Japan gets tap on shoulder
Poor sovereign government finances are not just the province of Europe. Fitch this morning downgraded the credit rating of Japan to A+, one notch below both S&P and Moody’s. Fitch stated the obvious extraordinary amount of debt they have relative to GDP but said “the country’s fiscal consolidation plan looks leisurely relative even to other...
Euro
Dating back to its introduction in 1999, the net spec short position in the euro for the week ended Tuesday, according to the CFTC, rose to a record high.
Succinct Summation Of Week’s Events (05/18/2012)
Succinct summation of week’s events: Positives: 1) Cheers to Mark Zuckerberg and Facebook for building an incredible business and whose reward today is hugely deserved and exciting to watch. 2) April Housing Starts back above 700k for 4th month in the past 6 at 717k, above est of 685k and March revised up by 45k to...
Spanish banks bounce/Greek contingency plans?
Confirming again that when rating agencies act its old news, Spanish banks are bouncing after 5 days of selling notwithstanding multiple credit downgrades by Moody’s last night. After a 42% decline in the past 10 trading days, Bankia in particular is up by 20%+ today. Bond yields in Spain and Italy are also lower and...
FOMC get together
Because not much change occurred in the economy between the March and April FOMC meetings, there was not much new in the minutes from the April get together and why the April written statement wasn’t much different than in March. With respect to doing more, “several members indicated that additional monetary policy accommodation could be...
De La Rue
Outside of the Greek stock market, if there is one stock to watch as an indicator of what the market thinks of the chances Greece stays in the euro or not, watch De La Rue. Traded in London, they make physical currency and if Greece leaves the euro, a lot of drachma will have to...
Succinct summation of week’s events (05/11/2012)
Succinct summation of week’s events: Positives: 1) Initial Jobless Claims total 367k, below 370k for 2nd week after previous 3 weeks above 380k. 2) UoM confidence in May rises 1.4 pts to best since Jan ’08, one yr inflation expectations fall to lowest since Dec ’10. 3) Gasoline prices fall another .06 on the week...
UoM confidence up, lower gasoline prices likely helped
The preliminary UoM confidence number at 77.8 was above expectations of 76, up from 76.4 in April and the highest since Jan ’08. The Current Conditions component led the gain as it rose 4.4 pts while the Outlook fell .6 pts. While a coincident indicator rather than something leading in terms of consumer behavior, it’s...
Treasury gets thumbs up on toughest sale of week
The toughest sale of the week for the US Treasury, debt going out 30 yrs without inflation protection with a yield barely above 3%, not too much higher than stated inflation, went well. The yield of 3.09% was well below the when issued of 3.11% and the bid to cover of 2.73 was above the...
Greece will get next tranche
Within the last hour there has been noise that the EU won’t disburse the next tranche of money to Greece due tomorrow after a DJ headline said “Some governments concerned about making payment amid Greek political turmoil,” according to sources. Due to the Wall St phone game this was immediately interpreted to say the EU...
What’s next in Greece and does it matter?
Confirming the fears that resulted after the Greek elections and was followed with a 7% decline in Greek stocks, Antonis Samaras, the President of the New Democracy Party who got the most votes is saying he is unable to form a coalition government with the other party leaders. He is giving back his mandate to...
French results as expected, Greeks get extreme
While a socialist was elected in France because voters paradoxically felt that it was the best way to deal with the aftermath of too much socialism, the results were expected last week and its why French stocks are down modestly and French bond yields are lower with the 10 yr in particular at the lowest...
