger as crude prices rise.“Among the factors that could result in portions of these amounts being recognized again as proved reserves at some point in the future are a recovery in the SEC price basis, cost reductions, operating efficiencies, and increases in planned capital spending,” Exxon said in the filing.The blow to future production potential comes just weeks after Exxon posted its first annual loss in at least four decades. Exxon shares were little changed at $56.85 in after-hours trading and have advanced 38% this year.The Wall Street Journal reported last month that Exxon was being investigated by the U.S. Securities and Exchange Commission for allegedly overvaluing a key asset in the Permian Basin. Exxon has said the allegations are demonstrably false.CEO’s PrioritiesExxon previously flagged that low prices could wipe as much as one-fifth of its oil and gas reserves from its books but steep cuts in drilling expenditures also imperil the assets its able to keep on the books.Chief Executive Officer Darren Woods has prioritized high-return projects such as offshore oil in Guyana, shale in the Permian Basin as well as chemical and gas operations along the Gulf Coast in order to defend the company’s dividend. This year’s rally in oil prices will help bolster Exxon’s cash generation, which in recent quarters has failed to cover both its capital spending and dividend, leading to an increase in debt to almost $70 billion.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- After weeks of grumbling, the world’s biggest bond market spoke loud and clear Thursday -- growth and inflation are moving higher. The message wreaked havoc across risk assets.Benchmark 10-year Treasury yields catapulted to the highest in more than a year at over 1.6% and traders yanked forward their opinion of how soon the Federal Reserve will be forced to tighten policy. Equities tumbled, as higher borrowing costs put pressure on soaring valuations. Even Treasury Secretary Janet Yellen felt the sting, with record low demand for a fresh round of government debt.Speculation is building that a year of emergency stimulus is not only working, but has left some areas of the economy at risk of one day overheating. Locked in the same patterns for months by the Covid-19 crisis, markets now appear to have begun a long-awaited process of repricing themselves, as trillions of dollars of federal spending and positive vaccine results boost odds developed countries will heal faster than central bankers expected.“The economy is already recovering and a lot of people think that this stimulus proposed is much more than what’s needed,” said John Carey, portfolio manager at Amundi Asset Management U.S. “You put too many coals on the fire and we build the fire to a very intense level. People start to think the Fed won’t be able to keep rates where they are.”After holding at historically low levels since April, the jump in Treasury yields -- even if it bespeaks economic health -- is inevitably a jarring spectacle for traders, forcing them to reconsider positions in multiple markets. Megacap tech names -- previously the bull market’s darlings -- led the plunge on Thursday, with the Nasdaq 100 sinking almost 4% as the rise in rates made it harder to justify valuations that are higher than any time since the dot-com bubble.The bond selloff stalled in Asia hours on Friday, as markets paused for breath, following the whirlwind session which saw rising yields overwhelm areas of equities that tend to benefit from higher rates. The KBW Bank Index -- which climbed to its highest level since 2007 on Wednesday -- dropped by 2.7% amid the carnage. Energy and utility shares in the S&P 500 also fell at least 1%.Currency markets were jolted as well. The Bloomberg Dollar Index rallied 0.7% Thursday, the most since September, while historically volatile emerging market currencies slid. The South African rand, Turkish lira and Mexican peso led the drop in emerging markets, falling at least 2%.The impact of lockstep moves in bonds and stocks can be seen in sophisticated portfolio strategies such as risk parity, which try to balance exposure across assets, according to Wells Fargo Investment Institute. The $1.2 billion The RPAR Risk Parity exchange-traded fund (ticker RPAR) dropped as much as 2.7% -- its biggest decline since March 18, 2020, in the height of the pandemic rout.“Right now those rates are increasing at a pace that may be unsettling to strategies such as risk parity, and the fixed income volatility is spilling over into other assets,” said Sameer Samana, Wells Fargo Investment Institute’s senior global market strategist. “Until the speed at which rates are rising slows, we may need to mentally prepare ourselves for more days like this.”Breakeven inflation rates -- bond trader projections for where they see annual consumer price inflation averaging over the decade -- are at multiyear peaks. At about 2.2%, it is up sharply from last year, when it fell as low as 0.47% in March.