CTA Trading Desk Morning Report
[7:00am ET] Good morning.
Ping-pong-ping. Yesterday was higher; early this morning was lower; then along came what has been labeled a successful Italian bond auction. Ping.
The equity-debt game in Europe is not a so-called ‘friendly’. There is in fact a lot at stake.
Earlier the European banks were all red. Now just some are red. Equities have regained the momentum. For now.
Have a good day.
[9:10am ET] Good morning, Geoff here.
Last week, I mentioned that Italy had an important bond auction that we had to watch. Today, Italy had a difficult bond auction where it had to pay 7.89% yield to borrow money for 3 years. I guess some are calling this a successful auction, yet the yield paid is the highest since the euro began and unless real solutions are found, rates will continue to rise and there will be no Santa Claus rally.
For the time being, the US dollar continues to appear as though it is forming a double top that will propel stocks and commodities higher which is good for our positions. However, as Bill mentioned in the Week In Review, no one knows what is going to happen in Europe. Each day that passes with continued failure of the EU to find a solution to the debt crisis leads to heightened risk.
What gives me pause regarding Monday’s strong rally is the action of US Treasuries. Usually, traders will be selling Treasuries into a strong stock rally as they put money to work in risk assets – but that did not happen and after an initial sell-off, bonds rallied strongly all day. If the bond market holds up in the face of a rising stock market, we need to be very careful with our longs. No one ever went broke taking gains.
In portfolio management, being prudent means that the trader manages both risk and return. For our part, we were positioned and ready for the bounce that we are experiencing now, but we are very wary of the risks that surround us. I am guessing that we will have at least a week of higher stock prices as hope runs out for the shorts and they continue to squeeze the market higher. Once they are out, the market can continue lower if it wants to.
In other news, American Airlines filed for bankruptcy which it has avoided doing since 9/11.
Have a great trading day!
Here are the 7:00am ET snapshots of the latest equity market trading results for Europe, and futures prices plus 5-minute charts of the futures for S&P 500, 30-year US Treasury Bond, US Dollar index, Gold and Crude Oil.
| Symbol | Name | Last Trade | Change | Related Info |
|---|---|---|---|---|
| ^ATX | ATX | 1,751.30 |
 12.50 (0.71%) |
Components, Chart, More |
| ^BFX | BEL-20 | 2,007.41 |
1.49 (0.07%) |
Components, Chart, More |
| ^FCHI | CAC 40 | 3,034.72 |
 21.79 (0.72%) |
Components, Chart, More |
| ^GDAXI | DAX | 5,791.66 |
46.33 (0.81%) |
Components, Chart, More |
| ^AEX | AEX General | 274.37 |
2.76 (1.02%) |
Components, Chart, More |
| ^OSEAX | OSE All Share | 422.06 |
1.39 (0.33%) |
Components, Chart, More |
| ^OMXSPI | Stockholm General | 290.16 |
1.71 (0.59%) |
Components, Chart, More |
| ^SSMI | Swiss Market | 5,540.58 |
17.92 (0.32%) |
Components, Chart, More |
| ^FTSE | FTSE 100 | 5,336.17 |
23.41 (0.44%) |
Components, Chart, More |
| FPXAA.PR | PX Index | 855.50 |
3.80 (0.44%) |
Chart, More |
| ESI500000000.MA | IGBM | 817.46 |
1.94 (0.24%) |
Components, Chart, More |
| MICEXINDEXCF.ME | MICEX Index | 1,470.61 |
4.39 (0.30%) |
Chart, More |
| GD.AT | Athex Composite Share Price Index | 665.02 |
1.93 (0.29%) |
Chart, More |
http://finviz.com/futures.ashx
http://finviz.com/fut_chart.ashx?p=m5&t=ES
http://finviz.com/fut_chart.ashx?p=m5&t=ZB
http://finviz.com/fut_chart.ashx?p=m5&t=DX
http://finviz.com/fut_chart.ashx?p=m5&t=GC
http://finviz.com/fut_chart.ashx?p=m5&t=SI
http://finviz.com/fut_chart.ashx?p=m5&t=CL
The team will check in during the day, reporting in the Discourse when there is a new entry.
Enjoy your day.
Cara on Trends & Cycles
Vad's Catch of the Day
Kaimu's Sound Money
CTA Trading Desk Mid-Day Report
CTA Trading Desk Post-Close Report
Comments
Econoday Today
RSI Summary as of EOD 2011-11-28
Accumulation Zone: Monthly 12, Weekly 10, Daily 4
Distribution Zone: Monthly 3, Weekly 0, Daily 1
Cara 100 Ratings Changes For Tuesday
Good morning.
