Market Wrap 6.29.09
Submitted by Tyler Durden on 06/29/2009 - 17:32In the absence of our daily CDS market closing commentary (some people actually enjoy taking vacations), I provide you with RANsquawk's equity and credit EOD wraps.
Raiffeisen Bank Pulls Exchange Offer
Submitted by Tyler Durden on 06/29/2009 - 16:35It was only a week ago that we were conjecturing about the prospects for Austrian mega-bank Raiffeisen. This being Zero Hedge of course, we came to the conclusion that the prospects were not that hot. Some readers vehemently disagreed. Maybe news today out of RZB will make them a tad less skeptical: the bank announced that it was scrapping the exchange offer without providing much of a reason.
NYSE "Volume" - Lowest Since January 5
Submitted by Tyler Durden on 06/29/2009 - 15:30
Today is EOQ, yet the NYSE traded with the lowest volume since January 5. The correlation continues: low volume - market up; high volume - market plunge. Rinse. Repeat.
Norway Swapping Government Debt For Mortgages
Submitted by Tyler Durden on 06/29/2009 - 15:10Long perceived as a bastion of stability due to their oil-extraction based economy, and socialist system that the US can only dream to emulate, today the Norwegian Central Bank conducted a Dutch auction in which it exchanged NOK10 billion of government securities for residential and commercial mortgage loans. And not just any loans, but including those denominated in SEK, DKK, EUR, USD, GBP and CHF (well, in retrospect, looks like pretty much any loans). Exchange swaps will cover maturities between December 2012 and 2014. But aside from the specifics, it seems that even the Norges are starting to monetize MBS: a process demonstrated to work phenomenally well at propping up a hollow economy by the likes of economic alchemists such as Ben Bernanke and Tim Geithner.
Afternoon News
Submitted by Tyler Durden on 06/29/2009 - 14:17- Danish officials confirm swine flu victim resisting Tamiflu
- VIX drops to 25.65, below closing level before Lehman collapse
- Qatar has made offer for Porsche: Qatar’s offer includes for Porsche’s VW options.
- Germany's Vice Chancellor Steinmeier says no room for further tax cuts
- Bank of America (BAC) 2009 estimate cut to USD 0.65 from USD 0.71 by Rochdale's Bove
- Government to stop outright purchases of stock, State Street to stop rolling buy ins (relax, i jest)
Dennis Kneale: The Great Recession Is Over
Submitted by Tyler Durden on 06/29/2009 - 14:01And I thought the Sanford letters were going to be the funniest thing posted here this afternoon. Oops...
FDIC Releases State Loan-To-Deposit Ratios
Submitted by Tyler Durden on 06/29/2009 - 13:44
The FDIC today made public for the first time host state loan-to-deposit ratios. Alas, the data is quite dated, as it represents the June 30, 2008 snapshot. Since then one can imagine things have changed quite a bit. The data are being released in order to calculate complaince with "section 109 of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994."
San Francisco Fed On Employer-Sponsored Insurance
Submitted by Tyler Durden on 06/29/2009 - 13:15In keeping up with relevant current topics, the San Francisco Fed has issued a new paper analyzing how proposed new changes to health insurance planning may impact the broad economy by comparing to the example of the Prepaid Health Care Act (PHCA) adopted by Hawaii in the 1970's. Presumably, the administration has done its empirical homework as it pushes for various expensive adjustments to insurance plans, however it bears to read this piece for the conclusions, which essentially notes that not only are business likely to suffer higher incremental costs, the marginal employment of full time workers will likely suffer as more and more shift to find loopholes in proposed legislation, putting further stress on the already broken (un)employment landscape.
My Immoral Beluved (Sic)
Submitted by Tyler Durden on 06/29/2009 - 12:37Some afternoon levity: now that Madoff is set to spend the remainder of his life behind bars, the public's attention is shifting to whatever other scandal will fill the pages of the yellow press. And as this summer has progressed very slowly, with the SEC cowering in its cave, afraid to do anything about the unprecedented market manipulation evident to anyone but the market regulator, the general public likely will have to make do with the tryst of Gov. Mark Sanford and his Argentinian beau as the topic de jour.
Another No Volume Day, With Quants Lurking In The Shadows Ready To Pounce
Submitted by Tyler Durden on 06/29/2009 - 11:40
As Larry Levin pointed out earlier, there is no volume as usual, a perfect opportunity for the SPARCs and the (In)visible hands to wreak havoc with all the shorts, as per the running script. Volume runrated to end silly low.
Six Flags Ad Hoc Bondholders Preparing For Big Valuation Fight
Submitted by Tyler Durden on 06/29/2009 - 11:08Even as Six Flags' OCC (Official Credit Committee) was being formed in Delaware last Friday, with naive participants such as BoNY, HSBC, Esopus Creek Capital, Schottenfeld Associates, John Gorman, Whirley Drink Works and Coca-Cola (the last two must be royally pissed as all their advance profits on $9.95 small cups of soda have just become General Unsecured Claims) all hoping for some meager recoveries, and financial advisors (Broadpoint, Chanin, Moelis, Mesirow, BDO and Peter J Solomon, all of which are now overnight specialists in the amusement park business) trying to bedazzle the committee with their pretty charts and glass beads (and in the case of some, expansive dinners at Tao, where engagement letters were hoped to be signed on the naked backs of blonde, barely legal, Ukranian imports), the ad hocs were preparing for war according to Debtwire.
Guest Post: The Future - Deflation
Submitted by Tyler Durden on 06/29/2009 - 10:18Everyone speaking about inflation these days. Many seeing it mostly in commodity prices and the insane printing of money. Yet with oil heading steadily back to the range from last summer, there is no bottom anywhere for home prices. Also, banks can hoard up all the cash they want: nobody wants it. Consumer are firmly retrenching into thrift mode, and cutting up credit cards or simply maxing out and not paying them. To say inflation is guaranteed in light of trillions and trillions of consumer wealth destroyed, is very shortsighted.
Loans Versus Bonds Relative Value: Week of June 25
Submitted by Tyler Durden on 06/29/2009 - 09:47
As expected last week, the tide in credit is turning. The average loan was 5 bps wider, while toxic bonds, just like that scene in Indiana Jones and the Temple of Doom, are starting their descent back into hell, wider by 78 bps on average, and just 23 bps away from the critical 1,000 bps threshold (after being at 895 bps last week).
CNBC: "This Market Continues To Be Propped Up By Government Intervention And Manipulation"
Submitted by Tyler Durden on 06/29/2009 - 08:45Amusing to see the biggest propaganda voice for the administration and General Electric let this one slip. At 2:22 in the video below, Larry Levin discloses the truth about ongoing flagrant market manipulation. That's why CNBC needs a 15 second delay, although Freudian slips among all the noise are why watching the channel can be so rewarding at the end of the day.
