I just want to extend sincere and humble thanks to Bill & Geoff. This morning's report is what sets this blog apart and why it is a must read every day.
I really hope everyone appreciates the excellence that is given away for free here to help the individual retail investor survive in these most difficult markets and learn to use these critical tools for themselves.
Eventually it may come to that. But in the short term, a return to the Drachma solves nothing. If fiat is only as strong as the credibility of the gov't printing it, then the Drachma already has no credibility and crazy inflation will immediately ensue. The Greeks have already swilled at the Euro trough for more than 10 years and now the time has come to repay. Personally, I applaud Frau Merkel for holding the line on austerity. Better to phase it in voluntarily than to have it foist upon you when all social safety nets fail later on.
When Lehman failed everyone lamented it and wished that it could have been prevented, but it could not be. Sometimes things fail. This may be one of those times (again). If the tanks end up rolling at some future date, the Greeks will have no one to blame but themselves. They're the ones who failed to collect taxes for years; they're the ones who elected feckless leaders; they're the ones that didn't make any hay while the sun shone brightly in the early days of the Euro but now don't want to adopt German austerity when the bill is due.
Let's just hope that the Germanss stance toward profligate Greece isn't a foreshadow of future China / US relations...the analogy applies.
Like Kaimu is fond of saying "It all works until it doesn't". Well, today in Greece, it officially "doesn't" anymore, hence the Greeks take their Euros (while they can still get them) and split.
In fairness to NYUGrad, I think this was baked in the cake...a little bit.
The other shoe to drop will be the ensuing failure of a major French bank when Greece officially defaults and the IMF pulls the plug on the compromise.
The thing that puzzles me is that the leftist Greek politicians can't really believe that (a) Frau Merkel will blink and relax hard fought austerity demands or (b) that a return to the Drachman is somehow the answer.
JPM announces a major blow up out of left field last night, but BAC is catching a bid and is way, way oversold, IMO.
While timing is the key to trading, someone out there will eventually make a lot of money accumulating BAC way down here.
I'm sure it won't be me as the time premium on my OTM JAN 2013 calls slowly bleeds off, but Moynihan is swallowing all the unpleasant doses of castor oil needed to lead to a vibrant tomorrow. I really think the turn around is under way and the culture is changing.
For the US economy to really start firing on all cylinders again, the banking sector has to be a leader.
With all this talk about trillion dollar deficits...doesn't this amount of gold count for something? CNBC says that the US has more than $418B of it.
If the deficit is 1.2T, but the US holds gold bullion worth nearly 1/3rd of that, aren't we sufficiently hedged to redeem treasury paper in gold if we have to? In effect, buying back our own debt with gold (the ultimate destroyer of debt)?
If the premise is that gold will only rise in value as the currency of last resort, than it seems to me that the US is the world's biggest gold bug and really has little to worry about...in addition to issuing the world's reserve currency.
This is starting to feel like a range-bound and heavy tape.
Even if you bought the last dip below 1370...you've just round tripped again.
I'm really hoping for some resolution in the tape here over the next 2 weeks. S&P really needs to wash out fully down to 1340'ish or it's got to break out hard over 1400 and not look back. Otherwise, this is just churn on decreasing volume.
Its funny because the report will be good and Apple is still a great company, but expectations are just way, way beyond the pale.
One of these days, it might even be a good buy.
I wouldn't play options off of AAPL earnings, either. I'm sure smarter people than I are trying strangles and straddles, but those never seem to make any real money.
I do think that if AAPL has a really disappointing report, the market could take a quick trip down to S&P 1340 before the weekend, though. That's what I'm watching.
Channel cheks on I-phone sales through T & VZ are well below expectations and Mac sales are very unspectacular, so unless the I-pod really blows out crazy, I'm looking for a big, big miss tonight.
Let's see if AAPL bleeds off all day into the close.
