I have the lead quote in the this page one NYT Business section article on the Markets — which came out prior to this NFP:

“Less-worse isn’t the same as better,” said Barry Ritholtz, chief executive of FusionIQ, a research firm. “We want to see ‘good.’ In order to grow profits, in order for earnings to increase, in order for corporate America to start hiring and spending, we need to see greener shoots. So far that hasn’t really happened.”

Great graphic, too:

>

0701-biz-market2

>

Source:
In 2nd Quarter, Stocks Gained, but for How Long?
JACK HEALY
NYT, June 30, 2009

http://www.nytimes.com/2009/07/01/business/01markets.html

Category: Economy, Federal Reserve, Finance, Friday Night Jazz, Media

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

89 Responses to “Quarterly Review”

  1. investorinpa says:

    All the government is getting is very light pale green shoots. Maybe asparagus colored shoots.

  2. franklin411 says:

    That’s all that can be expected, investor. Unemployment will remain elevated for quite a while. Why?

    Because, quite simply, America is unemployed. I’m not talking about the people. I’m talking about the Nation. The world doesn’t need what we sell (except for airliners, military hardware, and agricultural products). How do we turn that around? How does America “get a job?”

    Is it by cutting taxes and praying for the best? Is it by cutting government spending mindlessly and across the board? How will that change anything?

    Or is it by doing something we haven’t done in 30 years: invest in the future. Is it by consciously making an effort as a Nation to making things the world wants to buy?

  3. HCF says:

    >“Less-worse isn’t the same as better,” said Barry Ritholtz

    Love the quote, Barry… I was trying to explain to some co-workers yesterday that essentially what we have is that catastrophe is better than apocalypse. For that matter, wouldn’t disaster be a step up from catastrophe? At some point in time, only good news will be good news…

    HCF

  4. The Curmudgeon says:

    OT:

    Here’s a green shoot for you BR, from today’s WSJ;

    Business is back on Wall Street. If the good times continue to roll, lofty pay packages may be set for a comeback as well.

    Based on analysts’ earnings forecasts for 2009, Goldman Sachs Group Inc. is on track to pay out as much as $20 billion this year, or about $700,000 per employee. That would be nearly double the firm’s $363,000 average last year, and slightly higher than the $661,000 for the average Goldman employee in fiscal 2007, according to analyst estimates reviewed by The Wall Street Journal.
    http://online.wsj.com/article/SB124649352055183157.html

    >Goldman Sachs is the essence of hubris: Acquire effective control of the government money machine (doesn’t nearly everyone at the Fed/Treasury, etc., have the moniker “former ……for Goldman Sachs?), engineer the rescue of AIG such that your butt stays in the clear, and then, when you think all the sheeple that funded your rescue are no longer looking, jack up compensation to levels exceeding even those before you were rescued! Of course, you had to, right? To make up for the lost compensation during the dark days of pulling government levers to impose obligations on the taxpayers such that your bad risk management wouldn’t cost you the gravy train you were on.

    Goldman Sachs is just soooo clever. But I’ve got a feeling this is gonna come back to hurt ‘em.

  5. alfred e says:

    BR: Shame on you for validating the term “green shoots” :>(

    Your site is hiccupping on a regular basis. Don;t know whether it’s in overload or your configuration is hammered. Could be part of why some comments get eaten. Some may get impatient waiting for it to get swallowed, or confused by some of the error messages being spewed “NO serving node available”.

    [BR: Yeah, its a wordpress glitch — fix should be ready next week.]

    Improvement? Sure we’re right back where we were a few months ago (S&P), only with higher unemployment. It will be interesting to see how earning reports turn out.

  6. Bruce N Tennessee says:

    Is it by cutting government spending mindlessly and across the board? How will that change anything?

    Franklin: Your typing is worse than mine…look at what you wrote….Let me fix it for you….

    Is it by government spending mindlessly and across the board? How will that change anything?

    There…all better.

  7. EricTyson says:

    Profits rebound before unemployment declines as leaner companies reap the initial benefits of a rebound and are slower to rehire workers in the initial stages of a rebound.

  8. ironman says:

    BR: The graph’s good, but the quote’s better. Spot on!

  9. WaveCatcher says:

    This rally is beginning to remind me of the October 2002 rally, which lost strength after a few weeks and then reversed down till the Market tested the lows in March 2003.

    The first leg was a melt up rally powered by short covering. The past few weeks the rally has become flaccid, with some signs of distribution in the past couple of weeks.

