Posts filed under “Think Tank”

US$/G8

The euro is rallying to the highest level of the day vs the $ after a Canadian official, speaking anonymously, said that while the G8 will likely discuss the US$ and its reserve currency status, there will not be explicit US$ reserve currency comments in the official communique. With about 70% of China’s almost $2 trillion of reserves in US$ assets in particular, the shift towards an alternative to the US$’s reserve status will be a very evolutionary process and a change won’t be the result of some event as China wants no part of a disorderly $ decline considering such large holdings. Many other central banks can say the same thing. The end result on this issue seems to be clear considering the monetary and fiscal policies of the US government but the destination is more uncertain and hopefully orderly.

Category: MacroNotes

10 yr TIPS auction

The Treasury’s 10 yr TIPS auction was solid as the yield was about 1 basis point below expectations and the bid to cover of 2.51 is the highest since Jan ’00 and well above the average over the past year and a half of 2.13. The level of indirect buyers at 49.7% is no longer…Read More

Category: MacroNotes

ISM services index

The June ISM services number was one point more than expected at 47 and up from 44 in May and it’s at the highest since Sept ’08 when it was at 50, the cut off between contraction and expansion. Business Activity rose 7.4 points to just shy of 50 at 49.8. New Orders rose to…Read More

Category: MacroNotes

FusionIQ S&P 500 Equity Market Review

Kevin Lane is one of the founding partners of Fusion Analytics, and is the firm’s director of Quantitative Research. He is the main architect for developing their proprietary stock selection models and trading algorithms. Mr. Lane is a member of the Market Technicians Association. ~~~ As seen below in the S&P 500 has been capped…Read More

Category: Index/ETFs, Markets, Think Tank

La Narco Sistema: My friend Lucy Komisar has just published a great scoop in The Miami Herald that reports on the role played by the State of Florida in enabling the Ponzi scheme of Allen Stanford and the now-defunct Stanford Group. Lucy reports: “Florida regulators — over objections by the state’s top banking lawyer —…Read More

Category: Investing, Legal, Think Tank

It’s all about the guidance

The crux of the argument calling for a 2nd half recovery is predicated on an inventory replenishment cycle, led by the auto sector. The stabilization in the capital markets has also boosted the expectations components (and not current conditions) of many economic indicators. Thus, as we enter Q2 earnings season, forward looking guidance will be…Read More

Category: MacroNotes

Words from the (investment) wise July 5, 2009

http://www.investmentpostcards.com/2009/07/05/words-from-the-investment-wise-for-the-week-that-was-june-29-%E2%80%93-july-5-2009/

“Words from the Wise” this week again comes to you in a shortened format as I am still on the road in Europe (also see my post “Gone A.W.O.L. – to Slovenia and Switzerland“) and do not have access to my normal research resources. Although only brief commentary is provided, a full dose of excerpts from interesting news items and quotes from market commentators is included.

The holiday-shortened week saw pundits pondering the depth of the economic rabbit hole as the curtain closed on the second quarter. As investors vacillated, most financial markets were characterized by a roller-coaster ride. Friday’s worse-than-expected US jobs data left no doubt that the economy was in recession.

Given the economic malaise, it is safe to say that there have probably been better fourth of July celebrations than this weekend’s …

05-07-09-01

Source:Dave Granlund

The past week’s performance of the major asset classes is summarized by the chart below – a set of numbers that indicating that a degree of risk aversion has crept back into financial markets.

05-07-09-02

Source: StockCharts.com

Looking at the quarterly performance of the same asset classes, the picture is quite different from the chart above, with risky assets putting in a phenomenal performance to the detriment of the traditional safe havens such as the US dollar and government bonds.

05-07-09-03

Source: StockCharts.com

A summary of the movements of major stock markets for the past week, as well as various other measurement periods, is given below. The weekly gains/losses camouflage the fact that many indices experienced a rather bumpy ride during the course of the week.

Click here or on the table below for a larger image.

