Posts filed under “MacroNotes”
Notwithstanding a slightly better than expected Q3 GDP print for Germany and France, the euro zone economy contracted in Q3 as forecasted. Q3 GDP for the region fell .1% q/o/q, the 3rd q in the past 4 of declines. At the same time, CPI rose 2.5% y/o/y in Oct, remaining above the 2% ECB target rate for a 23rd straight month. In the UK, retail sales in Oct fell more than expected. On Greece, the German Finance Minister said they’ll figure out by Tuesday on how to fill the 30b euro gap.
In Asia, the yen is down sharply for a 2nd day to near a 7 month low vs the US$ following the new gov’t turmoil with new elections coming and comments yesterday from opposition leader Shinzo Abe who said “we should set an inflation target and print unlimited yen until we reach that target.” The Nikkei was up 1.9% in response. The Shanghai index fell to a 7 week low after Q3 non performing loans rose in Q3 across the Chinese banking system.
In the US, post election and the subsequent market selloff has the individual investor at the most bearish since Aug ’11 at 48.8 v 39.9 last week. Bulls fell to 28.8 vs 38.5, near the lowest since July according to AAII. Combine this with a very oversold market and we’re close to a short term bounce.
Noteworthy in the Oct FOMC minutes was the discussion on the effects of the Sept announcement of QE3. They said “the initial effects were generally viewed as consistent with a marked easing in financial conditions. For example, yields on MBS dropped noticeably, leading to a decline in mortgage interest rates, and corporate bond yields generally…Read More
After 5 weeks in a row of declines totaling 28%, notwithstanding historically low mortgage rates, the MBA said refi apps for the week rose 13.1% to a 4 week high. Purchase apps rose 11% also to a 4 week high. With the stabilization in housing a bright spot, albeit off dramatically low levels, lets hope…Read More
Retail Sales in Oct were soft as the core rate, taking out autos, gasoline and building materials, fell .1% m/o/m vs expectations of a gain of .4%. Building materials fell by 1.9%, autos/parts were down by 1.5%, electronics were lower by 1%, furniture sales fell for a 3rd month, clothing sales fell by .1%, department…Read More
Markets this morning are worried about how European officials plan on further funding Greece with extra money to bide them over for a few more years. The EU is completely unrealistic in thinking they can pull this off without taking any losses on their debt holdings while the IMF on the other hand understands that…Read More
As we’ve been all well trained (and annoyed) with the art of politician newswire headline watching throughout Europe over the past few years as they grappled with Greece, Ireland, Portugal, Spain, etc…hopefully we’ll be ready for the barrage of US political sound bytes and opinions on how to come to an agreement between Dems and…Read More
We start the day with the S&P futures basically kissing its 200 day moving average of 1369, thus making the action from here a key focus of every technician. The theme of European economic weakness and our own fiscal issues at the same time US earnings are no longer growing for now remains intact. We…Read More
Review of my personal market diary over the past few months: 1)The Fed, ECB, BoE, BoJ and SNB will continue to print huge amounts of money, CHECK. 2)Earnings growth globally is slowing with GDP and we’ve seen the peak in profit margins, CHECK. 3)Election is over, DC doesn’t change, taxes are going up at exactly…Read More
The direction of monetary policy depending on who wins today’s election has been an important discussion with an Obama win expecting to have no impact and a Romney win expected to alter the focus. As an Obama victory will just give us more of the same, I wanted to give a quick opinion on what…Read More
Here is a little humor ahead of tomorrow’s election and after an extremely difficult week for many, While many of us agree with this little girl and we’ll finally know for sure tomorrow night what we’ll get for the next four years, most business people and investors want a continuation of current tax rates (I…Read More