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PIMCO On The Dollar As A Reserve Currency

Tyler Durden's picture




 

No deflation here, or maybe just positioning for a better reentry point for the "Authority on Bonds." PIMCO's Curtis Mewborne on Emerging Markets in the New Normal

EM Pimco -

 

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Wed, 08/19/2009 - 10:30 | 40999 Anonymous
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Tyler are u Curtis Mewborne :-P?

Wed, 08/19/2009 - 11:26 | 41099 mgarrett84
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This was very thoughtful of Pimco and Buffet to try to spur a little dollar weakness/ asset price inflation while we seem to be on the verge of the next round of the deflationary death-spiral.  

Wed, 08/19/2009 - 17:01 | 41257 iknowNOW (not verified)
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watch nat gas DOE numbers tomorrow morning 10.30 central. if nat gas closes up hard today expect opposite move tomorrow

I don't see the direct relation between what is happening to UBS clients and the secrecy of other bank accounts in the country, especially in banks that are not international.

<remaining content removed by Sacrilege>

 

Wed, 08/19/2009 - 10:33 | 41003 Anonymous
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TD, did you see that ramp up this morning, and OH SUPRISE, crude inventories come out with a big drawdown? Maybe you can shine a light on those MF's that had an inside.

Wed, 08/19/2009 - 10:34 | 41004 B_Movie
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WRT SPY today will be interesting ..gap away and now a rally ...

any faliure to hold  will be a sure sign of weakness ...

looking like stopping volume in ESU09 5 minute bars this bar .......

bwdik

Wed, 08/19/2009 - 10:34 | 41005 Anonymous
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TD, did you see that ramp up this morning, and OH SUPRISE, crude inventories come out with a big drawdown? Maybe you can shine a light on those MF's that had an inside.

Wed, 08/19/2009 - 10:35 | 41006 Anonymous
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How this market is up today is beyond rational explanation.

Wed, 08/19/2009 - 10:35 | 41009 John Self
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TD just grabbed this piece off the printer he shares with Curt Mewborne.

Wed, 08/19/2009 - 10:45 | 41011 mdtrader
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It's national destroy the dollar day. Crude inventories were interesting lol! Did they make that number up just for today!

Of course crude going up will do wonders for consumer spending. Let's all buy Nasdaq, not.

Wed, 08/19/2009 - 10:41 | 41019 Anonymous
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That news was leaked, it's so fucking obvious. Where is the FCTC????

Wed, 08/19/2009 - 10:51 | 41033 Cheeky Bastard
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http://www.smartmoney.com/marketcalendar/?story=events&event=Crude%20Inventories&wdate=8/19/2009 compare this to the year before; and compare crude derivatives and the transportation figures of those and the behaviour of traders and hedge funds, if the recovery ( im speaking hypothetically here ) is on the way crude could skyrocket to 08 highs. Mark my word. Of course if that happens we will have a depression similar to the dark ages; but fuck that as long as the boys on JPM commodity trading desk get their bonuses everything is good. ( they have those tankers waiting )

Wed, 08/19/2009 - 10:56 | 41036 Sqworl
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I guess someone read my post of Dollar collapse yesterday???

Wed, 08/19/2009 - 10:59 | 41039 mdtrader
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but what if the euro crashes first!

Wed, 08/19/2009 - 11:03 | 41043 Sqworl
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but what if the Pound crashes first? 

Wed, 08/19/2009 - 11:12 | 41070 asdf
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what happens when the sky falls down?

Wed, 08/19/2009 - 11:08 | 41057 Cheeky Bastard
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what if yuan floats ? 

Wed, 08/19/2009 - 11:15 | 41074 Sqworl
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Who's juan?

Wed, 08/19/2009 - 11:29 | 41105 AnonymousMonetarist
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If they made the  yuan convertible today the yuan would drop in value ... dramatically.

Closed system is the only thing that allows them to inflate.

Any yuan to dollar conversion comes from printing or borrowing.

Imagine the capital flows on the bust side of the Chinese cycle in an open system! boom ...

 

Wed, 08/19/2009 - 12:15 | 41175 Anonymous
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Absolutely Correct

Wed, 08/19/2009 - 10:37 | 41012 Oso
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JPM was painting the tape in SPY all morning into the open and afterwards, and someone just smoked DXY.  Any guesses who?

 

Also, i dont believe the oil inventory data for one minute.

Wed, 08/19/2009 - 10:42 | 41021 mdtrader
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Maybe crude is like unemployment and tankers drop off the list without being counted after 4 weeks without use!

Wed, 08/19/2009 - 10:46 | 41023 Anonymous
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No, its like the Russian Freighter fiasco..they just lose track of those Oil tankers for a couple of days and the oil is somehow not accounted for. I guess they just tell the captain to turn off their GPS system.

