by ilene - May 28th, 2009 2:00 pm
Let’s visit with Nouriel Roubini! Intro to Nouriel’s article in Forbes, courtesy of Timothy D. Naegele. – Ilene
I agree with [Nouriel] about the countries that will be hit hardest (e.g., the U.S., the U.K., Ireland, Iceland, Spain, many emerging European economies, Australia and New Zealand). Nouriel fails to include Russia and some other countries that will be hit much harder than the U.S.; and if you read his article very carefully, he is essentially setting up a depression scenario. However, having been "burned" with the moniker, Dr. Doom, he seems to have chosen — for political reasons — not to go that far, but it undergirds his article. Also, he is talking about "years" before recovery takes place, which is consistent with my view of a decade (e.g., 2017-2019).
At best, he is saying that the U.S. will go through a decade like Japan, where the economy will be in the doldrums. I believe it will be far worse than that though; and my estimates do not take into account other factors that may produce even greater downward pressures (e.g., the reemergence of Swine Flu; wars beyond Iraq and Afghanistan).
Nonetheless, the article is important for what it says and what it does not say.
By Nouriel Roubini, in Forbes
An analysis of medium-term economic prospects.
Last week, I discussed why the U.S. and global recovery will occur later than the optimistic consensus argues. This week, I will discuss why the recovery will be sub-par and below trends for a few years once it does occur, and why there is even the risk of a double-dip W-shaped recession.
The crucial issue facing us is not whether the global economy will bottom out in the third or fourth quarter of this year, or in the first quarter of next year. It’s whether the global growth recovery, once the bottom is reached, will be robust or weak over the medium term--say 2010-11. As I argued last week, one cannot rule out a sharp snapback of GDP for a couple of quarters, as the inventory cycle and the massive policy boost lead to a short-term growth revival. My analysis, however, suggests that there are many yellow weeds that may lead to a weak global growth recovery over 2010-11.
Continue here.
See also: Euphoria or the Obama Depression? By Timothy D. Naegele.
by Zero Hedge - May 28th, 2009 1:18 pm
Courtesy of Tyler at Zero Hedge
2s7s chart below showing just how much tolerance bond vigilantes have for anything with a duration of over 2 years and 1 day. 3 minutes until the 7 year auction results are announced.
Update: Closes at 3.30, 2 cheap to current, 2.26 bid-to-cover, 7 years now dropping.
Update: and it rips
And the 2s10s, back to yesterday’s wide. The supplemental liquidity eliminators taking advantage of the total confusion in equities and squeezing equities higher.
by Zero Hedge - May 28th, 2009 1:13 pm
You will be pleased to know that Zero Hedge has managed to dig up quite a bit of interesting history on BankUnited. For instance, we have discovered that BankUnited’s power animal is the Black Carpenter Ant (indigenous to Florida and prone to destroy homes).
Look for our updates in the coming weeks.
by Zero Hedge - May 28th, 2009 12:41 pm
Market rallies on the news that 20% of bondholders (the ad hocs) agree with the proposed plan to get warrants in a worthless company. Hm, what about the 80% who do not?
by Zero Hedge - May 28th, 2009 12:39 pm
Courtesy of Tyler Durden
Aaa/AAA/AAA heard in the market with multi-part TLGP trade. Citigroup Funding offering 2y fixed and/or floater (benchmark size); and Citigroup NA offering 3y fixed and/or floater (benchmark size). Citi sole. Pricing asap.
Good to see 9 A’s supporting this issue, backed by the full faith and credit of the FDIC’s $0 DIF.
by Zero Hedge - May 28th, 2009 12:36 pm
Courtesy of Tyler at ZH
Til Schuermann, VP of Financial Intermediation at the Federal Reserve Bank of New York, is testifying today on issues in Commercial Real Estate, and his prepared remarks essentially drown the prospect of green shoots in the context of CRE.
The same cannot be said for loan demand. The SLOOS reports that the net fraction of loan officers reporting weaker demand in April 2009 was 60% for C&I and 66% for CRE loans, a historical low for CRE demand. Weak demand bears emphasis, as it indicates that the observed slowdown in overall credit is partly due to firms’ reluctance to borrow, and not entirely to banks reluctance to lend [someone finally pointing out the obivious].
The combination of acute stresses in the financial markets, together with stresses on bank balance sheets, in the middle of the worst recession in a generation, should caution us from believing that recovery is just around the corner.
His full prepared testimony is provided below.
Testimony before the TARP Congressional Oversight Panel, Hearing on Commercial & Industrial and Commercial Real Estate Lending, New York City
Members of the Panel, thank you for giving me the opportunity to discuss with you some of the recent trends in commercial lending, and especially the role banks have played and are playing in the provision of credit to this important sector. My name is Til Schuermann, and I am a vice president of the Federal Reserve Bank of New York. I wish to preface my remarks by noting that they do not reflect the official views of the Federal Reserve Bank of New York or any other component of the Federal Reserve System.