    The WaveCatcher model portfolio is moving back to a fully hedged stance for next week.

  10. Novemberrain says:

    “It looks like the economy was still losing substantial momentum as the second quarter came to a close.” said William Sullivan, chief economist at the JVB Financial Group in Boca Raton, Florida.

    Less worse is surely Better but why settle for ‘less-worse’. The unemployment ratehas hit a nearly 26-year high of 9.5 percent. This has severely affected the housing market as well.Anxious borrowers are still unsure of their repayment capabilities coz they are unsure of their employment status. I really wonder what our lawmakers are doing??

    Read this interesting article Government efforts are not helping

  11. Bruce N Tennessee says:

    http://www.nytimes.com/2009/07/03/business/economy/03jobs.html?_r=1&ref=business

    U.S. Job Losses Rise in June as Unemployment Reaches 9.5%

    “The numbers are indicative of a continued, very severe recession,” said Stuart G. Hoffman, chief economist at PNC Financial Services Group in Pittsburgh. “There’s nothing in here to show that the economy and the market are pulling out of the grip of recession.”

    …Now, I see several reports today that suggest a final U3 of over 11%…something the “pessimisters” on this blog have considered for some time…

    The recession is what it is…

  12. aitrader says:

    Good quote! But the graph is of the S&P – don’t see what that has to do with green shoots.

    In my book green shoots are jobs, manufacturing, earnings, and exports – in that order. The S&P graph seems like the tail tryin’ to wag the dog.

  13. cvienne says:

    @Franklin

    “How do we turn that around? How does America “get a job?”
    “Is it by consciously making an effort as a Nation to making things the world wants to buy?”

    How about we start making little FRANKLIN411 voodoo dolls? I’d buy that (& I think most of my friends would too)…

  14. dmlopr says:

    The good news is, we’ve slowed the bleeding down, mrs sam. However, since the wound was so deep, your husband lost too much blood for a full recovery. You’ll just have to learn to adjust to his limited potentials.

  15. uno says:

    Taleb is making some cogent comments today.

  16. ben22 says:

    @Eric,

    You are describing what has happened in the past, which tells us nothing of the future.

  17. leftback says:

    “Profits rebound before unemployment declines as leaner companies reap the initial benefits of a rebound and are slower to rehire workers in the initial stages of a rebound.”

    This is true in a normal recession, Eric, where monetary and fiscal easing are able to stimulate the economy via increases in consumer spending. The same does not apply in a recession triggered by financial crisis.

  18. cvienne says:

    @Eric

    “Profits rebound before unemployment declines”

    My take?

    PROFITS REBOUND WHEN PEOPLE EFFING BUY THINGS!

  19. call me ahab says:

    “Profits rebound before unemployment declines as leaner companies reap the initial benefits of a rebound and are slower to rehire workers in the initial stages of a rebound.”

    makes sense on paper- and I guess you are hoping for another bubble being created to juice the economy- but assuming that doesn’t happen- and people remain unemployed- and others refuse to spend out of fear- how do you see a rebound? -

    have you ever considered that maybe this is as good as it gets?

  20. Chief Tomahawk says:

    BR, interesting article in Vanity Fair coming out on Harvard.

    From the following:

    http://www.vanityfair.com/online/daily/2009/06/harvard.html

    [Harvard] = ““They are completely fucked.””

  21. John Clarke says:

    Well it looks like the ‘managed selloff’ continues. Most of these Indexes look to me like they’re in consolidation patterns setting up for another push higher through the meat of earnings season– next 2-3 weeks– before we see any meaningful correction.
    I’d like to see the yield on the 10 year hit 4.5% and oil shoot to 80+…

  22. Dogfish says:

    @cvienne

    My take?

    PROFITS REBOUND WHEN PEOPLE EFFING BUY THINGS!

    —–

    …and people will effing buy things when they can afford to, which will happen when they aren’t completely indebted and/or unemployed, which won’t happen anytime soon, because the companies effing making the things can’t afford to pay people enough…. ie, those companies need profits before they can hire, which leads to people effing buying things… ie “Profits rebound before unemployment declines”.

    Sidenote: The voodoo doll comment was uncalled for. Your contempt of f411′s views are quite apparent. Your repeated jabs say more about you than him.

  23. leftback says:

    Chief: The problems at Harvard are common to many other institutions such as pension funds and universities. A common theme is that they held too many illiquid positions and were unable to move nimbly as problems appeared and multiplied in their portfolios. In this respect nothing much has changed. The debt problems facing many of the universities are very serious. Overbuilding was a serious disease as medical schools chased NIH grant $.

