Archive - May 2012

All Hail to the Great One...Moolaram!!!

If you just submitted an order to buy FB today, and were confident the order was executed even if at market, you may be out of luck:

• NASDAQ HAS PROBLEM DELIVERING FACEBOOK TRADE EXECUTION MESSAGES

What this means is that the exchange at this point is deciding whether or not to send back late executions to all people who bought, or thought they bought. Needless to say this means that the indicated price is likely not the real price if one factors for all the latent orders, on both the bid and offer side, unless of course all those orders get cancelled, further eroding confident in the market, only this time hitting that one segment most disenchanted with the stock market - mom and pop.

The Elite Financial Players Are Manipulating the Game So that They Get the Stimulus ... and the Little Guy Gets the Austerity

$38.00 Syndicate bid holding...high was $45.00 - 200mm shares traded

The situation in Europe is bad...  How BAD? Well, France, Spain, and Germany have ALL implemented border controls. That's not a typo. Spain, France, and Germany can each close their borders for up to 30 days at any point if they so choose. Why are they doing this? Because they know that when the stuff hits the fan and the EU collapses (which it will in the next few months) people are going to attempt to flee with their money... so they have made it so that no one can get it... and no one can get out. 

Now that, thank God, the Facebook IPO is behind us, effective immediately, new Federal regulations expressly ban the following terms within the fifty United States and its territories:

UPDATE: $40 handle broke - $38.3!!

UPDATE: Algos defending $40.00 desparately! 115mm shares

From the $38 IPO price, we open at $42.05 (now at $40.1) but we note that in Germany it has tumbled from well over EUR90 earlier. We get the sense the media is disappointed, but of course they will be talking longer-term now and defending a weaker-than-expected open: CNBC: "I just want to make sure we don't whip ourselves into a frenzy on the short term value." - perhaps a little late for that eh?

Yes, we are all waiting for what is increasingly becoming an epic disaster. In the meantime there is this:

• TRADERS FOR FACEBOOK HAVING PROBLEMS CHANGING/CANCELING ORDERS:WSJ...

We believe CANCELING is the operative word. Of course, Europe is about to close which according to some may be the catalyst. In other news, nobody even dare think, let alone whipser "Market Conditions"

Update: $42, $43.25, $45, $44

There's a big, fat "I told you so" coming down the pike. 

Presented with little comment as JPMorgan, Citi, and Morgan Stanley (and JEF) are now down year-to-date (after being up 35-40% just a few weeks ago) and catching up to the credit reality that we have been so vociferous about...

David McWilliams (of Punk Economics) begins his latest excellent discussion by conjuring Clint Eastwood and noting that when it comes to the Fiscal Compact in Europe "they are pissing down our backs and telling us that it is raining". The Fiscal Compact will NOT strengthen the Euro but in fact by cementing the austerity agenda into law it will make the political environment even more unstable. The Irishman goes on to discuss why Europe is imploding as he insightfully notes that "financial panics do not cause the destruction of wealth, financial panics merely tell you the extent to which wealth has been destroyed by reckless speculation". The realization that current account deficits and not budget deficits were always the problem in Europe which leaves the fiscal compact akin to a doctor prescribing chemotherapy for heart disease. McWilliams explains why France has seen such a change and why the fiscal compact has nothing to do with the Euro but is all about reassuring the German electorate that they will be protected from the consequences of a monetary union that they were bounced into in the nineties; as they are terrified of 'Peripheraid' - the constant drip-drip feeding of German cash to the periphery. Critically, driving to his final discussion of how the Irish should vote on the referendum - remembering that the German elites want a Federal Republic of Europe and that the entire union is in the midst of a massive negotiation - he lays out in cartoon simplicity why Germany is stuck with a massive personal interest in 'cleaning up the EU neighborhood'. Ireland should not give up cheaply in the referendum 'poker match' as all nations try and figure out who the sucker at the table is. Must-watch clip to comprehend the 'game' occurring in Europe and how it is changing very recently.