09:00 Case-Shiller 20-city Index
10:00 Consumer Confidence
10:00 FHFA Housing Price Index
------
BA - Boeing initiated with a Buy at Sterne Agee. Target $82
QCOM - Qualcomm initiated with an Outperform at Scotia Capital. Target $70
SLB - Schlumberger initiated with a Buy at Jefferies. Target $90
SNDK - PT Lifted from $63 to $68 @ Stifel Nicolaus. Buy
UTX - United Technologies coverage assumed with a Buy at Sterne Agee. Target $87
------
"The difference between fiction and reality? Fiction has to make sense."
- Tom Clancy
Non US Economic Data
UBS CONSUMPTION INDICATOR Switzerland (Oct)
Actual: 0.91 Previous: 0.82 Revised from 0.84
This Swiss consumer indicator has actually bottomed out according to its history chart and is rising again.
NET LENDING TO INDIVIDUALS (MOM) UK for Oct
Actual: £1.3B Cons.: £1.0B Previous: £0.3B
Private lending remains in a slump since 2008 but remaining positive nonetheless. Obviously Osborne's budget blues speech today isn't going to help consumer confidence.
http://www.fx360.com/calendar/
Australia LEI remains positive for September
The Conference Board Leading Economic Index® (LEI) for Australia increased 0.1 percent and The Conference Board Coincident Economic Index® (CEI) increased 0.3 percent in September.
The Conference Board LEI for Australia increased slightly in September. A large gain in money supply* more than offset negative contributions from building approvals, stock prices, and rural goods exports. Between March and September this year, the leading economic index increased by 0.5 percent (about a 1.0 percent annual rate), only slightly slower than the 0.7 percent growth (about a 1.3 percent annual rate) from September 2010 to March 2011. In addition, the strengths and weaknesses among the leading indicators have been nearly balanced in recent months.
http://www.conference-board.org/press/pressdetail....
Cara 100 Update
MRK - Merck initiated with a Buy at MKM Partners. Target $38
CS opines on Europe: Game over
• The deterioration in liquidity and pricing in euro area government bond markets means an aggressive policy response is urgently needed. Liquidity needs to be restored by the time government issuance ramps up in early 2012.
• Such liquidity can only come from the ECB in our view and could be provided by a large-scale asset purchase programme of quantitative easing. We think conditions will increasingly justify the ECB embarking on it early next year.
• A large-scale asset purchase programme of quantitative easing, buying euro area government bonds in the secondary market, would be justifiable under the Treaty if it was undertaken for monetary policy purposes. That may mean the ECB needs to take rates down to a "zero-bound." It would also mean that the ECB would need to buy either a representative basket of euro area government bonds or, perhaps, EFSF bonds. For such a programme to be similar in scale to that seen in the US or UK would imply around €€ 1trn of asset purchases.
• That requires that the ECB does something it has hitherto denied it would, but not doing it will be increasingly grave for the euro area economy and, quite possibly, the euro itself.
• In our view, a ECB QE programme would reduce the safe haven premium in bunds. Thus, we expect a bold move from the ECB to result in higher German yields and core curve steepening. Large scale QE would also imply policy rates remaining low for a prolonged period. Hence we would expect reds/greens flattening in the front end. In terms of the periphery, the main beneficiaries are countries with relatively lower debt-to-GDP ratios. We expect Spain to outperform versus Italy and Belgium.
Toronto Star adds:
Eurozone ministers meet in desperate attempt to save euro
The 17 finance ministers of the countries that use the euro converged on EU headquarters Tuesday in a desperate bid to save their currency — and to protect Europe, the United States, Asia and the rest of the global economy from a debt-induced financial tsunami.
Re: CS opines on Europe: Game over
Seems very clearly stated. I suppose this view point will become the "mantra" in the days and weeks ahead, echoing through financial media and institutions until it happens?
Eurozone's M1, M2, and M3 – have each begun to decline.
Telegraph.co.uk
Europe's shrinking money supply flashes slump warning
By Ambrose Evans-Pritchard, International business editor
All key measures of the money supply in the eurozone contracted in October with drastic falls across parts of southern Europe, raising the risk of severe recession over coming months.
