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  Wednesday, 4 Mar 2015 | 9:21 AM ET

Ex-Chesapeake CEO is back in the energy game

Aubrey McClendon, long regarded as one of the brashest, most creative executives in the U.S. energy industry, has raised $15 billion in cash and debt financing for a new venture 1½ years after being ushered out of the drilling company he helped found, Chesapeake Energy.

But just months after amassing that war chest for American Energy Partners, his new drilling company, McClendon is actively trying to add to it—amid a unique set of personal obstacles and some of the worst market conditions in recent memory.

Since June, the prices of oil and natural gas have spiraled to below $50 and $3 respectively, making it difficult to drill profitably in many domestic shale wells. In an indication of the perceived health of AEP in the credit markets, bonds issued by the company's drilling entities are trading at well below par, in a range between 67 cents and 87 cents on the dollar.

At the same time, a new lawsuit accuses McClendon of stealing Chesapeake's trade secrets to help launch AEP. Moreover, associates of McClendon say that some of his investors—notably the chief executive of the Energy & Minerals Group, AEP's largest equity investor—are growing frustrated, prompting McClendon once again to seek additional financing that would allow him to regain some independence.

So far this year, say people familiar with the matter, McClendon and his representatives have held multiple meetings with both banks and private-equity firms in hopes of raising additional capital in various forms.

»Read more
  Tuesday, 3 Mar 2015 | 1:45 PM ET

People aren't spending their gas savings: Zandi

Posted By: Jeff Cox
A man at a gas station in Dellwood, Mo.
Getty Images
A man at a gas station in Dellwood, Mo.

Consumers have been filling their pockets with the money they're saving while filling up at the gas pump, Moody's economist Mark Zandi said Tuesday.

As a result, expected improvements in sales data specifically and economic growth in general have fallen short of the expectations that came along with the sharp plunge in energy prices.

Consumer spending declined 0.2 percent in January after falling 0.3 percent in December at the same time gas was holding below $2 a gallon in many areas. While that was happening, retailers were enduring a miserable holiday shopping season followed by a 0.8 percent decline in January sales.

Read MoreGasoline seen rising at rapid clip

Zandi, though, said he's not terribly discouraged by the numbers.

"My sense is that it takes a little bit of time for savings to kind of build up into checking accounts before they decide, 'Wow, I've got money, I can spend and go out and buy something,'" Zandi said during a breakfast with reporters. "It takes at least a few months for that to occur."

»Read more
  Tuesday, 3 Mar 2015 | 12:22 PM ET

Oil pro Andy Hall: Next move will surprise market

Posted By: Kate Kelly

Oil trader Andy Hall has closed out his bearish bets on oil and is predicting a price recovery in crude sooner than many analysts expect.

In his most recent letter to investors, dated Monday, the chief executive of the $3.2 billion commodity hedge fund Astenbeck Capital Management harks back to a classic rationale for his bullish point of view: that the cure for low prices is low prices.

"The only question is how long it will take for these low prices to work their magic," he wrote. "We think it might happen more quickly than many expect."

»Read more
  Tuesday, 3 Mar 2015 | 10:57 AM ET

Are markets ready for June rate hike?

Posted By: Lawrence Delevingne

The smart money thinks the Federal Reserve will finally begin to increase interest rates early this summer. The question is how much market turmoil the move will cause.

Janet Yellen's Fed will finally increase the cost of borrowing money in June, according to remarks made by top BlackRock bond investor Rick Rieder and prominent hedge fund managers Jamie Dinan and Kyle Bass at a New York charity event Monday night.

Bass, head of Hayman Capital Management in Dallas, said the market isn't fully prepared.

"I think when she moves, it's going to cause a problem," Bass said at the Portfolios with Purpose awards night during a panel discussion moderated by CNBC's Scott Wapner.

»Read more
  Tuesday, 3 Mar 2015 | 7:00 AM ET

With dollar at 11-year high, here's what's next

Posted By: Sara Eisen

It's been a remarkable run for the dollar.

In the scope of eight months, the dollar index has shot up more than 19 percent against other currencies, after going nowhere for almost 10 years.

Companies from IBM to Harley-Davidson to Google to Coca-Cola to Proctor & Gamble have blamed the strong dollar for chipping away from their overseas profits.

The dollar is now sitting at the highest level in 11 years against other major currencies.

In the last 12 months alone, it's appreciated more than 21 percent against Norwegian and Swedish currencies; more than 17 percent against the euro and more than 13.5 percent against the yen.

So now what?

The strong dollar story has not changed, and many pros will tell you the currency has further to climb.

Why?

»Read more
  Friday, 27 Feb 2015 | 2:33 PM ET

This is the Fed's biggest economic headache

Posted By: Jeff Cox

If investors learned anything from Fed Chair Janet Yellen's testimony to Congress this week, it's that the central bank is willing to wait for inflation to catch up to employment before hiking rates.

