- Fed’s Outright Treasury Coupons Purchase for USD 7bln May. 2016 – May 2019, Offer/Cover 3.637 vs. Prev. auction of similar maturity 3.74
- Prime-mortgage delinquencies climb to 2.9%
- Russian banks require USD 20-80 bln in additional capital in 2009, says Fitch Ratings
- IMF reports reserve currency assets for Q1 2009; USD’s share of reserve assets rises to 65% vs. Prev. 64.1%
- French finance minister Lagarde says French banks can withstand deeper economic slump
- Venezuela says hoping for USD 75 oil price in 2nd half of the year
- Gasparino says about 9 groups to be chosen for PPIP
- Deutsche Bank CEO says banking industry will be less profitable
- World Banks’ Zoellick sees ‘great uncertainity’ on recovery’s timing
- RBS, Lloyds may need to sell units to win aid, EU’s Kroes says
Courtesy of RANSquawk
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by ilene - June 30th, 2009 2:49 pm
Courtesy of Bill Luby at VIX & MORE
FAS Is Now XLF
For someone who gets a kick out of volatility, the arrival of triple ETFs has been a little bit like manna from heaven. Of course the launch of the Direxion triple ETFs back in early November just happened to coincide with the highest VIX readings in history. There is nothing like record volatility, except perhaps record volatility times three.
But a lot has changed since November. The VIX traded in the 80s the month it was launched; today it was as low as 25.02. At the moment the VIX is exactly 1/3 as high as it was when it peaked in November at 81.38. For those who have been selling options, the ride down the volatility slide has been an unusually profitable one. In fact, it is likely that some of the premiums harvested in the last nine months or so will turn out to be the most bloated we will see in our trading lifetimes.
My personal interest in the triple ETFs notwithstanding, these vehicles have received mixed reviews, largely because their suitability as buy and hold investments degrades rapidly after just one trading session – with the problems exacerbated by increases in volatility. On the flip side, the recent decrease in volatility has taken some of the tracking and compounding errors out of leveraged ETFs. In fact, in the current environment, the 3x and -3x ETFs are starting to look somewhat tame relative to their history. The two charts below show the (30 day) historical volatility (purple line) and implied volatility (gold line) of the most popular financial sector ETF, XLF, and the 3x financial sector ETF that has taken the trading world by storm, FAS. While there are a number of interesting conclusions to be drawn from these charts, the point I wish to make is that current historical and implied volatility for FAS (top chart) is hovering around the 100 mark, which is about where HV and IV were for XLF (bottom chart) in February, March and April. In other words, the 3x ETF FAS is no more volatile or has more uncertainty in its stock price now than XLF did during the period from October through April. Tracking error aside, FAS is now effectively the ghost of XLF.
[source: iVolatility]
Tags: FAS, triple ETFs, volatility, XLF
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by Zero Hedge - June 30th, 2009 1:50 pm
Round three of the Taibbi – Van Pragg welterweight death-match will be brought to you compliments of the MGM Mirage (in exchange for 3 bond coupon waivers).
In the meantime, here is Matt’s Round 2.
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by Zero Hedge - June 30th, 2009 1:30 pm
In a move set to infuriate and send many Zero Hedge readers over the top,
the NYSE has taken action to make sure that nobody will henceforth be able to keep track of the complete dominance that Goldman Sachs exerts over the New York Stock Exchange. This basically ends our weekly Program Trading updates disclosed every Thursday indicating that Goldman has
singlehandedly captured all of
NYSE’s program trading.
In an information memorandum released on June 24 (09-31), the NYSE Regulation team has announced the Decommissioning of the Daily Program Trading Report (DPTR).
From the memo:
The New York Stock Exchange LLC (“NYSE”) will be decommissioning the requirement to report program trading activity via the Daily Program Trading Report (“DPTR”), which was previously approved by the Securities and Exchange Commission (the “Commission”).1 The last trade date for which member organizations will be required to file the DPTR with the Exchange will be July 10, 2009 and therefore the last required date to submit the DPTR will be July 14, 2009.
In the 2007 rule filing, the Exchange proposed to eliminate DPTR. The 2007 filing noted that there was some duplication between the DPTR data and the audit trail information that member organizations provide to the Exchange via account-type indicators at the time that they submit program trades to the Exchange… [A]fter consulting with the SEC, the Exchange announced that it would delay implementation of the two redefined account type indicators, and pending such implementation, member organizations would be required to continue filing the DPTR with the Exchange. The current delayed implementation date of the redefined J and K account type indicators is June 30, 2009. Accordingly, the Exchange still requires member organizations to submit DPTR.
