Archive - Sep 8, 2009 - Story

With such criminal masterminds as 62 year old couples from North Caroline daring to promise "extraordinarily high" returns, why on earth would Mary Schapiro have any incentive to look for the petty thieves of trillions in taxpayer money on Wall Street.

Here is why everyone can dump their E-Trade accounts and just get an F/X trading terminal. Just don't pay your monthly fee in Euros.

The Internet retorts that it is even more concerned by spread of disinformation by NBC/GE subsidiaries.

Some technical market observations courtesy of an insider. Alas, it is computers run amock as usual, so nothing else matters.

"From a stock market point of view [the refusal to allow raters to use First Amendment protection] is a game changer" - David Einhorn

"So for the first time in the post-WWII era, we have deflation in credit, wages and rents, and from our lens this is a toxic brew that in the end will ensure that the focus on capital preservation and income orientation will be the winning strategy over a strict reliance on capital appreciation." - David Rosenberg

A month ago, Goldman had no idea how to run the market higher so it quoted Barney Frank as a reason to upgrade GE and cause some serious squeezage. JP Morgan, which prudently sensed that the equity market being a derivative of the dollar weakness needs some substantiation, came out with a comparable GE upgrade last night, raising its target price from $12 to $17, not on anything as fundamental as a quote by a Congressman, but merely "on sentiment, as [it is] one of the last stocks for which a little good news can still go a long way. In the look for non-consensus, catch-up stories, GE stands out as the last, in our view." And it turns out potential upside momentum is good for a 40% increase to a multi-billion company's target price.

Who says momos are confined to equities. We present to you the latest bond/loan relative action, where every week there is some vomit inducing squeeze squeeze or collapse on no news: this week the yoyo was SS&C Technologies, whose loans tightened by over 100bps, while bonds widened by 20bps. Otherwise, the secured-unsecured divergence continues, with leveraged universe loans tighter in the last week by another 5 bps to 395 bps, while bonds continue drifting wider, 3 bps wider over the last week and over 70 bps over the past three weeks.

• Gold rallies past $1,000 an ounce on momentum and dollar  (Reuters)
• Dollar falls to 11 month low, Bernanke will not be satisfied until it hits 0 (FT)
• Oil follows gold higher as dollar gets hammered (AP)
• And another nail in the USD's coffin: Beijing issues first 6 billion, non-dollar denominated renminbi bond sale (FT)
• The next financial crisis: It's coming and we just made it worse (New Republic)

• Asian markets were mostly higher Tuesday; Taiwan up 1.2% on Cabinet reshuffle.
• China plans to offer 6B yuan ($879M) of government bonds in Hong Kong
• China showcases commercial jet at Asia air show
• China 2009 vehicle sales may rise 28% on stimulus, probably surpassing US.
• ECB says significant contraction in euro-zone economy has ended; rates unchanged.
• G-20 finance chiefs propose banks curb bonuses, increase capital holdings.

Blast from the future: this will be today's 4:01 pm headline.

"Zero Hedge (4:01 PM) - Another day in which the market was driven by the ongoing dollar cataclysm, the EUR-JPY carry trade, and some speculation on what gold will do. Also, another day in which stock direction was absolutely not based on fundamentals, and momos gunned every move higher on micro volume and every reversal was meet with a huge volume ramp."