"This is very worrying," said Tim Congdon from International Monetary Research. "What it shows is that the implosion of the banking system on the periphery is now outweighing any growth left in the core. We are seeing the destruction of money and it is a clear warning of serious trouble over the next six months."
http://www.telegraph.co.uk/finance/financialcrisis...
Geoff said
"In other news, American Airlines filed for bankruptcy which it has avoided doing since 9/11."
finally, my faith restored in capitalism. A company's stock is allowed to go to zero.
Re: CS opines on Europe: Game over
dberryclan,
Re: "Seems very clearly stated."
The source quoted in the blog that followed mine is one of the very many who apparently succeed in life by agitating the readers with their extreme views -- this way one day, the other the next. I pay them no heed. Nada.
The views of the HB&B analysts may also be self-serving, but they are more objective, better researched, contain more facts and express arguments we can discuss here. Some HB&B analysts are, in my view, well worth reading.
Making better use of Google Search
http://mashable.com/2011/11/24/google-search-infog...
I like this a lot. Should be taught in primary and secondary school!
Re: CS opines on Europe: Game over
Another brilliant piece of research. The European governments are about 40% of GDP and the US govt is about 25%. The real question is how long will this foolishness continue. As I've continue to point out asset prices are drastically distorted. I am certain we will have another reversion to the mean. To think governments can pay for everything and not have to pay bond holders is insane. I always looked at the charts of Japan and wondered what they must have been thinking. Now I look at yesterday's market action and the exuberance we see today and I understand. If you are trading these markets you are gambling not investing. If you get caught in a downdraft it will be costly and painful. To ignore the macro environment and what the bond market is showing us is crazy in my opinion.
Re: CS opines on Europe: Game over
Pretty much everyone is singing the song of "save the euro by relieving the banks of their bad trades" at this point.
The concept of buying a basket of bonds is a novel one. This way the ECB can pretend its monetary policy instead of a sovereign bond rescue.
Sometimes I wonder if these analysts are describing what they think the ECB will do, or are sending a message TO the ECB what they ought to be doing.
Risk aversion?
Chase to hedge funds....drop dead.
http://www.ritholtz.com/blog/2011/11/chase-to-hedg...
Re: CS opines on Europe: Game over
"buying euro area government bonds in the secondary market, would be justifiable under the Treaty if it was undertaken for monetary policy purposes."
This suggestion with a justification for the European QE was proposed by Lucrezia Reichlin (a very authoritative economist) in a recent article published by the most important Italian newspaper http://xrl.us/bmjsai.
Now seeing that CS draws on the same idea, I'd suppose that the direction could be that one.
Re: Geoff said
Bad thing is, the management is protected from certain creditors, while average employees, who agreeded to cuts a few years ago, get the shaft again.
Coal Stocks
It is very possible that these stocks have bottomed here.
Reasonable entries, daily, on all.
ANR
PCX
JRCC
BTU
Tight stops if your the nervous type.
Long ANR
TraderWizard e-mail
Folks, all those who signed up for e-mails and haven't seen them, check your junk mail boxes for the dates November 15-16 and November 24-25. When find it in there, make sure that you correct your filters so TraderWizard e-mails go to your Inbox. If you signed up for an e-mail and can't find it, contact us at info at traderwizard dot com so we send you a test e-mail.
AMR
Bad thing is, the management is protected from certain creditors, while average employees, who agreeded to cuts a few years ago, get the shaft again.
Pensioner's get the shaft too :(
Re: Coal Stocks
via UBS
Beantown Conference Coal Questions
.. Annual UBS Mini Coal Conference The UBS Metals & Mining team is heading to Boston this week to host our annual mini-coal conference. The meetings present an opportunity to catch up with management and put forth questions about the markets and the companies.
.. Macro: Pricing and Regulation Given the correlation of pricing expectations we have included the mandatory questions about pricing; however, we expect discussions of Chinese consumption and Australian exports to dominate the met discussions as will potential widening of spreads on high vol products. On thermal, discussions of the impact of EPA rules (CASPR, MACT) and the corresponding impact on future production growth and pricing will likely tangent off into speculation of consumer advocates getting involved once consumer bills skyrocket and/or concerns of reliability of the grid pausing the process.
.. Micro: Strategy, Buybacks, Restructuring While the group has tended to trade in a homogeneous fashion (met vs. thermal) as of late, six companies (BTU, ANR, ACI, WLT, JRCC and CNX) have made transformational acquisitions/disposal in the last year and historical multiples largely do not apply. We expect to drill down and ask the strategic questions: redeployment of capital (buyback/dividend), organic growth (new mines vs. ports?), pace of integration of new assets.