  24. ben22 says:

    John Clarke,

    I’m sort of thinking the same thing. I’m still holding out that the S&P goes to at least 965 – 1k before this countertrend rally is toast. I’m also holding on to that level because I want to be right since I made this call way back in March, lol. There have been some down days recently though that looked more like panic selling when looking at advancers/declines up/down volume etc. I guess we’ll find out in another few months.

  25. call me ahab says:

    john clarke-

    I opined earlier that there is much risk staying completely long heading into earnings- and that I would be inclined to lock in my profits before what is probably less than happy news on earnings-

    thoughts please- the whole crowd welcome to comment

  26. CapitalistCanuck says:

    @ahab, ben22, john clarke

    I tend to agree and I am betting on SSO at the moment heading into earnings season for a trade. For the moment, I think less bad is good still holds at-least for the rest of Q2. Presently. we are at the bottom of the channel and stuck in a trading range. Barr any earth shattering news, I think the market re-tests the peak. I work in financial services and lots of clients are pouring money back into stock basically doubling-down their bets to re-coupe losses, lots of dip buyers out there.

    Although, I still like UUP / DUG as a setup for Q3, but I don’t believe we fall apart in the summer.

  27. DL says:

    leftback @ 2:42

    “Overbuilding was a serious disease as medical schools chased NIH grant $”.

    I don’t understand exactly what you’re getting at. I don’t think that there’s a “boom/bust” cycle in the building of medical schools. First, medical schools turn away most applicants; there is no shortage of people willing to pay med school tuition. Second, NIH funding has been very steady over the last 20+ years; no boom/bust cycle there.

  28. call me ahab says:

    dogfish-

    the common wisdom is as you described- but do you not think that it is a bit of a circular argument-

    for instance- as you say- the more people buy the more companies can hire- however what of the flip side-

    the more companies hire the more people can buy (because they are employed)- thus- we could see the following-

    the more jobs that are lost results in the less people can buy thus the more people let go to protect the company and ensure its profitablity and its ability to survive-

    so where would the demand come from to spur profits and generate job growth- bit of a catch 22- no?

  29. leftback says:

    “Presently. we are at the bottom of the channel and stuck in a trading range”

    SPX 880-950 (minor range of 903-930). Crude $67-72. Gold $900-950. Play what you see.

  30. cvienne says:

    @Dogfish

    “The voodoo doll comment was uncalled for. Your contempt of f411’s views are quite apparent. Your repeated jabs say more about you than him.”

    Point taken…

    Sometimes (probably too often) I write things just so as to get a chuckle…If it offends you, I apologize…

    As for Franklin…oftentimes my “repeated jabs” [as you put it], come from the notion that it is difficult to argue with someone (as I have noticed by reading many other responses to Franklin’s comments), who is so clearly biased politically (and seems to think that POLITICS is the solution to our financial problems – a notion which is highly debatable)…

    I don’t think that it is necessary to be 100% serious 100% of the time…Why not have fun every once in a while?…Clearly, I’m not offended by your post calling ME out [In fact, I'm apologizing if it was taken the wrong way]…

    As for PROFITS…

    My “one liner” there reflects my long standing belief (which is evident in my language), that this economic downturn is going to be quite long lasting…I believe a BEHAVIORAL SHIFT is taking place…Over the past 4 months, there has been one “last ditch” effort to forestall that, but it finally seems to be breaking down…

    I believe that the PROMISE of America will eventually emerge when we have acknowledged our bad behavior over the past 30 years, bite the bullet for awhile, then re-emerge…I think the present Administration is doing a poor job of facilitating that process either due to ignorance, or arrogance…

    I frankly don’t the GOP would be doing any better if they held all the cards at the moment…But all I’m looking for are a group of leaders with GUTS…

    There don’t appear to be many around (save for the ‘bloggers’ on this site), who, unfortunately don’t hold elected office…

    Fair enough?

  31. leftback says:

    @DL: Medical schools have three activities: teaching, patient care and research. Teaching, as you say, has been unchanged. Bill Clinton doubled the NIH budget, in the 1990s, which was a very good thing. Unfortunately there was an enormous boom in the building of research buildings and in hiring of research faculty to try to capture the resulting $. Some of the debt issued to finance these buildings is now an albatross, as research $ become scarce.
    Exhibit A: Harvard, but there are many others.

