Archive - Nov 4, 2010 - Blog entry

The late night (daily) decoupling is here.

Michael Sabia, President and CEO of the Caisse de dépôt et placement du Québec, Canada's biggest pension fund, was the guest speaker at the the Board of Trade of Metropolitan Montreal's Desjardins business luncheon - Business Voices. He talked about the many facets of the Caisse's contribution to the economic development of Quebec, mainly in the context of a changing world, which both the Caisse and Quebec need to adapt to in order to achieve their full potential.

For the visually-oriented ...

Well, it’s official, Ben Bernanke has officially gone “all in” regarding currency devaluation in the name of pumping the stock market. I have to admit, even though I knew this was going to happen, I’m still in shock. After all, it’s not every day that you see a superpower collapse and lose its reserve currency status courtesy of a deranged mad man.

Regardless of your feelings on the matter, these are the cards the Fed has dealt us, so rather than devote space to critiquing our insane and corrupt Fed Chairman, I thought it better to devote today’s article to detailing what is to come as a result of the Fed’s policies.

FX Bottom-line: Heading into 2011, USD/CAD is facing a divergence in US-Canadian policy rates reminiscent of the 2002/03 period. Although USD/CAD declined by 15% during that period, we do not envision a similar demise in USD/CAD but diverging policy stances will keep USD/CAD under downward pressure throughout 2011. However, should the growth decoupling between the global and the US recoveries continue at the same pace as seen during the last 12 months, the 2002/03 scenario could well repeat itself in the currency market, leaving the trend in CAD against USD looking increasingly similar to the most recent rally in AUD/USD.

What about you?

After putting over $2Tn into our Dead Parrot Economy since the crash and getting no response, Bernanke is upping the ante with another $600Bn round of Quantitative Easing ON TOP OF the ongoing $250-$300Bn round of POMO commitments for a total of about $110Bn per month dumped into the economy... This represents a 10% increase in the money supply over 8 months and, therefore, a planned 10% decrease in the purchasing power of your dollar-denominated assets - a 10% tax on everything you own.

Low supply+ very high demand = higher prices

Investors who employ technical analysis tend to monitor stock trading volumes in comparison to its movements in price in order to predict upcoming reversals in trends in attempt to identify attractive entry points and essentially “time the market”. Today, we will identify which actively traded stocks you should buy

This is part 3 of the 5 part interview with Warren Buffett's biographer Alice Schroeder. It includes insight into what makes the Oracle of Omaha tick that you will not find anywhere else.

Book 'em, Danno!

After preparing my taxes last year, my accountant noticed my horror and responded that “You’re not playing the game right. Buy a house with a large mortgage, have children, or do something that’s deductible to reduce your tax bill.” The accountant’s words were true, and a shining example of a wealth transfer that’s not spoken of enough.

Who really won this election? I did! There will be a major sell off next year, not just in stocks, but in all asset classes. The election results increase the certainty and the severity of this event. Volatility (VIX) will rise across the board. What The Election Means for Economic Policy. What the Election Means for the Markets.

Morgan Stanley is also extending its abysmal track record in CRE with the 97% in Revel. The bank took an effective loss for the common shareholders, even when backing out the DVA effect (which is a non-cash charge) as long as you normalize one time items. There is plenty more pain in RE to come, and Morgan's track record is horrendous at the same time expenses are rising with talent fleeing.

When a Banksta sells a Treasury Note to Ben's Keynesian Magical Mystical Tour...He has no idea what to expect...