It could be a long wait—longer, in fact, than many market participants anticipate.

Language tweaks in Yellen's semiannual appearance Tuesday and Wednesday sent strong indications that even if the Fed removes the word "patient" from its next post-meeting communique, it will remain, indeed, patient when it comes to rate hikes.

"The more I think about it, the more I feel that Yellen was very dovish," David Rosenberg, economist and strategist at Gluskin Sheff, wrote of the testimony. "If a shift in policy was coming, this was the setting for verbalizing it—she passed up the opportunity."

»Read more
  Monday, 2 Mar 2015 | 10:09 AM ET

Bill Gross: Central banks have gone 'too far'

Posted By: Jeff Cox
Bill Gross
Reuters
Bill Gross

Ultra-easy central bank monetary policies are about to come back to bite the global economy, bond guru Bill Gross said in his latest letter to investors.

Institutions including the U.S. Federal Reserve fired the first shot in global competitive currency devaluation at the height of the financial crisis as a means to increase liquidity and push investors toward taking more risk.

Others followed suit but have only recently matched the Fed's aggressiveness. The European Central Bank, Bank of Japan and multiple others across foreign markets have gone to near-zero or negative interest rates as global growth has slowed.

Gross, who runs an unconstrained fund for Janus Capital, worries that the financial repression that goes along with easy-money policies is doing harm.

»Read more
  Monday, 2 Mar 2015 | 10:30 AM ET

Hedge funds cut Apple and these other VIP stocks

Posted By: Lawrence Delevingne

More hedge funds sold down or exited positions in eight of the 10 most commonly held stocks than the number of those that entered or added to the stakes, according to fourth quarter public stock ownership data compiled by industry analyst Novus.

Hedge funds showed their hand with new filings in February, with familiar names like Apple, Microsoft, Google, Johnson & Johnson and Citigroup showing up in the most portfolios as of Dec. 31.

»Read more
  Thursday, 26 Feb 2015 | 1:30 PM ET

All analysts want you to do is buy; here's proof

Posted By: Jeff Cox
A trader works on the floor of the New York Stock Exchange.
Getty Images
A trader works on the floor of the New York Stock Exchange.

Will Rogers once famously said he never met a man he didn't like. Wall Street has taken that sentiment and applied it to the stock market in an extreme way.

Most analysts on the Street have rarely met an S&P 500 stock they didn't like, or at least weren't willing to hang out with for a while.

An analysis from Bespoke Investment Group on stock ratings paints the picture in stunning fashion: Of the 12,122 ratings there are of companies in the broad market index, just 6.67 percent carry a "sell" label. The balance consisted of 48.43 percent "buy" ratings and 44.9 percent "hold." (The full report, which is premium content, can be accessed here.)

What's more, there's nothing particularly striking about the numbers from a historic perspective. Bespoke's Paul Hickey said in the report that the "percentages are roughly inline with where they have always been." In fact, the level of "sell" positions increased slightly from the last time Bespoke looked at the trend in August.

»Read more
  Thursday, 26 Feb 2015 | 1:22 PM ET

The oil selloff created this buying opportunity

Posted By: Lawrence Delevingne

The sharp decline in oil prices caused a selloff outside of traditional energy companies. But some of that selling—particularly in solar and water businesses—was misguided and presents an excellent buying opportunity, according to a leading natural resources and alternative energy investor.

"There isn't really a correlation. The market got nervous and ran too far," Ken Locklin, a director at $4.6 billion Impax Asset Management, said at an energy investing event Wednesday in Manhattan organized by the New York Hedge Fund Roundtable.

Locklin said that Impax had used the price decline as a buying opportunity. The firm added to its already large positions in water businesses, which investors sold in anticipation of beat-up energy companies slowing their hydraulic fracking, an extraction process that relies on huge volumes of water. Locklin said that related water companies actually had relatively low exposure to energy and actually focused more on industrial and municipal demand.

Impax also used the oil dip to add to its solar holdings, which sold off as the market anticipated higher use of oil as an energy source given its suddenly much-lower price. The stocks of large solar companies such as SunEdison and First Solar fell by double digits over the second half of 2014.

»Read more

About NetNet

  • NetNet is where you'll find the low-down and the high jinks of Wall Street. It's the place for insider stories, trader gossip, and tales of the foibles of the moneyed crowd and the culture of finance.Wall Street news and commentary served fresh all day long.

 

  • Jeff Cox is finance editor for CNBC.com.

  • Lawrence Develingne

    Lawrence Delevingne is the ‘Big Money’ enterprise reporter for CNBC.com and NetNet.

  • Stephanie Landsman is one of the producers of "Fast Money."

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