I only held a Vanguard Intermediate Bond Fund in my 401(k). I had been in that fund for more than 3 years and sold out of it a little over a week ago at what I consider to be very close to a market top. It was a good place to hide and I made some money. At one point, it was probably 40+% of my holdings. I would rather hold cash that I can move quickly into equities on a big sell off.
I think the 10 year note at 1.92% is just plain crazy at this point and utterly unsustainable. There is a wide disconnect between the BRIC interest rates and ours and I think that severe a decoupling can't last. Everyone knows that higher rates are coming and I don't need to catch the last nickel.
When the bond market finally turns, I think it'll be too swift and dramatic a move to time correctly.
That's the one to watch, Earl. We're back below the key 1370 level now, so a test of 1340 would be the next support where bids should enter in force (thanks, Geoff!).
Europe is to blame (again). Spanish bonds are flirting with insolvency; Netherlands gov't quits and Sarkozy is fighting for his political life in France now. It looks like Europe is pretty clearly headed for recession, partly self-induced by draconian austerity measures (they have no growth prospects).
So hard to be patient, but so absolutely necessary. I'm still holding a lot of cash...frankly more than I want to be, but I have little choice if I want to seize an opportunity to grow it. Completely out of US Bonds...for good (except TIPS).
1372 and holding so far, but under pressure. Seems like every move into the 1380's gets beaten back to this spot. Maybe this is tied to the US$ action? Waiting for the coils to spring one way or another.
Why doesn't MUX put in a stink bid for RBY? Rob owned a good portion of RBY once. At this point, I would think the RBY board would welcome him with open arms given that he sold out in October 2012 for C$4.17 which is considerably higher that what its selling for now. Someone at RBY should call Rob for lunch...come back Rob...all is forgiven. The market has zero confidence in Adamson and friends to bring Phoenix to commercial production.
Geoff called it. That is quite a line of scrimmage over these last 3-4 sessions. Bulls are fighting hard to hold it and push it; and bears are trying to punch it down and drown it.
Spot on. Looks like a classic case of outflow to me. But we won't hear Jamie Dimon talk about JPM's activities in this market on the conference call at all!
The last major currency to depart the gold standard was the Swiss Franc. This occurred in 1999 (not really all that long ago).
Is it mere coincidence that the Swiss Franc is arguably the strongest currency in the world today?
Personally, I think the days of any asset backed currency standard are long dead and never to return. Today's political economy is very reminiscent of late 19th century European aristocracy having titles but no money (governments) and needing to marry wealthy American industrialists (today's monied elites) to preserve family lines and holdings during the gilded age (Downton Abbey fans out there?).
And right on cue, CNBC reports that "Rumor on China GDP, sinks Dollar, spikes commodities" is running.
My Father in law recently posited a fascinating theory: He believes that China is accumulating gold and will eventually peg the Yuan to a gold standard. He then believes that the Yuan will - rather abruptly - replace the dollar as the world's reserve currency. I don't think China quite has the chops to pull that off, but it is a communist country, so who knows?
Pegging their currency to gold would certainly solve their potential inflation problem and hurt the $US dollar in the process...of course, it would also create the problem of what to do with all those worthless US treasuries that China's holding.
As far as Timmy & Bernanke's effort to keep a lid on yields...at some point bond investors start to vote with their feet. You have a lot of bond guys coming out now (Dan Fuss is the latest today) saying that you have to get ahead of the rising interest rate trade. Its just chatter now, but I think it is legitimate and gaining momentum. A top in the bond market is like Mt. Everest...everyone knows about it...few actually make it to the top...and its very difficult to breathe up there.
I just want to extend sincere and humble thanks to Bill & Geoff. This morning's report is what sets this blog apart and why it is a must read every day.
I really hope everyone appreciates the excellence that is given away for free here to help the individual retail investor survive in these most difficult markets and learn to use these critical tools for themselves.
I am grateful.
