Archive - Nov 4, 2010 - Story

Goldman: "In practice, QE2 is likely to continue well beyond June 2011—at least well into 2012—if our forecasts for unemployment and inflation are close to the mark. We believe that purchases could ultimately cumulate to around $2 trillion...Under our longer-term projections it is easy to come up with models that show no tightening until 2015 or later." In other news, the economy will not recover for the next five years, but under the Centrally Planned Feudal State of Bernanke, the economy is irrelevant. Incidentally, Zero Hedge now believes a $5 trillion QE3 program will be announced by July 2011, when gold is trading at $10,000, the entire Treasury curve is at zero, and stock prices are meaningless courtesy of a DXY sub 50, and every commodity opening limit up daily.

Just like in mutual fund outflows, the initial claims prior upward revision is spot on as expected: prior week's 434K was revised to 437K, continuing the statistically improbable streak by the Ministry of Truth. Otherwise, the current number, which will also be revised higher next week, came at 457K, 15K worse than expectations of 442K. And continuing claims, which came at 4,378K, was, presto, a decline from the now revised number of 4,382K, which initially came at 4,356K. Net, net: this is the 15th in a row upward revision for initial claims, 14th for continuing: propaganda uberalles.

• Fed takes bold, risky step to bolster weak economy (Reuters)
• Oil rises towards $86 on Fed, weak dollar (Reuters), we expect $90 oil within a week
• Asia Girds for Stronger Currencies, Bubble Threat From Fed Move (Bloomberg)
• Obama Says He'll Negotiate With Republicans on Bush Tax Cuts (Bloomberg)
• Sarkozy To Meet Hu As France Takes G20 Lead (FT)
• Pettis Op-ed: Targeting Currencies Will Not Stop Trade Imbalances (FT)
• Bank of America Edges Closer to Tipping Point: Jonathan Weil (Bloomberg)
• Analysis: Strategic tensions threaten Asia as China rises (Reuters)
• Goldman's Pay Pool Shrinks Fastest as Traders' Fortunes Dwindle (Bloomberg)

• BOJ confronts two-decade land slump with planned purchase of REITs, ETFs.
• U.S. sales of cars and light trucks rose 13.4% in October from a year ago.
• AES's Sept. net income declines from $185M to $114M.
• Aetna's net rose 53% on invt gains, lower costs. Ups 2010 EPS view to $3.60 (prev $3.05-3.15).
• Alcatel-Lucent Falls on lower-than-expected operating margin
• Amdocs sees Q1 EPS at $0.49-0.58 (cons $0.60); revs of $760-780M (cons $774.39M).
• Becton Dickinson reports in line; posts Q4 EPS of $1.24, Revs up 1% at $1.87B.

Reports today on the Monster index (already out - it fell, but hey, QE2), initial claims, productivity and costs, and spending at retail chains….Oh yeah, and a $5-6 billion POMO.

RANsquawk European Morning Briefing - Stocks, Bonds, FX etc. – 04/11/10