Archive - Apr 26, 2010

• Computerized front running: how a computer program designed to save the free market turned into a monster (Web of Debt, h/t MF)
• Even after failing to keep Citi above $5, US Treasury to sell 1.5 billion shares of Citi stock (Bloomberg)
• Dodd accepts ban on bank derivatives business (AP)
• But hold on: this would hinder the billionaire's plans to become a trillionaire: Berkshite presses lawmakers to roll back proposed curbs, avoiding potential hit... and we can't have that now can we (WSJ)
• Rogoff says Greece may not be Europe's last bailout (Bloomberg)
• Bill Gross: "In order to pay the interest and the bill when it comes due, we'll
  simply have to issue more IOUs. That, to me, is Ponzi-like. It's a game that can never be finished." (WaPo)
• Do you have any reforms in size XL? (NYT)
• AXA Rosenberg finds cording error in risk program (Reuters)

• Asian stocks, commodities rally on economic recovery, Greece.
• Bond traders declare inflation dead with yields below 2008 crisis levels.
• China is considering introducing new or higher taxes on real estate.
• Consumer spending in US probably stepped up, carrying expansion in 2010.
• Dollar rises versus Yen amid signs of global recovery before Fed meeting.
• Finance Ministers urge IMF, EU to speed aid to Greece at Washington Talks.
• Germany is laying the legal ground for its contribution to the financial aid package for Greece.

"We are trapped in some horrendous Keynesian/monetarist nightmare, where policymakers, aided/abetted/advised by their buddies in the media, in the lobbyist cabal and in financial system, have YET AGAIN decided to go down the route which merely delays the problem/pushes it down the road, but which virtually guarantees that when the NEXT bubble collapses (I assume it will be the Global Government Debt/Bond Bubble and/or the Global Fiat Money/Paper Money/FX Bubble), there is NO pleasant way back. When this next bubble collapses, those of us living/working in these problem economies will realise, too late of course, that WE are the new emerging markets. And no, I don't mean the next China, instead my reference is to Argentina back in the late 90s/early 00s!. So if (as it seems to me) - even though we are agreed on the weak sustainable grwth outlook for the UK US Japan & Europe - that I WAS wrong and that Kevin is right on Austerity and the Reflation Trade, that policymakers will simply keep on behaving recklessly by loading on more debt and blowing more and bigger bubbles until the point of market and/or taxpayer revulsion, then this has some very clear 'asset allocation', and other implications" Bob Janjuah

RANsquawk European Morning Briefing - Stocks, Bonds, FX etc. – 26/04/10

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The Greek bond holiday is here. Greece's bond pricing administration HDAT has withdrawn bond prices as spreads have hit 650 bps. Greece acknowledges it is game over as 10 Years are at 10%, and 3 Years at 13%. Stock liquidation are rampant as Greeks are on the verge of panic: the ASE is down 3% and investors are now widely expecting a 10% correction to below 1,700 on the ASE. And Portugal is now officially part of the party Portuguese - CDS just hit 310 bps.In the meantime Germany is starting to feel the burn - German FinMin Schaeuble has stated he is determined to defend the stability of the euro by asking that Greek talks with IMF conclude by weekend. He also said that he anticipates that Euro zone and IMF want to free up Greek aid simultaneously and does not favour idea of granting Greece moratorium on debt. Alas, the time for speeches is over. Making matters worse, Germany’s SPD says will not back accelerated parliamentary process to approve Greek aid, rendering all rhetoric useless. Lastly, Angela Merkel will make a statementon Greece at 13:00 GMT. We can't wait to hear the powerlessness in her voice.

RANsquawk European Morning Briefing - Stocks, Bonds, FX etc. – 26/04/10

Weekly technical profiles of Gamestop (GME), Waters (WAT), Liberty Media (LINTA), JetBlue (JBLU), Radioshack (RSH), Exelon (EXC), Monsanto (MON), H&R Block (HRB) & China North East Petroleum (NEP) with explicit trade setups