The Exchange has filed with the SEC to implement the decommissioning of the DPTRrequirement following the July 10, 2009 trade date. Accordingly, the last required submission of the DPTR will be on July 14, 2009, which is the second business day after the last trade date for
…
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by ilene - June 30th, 2009 1:25 pm
Courtesy of Edward Harrison at Credit Writedowns
Here is more from Dylan Ratigan’s new show on MSNBC. Arianna Huffington and Eliot Spitzer were guests. They all have noticed that Barack Obama has spent an inordinate amount of political capital and money on the financial services sector without showing any stomach for serious all-encompassing reform. Why is still unclear, but Huffington suspects capture via Geithner and Summers.
The video is below. The more I hear the newly semi-rehabilitated Eliot Spitzer, the more impressive I find him.
Tags: Arianna Huffington, Dylan Ratigan, Eliot Spitzer, regulatory capture, too-big-to-fail
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by ilene - June 30th, 2009 12:38 pm
Trader Mark comments on a few solar power companies, noting that they’re inadequately differentiated by American investors. Here are his thoughts.
Courtesy of Trader Mark at Fund My Mutual Fund
I’ve been a long time investor in the solar space (circa late 06) and one thing that has really irked me over the years is the complete lack of differentiation. Much like the market as a whole nowadays, its "all or nothing" in this space. The one exception has been First Solar (FSLR) – an American "thin film" (different technology than most solar companies) producer. The Chinese names have especially all been thrown together in one pot and when its time to run up solar, they all go up together (in varying degrees) and when solar is out of favor they all get pole axed. Hence doing any due diligence is really a waste of time.
Yingli Green Energy (YGE) and a company that has cost me many real (and virtual) dollars over the years, Trina Solar (TSL) are 2 of the Chinese solar markets with good size, and the most integrated production models. This should have differentiated them over the years – but as I said above, not in American investors eyes. We like "big easy to understand, sweeping themes" – i.e. oil up, solar good. And that’s as comprehensive as it seems to get.
We are seeing some nice action in both these names today, on the back of an analyst report which is alluding to the advantages the two companies have. Now that silicon (which is the main cost component on the material side) has swooned after bottlenecks plagued the industry for 3+ years, the other main cost is labor. And you are not going to compete with the Chinese on labor costs…
- Both Trina Solar (TSL) and Yingli Green Energy (YGE) shares are trading higher today following upgrades by Morgan Stanley analyst Sunil Gupta. He thinks both companies are going to take market share in the solar sector from U.S.-based and European rivals. Here are the details
- Trina:
…
Tags: CHINA, First Solar, FSLR, Solar companies, Trina Solar, TSL, YGE, Yingli Green Energy
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by Zero Hedge - June 30th, 2009 12:14 pm
It has been Zero Hedge’s understanding that traditionally lobbies of any kind tend to at least make a tacit acknowledgment of their conflicts of interest. This is especially true when the “lobby” in particular is none other than Wall Street legal powerhouse Wachtell Lipton, which in a series of machine-gunned missives which Zero Hedge has recently obtained, did everything in its power to persuade the SEC to adopt
every possible action that would essentially destroy short-sellers in the days after the Lehman collapse.
Among the policy recommendations that Wachtell made clear in no uncertain terms that it (and its numerous clients) would demand implemented were:
the SEC should immediately re-impose, under its emergency powers, the “Uptick Rule.” In addition, the SEC must now consider other very strong measures such as using its emergency powers to place limitations on short sales for a period of time to restore a fair and orderly market. Also, it is essential for the SEC to scrutinize short sellers and their related transactions, including options and credit default swaps to determine whether these strategies are contributing to the severe dislocations taking place in the marketplace.
the SEC should promptly make public the results of their examinations of the short selling activities and take immediate enforcement action against those who are engaging in this abusive manipulative conduct.
the SEC should use its emergency powers to halt short selling in the securities of financial services firms and banks for a 90-day period.
[the SEC] should require hedge funds and other institutional investors to publicly report their daily short positions if those positions exceed ¼ of 1% of the outstanding shares of a public company and should also disclose publicly whether the short sellers have any oral or written contract, arrangement, understanding or relationship (legal or otherwise) with respect to those securities.
short sellers also should be required to report to the SEC on a next-day basis if they fail to deliver securities by settlement date
a critical next step is for the Federal Reserve Board, the Treasury Department, the SEC and the CFTC to undertake on an urgent basis a 30-day comprehensive review of the credit default swap
…
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by ilene - June 30th, 2009 11:59 am
Courtesy of Edward Harrison at Credit Writedowns
Late last year, I predicted that China, as a major exporter to the West, would feel a huge impact from the meltdown in the global economy, taking it’s growth rate down to 2% (See Top ten predictions for the 2009 global economy). Forgetting about the fact that data are highly suspect in China, I see that prediction as very unlikely to come true due to huge fiscal stimulus in China. The Chinese government is very much wedded to it’s 8% growth target and will do whatever it takes to come close to that target – including flooding the domestic banks with a wall of money to lend.
