Blogs

  • The Real World Order

    Today I'm passing along a piece from George Friedman, Chief Intelligence Officer at Stratfor. He makes the absolutely compelling argument that issues of war and peace follow these same guidelines. There are ebbs and flows, but war between countries is an inevitable part of history, and it's driven by simple geography. The recent war between Russia and Georgia was precisely such a "reversion to the mean," double-entendre fully intended. Navigating financial markets requires an understanding of the geopolitical issues - the war & peace - that drive them. What does this war mean for Russian gas supplies to Europe? What does this war mean for the future of the BTC pipeline? Does this war make Iranian inclusion in global markets more or less likely? Is Russia just "vertically integrating" its control of energy flows with less-than-subtle tools?...
  • Fannie and Freddie Back In The News...

    * Strange trading days... * U.K. Retail Sales surprise.... * Norway's GDP prints strong! * A CDO lesson... ** Fannie and Freddie Back In The News... Good day... And a Tub Thumpin' Thursday to you! Don't know why... I just felt like it should be a Tub Thumpin' Thursday! I hit the wall yesterday, as I went home, and fell asleep at 3 o'clock, and didn't wake up till night time! Watched a few innings of my beloved Cardinals, wanted desperately to stay up and watch the May-Walsh beach volleyball game, but went right back to bed! So... I should be rested, eh? One would think so, but with the treatments I take, they just simply wipe me out! But... Hey! I always said that sleep was the greatest thing... I just get to enjoy more of it, right? OK... Another day of strange trading... As I signed off yesterday, the euro had given up it's previous day's gains, but found some terra firma at 1.47 and then rallied in the afternoon... If you guess right, as I have not done so this week, you can catch a great price to sell, and buy, all in the same day!...
  • A Scramble for Alpha in an Alpha Starved Environment

    commentary from this week’s “Sectors and Styles Strategy Report”*: Unless one buys into the idea implied by the recent price action of US consumer related sectors (see pages 4 and 8*) that economic matters in the US are about to get...
    Posted to Musing on the Markets by Vinny Catalano, CFA on 08-21-2008
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  • The Stock Playbook Market Summary / 8-20-08

    The market fell sharply for a second straight session Tuesday after a hefty jump in wholesale inflation and a drop in new home construction gave investors more reason to believe an economic recovery is far off. The Labor Department said its Producer Price...
    Posted to The Stock Playbook by Dave Dispennette on 08-20-2008
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  • A Downward Revision of Eurozone Growth...

    * Euro rally ends quickly! * Housing Data continues to be bad... * OECD wants Norway's rates increased... * The Aden Sisters on a Wednesday! ** A Downward Revision of Eurozone Growth... Good day... And a Wonderful Wednesday to you! I'm sitting here wondering what to write about this morning, and on the radio is a classic song by Led Zeppelin, Dazed and Confused... Seems quite apropos, eh? I say this because that's what I've been for the last month, as the dollar got up from its death bed, and there's not a sign of any medicine that was prescribed had been taken! Oh well, why would I think that things would change for me at this stage of my life, I've been dazed and confused for a long time! HA! I'm sure that's what a lot of people are saying right now anyway... The euro rebounded over 1-cent yesterday, but that rebound has been wiped out completely in the overnight markets... There's just no lasting power in any currency rally VS the dollar right now. And as I keep going saying, this is reminding me so much of 2005 when the dollar covered up its pimples and posed for GQ, only to see the pimples pop through the makeup by year-end....
    Posted to Daily Pfennig by Chuck Butler on 08-20-2008
  • Beyond the Sound Bite: An Interview with Beth Ann Bovino

    With the US economy tettering on the edge of a second down leg and much of the global economy poised to join, economic forecasts range from the plain bad to the outright terrible. My interview with the Senior US economist for Standard and Poors includes...
  • Storms On The Horizon - The Entitlement Time Bomb

    The federal budget deficit is projected to soar to a record $482 billion in 2009. With that in mind, I reprint a recent speech by Dallas Federal Reserve Bank president Richard W. Fisher on the subject of the US debt crisis. Let me warn you, this is not for the faint of heart. It is one of the most chilling forecasts I have read in a long time. You need to read it. The question is, why is no one talking about this problem or taking any steps to head it off? I offer some comments at the end....
  • Inflation, The Fisher King and a Solar Stock

    Inflation, The Fisher King and a Solar Stock And to think, investors cheered the Fed’s decision to hold interest rates unchanged. Today, the Producer Price Index, a popular low-ball measure of wholesale inflation, came in twice as hot as expected...
  • German Investor Confidence Rises!