Eventually it may come to that. But in the short term, a return to the Drachma solves nothing. If fiat is only as strong as the credibility of the gov't printing it, then the Drachma already has no credibility and crazy inflation will immediately ensue. The Greeks have already swilled at the Euro trough for more than 10 years and now the time has come to repay. Personally, I applaud Frau Merkel for holding the line on austerity. Better to phase it in voluntarily than to have it foist upon you when all social safety nets fail later on.
When Lehman failed everyone lamented it and wished that it could have been prevented, but it could not be. Sometimes things fail. This may be one of those times (again). If the tanks end up rolling at some future date, the Greeks will have no one to blame but themselves. They're the ones who failed to collect taxes for years; they're the ones who elected feckless leaders; they're the ones that didn't make any hay while the sun shone brightly in the early days of the Euro but now don't want to adopt German austerity when the bill is due.
Let's just hope that the Germanss stance toward profligate Greece isn't a foreshadow of future China / US relations...the analogy applies.
Like Kaimu is fond of saying "It all works until it doesn't". Well, today in Greece, it officially "doesn't" anymore, hence the Greeks take their Euros (while they can still get them) and split.
In fairness to NYUGrad, I think this was baked in the cake...a little bit.
The other shoe to drop will be the ensuing failure of a major French bank when Greece officially defaults and the IMF pulls the plug on the compromise.
The thing that puzzles me is that the leftist Greek politicians can't really believe that (a) Frau Merkel will blink and relax hard fought austerity demands or (b) that a return to the Drachman is somehow the answer.
JPM announces a major blow up out of left field last night, but BAC is catching a bid and is way, way oversold, IMO.
While timing is the key to trading, someone out there will eventually make a lot of money accumulating BAC way down here.
I'm sure it won't be me as the time premium on my OTM JAN 2013 calls slowly bleeds off, but Moynihan is swallowing all the unpleasant doses of castor oil needed to lead to a vibrant tomorrow. I really think the turn around is under way and the culture is changing.
For the US economy to really start firing on all cylinders again, the banking sector has to be a leader.
Spanish yield over 6% = default, no? Maybe it was 6.25%...
Dr. Strangelove?
Please confirm if you're reading along.
Thanks in advance.
Hmmmm...I wonder if that chart has adjusted for dividends?
Methinks not.
With all this talk about trillion dollar deficits...doesn't this amount of gold count for something? CNBC says that the US has more than $418B of it.
If the deficit is 1.2T, but the US holds gold bullion worth nearly 1/3rd of that, aren't we sufficiently hedged to redeem treasury paper in gold if we have to? In effect, buying back our own debt with gold (the ultimate destroyer of debt)?
If the premise is that gold will only rise in value as the currency of last resort, than it seems to me that the US is the world's biggest gold bug and really has little to worry about...in addition to issuing the world's reserve currency.
Too simplistic?
This is starting to feel like a range-bound and heavy tape.
Even if you bought the last dip below 1370...you've just round tripped again.
I'm really hoping for some resolution in the tape here over the next 2 weeks. S&P really needs to wash out fully down to 1340'ish or it's got to break out hard over 1400 and not look back. Otherwise, this is just churn on decreasing volume.
Hasn't Herr Faber been saying this to anyone that will listen since the last crisis ended? Its always "imminent", too.
I tune him out...he goes in the puppet head bin with Jim Rogers, Dennis Gartman, Nouriel Roubini and Meredith Whitney.
They are all about promoting themselves and selling newsletters. Yawn.
Its funny because the report will be good and Apple is still a great company, but expectations are just way, way beyond the pale.
One of these days, it might even be a good buy.
I wouldn't play options off of AAPL earnings, either. I'm sure smarter people than I are trying strangles and straddles, but those never seem to make any real money.
I do think that if AAPL has a really disappointing report, the market could take a quick trip down to S&P 1340 before the weekend, though. That's what I'm watching.
Channel cheks on I-phone sales through T & VZ are well below expectations and Mac sales are very unspectacular, so unless the I-pod really blows out crazy, I'm looking for a big, big miss tonight.
