Archive - Nov 2009

• Asian stocks, currencies rise on Japan, China economic data; gold advances.
• China's industrial production output grew 16.1% in October, its fastest pace in more than a year.
• Job openings in U.S. remain close to record-lows
• Oil prices fell $79 a barrel in Asia amid rising U.S. oil inventories and a weaker dollar
• Swiss rules to tie bonuses to profit will apply only to the nation’s 12 largest banks
• Unfilled positions climb to most since June as US companies delay hiring.
• USDA trimmed its production forecast and raised its price outlook for crops.
• Adobe to cut about 680 full-time positions or about 9% of its total work force.

In the letter to the IASB, Jörgen Holmquist, director general of Internal Markets at the European Commission, said more assets might be marked to market under the new system than even under existing rules. He urged the IASB “urgently” to consider further changes.

Greenspan's glasses though: totally the same. Literally. Same pair.

Just when it seemed that all the stops had been pulled on the REIT juggernaut and nothing else would be able to surprise to the upside, save for Vornado finding an ancient Mayan city made of 24k gold in its back yard, after we read the attached research report on US REITs from Goldman analyst Jonathan Habermann, we have a dead taste in our mouth. The reason for that is we believe Goldman is within 2-4 weeks of upgrading the entire REIT space to something comparable to a Conviction Buy (not sure if that is possible for an entire industry, but we are confident GS will find a way).

A very much... welcoming...Margaret Brennan discusses Niall Ferguson's opinion on the dollar, and his Fed policy outlook. Aside from the red dress, notable items include Niall's very astute observation that "Chimerica," which for all intents and purposes is a megalith sovereign, joined at the hip, and whose existence is predicated on the "non-defection" of the significant other in perpetuity, will continue to shift the pain of adjustment on the "developed world." Some very critical thoughts on why Europe and Japan are more than happy to be on the receiving end of the K-Y in the currency department so long as their markets obtain the benefit of the appreciating S&P.

Dodd's bill - while sounding good - is really an all-out attempt to save the current, broken system...

In this piece, we compare the relative performance of the 6 primary domestic equity markets, highlight extraordinary Fibonacci cycles on the VIX, illustrate possible dueling Head & Shoulders patterns between the S&P 500 and the VIX and address the current technical profile of the US Dollar

Remember the equity market yesterday: total, insane, low-volume melt up? One would think CDS would be blue blue blue. Well, here is what happened across NA IG CDX land.(and yes, no surprises).

Spreads were mixed to slightly tighter in the major indices today despite negative breadth in single-names. HY outperformed IG as both indices saw inside days amid low volumes pre-holiday tomorrow. Financials outperformed non-financials but the financials were off their best levels by the close (as we suspect some concerns over Bair's Basel II Bumblings started to be taken seriously).

"The futures are getting gunned on massive volume without any coinciding volume in SPY. This means an institution is jamming the futures higher knowing that they can drive the market higher on no volume."

and

"The results of low transaction-cost Casino Capitalism are that short-term, high-frequency traders are squeezing out long-term investors, the listed market for public companies is in decline, and this decline is taking the U.S. economy with it."

Question: When is it ok to cook the books of a public company?

Despite the outright collapse of ABK and MBIA, two more failed financial gamblers today, investors continued to push stocks higher, solely on the backs of AAPL, GOOG, PCLN, and BIDU. Its been quite amazing that this is the first bubble in world history that was actually able to repeat itself within the span of 18 months. Kindleberger will have to re-write his "Manias, Panics and Crashes" book to document this absurdity.

Saudi Aramco, national oil company of the world’s largest oil producer and exporter, decided earlier this month it will drop West Texas Intermediate (WTI) as the benchmark for pricing its oil for sale in the US market. The news instantly sparked speculation that other major producers would follow. Chavez (not surprisingly), reportedly already indicated Venezuela would follow Saudi’s lead adopting the new index.

Dear Mr. Kotz:

Enclosed please find our invoice for services.

- Zero Hedge

Let's do the math: the US Gov't needs to roll about $5 trillion (and increasing) every year, Commercial Real Estate has a $3 trillion refi cliff around 2014 and the banking system has a $7 trillion roll maturity by 2012. In other words at or about 2012, or at the time Barack Obama is sure to be enjoying record approval ratings (high or low, your choice) courtesy of 30% unemployment, the American economy will be straddled with not just the ongoing burden of issuing about $2 trillion in debt each year to finance what can only be characterized as a budget concocted by the most hard-core, raving lunatics in the Federal Insane Asylum Reserve, but will have to deal with roughly $15 trillion of rolling maturities.