In early 2007, just before the crisis hit, U.S. commercial banks had $10 trillion of assets on their balance sheets. About 60% was composed of what we may think of as traditional banking assets in the form of loans and leases, and of that about $1.2 trillion or 20% was in the form of commercial & industrial (C&I) lending, and about $1.4 trillion or 24% in commercial real estate (CRE) lending, the topics of today’s hearing.1 Meanwhile, the sum total of assets at other important non-bank intermediaries
…
by Zero Hedge - May 28th, 2009 12:33 pm
by Zero Hedge - May 28th, 2009 12:29 pm
Courtesy of Tyler Durden
From Bloomberg’s chart of the day, reflecting the massive lag in muni weakness compared to the compost heap that is the general economy.
Bloomberg had this to say:
This year, 16 municipal issuers have failed to make payments on $426 million in bonds. In 2008, 140 issuers defaulted on a record $7.6 billion. Among the latest to default: the Memphis Redbirds Foundation, which in 1998 sold $72 million in sports facility revenue bonds to help pay for a minor-league baseball franchise and a 14,000-seat stadium in downtown Memphis. Since 1999, issuers have defaulted on $24.13 billion in municipal bonds out of a total of $3.4 trillion issued, according to Thomson Reuters.
Good thing all those wraparound bond-insurance companies are alive and cracking… Oh wait, producer telling me… what’s that… oh… really… hm…. well that’s just not good now is it.
hat tip the irish, er, scottish, dude with a thing for young ladies
by Zero Hedge - May 28th, 2009 12:24 pm
Courtesy of Tyler at Zero Hedge
So just which is it? Did the streaming ticker not pay its real time bill today?
by Zero Hedge - May 28th, 2009 12:23 pm
Also new home sales rise to a below consensus 0.3%, "up" from a majorly downward revised March decline of -3.0%.
Amusingly, homebuilder confidence climbed to an eight-month high in May. Mortgage applications to purchase homes are also up 9 percent from February’s nine-year low. We shall see how confidence fares now that mortgage rates are at pre QE levels.
January 27th, 2012 1:52 pm
Largest Central Banks Now Hold Over 15 Trillion in Fictitious CapitalCourtesy of Russ Winter of Winter Watch at Wall Street Examiner
I could not help noticing that China’s imports from Japan fell 16.2pc in December. Imports from Taiwan fell 6.2pc. The strong yen strikes again: Honda decides to build a high-performance hybrid Acura in Ohio – instead of its home nation of Japan. The firm’s continued shift in p...
January 27th, 2012 1:40 pm
Reminder: David is available to chat with Members, comments are found below each post.
January 27th, 2012 12:55 pm
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
In an effort to reach the angry mob, CNBC's Rick Santelli goes all Sesame Street on the numbers behind the US Debt Ceiling Rise. Focusing for two minutes on what this practically means for every man, woman, child, and politician, the shouting Chicagoan points out that when the US breaches this new limit then the world's entire population will be on the hook for $2,346 each (and $52,409 per US person).
...January 27th, 2012 12:35 pm
Courtesy of Doug Short.
The Weekly Leading Index (WLI) growth indicator of the Economic Cycle Research Institute (ECRI) posted -6.5 in its latest reading, data through January 20. The latest public data point is a reduced contraction from last week's -7.6 (a slight downward revision from -7.5). This is the highest level (i.e., least negative) since early September. However, the underlying WLI declined fractionally from an adjusted 123.3 to 122.8 (see the third chart below).
Early last December Lakshman Achuthan, the Co-founder of ECRI, spoke with Tom Keene on Bloomberg Television's Surveillance Midday. You can watch the video on the ECRI website here, with bold heading Recession Update. The eight-minute video is well worth watching in its...
January 27th, 2012 11:15 am
Submitted by Mark HannaCourtesy of MarketMontage. View original post here.
Some combination of better made cars, and less Americans able to pay new car prices has conspired to push up the average age of U.S. vehicles to a new record high. Reflecting this sea change, one of the best investment g...
January 27th, 2012 10:05 am
Courtesy of Benzinga.
Shares of battered tech company Research in Motion (NASDAQ: RIMM) are seeing much strength during Friday's trading session.
Fairfax Financial Holdings released a 13G filing with the SEC this morning, in which they disclosed a 5.12% stake in Research in Motion.
Currently, shares of Research in motion are up over 4% at $16.85. Over the last year, Research in Motion is down over 72%.
