When we insist that markets are broken and the equities have been consigned to the gambling casinos, look no farther than today’s filing by Alpha Natural Resources. Markets, which were this wrong on a prominent name like ANRZ at the center of the global credit boom, did not make a one-time mistake; they are the mistake. As it now happens, the global credit boom is over; DM consumers are stranded at peak debt; and the China/EM investment frenzy is winding down rapidly. Now comes the tidal wave of global deflation...
But as shown below, eventually the credit bubble stops growing, materials demand flattens-out and begins to rollover, thereby causing windfall prices and profits to disappear. This happens slowly at first and then with a rush toward the drain.
ANRZ is thus rushing toward the drain because it got capitalized as if the insanely uneconomic met coal prices of 2011 would be permanent.
http://www.zerohedge.com/news/2015-08-03/worldwide-credit-boom-over-now-comes-tidal-wave-global-deflation
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