  32. Bruce N Tennessee says:

    Am I getting as goofy as Franklin thinks, or does this seem like deja vu from the Bernanke/Paulson “the sky is falling right this minute” we went through last fall?

    GM waits for judge’s ruling on sale plan

    NEW YORK (AP) — An attorney for General Motors urged a bankruptcy judge Thursday to approve the automaker’s sale plan, saying that the only other alternative would be a liquidation of the company’s assets that would have “horrific” consequences for everyone.

    Attorney Harvey Miller said the government appears committed to cutting off funding to GM if the sale is not approved by July 10. Some parties objecting to the sale argued in court that the Obama Administration won’t allow GM to fail.

    “Essentially the objectors are asking you to play Russian roulette,” Miller said, adding that ignoring the deadline would put the futures of GM’s employees, retirees, and creditors all at risk.

    …..followed by………

    “Earlier, Michael Richman, an attorney for a trio of bondholders opposed to GM’s plan told U.S. Judge Robert Gerber to “call the government’s bluff” and require GM to restructure itself through a more traditional Chapter 11 process instead of through the quick sale of its assets.

    Richman said that while the company may be powerless to fight the government’s demands, the court can “push back” to protect the interests of all the company’s stakeholders.

    “The court should draw the line and say that this transaction goes to far,” Richman said. “This sends a powerful message that even in the bankruptcy courts of the country’s commercial capital there are limits and that rights and due process are not to be sacrificed.”

  33. Mannwich says:

    @Eric: Not intended to offend, but that seems like lazy-ass thinking to me. Again, no offense or anything. Just because something happened before under many different circumstances/variables, doesn’t mean they’ll happen again now.

  34. Marcus Aurelius says:

    I don’t understand why we’re debating things getting better vs. getting worse. Are we waiting for some magic/divine hand to turn a swine’s ear into a silk purse? It’s not like we all don’t understand what kind of seeds were planted, and what the green shoots that are now emerging, if any, are (think Alt-A, option ARM, CRE, GSLs, CC debt, globalization, unemployment, stimulus and taxation, and then imagine a Kudzu/Poison Ivy hybrid).

    The markets recently — and gold, and the dollar — have been subject to large initial moves, followed by relative flat lines. Big players are goosing the machinery to their short term advantage, and everyone else is trying to make sense of the ups and downs, as if some fundamental shift in the economy (one that might have slipped under the radar of blogs like this — as if that is possible) had taken place.

    From he Outer Limits (annotated):

    “There is nothing wrong with your television set (stock market/financial health). Do not attempt to adjust the picture (your investments). We are controlling transmission (the trend). If we wish to make it louder, we will bring up the volume (rally on weak volume!). If we wish to make it softer, we will tune it to a whisper (decline on strong volume!). We will control the horizontal (how long this will last). We will control the vertical (how much you will lose). We can roll the image, make it flutter (no purpose doing a reality check). We can change the focus to a soft blur or sharpen it to crystal clarity (but we seem to have an unmitigated preference for the blurry).”

  35. Mannwich says:

    In the past, people could jack up their credit cards as a safety net during the down times knowing they’d eventually have a job before their unemployment runs out and their credit gets turned off. Me-thinks that many are starting sweat big-time now as the last vestiges of their safety net whithers away and dies. 401k raids are happening as well, and should become more frequent as a result. That should help the markets quite a bit…..

  36. Bruce N Tennessee says:

    @Dogfish:

    Actually, I admire Franklin’s pluck…and as all of us know, having been told often enough by Franklin himself, education is the key. Some very bright investor once said that you really only learn when you bet wrong on the market, and that when you make money, you don’t really learn much…that is true in my life, and why I get frustrated with Franklin’s toeing the party line of the new administration…

    I don’t much care for politics like Franklin does, but I will always be a fiscal conservative. I think most of us here would like to see young Franklin not go through the investment pain most of us have gone through over the years…

  37. leftback says:

    Franklin will be OK if he invests in dinner at Chipotle Mexican Grill and a new bicycle. Happy days.