05-07-09-04

Stock market returns for the week ranged from top performers Egypt (+8.9%), Uganda (+7.9%), Bangladesh (+6.3%), Pakistan (+6.1%) and China (+5.5%) to Slovakia (-9.3%), Croatia (-8.7%), Vietnam (-5.6%), Mauritius (-4.0%) and Hungary (-3.6%) at the other end of the scale. Emerging markets make up all ten of the best-performing stock indices so far in 2009, led by Peru, Sri Lanka and China. (Click here to access a complete list of global stock market movements, as supplied by Emerginvest.)

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Category: Think Tank

Happy Birthday America

Happy Birthday America
July 4, 2009

As we celebrate the nation’s birthday, we may wish to be mindful of the stress that many in our country are under.  We may try to be gracious in the face of adversity.  We can pause.  And reflect.  And give aid.

On Friday, in New York, I watched a caring person take 15 minutes to escort a blind woman to her home.  They were strangers.  There was construction on the street and the blind person needed some guidance.  Many passed her by, but thankfully not all.  Kindness to a stranger is a value that doesn’t get measured in our national GDP.  It gets counted when each of us looks in the mirror.

Two close personal friends sent me the email that I will quote below.  It is sourced to a Washington Post story; that link is below as well. It will inspire us as the grill is lighted and the chicken sizzles.  America will weather this economic storm if it does not lose its humanity.  The risk of that loss is a far greater threat than the federal deficit.

The email story follows:

“Washington, DC Metro Station on a cold January morning in 2007. The man with a violin played six Bach pieces for about 45 minutes. During that time approx. 2 thousand people went through the station, most of them on their way to work. After 3 minutes a middle-aged man noticed there was a musician playing. He slowed his pace and stopped for a few seconds and then hurried to meet his schedule.

4 minutes later:

The violinist received his first dollar: a woman threw money in the hat and, without stopping, continued to walk.

6 minutes:

A young man leaned against the wall to listen, then looked at his watch and walked on.

10 minutes:

A 3-year-old boy stopped, but his mother tugged him along hurriedly. The kid stopped to look at the violinist again, but the mother pushed hard and the child continued to walk, turning his head all the time. This action was repeated by several other children. Every parent, without exception, forced their children to move on quickly.

45 minutes:

The musician played continuously.  Only 6 people stopped and listened for a short while. About 20 gave money but continued to walk at their normal pace.  The man collected a total of $32.

1 hour:

He finished playing and silence took over. No one noticed. No one applauded, nor was there any recognition.

No one knew this, but the violinist was Joshua Bell, one of the greatest musicians in the world. He played one of the most intricate pieces ever written, with a violin worth $3.5 million dollars. Two days before Joshua Bell sold out a theater in Boston where the seats averaged $100.

This is a true story. Joshua Bell playing incognito in the metro station was organized by the Washington Post as part of a social experiment about perception, taste, and people’s priorities. The questions raised: in a commonplace environment at an inappropriate hour, are we able to perceive beauty? Do we stop to appreciate it? Do we recognize talent in an unexpected context?  One possible conclusion reached from this experiment could be this:  If we do not have a moment to stop and listen to one of the best musicians in the world, playing some of the finest music ever written, with one of the most beautiful instruments ever made, how many other things are we missing?”

For details see the story by Gene Weingarten, Washington Post staff writer, Sunday, April 8, 2007; page W10.  The link is: http://www.washingtonpost.com/wp-dyn/content/article/2007/04/04/AR2007040401721.html .

Now to some economics as we celebrate America’s birthday.

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Category: Think Tank

Michael Lewis: The Man Who Crashed the World

Category: Think Tank

Return of the Spice Route

Fascinating discussion via Nomura strategist Sean Darby on a new investment theme: Investors are overlooking the domestic growth opportunities of Muslim-dominated countries situated along the ancient Spice Route. We estimate that between 2020F and 2025F, approximately one in every five births will be in countries whose ports were visited by merchants trading along the route…Read More

Category: Think Tank