Huffington Suggests Moving Money Out Of Big Banks On Kudlow (Video)

Kudlow debated with Arianna Huffington today on her suggestion that people move their money out of the big banks and into community banks.  What would happen to the ex-TARPies if people actually did this in mass? I'll leave you that to ponder while you're getting a champagne shower tonight. Happy new year.

Unusual Move in PHK on Large Volume (Pimco High Income Fund Charts)

Wow, you don't see this everyday, especially when it's a lone move.  Hat tip to Marla Singer at Zero Hedge for pointing this out today, visit the post "What Yield Was the Device That Just Hit PIMCO's High Income Fund?" for an in-depth look.  The chart says 8.26 million shares dropped on PHK and it opened at 12.14, hit a low of $8.81 and closed at $11.30 (-6.69%).  Hundreds of thousands of shares then scooped it up after hitting a capitulation low below 9.  It was a volatile day for PHK with no news on the high yield space, PHK exposure or a forced dump somewhere, unless I'm missing something.  FYI, Top institutional holders as of 9/30/2009 were Atherton Lane Advisers, LLC (6.4 million shares) and Wells Fargo (1 million shares) (Yahoo Finance).  Not saying they are related to the volume.  Check out the charts.  What's up?

PHK (Pimco High Income Fund) Intra-day (Courtesy of FreeStockCharts.com)


PHK 6 Month Chart (Courtesy of Stockcharts.com)

$SLV Put Options Setting Up For 2010, Active From Feb-April (Silver ETF)

The silver ETF ($SLV) had interesting put activity today.  SLV put/call activity was on the most active/top bearish list at the ISE.  SLV had an ISEE ratio of 2, puts/calls opened = 52,561/1,087.  CrimsonMind.com had this..
"40,000 Jan 15 puts traded at $0.04 (bid:0.04 ask:0.05), approximately 20,000 Feb 15 puts were purchased for an average premium of $0.23 per contract and 20,000 April 15 puts were purchased for an average premium of $0.53. Total of 85956 puts traded compared to the 10 day average volume of 11170. Total of 7600 calls traded." (CrimsonMind Activity Watch)

I found info on the trades at OptionMonster (webcast) and TheOptionsInsider. It looks like the SLV trade was bearish or protective going into 2010 and could be a roll from January.  Here is the pic of the option chain from Yahoo Finance.

SLV (Silver ETF) $15 February Puts Opened (Courtesy of Yahoo Finance)


SLV $13-15 April Puts


Robert Prechter of Elliott Wave Interviewed at Minyanville (Video)

Found this video on Elliott Wave International. This was done in November I believe. Markets are a fractal, ride the wave! Hat tip Minyanville.com.

China Has Fastest Train in the World, Travels 245mph, 394Km! (Videos)

And we have the Amtrak and Government Motors..  At least we can head out west on the California Zephyr, which I plan to take from Chicago-California in due time.
"The train can go 394.2 kilometres per hour, it's the fastest train in operation in the world," Zhang Shuguang, head of the transport bureau at the railways ministry, told Xinhua. By comparison, the average for high-speed trains in Japan was 243 kilometres per hour while in France it was 277 kilometres per hour, said Xu Fangliang, general engineer in charge of designing the link, according to Xinhua. Beijing has an ambitious rail development programme aimed at increasing the national network from the current 86,000 kilometres to 120,000 kilometres, making it the most extensive rail system outside the United States."  (full story at AFP, and another story at TimesOfIndia)

Bill Gross Dec Update .01% Savings vs. Utilities, XLU Performance Comps and January Calls Moving

From Bill Gross December Outlook at Pimco.com, Anything but .01%. Speaking of $XLU, it's trading at $31.53 and 10,339 calls just traded on the Jan $32 strike at .16 w/ 60,100 open. Look deeper into the ticks/nature of the trade...  I provided a chart of $XLU and an XLU 1 year performance chart vs. QQQQ, SPY and DIA.  XLU +10.45%, DIA +22.75%, SPY +26.36%, QQQQ +54.70%.  Nice performance gap.
"OK, so where does that leave you, the individual investor, the small saver who is paying the price of the .01%? Damned if you do, damned if you don’t. Do you buy the investment grade bond market with its average yield of 3.75% (less than 3% after upfront fees and annual expenses at most run-of-the-mill bond funds)? Do you buy high yield bonds at 8% and assume the risk of default bullets whizzing at you? Or 2% yielding stocks that have already appreciated 65% from the recent bottom, which according to some estimates are now well above their long-term PE average on a cyclically adjusted basis? Two suggestions."

