The WSJ is reporting that Fed Pres Bullard is saying that he sees rates on hold near zero in ’10, but asset sales are possible and he said it’s “too early” to change the language of ‘extended period. Assuming he was quoted right and he believes that rates will be near zero in ’10, I would like to set Bullard up on a date with the Treasury market. I think they should get together and get to know each other. I say this because the comment from Bullard reveals an opinion that ignores or doesn’t believe market signals, signals such as the steepest yield curve ever and 16 month highs in inflation expectations to name a few. The bond market seems to want to tighten policy for the Fed irrespective of how the Fed wants to calibrate short term rates, thus a sit down makes great sense. I believe the benefits of the date would be a smoother process of Fed unwind that if done right, will benefit us all and limit the inevitable disruptions.
Alt headline: WTF Is This Bing Icon Doing on My BlackBerry ?
I haven’t seen much on this anywhere in the media: Most of my office suddenly noticed today that these damn Bing icons things on their BlackBerrys. And, you cannot delete the sticky little buggers (but you can hide it). If you want to use Google, there is no longer any app for that — you have to go to Google.com.
Apparently, this began getting rolled out back in November. It seemed to have gone wide recently.
I am totally offended by the latest stupidity of Verizon: I’m not sure who to be more upset at: Microsoft, for wanting to hijack my mobile device, or Verizon, for giving them permission. I used to think Mister Softee epitomized evil, but it now looks like they have a little buddy.
And in true Microsoft fashion, a spate of problems have come along with this new Icon. Are they related? I don’t know, but it sure as hell wouldn’t surprise me.
Time to go open source — this could be the greatest thing for competitors to these two behemoths ever . . .
Sales of new one-family houses in November 2009 were down (seasonally adjusted annual rate) This is 11.3% (±11.0%) below the revised October rate, and is off 9.0% (±15.3%)* below the November 2008.
The median sales price of new houses sold in November 2009 was $217,400; the average sales price was $280,300. Current inventory is a 7.9 month supply.
As I have warned many times in the past (see this from 2005), New Home Sales are highly volatile (primarily) self reported data, and subject to significant swings.
In a hangover from the tax credit induced binge in the July thru Oct period, Nov New Home Sales, which measure contract signings which were likely done when the extension of the tax credit was uncertain and thus believed to be unattainable at the time, totaled 355k annualized, 83k below forecasts and down from 400k in Oct (revised from 430k). It’s at the lowest level since April. Months supply rose to 7.9 from 7.2, the most since June. The South and West saw the biggest declines which are the two areas that have the biggest competition from foreclosures. The Northeast fell a touch while the Midwest saw a gain. Home prices fell 1.9% y/o/y but rose 3.7% sequentially. Bottom line, with the artificial lift from the tax credit (where half of buyers are 1st time for existing homes and many were able to take advantage), its become very tough in gauging true demand. Come summer, after the tax credit expires and the Fed is done buying MBS, we’ll know.
“After the collapse of Lehman Bros. in September 2008, Federal Reserve Chairman Ben Bernanke, then-Treasury secretary Henry Paulson and then-New York Fed president Timothy Geithner stood on the brink of catastrophe. Their decision not to bail out Lehman set off a near panic among investors and lenders worldwide.
In response, the government implemented a $700 billion bailout and has since adopted a series of rescue measures that put U.S. taxpayers on the hook for a potential $14 trillion, author Barry Ritholtz says.
The panic and the U.S. reaction spawned a wave of books. Money Bookshelf editor Gary H. Rawlins picks some of the better ones. The selection includes books that point the finger at Wall Street firms and their CEOs, that blast the government for excessive bailouts, that assail the U.S. economic policy triumvirate for letting the inflation genie out of the bottle, and that explain arcane financial derivatives and how they acted as viral agents spreading the crisis to the global economy.
•Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System — and Themselves by Andrew Sorkin (Viking Adult, $33). Arguably the definitive history of the banking crisis, a blow-by-blow account of how decisions made on Wall Street and in Washington in the past decade led to the crash of the global financial system.
•Bailout Nation: How, Greed and Easy Money Corrupted Wall Street and Shook the World Economy by Barry Ritholtz (Wiley, $25). Explores how the U.S. evolved from a rugged independent nation to a soft Bailout Nation, where financial firms are allowed to self-regulate in good times, but are bailed out by taxpayers in bad times.
This morning, I will visiting with Dylan Ratigan & Co. on MSNBC’s Morning Meeting. We will be discussing the President’s meetings with community banks in light of the bailouts.
Note the dissension between the two banking groups: The American Bankers Association (biggest TARP recipients here) and the Independent Community Bankers of America. One is much more concerned with pending regulatory reform of the U.S. financial system than the other. Can you guess which is which?
Following the selloff in treasuries and MBS, Bankrate.com said last night that the average 30 yr fixed mortgage rate rose 9 bps in a day to 5.2% and is up from 5.06% on Friday. It’s the biggest one day upward move in 2 months. The MBA said mortgage apps were down 10.7% with refi’s lower by 10.1% and purchases down by 11.6% but the numbers typically fall in the last few weeks of the year and the data is for the week ended Friday so also doesn’t reflect the two day rise in rates. ABC confidence rose 3 pts to -42, the highest since May and is up at just the right time in terms of holiday sales. The gain was led by the Buying Climate which measures whether its a good time to buy something. Chinese stocks bounced off its 6 week low following a sharp rally in India after their finance minister made optimistic comments about growth for 2010. Income, spending, confidence and new home sales highlight the data of the day.
"I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale." -Thomas Jefferson (letter to John Taylor in 1816)
After 3 quarters in a row that averaged just 1.2%, Q4 GDP grew 2.8%, a touch below expectations of 3.0% BUT Nominal GDP grew well below forecasts. Because the price deflator was up just .4% vs the estimate of 1.9%, Nominal GDP was up 3.2% vs the estimate of 4.9%. Personal Consumption rose 2.0% vs the forecast of 2.4%. Fixed Investment rose 3.3% helped by a 5.2% increase in equipment and software spending and residential construction rose by 10.9%. Trade was a slight drag on GDP growth and government spending was as well led by a 12.5% decline on national...
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