Archive - Jan 12, 2011

The general market tone is more positive this AM as winter weather impacts the Northeast. Yesterday's NFIB Small Business Optimism and other economic data did not paint a commensurately rosy picture alongside the recent ISM prints. Today's big releases will be the Fed's Beige Book, which should provide a more granular level of data points on expansion, and the US Monthly Budget Statement.

Ever since his transition from a critical, respected and objective economist to the third coming of A Joseph Cohen, Goldman's Jan Hatzius has become an increasingly irrelevant second fiddle-cum-broken record, and as such his observations have merited less and less attention. His latest spin piece on why the centrally planned US economy will grow within the parameters of "perfection pricing" is merely more confirmation of this sad transition. To wit: "2012 is still a long way off, and the uncertainty surrounding any forecast is large.  But if we are right, the implications of this forecast are reasonably benign for the US Treasury market and very benign for the equity market.  Indeed, our strategists expect only a moderate increase in 10-year Treasury note yields to 3¾% at the end of 2011 and 4¼% at the end of 2012, as well as an increase in the S&P 500 index to 1500 by the end of 2011." In other words: the debt-fueled Frankenstein of a Goldilocks monster, currently rampaging around on government-funded steroids, is really completely under control. It appears that all the gloves have come off in this last attempt to reflate the global ponzi, and sadly credibility once relevant, is now completely out of the window.

The pace picks up, but only a bit, as we get import prices, the beige book, and the December budget balance following this morning’s mortgage applications report…New POMO schedule released today.

Legitimate humanitarians inspired by real compassion inevitably seek to help men become more responsible for themselves, not less. Compared to this mission, the Loughners of the world are only a distraction, a media game which does not need to be played. While it is important to safeguard against events like that which took place in Arizona, it is even more important to safeguard against the exploitation of these events by those who would do much greater harm. The wider view requires a respect for the enduring benefits of freedom, which eclipse our momentary lapses of human character. The Liberty Movement’s interest lay not just in the chaos of the present moment, but in the clarity of a possible future; one in which man’s individual sovereignty is valued, rather than feared.

The most expected yet anticlimactic bond auction for 2011 has come and gone: after getting the backstops of the ECB, China and most recently, Japan, Portugal managed to sell €1.25 billion in 4 and 10 year paper. And while the the yield on the 10 year was better than expected, and notably lower than the 7% where the point had been trading on the curve recently, the 4 year priced notably weaker compared to previous. Of course, none of this would have been possible had the ECB not been buying Portuguese bonds in the open market for two days this week, and continuing into Wednesday, into the biggest farce of a market currently operating in Europe.

RANsquawk European Morning Briefing - Stocks, Bonds, FX etc. – 12/01/11

RANsquawk European Morning Briefing - Stocks, Bonds, FX etc. – 12/01/11

Retail traders are notoriously wrong at picking market direction/tops and bottoms. Most retail traders very naturally seem to adopt a counter-trend stance and this offers very accurate signals for individuals looking to trade against this group. This daily report is designed to help traders focus their efforts on higher probability pairs.

Today’s slow day in dataflow found matching silence in the markets, as traders look ahead to Portuguese and Spanish auction tomorrow and Thursday, respectively.

It was a fairly quiet day on the market as investors get ready for earnings season, brace for...