  38. Mannwich says:

    I guess this is a lagging indicator too. No worries here. In fact, this is precisely what we need – - purge the excess debt out of the system so that we can begin anew. Could take years, decades even.

    http://www.calculatedriskblog.com/2009/07/personal-bankruptcy-filings-increase-40.html

  39. cvienne says:

    …last note on Franklin…

    If you’re going to come to party armed ONLY with the torch you carry for the political candidate of your choice…You’d better be ready to face some buckets of water…

    …and you’d better hope that you don’t share the same genetic makeup with the Wicked Witch of the West…

  40. Mannwich says:

    This post by Mish on Citi’s analysts has me rolling…too much. He’s so right though.

    http://globaleconomicanalysis.blogspot.com/2009/07/listen-to-citigroup-analysts-at-your_02.html

  41. Thor says:

    Franklin: We are still the worlds largest manufacturer, by far. Check your statistics before you spout more meaningless jargon

  42. thetanman says:

    Canuck said,

    I work in financial services and lots of clients are pouring money back into stock basically doubling-down their bets to re-coupe losses, lots of dip buyers out there.

    That sounds ominous, but not bullish..

  43. I-Man says:

    @ Canuck:

    You said:
    “I work in financial services and lots of clients are pouring money back into stock basically doubling-down their bets to re-coupe losses, lots of dip buyers out there. ”

    I-Man say:

    Sounds more like a recipe for a top than a bounce… but what do the charts say?

    They say:

    Lower high is in. Trend is broken. Either go cash, govies, or get short.

  44. cvienne says:

    @CapitalistCanuck

    “I think less bad is good still holds at-least for the rest of Q2″

    Q2 is over…

    Was that a typo (& you meant to type Q3)?…and if so, you really think the “green shoots” thing holds on until September 30th?

    Personally, I’d say the behavior in the S&P since June 11th would say that they’d better come up with another sound byte to latch onto…Hell – I can’t even remember who won the World Series last year…

  45. CapitalistCanuck says:

    @thetanman

    agreed.

    I’m on the tax-planning side of finance so I don’t offer investment advice, but I have seen a major momentum shift in attitude since March. Most missed the move on the sidelines paralyzed by fear, now they have confidence – of course after a 40% rally. Wallstreet will not leave easy money on the table, lots left to steal from…

  46. cvienne says:

    @I-man

    “Lower high is in. Trend is broken. Either go cash, govies, or get short.”

    AMEN – I-MAN

  47. CapitalistCanuck says:

    @cvienne

    I refer to quarter’s in-terms of reporting season so yes technically Q2 is over but waiting on the results…

  48. cvienne says:

    @CapitalistCanuck

    “Wallstreet will not leave easy money on the table, lots left to steal from…”

    That’s why I like the long bond here…If they liked the 40% rally on VAPOR (& hope for an earnings rebound), they’re going to LOVE getting paid to hold govies, and the SAFETY that represents, up to 20 basis points above par (from 6 BP below par)…

    I think it’s going to be an easier sell…

  49. leftback says:

    “Lower high is in. Trend is broken. Either go cash, govies, or get short.”

    Or indeed, all three. Peace bro’… but beware the following:

    1. “fixing” of positive earnings surprises, and 2. the momentum effect cited by Canuck above.

    At the present time I prefer shorting oil and the drillers rather than the financials, for example. Just my 2p.

  50. cvienne says:

    @CCanuck

    If we do a REDUX of last year, someone could go long Treasuries and hold onto them through January (and participate in the run-up)…

    Anyone who got 40% from March until now and has to sell to lock in gains will get hit next April…

  51. leftback says:

    @cvienne: Johnny Retail doesn’t know dick about bonds because they are hard to understand and doesn’t appeal to the greed factor because you can’t hit a 10-bagger, but the institutions will head in that direction in Q3.

  52. Mannwich says:

    @leftback: I’m with you on that one. Keeping my DUG position intact for the moment but sold SRS and FAZ for some (finally) long awaited profits. Mannwich is off the schneide.

  53. cvienne says:

    I wonder how Credit Suisse is feeling about the IYR right about now…

  54. cvienne says:

    @lefty

    “but the institutions will head in that direction in Q3.”

    That’s good enough for me…& Hugh Hendry

  55. Mannwich says:

    @cvienne: Me-thinks CS will be fleeing the IYR by the end of the summer, at which time SRS is going to pop again.

  56. I-Man says:

    You’re right Left, but those are things that “may” happen.

    The tape/trend I see in the now has me where I am as far as my positions are concerned.

    I cant do a thing about what effect contrived earnings may or may not have on the tape. I can set some stops though and follow the trend accordingly and let the chips fall where they may.

  57. Chief Tomahawk says:

    Leftback, just thought it to be interesting not even the elite of Harvard saw their way around this. Or maybe some folks knew but tried to keep it under the rug. Case in point: Why didn’t they cancel the interest rate swap rather eat a $1 billion dollar loss?

