Archive - May 31, 2011 - Blog entry

European sovereign and contagiously financial risk was the major underperformer of May but the clear preference for IG credit over all and risk aversion towards high yield credit remains worrisome. Up-in-quality and up-in-capital structure along with the new-issue/curve steepener/basis trade in IG are solid themes but the last few days have seen a mad scramble for high beta equities into month-end salvage an otherwise dismal month.

Financial power is to achieve what military conquest had done in times past.

CalPERS just hired a seasoned veteran to oversee their private equity program...

Okay Zero Hedge, this "FIX" can not be passed. This can not be the framework for things to come. Spread the word! Email it, facebook it, digg it, stumble it, tweet it, repost it, etc. This is absolutely unacceptable...

The Secret Weapon: Dance!!!!

If you feel like - oh, man, EVERYTHING turns out to cause cancer - I can relate. But - unlike all the shenanigans which the powers-that-be are pulling - this is something we're doing to ourselves ...

The big picture here concerns the US Dollar which had already fallen to test its 50-DMA. If the US Dollar breaks below this line and fails to reclaim it then the US Dollar rally is over. The technical pattern here is a falling wedge pattern. As the below chart shows we hit right up against upper descending trendline. We’re likely to test the lower trendline now which is around 72 or so.

What the smart money is saying ...

U-G-L-Y ...

Man bites nature. Nature bites man back.

All work and no play, makes Juncker a dull EURO boy...

While Americans are apparently able to pay infinite amounts of money for gas, we still can't find a price they are willing to pay for homes as this morning's Case-Shiller Survey shows home prices in the 20-city index falling ANOTHER 3.6% from March to a brand new 8-year low.

Make no mistake. A new variety of quantitative easing has already begun in a big way, and is generating its desired effect. The same $600 billion that stampeded into risky markets is doing a 180 and then stampeding right back out again. We might even see bonds peak and risk assets bottom on June 30, the day QE2 ends. Clever Ben, clever.

The banks can be trusted... Truly! All of them, but particularly the BIG ones! JP Morgan slashes loss provisions on RE loan assets by more than Dexia actually provisions for said losses in anticipation of sale. This is bullish, of course, so Goldman puts JPM on their "CONVICT"ion buy list in order to create the buying pressure necessary to dump prop inventory. Of course, this is just speculation on my part. After all, they would never do such a thing with Apple, would they?

S&P 500, Dow Jones, Nasdaq, Russell 2000, Nymex Crude Oil, Comex Gold, EURUSD, GBPUSD, USDJPY