Posts Tagged ‘Swiss francs’

Much Ado About TED, LIBOR, and Currency Swaps

Much Ado About TED, LIBOR, and Currency Swaps

Courtesy of JESSE’S CAFÉ AMÉRICAIN

There is some alarm being expressed about the recent increase in the TED spread from some quarters this week.

Here is a short term chart of the TED. It is definitely elevated expressing the accelerated demand for dollars in Europe. Although the BIS reports will not catch up with this action for quite a while, I suspect we are seeing a replay of a flight away from dodgy assets such as dollar denominated CDO’s that European customers had deposited with their banks that are now being liquidated again. Also, and undeniably, there is a flight to gold, Swiss francs, and US dollars from the Euro as the ECB and the EMU sort out their serious issues brought about by a single currency and monetary policy working across a wide diversity of localized fiscal conditions.

However, here is the longer term picture of the TED spread. As you can see, it is a bit too early to hit the warning sirens. But it does bear watching.

The long view is not very dramatic, and also not as useful for promoting short euro hedge fund trades, or for generating viewer clicks.

For some additional perspective, here is a chart of the one year LIBOR rate.

Here is a short term view of LIBOR in US Dollars. It is definitely elevated.

But here is a similar short term view of LIBOR expressed in ECU’s. By comparing the two LIBOR charts one might think that there is an elevated demand for dollars, probably attributable to a flight to safety. The DX chart indicates that it seems to be peaking. But it can always take a turn for the worse. 

And while we are at it, here is a reprise of a prior discussion of the Fed’s swap lines with Europe, designed to relieve imbalanced demand for dollars.

The US is indeed contributing to the bailout of Greece, via its membership in the IMF. But not through the currency swap lines, unless there is something else going on there behind the scenes. Since the US owns the biggest printing press in the world, at least for now, that would not be a shock.

There may be a time to worry about European insolvency. But quite a bit of what we are hearing about Europe these…
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Kimble Charting Solutions

Is the Nasdaq 100's Out-Performance Nearing a Top?

Courtesy of Chris Kimble

Is the latest ramp higher and Large-cap tech stocks have been the clear market leader, out-performing the broad market for months.

In today’s chart, we look at the Nasdaq 100 to S&P 500 performance ratio in an effort to answer the question: Is the ramp higher in tech stocks and severe out-performance sustainable?

While we may not be able to answer that question today, the ratio IS at an inflection point. And following today’s ratio chart should help us answer that question.

As a reminder, the ratio rises when the Nasdaq 100 is out-performing the S&P 500. Note also that it is a longer-term “monthly” price chart.

Important Br...

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Zero Hedge

'Father Of Credit Risk Modeling' Has Ominous Warning Over "Insolvent" Companies Piling Up Debt

Courtesy of ZeroHedge View original post here.

“When there is an increase in insolvency risk, what you do not need is more debt. You need less debt.”

That is the common-sense warning from Ed Altman that every talking head in the world seems incapable of understanding or admitting.

Altman, wh...



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Phil's Favorites

Was that the Top?

 

Was that the Top?

Courtesy of  (originally posted on July 13, 20) 

That was one heck of a reversal today in tech stocks. At one point the Nasdaq-100 was up more than 2%, but it gave up all of those gains and then some, finishing the day down over 2%.

After a 60% move off the March lows, the question on many investor’s minds tonight is, “was that the top?”

This type of reversal is rare and is only seen in volatile markets. It happened at the bottom in March 2020, and before that you’d have to go all the way back to the bottom of March 2009.

It’s happened at the bottom, but it also ha...



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Biotech/COVID-19

How 'good' does a COVID-19 coronavirus vaccine need to be to stop the pandemic? A new study has answers

 

How 'good' does a COVID-19 coronavirus vaccine need to be to stop the pandemic? A new study has answers

The lower the vaccine’s effectiveness, the more likely social distancing in some form may still be necessary. Gopixa via Getty Images

Courtesy of Bruce Y. Lee, City University of New York

The U.S. is pinning its hopes on a COVID-19 coronavirus vaccine, but will a vaccine alone be enough to stop the pandemic and allow life to return to normal?

The answer depends on a how “good” the vaccine ends u...



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ValueWalk

Whitney Tilson Is Bullish On Bank Stocks

By Jacob Wolinsky. Originally published at ValueWalk.

Whitney Tilson’s email to investors disucssing him being bullish on bank stocks; the bear case; Doug Kass with the bull case.

Q2 2020 hedge fund letters, conferences and more

Earnings Season For The Big Banks

1) It's earnings season for the big banks this week.

Citigroup (C), JPMorgan Chase (JPM), and Wells Fargo (WFC) reported this morning... Goldman Sachs (GS) is up tomorrow... and Bank of America (BAC) and Morgan Stanley (MS) round things out on Thursday.

The sector has been decimated this year. The Invesco KBW Bank Fund (KBWB) is down 35% year to date, vast...



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Digital Currencies

Bill Gates, Elon Musk, Jeff Bezos, Bloomberg, Kanye, Apple Twitter Accounts All Hacked In "Nigerian" Bitcoin Scam, Over $100,000 Stolen In Minutes

Courtesy of ZeroHedge

The twitter accounts of two of the world's richest men, Bill Gates and Elon Musk (and perhaps others) were hacked late on Wednesday, in what appears to be a version of a "Nigerian" bitcoin scam.

At 440pm ET, Musk tweeted the following:

Microsoft founder Bill Gates had a similar tweet.

As did Jeff Bezos:

...



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The Technical Traders

Second Phase Real Estate Collapse Pending

Courtesy of Technical Traders

Real estate, especially commercial real estate, is likely to be the first segment of the real estate market to enter the second phase of an extended collapse.  The COVID-19 virus has created an atmosphere where continuing operations for retail, restaurants, and many other business segments is virtually impossible to maintain.  Without the ability to earn sufficient income, thousands of restaurants and other retail businesses have already closed or are in the process of closing.  This has pushed the commercial real estate market into turmoil.  We believe the residential real estate market will follow the commercial market because consumers are going to suffer as commercial real estate collapses....



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Chart School

Dow 2020 Crash Watch - Update

Courtesy of Read the Ticker

Like 1929 the markets have bounced. This time it is on the back of the FED $6.5T money printing.

Previous Post: Dow 2020 Crash Watch 

But can the FED blow $6T every time the market rolls down to test support.

Yes, maybe before the US 2020 elections the FED will do 'what it takes'. But post elections not so much, the year 2021 is a long way from the next election (presidential or congress) and defense of the markets may not be so supportive at $6T or $10T per market smash. The FED may hesitate, and that will be window for stocks to break lower.

The 36 month simple moving a...

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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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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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