Research In Motion Limited is a designer, manufacturer and marketer of wireless solutions for the worldwide mobile communications market. RIM provides platforms and solutions for access to information, including e-mail, voice, instant messaging, short message service.
...January 27th, 2012 12:00 am
Top 5 RisersStockRatingAnalysisASBCBUYMany analysts are expecting higher than previously expected long term growth from Associated Bancorp, and its near-term earnings outlook is also improving.CZZSTRONGBUYThe recent earnings history for Cosan Ltd shows significant improvement while projected valuation continues to rise.STLDBUYProjected value continues to rise for Steel Dynamics while long term increases in earnings growth are also becoming more widely expected.PSESTRONGBUYAn increasingly attractive expected long term growth rate and a significantly higher projected valuation from just a fe...January 26th, 2012 6:16 pm
Courtesy of John Nyaradi.
Major markets and major index ETFs corrected slightly today after the stock market’s euphoric party yesterdayMajor markets suffered a slight hangover today, as the S&P 500 dropped .57%, the Dow Jones Industrial Average dropped .18%, the NASDAQ dropped .46% and the Russell 2000 Index dropped .34%, after yesterday’s crazy Fed and Tech Sector induced Wall Street Party. The NASDAQ, in particular, partied very hard, so hard in fact that the NASDAQ reached its 11 year record high.
The major market index ETFs were hungover too as the SPDR S&P 500 ETF lowered .51%, the SPDR Dow Jones Industrial ...
January 26th, 2012 1:38 pm
Today’s tickers: DB, ATHN & LSI
...
more from Caitlin
January 23rd, 2012 8:56 am
Reminder: OpTrader is available to chat with Members, comments are found below each post.
This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).
We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options.
Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.
To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here
Optrader
...January 22nd, 2012 10:09 pm
Here is the virtual portfolio weekend update. Basically a recap of the positions and some notes about the trades. As usual, I'll post the previous week's P&L for comparison. Not the greatest of week in general! AA Money Only transaction last week as we bought back the AA Feb 9 puts on Tuesday for close to a 70% profit. The idea is to sell another set of put as soon as we get a chance. Previous week P&L - $400.00 We lost some ground this week, but we'll keep on selling premium! FAS Money We also lost some ground in this virtual portfolio, but we have sold plenty of premium for the coming week. A little correction would go a long way to help! On Wednesday we sold the FAS Feb 72 puts (already good for 50%), on Thursday we added the Jan4 78 calls and on Friday we had to roll the Jan 78 puts to the Jan 80 puts. We were hoping for these ones to expire worthless on Friday, but a late stick killed that hope. Previous week P&L - $4372.00...January 22nd, 2012 2:52 am
NEW: Elliott and Ilene are available to chat with Members regarding topics presented in SWW, comments are found below each post.
Here's the latest Stock World Weekly. We discuss the Fed's next move, and it's new policy for more QE-cating. Brief review of Sabrient's trade ideas for 2012 (already doing well) and a few new buy-writes from Phil and Pharmboy. Enjoy! (Feedback appreciated - give some life to the comment section below.)
Click this link for this weekend's newsletter, and sign in or sign up.
...January 18th, 2012 1:09 am
Reminder: Pharmboy is available to chat with Members, comments are found below each post.
Finding new and exciting Biotech companies that target novel mechanisms is like trying to find a needle in a haystack. Sure there are many companies working on cutting edge science, but investing in those companies to reap the rewards of their work is a very dangerous game. More often than not, companies fail because the mechanism does not pan out, the compound(s) do not have pharmacokinetics (get into the body or last very long in the body), or an adverse event happens that knocks years off a development timeline. In addition, the stock can be manipulated by market makers so investors don't know which way is up. I approach investing in biotechs as a long term prospect. I continue to like our current portfolio of biotech companies (join in chat for many of those plays), and we continually add/subtract shares and sell/buy options on ...
Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
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Note: The material presented in this commentary is provided for informational purposes only and is based upon information that is considered to be reliable. However, neither Philstockworld, LLC (PSW) nor its affiliates warrant its completeness, accuracy or adequacy and it should not be relied upon as such. Neither PSW nor its affiliates are responsible for any errors or omissions or for results obtained from the use of this information. Past performance, including the tracking of virtual trades and portfolios for educational purposes, is not necessarily indicative of future results. Neither Phil, Optrader, or anyone related to PSW is a registered financial adviser and they may hold positions in the stocks mentioned, which may change at any time without notice. Do not buy or sell based on anything that is written here, the risk of loss in trading is great.
This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities or other financial instruments mentioned in this material are not suitable for all investors. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only intended at the moment of their issue as conditions quickly change. The information contained herein does not constitute advice on the tax consequences of making any particular investment decision. This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation to you of any particular securities, financial instruments or strategies. Before investing, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice. |
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