  58. Dogfish says:

    @ ahab

    It completely is a catch 22, which is why I am as pessimistic and cynical about all of this as I am. Maybe the common wisdom is right, and as such we’re searching for an answer that doesn’t exist?

    How we spur demand when no one has any real wealth is not that far from asking an unemployed person how he is going to afford his mortgage. At it’s root, the problem itself is not complex, but there are no easy answers.

    We ran up a huge debt the past few decades, as individuals and as a country, and now the bill is due.

    I don’t see any sort of sustained recovery or return of demand without some major systemic changes, and too many powerful interests have too much invested in maintaining the status quo for that to happen effectively, if at all. The banksters and corporations we have enabled will continue to drain the energy and resources to remain solvent that otherwise could be used for our nation’s recovery, all while telling us it’s for our own good. Remember, we need them… right?

    We will lurch along for the next decade or so, trying to return to Business As Usual, postponing the restructuring that is needed if we are to return to being the productive and enlightened nation that we still seem to believe that we are. Which will happen anyway, eventually, inevitably, because all systems in nature seek balance, and right now we’re pretty far to one side. It’s just that we’re putting way too many resources in propping up the pendulum on that one side because an elite minority that has bought our government and owns our media fears the swing in the other direction.

    Just for turds and chuckles…
    Dogfish’s Abridged List of Needed Systemic Changes That Will Never Happen:

    1) Ban corporate lobbying
    2) Ban corporate political contributions
    3) Term limits for Congress.
    4) Institute a cooldown period of a year or two before a high-level government employee could be hired by a private company in a related field.

    I think you get the point. Fascism’s traditional definition is that of a confluence of corporate and government interests (implicitly at the expense of the people). I don’t think we’re far from that, and it’s a problem we have yet to come to terms with as a country.

  59. cvienne says:

    @I-Man, lefty, Manny

    One thing I remember is this…

    When the rally started back in March, the tape behaved in a way that didn’t let anyone in…The pullback just never came, and so many sat around and didn’t move…

    Could a selloff happen in the same fashion…

    We could be under 880 before anyone wakes up and realizes what’s going on…

  60. Mannwich says:

    @Dogfish: “Just for turds and chuckes?” LOL. Never heard that one, but very good points.

  61. Mannwich says:

    @cvienne: So true. I was one who was paralyzed by that. The same thing could happen here. After all, we did head straight down from Jan-March. Could it happen again? I’m guessing not, but you never know…..

  62. I-Man says:

    whoa… what up with the trading extension on the nyse???

  63. CapitalistCanuck says:

    I wouldn’t put it past WS to spin positive earnings for a final pump and dump.

    I’m also happy taking the the long and short side of the long bond as I have done this year. As lefty mentioned there is a “greed” factor here. I can’t believe how many people I know loading up on “junk stock” for a big return. No one wants to make a safe 3%. It’s go big or go home attitude, swing at the fences at all costs. I’m still of the opinion we are in a deflationary spiral and probably begin to unwind at some-point and yes long bonds may produce an attractive return. I think we are closer to the time when bond auctions fail to generate such a strong response – that’s when we find ourselves in the midst of the next crises!

  64. Mannwich says:

    @I-Man: AmenRa pointed that out on the prior thread. Not enough power players able to get out today? Is that normal to extend the trading session?

  65. cvienne says:

    In fact…I can already hear the chatter at the barbecues this weekend…

    MM’s looking to get that last cash from Joe Retail…

    “Oh look – there was a 200 point down day…just what we’d been expecting…Let’s let this market retrace back a little and then we can buy it CHEAP for you…just what we’d been waiting for…

    So at 880, JR piles in (for a quick day move)…Goldman Sachs will be happy to sell them their shares…

  66. Mannwich says:

    @cvienne: LOL. “Buy the dips”, right?

  67. Dogfish says:

    @ cvienne 3:06

    It takes a whole lot more than that to offend me :) I don’t know why I made that sidenote, just wanted to put that out there though.

    cvienne said:
    ====
    My “one liner” there reflects my long standing belief (which is evident in my language), that this economic downturn is going to be quite long lasting…I believe a BEHAVIORAL SHIFT is taking place…Over the past 4 months, there has been one “last ditch” effort to forestall that, but it finally seems to be breaking down…

    I believe that the PROMISE of America will eventually emerge when we have acknowledged our bad behavior over the past 30 years, bite the bullet for awhile, then re-emerge…I think the present Administration is doing a poor job of facilitating that process either due to ignorance, or arrogance…

    I frankly don’t the GOP would be doing any better if they held all the cards at the moment…But all I’m looking for are a group of leaders with GUTS…”
    ====

    I COULD NOT AGREE MORE WITH EVERYTHING YOU SAID THERE!