Wed, 08/19/2009 - 11:12 | 41069 Oso
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Fed Up: buys $2.599B of the $13.087B dealers were dumping

Fed buys $2.599B in the 2020 to 2026 maturity range of the $13.087B dealers tried to unload. The previous 5 outings saw the Fed gobble up an average $3.05B of the $11.81B dealers were tossing

 

AH HA.  no wonder shit rallied and DXY puked.

Wed, 08/19/2009 - 12:21 | 41185 texpat
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Ha!!!

I saw the spike, and thought 'OMO!' And lo and behold.

Wed, 08/19/2009 - 11:14 | 41072 Cheeky Bastard
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and someone just smoked DXY.  Any guesses who?

 

Chinese, they liquidated 3.1% of their holdings last week, and are continuing to do so, the little pick up you saw in DXY was due to the British who increased their inventory by 30.1 percent. interesting the ratio of Chinese unload, and BoE purchase is 10:1; translated into the amount purchased is somewhere 1.4:1.

Wed, 08/19/2009 - 10:40 | 41017 asdf
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they propose to look at emerging markets but also mention that all em-currencies are not freely convertible. OK...

Wed, 08/19/2009 - 10:41 | 41020 mgarrett84
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I agree with their point.  But those who are speculating will get roasted at current levels. 

 

Oso- I'm fading crude here,  bought back the puts I wrote lower.  The data was clearly known as seen in the run up the last two days.  

Wed, 08/19/2009 - 10:43 | 41022 Anonymous
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PIMCO bears appear to be wrong again.

Collapse of the commercial real estate was the ultimate hope for the bears (according to multiple bears, "US commercial real estate is the next shoe to drop, short everything, in particular short regional banks like there is no tomorrow, or short KRE"), but it appears that the bears are wrong again (according to the latest report) and they never learn.

Decline in Commercial Real Estate Sectors Appears to be Slowing
http://www.realtor.org/press_room/news_releases/2009/08/decline_slowing

Wed, 08/19/2009 - 11:06 | 41049 Harbourcity
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Decline slowing is not recovery.

 

Wed, 08/19/2009 - 11:34 | 41109 Anonymous
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Commercial Real Estate Leading Indicator Index is the best LEADING indicator out there. You need to see the rate of decline easing (bottoming) before the recovery (you cannot go from negative 5 to positive 5, you need something in between first).

Wed, 08/19/2009 - 18:16 | 41692 Harbourcity
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I guess that's true if the CRELI is akin to a Randy Newman song.

Wed, 08/19/2009 - 11:10 | 41063 Anonymous
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When one considers it is in the realtors' best interests to pump the CRE market, one begins to understand why such reports are dubious.

This is probably a more accurate picture of reality:

http://online.wsj.com/article/SB124804759792663783.html

Wed, 08/19/2009 - 11:32 | 41108 Anonymous
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If you do not believe the Commercial Real Estate Leading Indicator Index, then look at KRE (hedge funds heavily shorted KRE in anticipation of the commercial real estate collapsing).

KBW regional banks (KRE) is up today. It appears that the hedgies are not as skeptical about the index as you are -- the hedgies are scared and covering.

Wed, 08/19/2009 - 12:51 | 41258 iknowNOW (not verified)
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The day after publication in the Register, Greenspan, Rubin and Levitt issued a news release “seriously question[ing] the scope of the CFTC’s jurisdiction

Wed, 08/19/2009 - 11:19 | 41083 Anonymous
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and they never learn
--------------------------
really? and that would be why? because markets are 30-40% below their highs?

Wed, 08/19/2009 - 11:47 | 41128 Anonymous
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No, because the markets are up 45% from the bottom (when almost all the bears were predicting the end of the world in March, in particular one permanent bear, Barry Ritholtz, who went on Bloomberg radio in the middle of March and declared "BAC and C going down to zero". BTW, I pulled the trigger (even went to his blog and told him that I loaded up on BAC at $3.19 and C at $1.29 right after his preposterous bank nationalization hysteria on Bloomberg radio). I have also loaded up with SPYders on Friday, one day before the market 666 bottom.

Wed, 08/19/2009 - 11:50 | 41134 Anonymous
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"the bears are wrong again (according to the latest report) and they never learn"

There was around a 50% run up in 1930. Japan rallied about that much several times in the 90's. All those rallies were crushed. Maybe the bulls never learn?

Wed, 08/19/2009 - 10:50 | 41031 cocoablini
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I thought commodities would be relatively free from the FED marekting dept. but the numbers are shocking-shocking as in not believable for a second. What's next-PPT conjures up a hurricane for the oil market?

Wed, 08/19/2009 - 10:56 | 41037 Anonymous
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Cab I ask a question?what data came out from the govie,and where not corrected a month later?at any rate,this is not the first time that there is a broad decline in the market,they try to balance it with oil. Don't forget that oil industry constitute a huge component of the s&p index

Wed, 08/19/2009 - 11:01 | 41041 Anonymous
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I am not sure why deflationists persist in their delusions.