Dollar strength
I suppose that if the dollar holds near 78-79 through the week this will be bad for equities.
OWS London demands
Clear, articulate, germane.
http://blog.rivast.com/?p=5161
Re: OWS London demands
Bravo!
From the link:
"While the strike is about public sector pensions, it is perhaps worth examining while we are talking about political unrest the related topic of the Occupy London demands. It is striking how reasonable they are":
1. We must abolish tax havens and complex tax avoidance schemes, and ensure corporations pay tax that accurately reflects their real profits.
2. Legislation to ensure full and public transparency of all corporate lobbying activities must be put in place. This should be overseen by a credible and independent body, directly accountable to the people.
3. Those directly involved in the decision-making process must be held personally liable for their role in the misdeeds of their corporations and duly charged for all criminal behaviour.
(EU) EFSF to set up more than
(EU) EFSF to set up more than one fund; May be leveraged at 2-3 times (in line with ests by Luxembourg Fin Min Frieden reported earlier today); guarantee losses of 20-30% - financial press
- Final document to be unveiled later tonight.
- NOTE: Also earlier today:
- France Fin Min Baroin: Still trying to get the EFSF leverage to reach €1.0T - ecofin meeting
- Spain Fin Min: the EFSF program maximum has yet to be determined, should make EFSF as large as possible.
- Belgium Fin Min Reynders: EFSF capacity needs to be increased; will discuss possibility of ECB lending to IMF but the final decision will be with the ECB.
Nov 27th:
- (EU) New rules draft for the EFSF; Will allow for intervention on the primary and secondary bond markets and will offer partial protection of as much as 30% to investors - financial press
- EFSF to keep a buffer of €10B "to provide EFSF with the necessary flexibility to carry out the new funding requirements through the issuance of short-term instruments".
- Partial protection to those buying a country's bond in around 20-30% of the bond's principal amount.
Re: (EU) EFSF to set up more than
Oh, uh huh...that's what bond buyers are all about....20-30% protection of their principal. Man, that just gives a bond trader warm and fuzzy feelings inside, doesn't it?
Re: (EU) EFSF to set up more than
... and market reaction reflected it, they were obviously not terribly impressed. But who cares about them... they are speculators, they "attack the countries," and they are "bond vigilantes" (this last term is my favorite). If only politicians running this rotten machinery could find the way to throw them under the bus without machine coming to full stop, they would, just out of sheer hatred for market forces with which they can't bargain, negotiate or threaten them.
Re: (EU) EFSF to set up more than
"they are speculators, they "attack the countries," and they are "bond vigilantes"
Yes, otherwise known as LENDERS.
The same LENDERS that keep politicians empowered by making promises with said LENDERS money.
Yes, it IS difficult to threaten your banker when you are a credit addict and don't pay your bills, isn't it?
They are also known by the much less negative term: 'GROWNUPS'.
Worthy read
http://tinyurl.com/7of957d
Stimulus Package
One of you sent this to me a couple days ago. Maybe you already posted it here. If not, enjoy...
------------------------------------
It's a cold day in the small Saskatchewan town of Pumphandle and
Streets are deserted. Times are tough, everybody is in debt, and
everybody is living on credit.
A Traveler comes to town and lays a $100 bill on the hotel desk saying he
wants to inspect the rooms upstairs to pick one for the night.
As soon as he walks upstairs, the hotel owner grabs the bill and runs next
door to pay his debt to the butcher.
The butcher takes the $100 and runs down the street to retire his debt to
the pig farmer.
The pig farmer takes the $100 and heads off to pay his bill to his supplier,
the Co-op.
The guy at the Co-op takes the $100 and runs to pay his debt to the local
prostitute, who has also been facing hard times and has had to offer her
"services" on credit.
The hooker rushes to the hotel and pays off her room bill with the hotel
owner.
The hotel proprietor then places the $100 back on the counter so the
traveler will not suspect anything.
At that moment the traveler comes down the stairs, states that the rooms
are not satisfactory, picks up the $100 bill and leaves.
No one produced anything. No one earned anything...
However, the whole town is now out of debt and now looks to the future
with a lot more optimism.
And that, ladies and gentlemen, is how a "stimulus package" works.