    I think, by rule, leaders with guts aren’t allowed within the ranks of either of our political “parties”. We need some legitimate third parties to gain some traction in this country, the current duopoly is no better than two organized crime families divvying up the neighborhoods for protection. Competition is a good thing…

  68. leftback says:

    “Leftback, just thought it to be interesting not even the elite of Harvard saw their way around this”
    Arrogance and hubris to the nth power, Chief. You have no idea. Plus remember that it is OPM for the managers.

    “MM’s looking to get that last cash from Joe Retail…”
    Agreed. Welcome those post-barbecue bargain shoppers, then fade the move.

  69. cvienne says:

    @CapitalistCanuck

    Think of it this way…

    Joe Average money manager got an S&P which was marginally UP for the 1st 6 months of ’09 (S&P opened ’09 at around 903)…

    Maybe he was a little clever and made some moves in March and is sitting on 10-20% profits…

    This doesn’t concern me (because I trade my own accounts), but if I were handling A LOT of clients portfolios and sitting on a double digit gain in July, I’d call it a WIN for the year and tuck myself into the long bond which is trading 6 basis points below par…

    Let the others “hoping for a 10 bagger” duke it out amongst themselves…No matter what happens, I close the books a WINNER on the year (unless the dollar falls out of bed and there is a mass exit from govies)…

  70. Mannwich says:

    @cvienne: I think a lot of folks are going to have those thoughts over the long weekend. Plenty of time to ponder that one with the three day weekend a peek at what happens in the foreign markets while we’re celebrating our nation’s birthday.

  71. cvienne says:

    @Manny

    Tide has shifted…It’s time to SELL the rips…

    Actually – my interest in GOVIES right now is predicated on several notions…

    1. Lefty & Ben have had great intuition with regards to acting “counter trend”…IOW – Since everyone seems to be chanting INFLATION, it is a lopsided trade.

    2. I’d almost rather be a CALL BUYER of Treasuries than a “short seller” of equities…If we truly do reach a crisis in the late summer or fall…I want something I can redeem…What if they close the markets?

  72. leftback says:

    @cvienne: That describes several relatively agile hedgies. Now the smart ones will have learned from 2008….

    Goodnight, all, you have been great company during an interesting week. Now off you go, chaps, get out the beer and the bunting, and celebrate kicking British butt in 1778, or whenever it was. Come to think of it, I’ll join you.

  73. cvienne says:

    @Dogfish

    We’re cool…

    Understand that any comments I make to Franklin are made completely in jest…I hold no ill will towards the guy…

    In order not to be COMPLETELY BORED some days while contemplating the tape, I try to troll out my wittier side…

    U know…keep the pencils sharp ;-)

  74. CapitalistCanuck says:

    @cvienne

    I look at it almost the same way as you do. Substitute money manger for JPM/GS and “other” for Johnny Retail. The institutions want to keep Johnny Retail on board the ride a little while longer…I could be wrong, but I am putting money on it. Guess we’ll see….

  75. cvienne says:

    @lefty

    WAIT!

    Can I borrow “the twins” for the weekend?

  76. call me ahab says:

    cvienne @ 4:19-

    that would be a wise and safe move-

    does anyone know- as a money manager in a fund- are you allowed to change your mix outside of the prospectus?

    also- b22- I would assume that any money you are managing- you would need the ok from the customer to sell/ buy or otherwise change their portfolio- no?

  77. I-Man says:

    Man… those bids keep falling AH…

    SPY @ 89.46

    QQQQ @ 35.44

  78. call me ahab says:

    is leftback a Brit? -

    with all the previous soccer comments and his current comment I am thinking so- and Cvienne mentions soccer- but he lived in Italy for 12 years- so it is understandable- I think I-Man mentioned soccer once or twice as well- he said he is from Virginia though- so doesn’t add up-

    I can honestly say- I do not know anyone- except a Cuban dude I work with- that follows soccer- and even he doesn’t mention televised matches- only the league he plays on-

    do they even televise soccer in the States? Never have come across a match outside of the Olympics- but even then . . .

  79. I-Man says:

    LOL Ahab!

    Yeah- Left is a brit, an expat brit I believe, but a brit nonetheless.