"Let me tell you what I’m doing. I don’t have the long-term investment objectives of Berkshire Hathaway, so I’m sort of closer to an average investor in that regard. If that’s the case, I figure, why not just buy utilities if that’s what the future American capitalistic model is likely to resemble. Pricewise, they’re only halfway between their 2007 peaks and 2008 lows – 25% off the top, 25% from the bottom. Their growth in earnings should mimic the U.S. economy as they always have, and most importantly they yield 5-6% not .01%! In a low growth environment, it seems to me that a company’s stock should yield more than its less risky debt, and many utilities provide just that opportunity. Utilities and even quasi-utility telecommunication companies now yield between 5 and 6%, whereas their 10- and 30-year bonds yield less and at a higher tax rate to you the investor."

Eric Sprott Thinks S&P Will Break Below March Lows, Still Likes Gold and Thinks We Are In 15-20 Year Bear Market

Eric Sprott who runs a $4 Billion hedge fund in Toronto thinks the S&P will break below the March lows.  He thinks we are in a bear market that will last 15-20 years and the Fed is a ponzi scheme.  He's not the only one. James Altucher begs to differ (on Kudlow).
"The Toronto-based money manager, whose Sprott Hedge Fund returned 496 percent over the past nine years while the S&P 500 lost 32 percent, said the index’s 67 percent rally since March reflects investors misinterpreting economic data. He’s predicting the gauge will fall 40 percent to below 676.53, the 12-year low reached on March 9." read full story at BusinessWeek

h/t The Business Insider

Pimco's El-Erian Thinks S&P Will Drop 10% Under 1,000 In Span Of 3-4 Weeks

Mohamed El-Erian of Pimco still thinks we're on a sugar high. He also said this back in August, so this has been a very long high. The Fed supplies some potent sugar paper. Watching yield curve ratios ($UST10Y:$UST3M).

Stocks Higher? Famed Investor Says Don't Bet on It (AP, 12/27/2009)
"Homes are selling at their fastest clip in nearly three years, the unemployment rate is falling and stocks are up 66 percent since their March lows — the best performance since the 1930s. What's not to like? Plenty, according to Mohamed El-Erian, chief executive of giant bond manager Pimco." (read full article)
 Also read an interview with El-Erian at Fool.com, Get Ready for a Bumpy 2010.

Is the US Dollar About to Knock Out Copper? ($USD/$COPPER Convergence Chart, 跆拳道?)

Is the USD about to knock out Copper?  Convergenza?  $USD head fake?  Or is there something I'm missing w/ the pricing mechanism.  Что здесь происходит?  Continued from my previous post.

$USD vs. $COPPER


Iran Riot Videos on Holy Day, Ahmadinejad Response on BBC (12/27/09)

Intense protests or riots are going on in Iran.  Some videos are graphic. At the bottom Ahmadinejad was interviewed on BBC.  All of the videos were shot on cell phones and posted on Youtube. It's a revolution.  The first video shows a group of baseej is surrounded by the crowd, and disarmed..

March Copper, $JJC Short Interest and USD/$COPPER, COT Report - Pre-Junior Miner Analysis

Before I dig deeper into this junior copper mining play, I thought I'd browse the underlying action in copper by charting out the March future, $JJC, $JJC short interest and the Commitment of Traders (COT) report to see where the large specs are at.

The Copper Comex March 2010 Future is in a new rising channel as you can see.  It just pierced through a resistance level and is riding the 50 and 20dma and is close to testing 2008 resistance.   It's riding the reflation trade from the beginning of 2009 like everything else.  The US Dollar rally and gold dip, if sustained, could affect copper so I'll be watching $USD, $GOLD.  Near term support for March Copper is first the uptrend, then the 50dma (3.08) and strong support at 3.0.  It is trading at 3.319. 

Copper Comex Mar 2010 Future (Courtesy of OptionsXpress)


Next up is the most recent HG (Copper) COT report.  The last time I looked at the Copper COT, large specs were at an inflection point.  Since then they went from net neutral to slightly net long and kept the Dec future on the uptrend.

Detroit: City On The Move (1965 Video), Last Glory Days Before Riot of 1967

This is insane. These videos are from 1965, only 45 years ago. Two years later the city burned down during the 1967 riots. After watching the 6 videos below listen to the 16 part documentary Wake The Herd Productions did on the 40th anniversary of the 1967 Detroit riot" on WILS AM 1230 in Lansing, Michigan on July 24, 25 2007. They go through every single event that led up to the riots. Detroit had the auto industry on lock down and underlying racial tensions had to f@#% it all up! Damn.

John Paulson, Stiglitz Speak at Economist Panel on Credit Bubble

Hear John Paulson speak about the massive mispricing of risk which eventually led to the financial crisis.
"For me it was so obvious that these securities were completely mispriced and we were living in a casino. I think the other players that were involved in the business they got caught up in the exuberance, they got caught up in the competition to increase their underwriting volumes, caught up in the competition to increase their fees. They were very focused on annual earnings, quarterly earnings and annual bonus pools and with the amount of the liquidity, everyone got caught up in what became a massive credit bubble."