However, preventing a downturn with easy money is a dangerous way to reflate the economy. The likely malinvestment will be large, something about which Andy Xie has recently warned. Moreover, despite the implosion in house prices and shares in the Chinese market during the acute phases through to November 2008, a bubble has re-asserted itself there. In a recent post, “Does Ben Bernanke blow bubbles too?,” I referred to research by James Montier, now at GMO, which indicated that large increases in liquidity can and will reinflate bubbles even in the face of investors who feel chastened by a previous downturn. This seems very much to the point in China, where equity prices have risen some 60-odd percent since the trough in November.
Of course, all of this can continue for quite some time. And the Chinese are pulling out all the stops as the recent note by Marc Chandler, Chief Currency Strategist at Brown Brothers Harriman, attests.
There are several developments to note in China.
First, with deflationary forces still gripping the economy (year-over-year CPI has been negative by more than 1% since Feb), weakness in exports, Chinese officials are unlikely to allow the yuan to appreciate very much during the second half of the calendar year. The pricing of the non-deliverable forward implies expectation for less than 1% appreciation against the dollar over the next 12-months, the smallest expected gain in a couple of months. Next month will be the one year anniversary of the Chinese decision that in essence appears largely tantamount to re-pegging the yuan to the greenback. It has been
…
Tags: Andy Xie, Bubbles, CHINA, Chinese economy, exports, global economy, investment
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by ilene - June 30th, 2009 11:41 am
Stunning chart – if you care to visualize consequences of our economic insanity graphically.
Courtesy of Joe Weisenthal and Kamelia Angelova at ClusterStock
Americans are saving and paying off credit card debt at levels not seen in years, but where’s that money coming from? Increasingly, it’s not coming from work. As today’s chart (via David Rosenberg) demonstrates, a staggering proportion of American personal income now comes straight from government transfer payments — welfare, unemployment, etc.
And thus the process of household debt becoming government debt takes place.
Get this [ClusterStock's newsletter] delivered to your email, click here to sign up.
Tags: Chart of the day, Economy
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by ilene - June 30th, 2009 11:23 am
Courtesy of Jake at Econompic Data
Consumer Diffidence
Yeah, I didn’t know what diffidence meant either…
Bloomberg reports:
Confidence among U.S. consumers slipped unexpectedly in June, reflecting a weak labor market.
The Conference Board’s sentiment index decreased to 49.3 from a revised 54.8 in May, the New York-based research group said today. The figure was still above a record low of 25.3 reached in February. Another report showed home prices fell at a slower pace in April than in the previous month.
“The optimism that started to build over the last few months may be starting to fade,” Michael Gregory, a senior economist at BMO Capital Markets in Toronto, said before the report. “Labor markets are sort of stabilizing in terms of job losses, but the big issue is people are having a hard time finding a job.”
Source: Conference Board
Tags: Consumer Confidence
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February 23rd, 2012 12:07 am
Courtesy of www.econmatters.com.
By
EconMatters Oil futures spiked more than 2% in one day to their highest level in nine months on Tuesday Feb. 21. WTI front month contract closed at $105.84, while Brent ended at $121.66 on ICE, primarily on investors fear of potential conflict over the escalating tensions between the US, Europe, Israel, and Iran. A second Greek bailout deal of €130bn (£110bn; $170bn) also helped to inject some optimism into the market (which would seem totally mis-placed as we may need to
relive this Greek drama in two years). Nevertheless, the fact remains crude oil market supply and demand has not changed a bit to warrant a 2%+ price jump in one day.
...
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February 22nd, 2012 12:15 pm
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
Earlier today, we learned the first stunner of the Greek bailout package, which courtesy of some convoluted transmission mechanisms would result in some, potentially quite many, Greek workers actually paying to retain their jobs: i.e., negative salaries. Now, having looked at the Eurogroup's statement on the Greek bailout, we find another ...
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February 22nd, 2012 11:05 am
Courtesy of Benzinga.
In recent years, traders and investors have increasingly turned to social media to discuss their investments. Now, interested parties can get a scientific look at what is being discussed on a weekly, monthly, and even hourly basis.