Let's see if AAPL bleeds off all day into the close.
Gonna be ugly.
I only held a Vanguard Intermediate Bond Fund in my 401(k). I had been in that fund for more than 3 years and sold out of it a little over a week ago at what I consider to be very close to a market top. It was a good place to hide and I made some money. At one point, it was probably 40+% of my holdings. I would rather hold cash that I can move quickly into equities on a big sell off.
I think the 10 year note at 1.92% is just plain crazy at this point and utterly unsustainable. There is a wide disconnect between the BRIC interest rates and ours and I think that severe a decoupling can't last. Everyone knows that higher rates are coming and I don't need to catch the last nickel.
When the bond market finally turns, I think it'll be too swift and dramatic a move to time correctly.
That's the one to watch, Earl. We're back below the key 1370 level now, so a test of 1340 would be the next support where bids should enter in force (thanks, Geoff!).
Europe is to blame (again). Spanish bonds are flirting with insolvency; Netherlands gov't quits and Sarkozy is fighting for his political life in France now. It looks like Europe is pretty clearly headed for recession, partly self-induced by draconian austerity measures (they have no growth prospects).
So hard to be patient, but so absolutely necessary. I'm still holding a lot of cash...frankly more than I want to be, but I have little choice if I want to seize an opportunity to grow it. Completely out of US Bonds...for good (except TIPS).
GL.
1372 and holding so far, but under pressure. Seems like every move into the 1380's gets beaten back to this spot. Maybe this is tied to the US$ action? Waiting for the coils to spring one way or another.
My guess is that a big move up is coming.
Why doesn't MUX put in a stink bid for RBY? Rob owned a good portion of RBY once. At this point, I would think the RBY board would welcome him with open arms given that he sold out in October 2012 for C$4.17 which is considerably higher that what its selling for now. Someone at RBY should call Rob for lunch...come back Rob...all is forgiven. The market has zero confidence in Adamson and friends to bring Phoenix to commercial production.
...and they pinned the close on S&P right at 1369.57. Unbelievable.
Truly a game of inches these days.
Geoff called it. That is quite a line of scrimmage over these last 3-4 sessions. Bulls are fighting hard to hold it and push it; and bears are trying to punch it down and drown it.
Volatility is increasing, too.
Spot on. Looks like a classic case of outflow to me. But we won't hear Jamie Dimon talk about JPM's activities in this market on the conference call at all!
For those that are curious...
The last major currency to depart the gold standard was the Swiss Franc. This occurred in 1999 (not really all that long ago).
Is it mere coincidence that the Swiss Franc is arguably the strongest currency in the world today?
Personally, I think the days of any asset backed currency standard are long dead and never to return. Today's political economy is very reminiscent of late 19th century European aristocracy having titles but no money (governments) and needing to marry wealthy American industrialists (today's monied elites) to preserve family lines and holdings during the gilded age (Downton Abbey fans out there?).
And right on cue, CNBC reports that "Rumor on China GDP, sinks Dollar, spikes commodities" is running.
My Father in law recently posited a fascinating theory: He believes that China is accumulating gold and will eventually peg the Yuan to a gold standard. He then believes that the Yuan will - rather abruptly - replace the dollar as the world's reserve currency. I don't think China quite has the chops to pull that off, but it is a communist country, so who knows?
Pegging their currency to gold would certainly solve their potential inflation problem and hurt the $US dollar in the process...of course, it would also create the problem of what to do with all those worthless US treasuries that China's holding.
As far as Timmy & Bernanke's effort to keep a lid on yields...at some point bond investors start to vote with their feet. You have a lot of bond guys coming out now (Dan Fuss is the latest today) saying that you have to get ahead of the rising interest rate trade. Its just chatter now, but I think it is legitimate and gaining momentum. A top in the bond market is like Mt. Everest...everyone knows about it...few actually make it to the top...and its very difficult to breathe up there.