Heres why Greenspan is wrong on housing bottoming(Again) http://www.cnbc.com/id/15840232?video=1274816344&play=1
World trade seems to have bottomed http://www.cpb.nl/eng/research/sector2/data/trademonitor.pdf Whatever growth that comes from current levels will probably be weak as protectionist pressures prevail as the US-China mini war shows
Kevin Warsh sounding hawkish in today's WSJ. Makes it pretty clear that the Fed feels it is ok to begin to hike before unemployment rate has topped out. Probably the reason for euro$'s being down a few ticks. http://online.wsj.com/article/SB10001424052970204488304574433041058334138.html A snip ... In this environment, market participants and policy makers alike should steer clear of ironclad policy prescriptions. Nonetheless, I would hazard the view that prudent risk management indicates that policy likely will need to begin normalization before it is obvious that it is necessary, possibly with greater force than is customary, and taking proper account of the policies being instituted by other authorities. "Whatever it takes" is said by some to be the maxim that marked the battle of the last year. But, it cannot be an asymmetric mantra, trotted out only during times of deep economic and financial distress, and discarded when the cycle turns. If "whatever it takes" was appropriate to arrest the panic, the refrain might turn out to be equally necessary at a stage during the recovery to ensure the Federal Reserve's institutional credibility. The asymmetric application of policy ultimately could cause the innovative policy approaches introduced in the past couple of years to lose their standing as valuable additions in the arsenal of central bankers.
"Lacker Says Fed May Not Need to Buy MBS Authorized" http://www.senseoncents.com/tag/lacker-says-fed-may-not-need-to-buy-mbs-authorized/ "the Federal Reserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and up to $200 billion of agency debt." "Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; ... Jeffrey M. Lacker;" Vote was unanimous There is a difference between what these guys say and what they do, they routinely mislead people to anchor inflation. Plus he didnt mentioned the UR at all
Roserberg just lunched a long report where he talks about the possibility of the US starting a full blown weak USD policy. I very much agree with that sentiment after having read 'Essays on the Great Depression' by Bernanke. My only disagreement is that I believe it will be a far more of a monetary decision rather than a political one that he sees. The UR is the trigger in both cases but the FOMC (at least at this point) is untouched by political pressures so they will be caring about the core CPI and labor slack instead of elections. The possibility the Geithner would ask the NYFed to sell dollars in the open fx market with DX close to all-time lows seems pretty remote and it could trigger trade wars
Spread Between Optimism And Reality At All Time Record Wides "the US population is more 'hopeful' at this moment than it has ever been" http://www.zerohedge.com/article/spread-between-optimism-and-reality-all-time-record-wides Could leverage be the key behind the extreme emotions the US saw over the last 2 years?Maybe the more debt you have the more panic you feel then the more wishful/hopeful you get thinking everything is going to be alright(because accepting the alternative is so painful), this is just a theory though
Clarium going under? http://www.marketwatch.com/story/cl...ougher-in-september-2009-09-25?dist=bigcharts Looks like they shorted the market and had to face the rally "The hedge fund, run by PayPal co-founder Peter Thiel, lost 8% in the first 14 trading days of this month, according to an update Clarium sent to investors." Thats why I rather stick with waiting for ES to break the 40 or 50MA and break some trendlines before trying anything. Thiel doesnt like options either, it looks like they shorted green shoots in the underlyings
I think Clarium has been expressing their "short green shoots" thinking by being long the dollar - my guess is they were mostly short GBP/USD and short JPY/GBP. If (and its a big if) they managed to hold onto those positions through the rest of the month, they certainly made it all back and more.
Sometimes I think I take too much risk and risk too big of a drawdowns but Thiel is down something like 50% from his 08 peak
"Of course, if the economy remains mired in weak economic conditions, and inflation and inflation expectation measures are firmly anchored, then policy could remain highly accommodative." - Kevin Warsh one day after WSJ op-ed He was suggesting(indirectly) it might not take 14 months after the UR peaks to raise. Even if thats right, I expect the UR to top somewhere around the middle of 2010(being conservative) so even in the 7 month after scenario(Which I consider quite conservative) euro$ call will still cash http://www.federalreserve.gov/newsevents/speech/warsh20090925a.htm#f7