Provided by Social Market Analytics, here is the morning social media outlook for Wednesday, February 22.
Most Bullish
Sentiment has been most bullish this morning on two tech companies.
Sourcefire (NASDAQ: FIRE) reported stellar earnings yesterday afternoon, which prompted several analysts to upgrade their price targets on the stock. The company hit a fresh 52-week high earlier this morning, as shares surged over 23%.
Procera Networks (NASDAQ: ...
http://www.insidercow.com/ more from Insider
February 22nd, 2012 11:03 am
Courtesy of David Grandey.
In today’s market, it’s more important that ever to have a mindset to maintain a sane mental state and stay peaceful calm and centered.
Keep in mind with the markets as stretched as they are, we are in a high risk zone for pulling back as we have been in an accelerated uptrend with barely any pullback to speak of which as we all know can not continue forever — it never does. That said the music can stop at a moment’s notice and odds favor when it does it will be a gap down. So using that as a backdrop let’s look at SXCI. SXCI — SXC Health Let’s say that issue breaks above the pink line and triggers a long side trade. That’s all fine and dandy HOWEVER it’s what happens next that we have no control over. At that point it either follows through or it doesn’t. WE NOR YOU HAVE ANY CONTROL ...
more from Chart School
February 22nd, 2012 12:00 am
Top 5 RisersStockRatingAnalysis
AGBUYAn increasingly attractive expected long term growth rate and a significantly higher projected valuation from just a few weeks ago make AGCO a company to watch.
PCUBUYThe recent earnings history for Southern Copper shows significant improvement while projected valuation continues to rise.
PAGBUYAn increasingly attractive expected long term growth rate and a significantly higher projected valuation from just a few weeks ago make Penske a company to watch.
FEICBUYAn increasingly attractive expected long term growth rate and a significantly higher projected va...
more from Sabrient
February 21st, 2012 2:23 pm
Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
Other than that rally last Thursday that caught a lot of technicians flat footed (i.e. post the Apple reversal) the breadth in this market has been relatively poor the past 5 sessions or so. The Russell 2000 has been lagging the major indexes dominated by large caps, and my watch lists have contained far more red than green. Some people have been calling it the NBA market ("Nothing but Apple") but it's been a bit broader than that – i.e. Microsoft has acted well, and some groups are still working.
A bearish take on this is of course what I cited above – breadth is narrowing which usually happens near tops. Fewer and ...
more from Mark
February 21st, 2012 1:40 pm
Reminder: David is available to chat with Members, comments are found below each post.
Click here for the full report.
To learn more, sign up for David's
free newsletter and receive the
free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. -
Ilene...
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February 21st, 2012 1:39 pm
Today’s tickers: WYNN, CTRP, DTV & WMT
...
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February 21st, 2012 8:58 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
...
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February 20th, 2012 10:36 pm
Courtesy of John Nyaradi.
Monday comes and goes with no agreement on Greece until late night settlement on Greece.
European finance ministers met in Brussels Monday and deep into the night and finally, in the wee hours, apparently have struck an agreement for the next round of bailout money for Greece.
In overnight trading, the European indexes were up with the DAX gaining 1.46%, the STOXX 50 adding 1.2% and the FTSE climbing 0.7%
In Asia, major indexes were down slightly as the world waited for an answer on Greece.
The U.S. Dollar (NYSEARCA:UUP) declined after announcement of the agreement while the Euro Dollar (NYSEARCA:FXE) jumped.
The issue remains the same as it always ha...
more from John
February 19th, 2012 3:12 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 most recent Stock World Weekly, Balancing Act. Click on this link to sign in or sign up to read.
...
more from SWW
January 30th, 2012 7:22 am
Here is a quick update of past trades and our current position.
AA Money
No trade this week as we wait for AA to settle. Phil remarked last week that AA seemed overvalued. In the meantime, it looks like we might have to roll our Feb 9 calls. Good thing we sold only 5 of them against our position.
Last week P&L - 310.00
We lost ground last week, but we still have 11 months to sell premium!
FAS Money
Very good week for FAS Money as we benefited from the large amount of premium sold the previous week. We covered most of the shorts in advance of the Fed speech, but sold another set of options on Wednesday after the speech - 2 FAS calls that expired worthless on Friday, 2 FAS put that we are still holding and 2 FAZ put that we bought back for a profit on Friday. A late stick comparable to last week's almost gave us problems at the end of the day though!
Last week P&L - $4277.00
IWM Money
A decent week in this virtual portfo...
more from Strategies
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 ...
more from Pharmboy
About Phil:
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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