Europe in recession
Europe Is in for a Long Recession
by Paul L. Kasriel November 21, 2011"
"Collectively, the 27 sovereign nations that make up the European Union (EU) most likely entered a recession this quarter. Chart 1 shows that EU industrial production contracted at an annualized rate of 15.5% in September vs. August, a near certain sign of a recession. Given that the EU represents the largest economy in the world, a recession there is no small beer for the rest of the world."
http://www.northerntrust.com/pws/jsp/display2.jsp?...
Re: Europe in recession
http://af.reuters.com/article/commoditiesNews/idAF...
From Chile today: (industrial) "Output fell 3.2 percent in October from September and a surprise 0.8 percent from a year earlier"
Paulson's Folly -- proof of concept
http://blogs.reuters.com/felix-salmon/2011/11/29/h...
I said at the time, I believed Hank Paulson was a criminal. Few accepted it, so I referred to it as Paulson's Folly.
He defrauded Congress. Ask Sen. Chuck Grassley, who, back in 2008, stared into the cameras and said about Paulson and TARP, "I don't know what he's up to. He won't tell us."
No, Paulson was too busy telling his friends and family!
Re: Europe in recession
Does one month a trend make?
Coiling?
A casual look at 5 day charts of TLT, Dollar, Gold, and the Euro zone issues and I can't help but think they are possibly coiling so as to spring soon one way or the other. dunno?
DB
Financial trickery, part XIX
(Just to be sure - none of XVIII previous parts worked)
(EU) Formal EFSF agreement released; Issues partial 20-30% of principal protection on newly issued EU bonds
- Options to provide immediate and credible support.
- Final firepower amount to depend on use and mix of guarantees and co-investment funds.
- Bailout fund to have about €250B available to leverage following second Greek bailout.
- Option 1 involves credit enhancement in primary market; Aims to increase demand for sovereign bonds.
- Option 2 involves creation of 1 or more co-investment funds.
Re: Europe in recession
dberryclan,
"Does one month a trend make?"
Well, over here it takes to months back to back to be "official".
Is that anymore reliable?
For that matter is calling it over when millions are still unemployed reasonable?
I think it is like this...
"in 1964, Justice Potter Stewart tried to explain "hard-core" pornography, or what is obscene, by saying, "I shall not today attempt further to define the kinds of material I understand to be embraced . . . [b]ut I know it when I see it . . . ""
Grym
Big changes coming to auditing firms in Europe
http://www.ft.com/intl/cms/s/0/a4f58dba-1a89-11e1-...
FT reports: Michel Barnier, the EU internal market commissioner, wants to split the profession’s “Big Four” – PwC, Deloitte, Ernst & Young and KPMG – into separate audit and consulting arms in Europe as part of a package of measures designed to improve the vetting of accounts... (also) he won support for rules compelling companies to rotate auditor at least every six years, a move that would end the decades-long relationship between some companies and their auditors.
Re: Paulson's Folly -- proof of concept
May I just suggest that responsibility be demanded by not only US citizens but the entire world economic community affected by insider trading for one person's misadventures?
Re: Big changes coming to auditing firms in Europe
God I hope this has traction. The investing public has been ill served by the Jumbo accounting firms for at least 50 years. In many ways, they have been conflicted in a similar mannor as has Moodys, S&P and Fitch. This conflict of interest is Best observed by understanding the supposed 'chinese wall' that has never existed in fact between brokerage and investment banking functions in the bowels of GS, MS and all the lesser wannabees...
Accounting is thought to be a dull profession. It shouldn't be. The profession seems to be always behind the curve. It is because modern finance raced ahead of the prudent bean counters and convinced them of the fallacy of the 'old' ways to count the beans.
Accounting as a diacritic descipline needs new mentors to teach a 'philosophy' of what is or could be considered the standards of real economic value.
I 'went to school' in the mid 70's with a down to earth sell side accountant who showed me the difference of the impact of LIFO-FIFO, accelerated depreciation and capital costs write offs and the results during that period of inflation. In short, the lesson was buy CAT, sell IH. Buy Deere, sell Case.
On any 'deal' that I've ever been offered whether it was with real estate, oil and gas, fixed income, private equity or a super stock 'sure thingie' I always tried to parse the numbers myself. When it was over my head, I hired someone I trusted to do it for me.
Trust is the bond glue that lets you sleep at night. If you distrust the accounting, put your money with someone who has always questioned how plus 2's can equal 5.
conspicuous overnight market moves.