    Cant speak for CV, but my love of soccer came from being a player. Ironically, I had a british coach in highschool, and he’s also the one who got me turned on to my first bob marley and bunny wailer tapes…
    Hmm… come to think of it, guess dude had some influence on me.

    But all jokes aside, soccer kicks ass. I’d rather watch a soccer game, could be English league, Brazilian league, World Cup, MLS, USL… whatevah… then just about any sport besides American Football… of course! Go Redskins!!!

  80. cvienne says:

    @I-man

    I’m American…but I lived in Italy for a number of years (in Perugia)…

    I had a gym there & trained a lot of the players for AC Perugia (Nakata – who was from Japan, & later played for AC Roma, & Marco Negri who later played in Scotland)…

    I also trained Maldini (from AC Milan & Pagliuca former Inter goalkeeper)…

    I have some funny stories about Juventus too…

  81. Steve Barry says:

    This was a great day for shorts…nice gain and II Bulls barely fell.

  82. CapitalistCanuck says:

    @I-Man

    I wouldn’t put much weight into the moves. Volume was fairly light and most people took the day off or skipped out early.

  83. rootless_cosmopolitan says:

    @Franklin411:

    “Or is it by doing something we haven’t done in 30 years: invest in the future. Is it by consciously making an effort as a Nation to making things the world wants to buy?”

    Competitiveness of the US-business isn’t just about producing goods the world wants to buy, it’s essentially about guaranteeing sufficient profit margins for the capitalist class. Else the capitalists are just going to produce all the innovative goods in some other countries, using the cheaper workforce of other “Nations”. Thus, since you like to use the nationalist “we” so much, I hope, you are willing to bring the according sacrifice for your own “Nation” by accepting a lower wage/salary for yourself.

    rc

  84. I-Man says:

    @ CV:

    Dude… you are one multi faceted dude.

    As some folks have said before, you need to write your own blog on survivalism, agriculture, european culture, personal fitness, and technical analysis.

    I’d be a daily commenter fi sho.

    Have a good fourth… I take it I will be one of the few regulars from here actually in a cubicle tomorrow.
    How will I make it without you guys and the tape???

    Oh yeah… facebook maybe or youtube clips of Vaughn Benjamin.

  85. cvienne says:

    @CapitalistCanuck

    “I wouldn’t put much weight into the moves.”

    I’m going to take the other side of that notion…

    The volume both today & Tuesday was higher (on selloff activity) than it was yesterday…& more than over the past week or so…

    I mentioned just yesterday to look at the similarities betweeen 6/10 & 6/11…and the 6/30 & 7/1 patterns on the S&P…(and look at what followed)…

    I’ll say it for about the MILLIONTH time…we could be testing 880 by July 7th…

    I may play a small bounce there…But I don’t see even THAT holding up very long…

  86. cvienne says:

    @I-man

    OK my friend…have a nice 4th…

    Meanwhile, if you need something to LOOK AT…Look at the fact that “to me” that 888 on the S&P is soon to be the left shoulder of the the upcoming reverse H&S…

  87. Dogfish says:

    Close of business here for Thursday… Happy Fourth of July Weekend everybody! Truly a great crowd here.

    I’ll leave off with an aside that this particular sequence of comments was highly amusing to me as I overlooked the time part of the @ from ahab and just saw it as “@cvienne”, like so:

    # cvienne Says:
    July 2nd, 2009 at 4:27 pm

    @lefty
    WAIT!
    Can I borrow “the twins” for the weekend?

    # call me ahab Says:
    July 2nd, 2009 at 4:40 pm

    @cvienne
    that would be a wise and safe move

    —-

    Not so sure about the safe part…

    :)

    Go Panthers! (And Middlesbrough!)

  88. cvienne says:

    My “pre-holiday” prediction…

    Everyone is going to be scratching their heads and wondering how we got to 826 on opex Friday (7/17/09)…

  89. danm says:

    Unfortunately there was an enormous boom in the building of research buildings and in hiring of research faculty to try to capture the resulting $. Some of the debt issued to finance these buildings is now an albatross, as research $ become scarce.
    ——————
    The same thing happenend in Montreal. It’s always so much easier to get financing for bricks and mortar than for human capital.

    I’ve always believed that our world would change for the better when we started valuing services over goods. For example, couples will skimp on the Nanny to buy their Mercedes and the big house. But unfortunately, I don’t think that will ever happen.

    With more than 6 billion people, human capital is in big supply just as resources are relatively shrinking. And people have always been more attracted to scarcity.