My taxes (property, income, sales) have all gone up. So have utility costs. When I go to the grocery store the prices are flat to higher, while the amount in the package has shrunk, sometimes by a large amount. Every year I take a vacation to the same place, and rent a car. Last year I got one for $11 per day. This year, $19 per day. Also the taxes and fees have increased and now equal about the cost of the daily car rental. And I see oil is over $72 now.

So where is the deflation?

Don't bother with CPI and other cooked government numbers. Give me a real example of falling prices, and please don't say houses. My parents could buy a house 30 years ago for $70k that today, even after the crash sells for $300k. That's not deflation. And cars? Well unless I can get one for $2k like my parents did in the early 60s, I am going to say no deflation here.

The buck is toast.

Wed, 08/19/2009 - 11:08 | 41055 Anonymous
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Dude...deflation is coming in the forms of wages and housing prices...those constitute a bigger amount of GDP. but yes, all the prices of things you wish would go down actually goes up and vice versa.

Wed, 08/19/2009 - 11:10 | 41062 Anonymous
Anonymous's picture

The inflation you speak of is past tense. The deflation of the near past, present and near future is in the destruction of capital. Don't confuse cost of living factors with global capital flows. Its a macro argument, not micro

Wed, 08/19/2009 - 11:15 | 41075 Anonymous
Anonymous's picture

deflation is NOT a decrease in prices.

"Safeway has lowered prices on thousands of items at its stores in the Washington region as the supermarket chain adjusts to shoppers' increasingly frugal mind-sets."
http://www.washingtonpost.com/wp-dyn/content/article/2009/08/11/AR200908...

Wed, 08/19/2009 - 11:44 | 41122 Anonymous
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Inflation is not a currency phenomenon. It's monetary. Quit tying the dollar as an absolute to it.

Wed, 08/19/2009 - 11:54 | 41140 Anonymous
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I get paid in dollars.

Wed, 08/19/2009 - 11:49 | 41130 Oso
Oso's picture

um, what?  do u expect house/auto prices to immediately correct to 30 years ago?  I mean, you expect prices to literally gap down???  Are u for real?????

 

outside of food (which actually i have noticed lately is becoming cheaper) i havent paid full price for anything in months, nor do i intend to. 

Wed, 08/19/2009 - 12:27 | 41194 texpat
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Come on!

Gas is down. Kroger are throwing out coupons like no ones business. WM are accepting anyones coupons. Gexa in Tx have leccy at 10.3 c/kWh, from cheapest contract last year which was 12.something.

All the industrial surveys show prices coming down at a rate of knots.

Sure, we may have a currency event and go to hyperinflation, but sure as hell, we are in moderate deflation right now.

Wed, 08/19/2009 - 11:06 | 41048 Sqworl
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Im hedging via mega millions friday...and the winner is NY State!  75% tax on prize.

Wed, 08/19/2009 - 11:17 | 41079 Anonymous
Anonymous's picture

inflation and deflation are relevant to prior periods,and not to the sixties,then we might as well go to the roman time. I do believe that purchasing power of the dollar is stronger now than it was two years ago. Almost in everything,but most importantly is housing since this is the major chunk of expense in any hosehold budget.

Wed, 08/19/2009 - 11:52 | 41139 Anonymous
Anonymous's picture

The 60s were not the dark ages. We were on the same fiat currency then as now.

As for housing, prices go up 300% in a decade, then go down 50%, and you call that deflation? Please.

Wed, 08/19/2009 - 13:11 | 41316 Anonymous
Anonymous's picture

First of its not up 300% its more like 250%
and if they are down 50% from peak it means they are back at normal. 25% increase in a decade.
Its more of a 30% decline, which means prices have gone up 40-50% in a decade.

wouldn't say thats much.

Wed, 08/19/2009 - 11:19 | 41085 Anonymous
Anonymous's picture

Is Europe Done Dumping Its Gold? Gold is poised to go much higher in the near future:

http://truthingold.blogspot.com/2009/08/are-european-central-banks-done-...

Wed, 08/19/2009 - 11:22 | 41093 AnonymousMonetarist
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The United States passed UK economically about a generation before pound lost dominant status.

Wed, 08/19/2009 - 11:24 | 41094 Anonymous
Anonymous's picture

watch nat gas DOE numbers tomorrow morning 10.30 central.
if nat gas closes up hard today expect opposite move tomorrow hard and sharp. Also vise-versa. nat gas traders jobs is to lure in guppies the day before a big move. money always goes to the big fish.

Wed, 08/19/2009 - 11:44 | 41123 Anonymous
Anonymous's picture

Whoops I ment 10.30 eastern

Wed, 08/19/2009 - 12:29 | 41201 Anonymous
Anonymous's picture

Ho Hum-seen this picture before....

Fed lowers rate to almost zero and investment banks use the carry trade to front run dumb pension money into the "Emerging Markets are the Future" position.

Wed, 08/19/2009 - 12:30 | 41204 Anonymous
Anonymous's picture

Ho Hum-seen this picture before....

Fed lowers rate to almost zero and investment banks use the carry trade to front run dumb pension money into the "Emerging Markets are the Future" position.

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