I have noticed that the last couple of weeks the vast majority of US market moves happened after-hours with daily activity relatively flat.
Is US stock completely enslaved to trading in Europe/Asia, or is there some other manipulation?
platinum:gold ratio made a fresh low
below 0.9 last seen in ... 1985! But it was even lower (below 0.7) in 1982. Buying opportunity? Probably, but I will wait till it stops falling.
Connecting the dots on violence committed against OWS
View from a UK based journalist. First shots of a civil war...
The mainstream media was declaring continually "OWS has no message". Frustrated, I simply asked them. I began soliciting online "What is it you want?" answers from Occupy. In the first 15 minutes, I received 100 answers. These were truly eye-opening.
The No 1 agenda item: get the money out of politics. Most often cited was legislation to blunt the effect of the Citizens United ruling, which lets boundless sums enter the campaign process.
No 2: reform the banking system to prevent fraud and manipulation, with the most frequent item being to restore the Glass-Steagall Act – the Depression-era law, done away with by President Clinton, that separates investment banks from commercial banks. This law would correct the conditions for the recent crisis, as investment banks could not take risks for profit that create kale derivatives out of thin air, and wipe out the commercial and savings banks.
No 3 was the most clarifying: draft laws against the little-known loophole that currently allows members of Congress to pass legislation affecting Delaware-based corporations in which they themselves are investors.
When I saw this list – and especially the last agenda item – the scales fell from my eyes. Of course, these unarmed people would be having the shit kicked out of them.
For the terrible insight to take away from news that the Department of Homeland Security coordinated a violent crackdown is that the DHS does not freelance. The DHS cannot say, on its own initiative, "we are going after these scruffy hippies".
Rather, DHS is answerable up a chain of command: first, to New York Representative Peter King, head of the House homeland security subcommittee, who naturally is influenced by his fellow congressmen and women's wishes and interests. And the DHS answers directly, above King, to the president (who was conveniently in Australia at the time).
In other words, for the DHS to be on a call with mayors, the logic of its chain of command and accountability implies that congressional overseers, with the blessing of the White House, told the DHS to authorise mayors to order their police forces – pumped up with millions of dollars of hardware and training from the DHS – to make war on peaceful citizens.
But wait: why on earth would Congress advise violent militarised reactions against its own peaceful constituents? The answer is straightforward: in recent years, members of Congress have started entering the system as members of the middle class (or upper middle class) – but they are leaving DC privy to vast personal wealth... more
http://www.guardian.co.uk/commentisfree/cifamerica...
S&P bank downgrades coming in thick and fast
Bank of America Corp. (BAC) to A- from A
Bank of New York Mellon Corp. (BK) to A+ from AA-
Barclays PLC (BCS) to A from A+
Wells Fargo Bank N.A. (WFC) to AA- from AA
Citibank N.A. (C) to A from A+
Goldman Sachs & Co. (GS) to A from A+
JPMorgan Chase & Co. (JPM) to A from A+
Morgan Stanley (MS) to A- from A
http://blogs.barrons.com/incomeinvesting/2011/11/2...
We gonna sell off, or as Jesse suggests, lift stocks once again as we whistle past the graveyard? Futures ain't looking so great at 2am. Uncle Buck ain't giving up 79 as support.
Interesting that S&P should pull of a swifty here just as we were lifting. I don't believe it was coincidence and the futures bleeding off as a large descending triangle suggest longs are about to be shafted today. If the market ignores this news then one has to give credit to the strength it is presently showing. As always we shall see.
From Jesses:
Bloomberg says the SEC will look into any unusual activity on the bank stocks today in light of these after hour downgrades. Yeah, uh huh, sure. And they will file the information with the silver manipulation report from the CFTC.
When it comes, the financial reckoning will be like a thief in the night. Or like MF Global if you prefer. There will be a bank holiday, and after a few days you will be informed by the bank on how much of your money you have left, and when you can expect to have access to it.
I've managed to rustle up some more cash for the end of Dec. Looks like it'll stay in cash and I wait to see how deep the rabbit hole goes. Staying long silver bullion.
Interesting commentary from Romani Prodi
http://www.spiegel.de/international/europe/0,1518,...
He points out that Berlusconi is trying to keep the door open for a return to politics. Prodi acknowledges that the technocratic govt. in Italy is the right move on a provisional basis, given the lack of governance under Berlusconi.
