Archive - Jul 2009

Oil is going down, equities are going up - which is it?

As you no doubt have noticed, Zero Hedge has enjoyed taunting you by swimming through the ether like it was molasses. We are putting the final touches on things like load-balancing and network settings, so occasionally, as you bring us to new heights of traffic saturation, we've been tweaking things to max out our capacity. (Or exceed it and cause database violence).

“This is the world of smart securitisation,” said Geoff Smailes, managing director of global credit solutions at BarCap. “It’s not securitisation for leverage and arbitrage purposes any more. This is all about restructuring portfolios of assets to achieve risk, capital and funding efficiency in a transparent and less complex way.”

The week following NFP weeks are generally light on economic data. Typically these economic-light weeks garner a lot of speeches from Fed officials and the like. But while Fed Presidents Evans and Duke, as well as Geithner will speak or testify, remarks from them should not be market moving events. So, you might think that a quiet week would correspond with a low volatility. That is sensible enough, but you might be wrong. Investor confidence has been shaken by the July 2 NFP report that showed job losses in June were not just much worse than expected, but also much worse than the previous month. The July 2nd jobs report effectively discredited the “green shooters” thesis that thing were getting less bad. In other words, things are suddenly less bullish or more bearish. Oops!

Update: Short answer- probably not.

From our tips line:

I am sure you have probably seen this before, but I found some interesting differences in the article by Matthew Goldstein as posted at http://blogs.reuters.com/commentaries/2009/07/05/a-goldman-trading-scandal/ and the article as posted on cnbc, http://www.cnbc.com/id/31750907.

The returns of some big FX players are serving as an impromptu summary for the past 6 months.

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Matt Goldstein over at Reuters may have just broken a story that could spell doom for if not the entire Goldman Sachs program trading group, then at least those who deal with "low latency (microseconds) event-driven market data processing, strategy, and order submissions." Visions of swirling, gray storm clouds over Goldman's SLP and hi-fi traders begin to form.

You wanted decals? Fine. Here are your decals.

Over the past two weeks many banks issued press releases and opened up the PR spigot to indicate just how stable they all are now that a few have managed to pay down their TARP commitments. This of course, is nothing but a complete farce, and simply yet another chapter in the "consumer confidence" game played by the administration and its financial underlings. In order to see just how much the banking system depends on the continued unlimited wallet of taxpayers and Geithner's printing presses, and how much certain law firms continue to depend on the somewhat less limited wallet of Wall Street, I present an October 31, 2008 letter recently obtained by Zero Hedge, in which Sullivan & Cromwell, Wall Street's #2 favorite law firm (or is that #1: I am sure Wachtell Lipton would have a few choice words with regard to that particular league table rating, although it may be hard pressed to match S&C's $241,975 in donations to the Democratic National Convention), goes to town to make sure that its well-deserving clients including Bank of America, Bank of New York Mellon, Citigroup, Goldman Sachs, JP Morgan Chase, Merrill Lynch, Morgan Stanley, State Street and Wells Fargo get to not only have the taxpayers' cake (in perpetuity), but eat more and more of it each day.

Anytime someone tells you that a mortgage is less risky than “subprime” you know you have a problem. The Alt-A mortgage is largely absent from the current mainstream housing debate but is really the next wave that will further depress housing prices. Data produced from a June 2009 OTS and OCC report highlighting market conditions for 64 percent of U.S. mortgages finds that some 3.5 million loans are categorized as Alt-A. California issuing IOUs is home to many of the Alt-A mortgages.

After days of configuring, we've finally managed to get subscriptions working properly.  If you checked your email box you already know this because you likely received 900 emails at once as all the notifications queued up over the last week were batch-sent in one massive climax of SMTP server intercourse.

Sorry about the mess.

To configure your subscriptions, go to the "My Account" menu on the left and select the "Subscriptions" tab.

ETst

Hmmmmmmmmm

This is only a test.