    * Gold is oversold... * Dollar index is overbought... * RBA to cut rates... * More tears to shed in housing... ** German Investor Confidence Rises! Good day... And a Terrific Tuesday to you! Whew! A long day yesterday for me and the kids on the trading desk. I suspect today will be cut from the same cloth. We have quite a few currency investors panicking and bailing on their plan to diversify. It's not a One-Way street folks... No one ever said it would be! But those that held on to their positions during the dollar rally of 2005, were rewarded, as I believe they will this time too... But then, I could be wrong......
  • The Elusive Bottom

    In this weekend's Thoughts from the Frontlines, I quoted from part of a very thoughtful, right-on-target analysis by David A. Rosenberg entitled "The Elusive Bottom." Over the weekend, I decided that you should read the whole piece, as Rosenberg makes some very solid points about how the markets and the economy may play out over the next few years. He has a non-consensus viewpoint, but that is what I like for Outside the Box. In fact, I think this is one of the more thought-provoking pieces I have used in OTB for some time. Rosenberg is the North American Economist for Merrill Lynch. They were gracious to give me permission to send this letter out on such a short notice, and I believe you will well served to take the time to think through his analysis. And rather than try and give you a quick summary, let's just jump right in....
  • Sectors and Styles Strategy Report: August 18, 2008

    "Last week’s tepid US market action belied the much stronger decline in global markets (see page 8 of the report). Additionally, emergent strength in US consumer related sectors was evident. The combination of the two was modestly offset by...
    Posted to Musing on the Markets by Vinny Catalano, CFA on 08-18-2008
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  • Falling Short On Financing...

    * Dollar wages war on euro! * TICs comes up short... * An Oil discussion... * Mexico raises interest rates... ** Falling Short On Financing... Good day... And a Marvelous Monday to you! This week is shaping up to be much like a college fraternity pledge "hell week", as we will be as thin as a razor swim suit, with many people out... All I can ask of World Markets customers is that they be patient when calling this week, the wait could be long. OK... Friday saw some ups and downs but all-in-all a range bound day for the currencies. I'm not going to stick my foot in my mouth again and say that it looks like the euro has applied a tourniquet to the bleeding, like I did last week! I'll simply say that it held 1.47, and has added to that in the overnight trading....
    Posted to Daily Pfennig by Chuck Butler on 08-18-2008
  • Whatever Happened to Decoupling?

    The old mantra was that if the United States sneezed, the rest of the world would catch a cold, as the US was seen as the main driver of world growth. That was then. Economists and analysts began to argue that China and the developing markets were starting to provide a consumer base for the world. And Europe's new and growing markets would be able to stave off problems from abroad and stay on their own growth path. The world, we were assured last year, would not suffer from problems in the US economy. Today, we look at evidence that this might not quite be the case. And if it is not, those who look for diversification in global markets may be disappointed. Also, I quickly look back at my January forecasts and feel it may be time for a mid-course correction. It seems I may have been a little too optimistic. It should make for an interesting letter....
  • Inflation & Jobless Rate Soars!

    * Dollar wages war on euro! * Pulling the wool over our eyes... * A Gold discussion... * 4-weeks of selling renminbi... ** Inflation & Jobless Rate Soars! Good day... And a Happy Friday to one and all! It's been 3 weeks since I last started a Friday with that note. I hit every red light this morning on my way to work, which led me to think aloud in the parking lot, that this isn't going to be a Fantastico Friday... And when I turned on the currency screens, after reaching my desk, I could see why I thought those negative thoughts... It's getting ugly... Yesterday, I was busy with my head down working on something, when Chris Gaffney yelled across the trading desk, "Hey, Chuck, what happened to the euro?" I looked up to see the euro had lost 1-cent in a matter of 20 minutes... But that's not the end... This morning, the euro has given up another 1-cent, and now trades with a 1.47 handle. Just what the heck is going on here?...
    Posted to Daily Pfennig by Chuck Butler on 08-15-2008
  • Quotable Quotes: Sun Tzu

    As aquaman (a/k/a Michael Phelps) seeks to make Olympic history in Beijing, the advice from a Chinese champion from another era and another discipline is ageless. Be it sport, politics, business, or war, a few words from Sun Tzu. "Strategy without...
    Posted to Musing on the Markets by Vinny Catalano, CFA on 08-15-2008
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