By way of example he points out the lack of control over the shadow economy. A good write up can be found here.
http://www.dailymail.co.uk/news/article-2063932/Ju...
Just one group of Mafia situated geographically at the toe of Italy's boot have estimated annual turnover of €30B, equivalent to a small European sovereign. I imagine they don't pay tax on that either...
I can read the critique of democratic governance in Prodi's remarks, but I ask myself what do we do about it? And who uses this deteriorating situation to set themselves up in democratic governance's place? It's during such periods that the populists and demagogues come out of the woodwork to wrest control.
The world is changing... http://www.youtube.com/watch?v=y4Q0Et3wniM
WA AND THE AUD
ALOHA!
Anyone notice how fast the AUD went back to par with a USD, three trading sessions! So now the 80 mark for the USD is now resistance. Back when I first started blogging here it was support! The 80 used to be a very long term bottom for the USD ...
A glimpse at the ASX tonight and it is up and all my ASX holdings are up as well. Then I saw this on the West Australian website ...
The fall in Perth house prices continues, with new figures showing the median price for a home down by 0.8 per cent in October.
RP Data-Rismark reported the median house price, now at $453,000, has fallen by 1.5 per cent through the quarter and by 4.4 per cent in the year to date.
Since the market’s peak more than 18 months ago the median price for a house in Perth as fallen by seven per cent.
Wow ... down to $453,000AUD median house price! Where do I line up to buy a dozen? Wake me up when it gets down to around $200,000AUD like the USA! Then wake me when a AUD/USD is back to .55! Once that day comes I'll be on a Qantas flight sipping Fosters from a Qantas hostie! HA!!
Then this is the most viewed news stories at the West Australian:
1-Bali drink killed WA rugby player
2-Car hit, kills mum pushing pram
3-Laptop wi-fi concerns for sperm
4-Man sues former hostages, says they broke promise
5-Scientists develop new bird flu strain that 'could kill millions'
6-iPhone explodes on Sydney flight
7-The most awkward kiss ever?
8-Man ordered to pay wife for lack of sex
9-Perth house prices continue to fall
10-Firefighters battle South West flare-up
You can see where the Perth home prices rank(#9) ...
As usual people are more interested in gossipy frivolous stuff more than they are the economy and finances. Is that a sign of any thing?
Mad as Hell?
http://tinyurl.com/6q2zndo
Paulson, the SEC, the freakshow known as US politics...
Re: WA AND THE AUD
Been watching the Ozzie dollar play with parity as a sort of risk on/risk off measure recently.
As for housing and money, I pissed off my aunt, the matriarch of our family the other week by passing along an SMH opinion piece that asserted that the baby boomer gen have a lot to answer for. Throwing such articles out there in the family helps me to slowly put together a coherent, complex picture of where we went off the deep end - perhaps I should have been more nuanced than simply give the impression that "its all your fault".
But still, the level of ignorance relating to monetary practice is proving surprising from a family of well educated retirees (in her case, a Doctorate in Psychology). An uncle recently confessed that his greatest concern for the next gen of Robinsons (which includes me) is housing prices, which are massively overpriced, as you've pointed out.
But my suggestion of housing prices to be cut in half at some point in future comes as a message from Mars. Perhaps its related to the fact that Australians are measured as the most wealthy in the world, according to a recent article in a newspaper. Unfortunately that wealth is overwhelmingly tied up in real estate.
Hear no evil, see no evil, speak no evil?
Re: Mad as Hell?
Thanks Ron, a penny for your thoughts and always appreciated. Nice setup on the blog btw.
Re: Connecting the dots on violence committed against OWS
Les,
Thanks for the link. I have thought all along that the mainstream media video selections were spinning this to the radical left-led, lazy hippies, view.
A couple of the TV videos eliminated the most egregious parts of what I saw online. FOX, WSJ, and IBD all take that stand as does my local rag.
Tea Party and OWS should unite. I find it encouraging to realize this is ordinary US citizens who all realize the injustice being done.
Grym
SPX weekly
Investor's Market Pulse: S&P weekly close 1244 ( + 7.39 % )
Did the action this week trace a perfect Elliott 2 wave with rejection Friday at the 200 day or is this bullish as the S&P 500 trades above the daily 50 day MA? First resistance is a confluence at 1265 (200 day MA) and 1269 (wkly 50 MA); second resistance is 1293 (daily UBB). First support is 1226 (daily MBB); second support is 1210 (daily 50 day MA).