“We are in uncharted territory where we are likely to experience a global economic rebound with a global surge in inflation never experienced before,” said Bryce Doty, portfolio manager at Sit Fixed Income Advisors. “No one knows how it will play out.”While the U.S. unemployment rate clocks in at a still-elevated 6.3%, that’s below the 6.5% level that policymakers had forecast last June. A string of economic data as kept Citigroup Inc.’s Economic Surprise Index in solidly positive territory since last June, including retail and housing reports that have handily topped forecasts.For now, Fed Chairman Jerome Powell and his colleagues insist their best course of action is to hold interest rates low to ensure the recovery takes hold. Powell told the Senate Banking Committee Tuesday that the recent run-up in bond yields that has unsettled the stock market “a statement of confidence” in a robust economic outlook.On Thursday, as bond yields were exploding, Atlanta Fed President Raphael Bostic said “the economy can run pretty hot without seeing significant spikes in inflation.”While that may be true, financial markets are relentlessly forward looking -- and see the risks that come with a potential overheating. For now, the most obvious manifestation of that is the bond-market selloff, with investment firms including BlackRock Inc.’s research arm and Aberdeen Standard Investments retreating from government debt.“When the bond market wants to run, it’s going to run much faster than any central banker, and that again is on full display,” said Peter Boockvar, chief investment officer for Bleakley Advisory Group. “Also, be careful what you wish for. Don’t spend all your waking hours trying to artificially suppress interest rates and then root for higher inflation because when the market thinks that inflation will come, it will run you over.”(Updates sixth paragraph to show bonds stalled in Asia.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Indian Oil Corp will invest 329.46 billion rupees ($4.46 billion) to raise the capacity of its Panipat refinery by two-thirds to 500,000 barrels per day (bpd) by September 2024, the country's top refiner said on Friday. India, the world's third biggest oil importer and consumer, aims to expand its 5 million bpd refining capacity by 60% to meet rising local demand as Prime Minister Narendra Modi seeks to boost the manufacturing sector. Along with expanding capacity, IOC will install catalytic dewaxing and polypropylene units at its Panipat refinery in northern Punjab state, it said in a statement.
The crash came as the bank faces pressure to keep pace with changes fuelled by Bitcoin and other digital currencies.
Costco has a leg up on e-commerce behemoth Amazon (AMZN) on at least one measure, according to Charlie Munger, vice chairman of Berkshire Hathaway.
Prices are the highest since the pre-pandemic days, and they're still climbing.
Munger says the argument for diversification should be called 'diworsification.'
(Bloomberg) -- Li Ka-shing, Hong Kong’s richest property tycoon, is planning to raise funds for dealmaking by listing a special purpose acquisition company in the U.S., people with knowledge of the matter said.A company backed by Li’s family is working with advisers on the potential SPAC initial public offering, according to the people, who asked not to be identified because the information is private. They are considering seeking around $400 million, though the exact terms haven’t been finalized, the people said.The blank-check company could file registration documents with the U.S. Securities and Exchange Commission as soon as this week, the people said.Li is lionized by the public in Hong Kong, where he’s been nicknamed “Superman” for his investing prowess. The 92-year-old businessman became famous for his well-timed bets on everything from real estate to social media as he built a corporate empire spanning 50 countries.His family controls CK Hutchison Holdings Ltd., a $29 billion conglomerate that owns one of the world’s biggest port operators and has telecommunications, retail and infrastructure operations across Asia and Europe. They also run CK Asset Holdings Ltd., which is one of Hong Kong’s largest developers and also has investments in hotels, utilities and aircraft leasing. Both companies are now led by Li’s elder son, Victor.Li’s younger son, Richard, has already raised about $900 million via two U.S.-listed SPACs with tech mogul Peter Thiel. Richard is considering setting up a third blank-check company, Bloomberg News reported last week.No final decisions have been made, and details of the transaction could change, the people said. Representatives for Li didn’t immediately respond to emailed queries.(Adds details about Richard Li’s SPAC plans in sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.