He also talked about Government bailouts, common equity cushions etc... Paulson is making bank on $BAC and $GLD this year, timing those trades quite nicely.


Other links:
2008 John Paulson Congress testimony
Right before he nailed the $GLD trade
Paulson & Co. 3Q Letter, 13F Holdings [GLD, BAC, WYE, AU, SGP, C]
John Paulson Has Highest Net Long Exposure Ever (BAC, CMCSA, HEIG) on 12/8
MissTradeTV Interview w/ Greg Zuckerman

Did Expanded Government Ruin Detroit? (Video) Another Detroit Update

While searching for news about terrorists boarding planes to Detroit, I found a video at Global Economic Analysis (Michigan Forces Business Owners Into Public Sector Unions; Detroit's Aura of Hopelessness) with a guy attempting to explain why Detroit is in ruins.  He blames the leftists since the 1960s, mainly the expanded role of Government, teachers unions and the UAW.  I'm pretty sure social issues (1967 Detroit Riot) didn't help the situation either.  In the end, 27% (in reality 50%) of Detroit citizens are unemployed and the auto industry continues to buy out workers (Ford...GM is still reorganizing under Gov control).  Also Detroit has a budget deficit of $300 Million and Mayor Dave Bing is trying to "raise the cap on the amount of fiscal stabilization bonds Detroit can sell from $125 million to $250 million" (AP).

On a positive note, it's interesting that urban farms could possibly save the city (Investors see farms as way to grow Detroit - LA Times).  Also fresh car demand from China and India could funnel cash into the Detroit autos, which could ignite labor demand (China’s rural markets have big appetite for cars - MSNBC).  China’s Shanghai Automotive Industry Corporation Group (SAIC) recently did a 50:50 joint venture with GM India for $500 Million (Business Standard).  I bet Detroit becomes a top economic powerhouse in 80 years... You heard it here first people.

A 22 Year Chart Of $SPY To Keep An Eye On (3/1988 - 12/2009, Streaming)

This is a 22 year chart of $SPY trading live via FreeStockCharts.com with trend lines. Where will the next correction take place and/or at what level will SPYs valuation be priced in?  We are hitting the downtrend from the October 2007 peak.  The chart view is monthly and I included the 50 month moving average, MACD, RSI and Chaikin Money Flow.

Janet Tavakoli: Clawback Subsidized GS Bonuses For Selling Hot Air!

Lets see if Tavakoli can actually make something happen here. She was recently on FoxBusiness and wrote an article at Huffington Post about how Goldman Sachs is getting tax payer subsidized bonuses for slinging value destroying hot air and Treasury bail out cover-ups.  DV wrote a post on Tavakoli in October when she was interviewed by Max Keiser and provided links to articles she was quoted in dating back to 2005.  Also read the ongoing battle between the NYT  and Goldman Sachs.  Who will win the financial rap battle.

Goldman Sachs Responds to The New York Times on Synthetic Collateralized Debt Obligations (goldmansachs.com)

VS.

Banks Bundled Bad Debt, Bet Against It and Won (New York Times)

Peter Schiff Offers to Testify About Cause of Financial Crisis, But Not on List

Peter Schiff put out a youtube video tonight (1st below) entitled "A Nightmare before Christmas".  He brought up the health care bill, debt ceiling raise ($12.4 Trillion) and news on Treasury's aid cap for Fannie and Freddie.  That is decent news right there.  Schiff also said Congress didn't invite him to testify about the financial crisis (Dimon, Blankfein, Mack Among First to Testify at Crisis Panel).  It's funny that Schiff was the only one on CNBC in 2006 warning about the financial collapse.  Maybe Goldman Sachs should have done the same.  Merry Chistmakahwanza!
"The simultaneous selling of securities to customers and shorting them because they believed they were going to default is the most cynical use of credit information that I have ever seen,” said Sylvain R. Raynes, an expert in structured finance at R & R Consulting in New York. (must read NY Times article: Banks Bundled Bad Debt, Bet Against It and Won, 12/23/2009)
 

SPY, DIA, QQQQ Downtrends, Thin Air and Ascending Triangles! (12/20/09)

As previously mentioned, the Dow and S&P are testing their downtrend from the 2007 peak.  Here's a look at market ETFs before Monday's open.  First I'm going to present the 3 year view and then the 3 month view.  All of the charts are from stockcharts.com.

$SPY mirrors the S&P and is testing the downtrend from 2007.  Also July 2008 ceiling resistance is a few points higher.

$SPY


Official Floored Trailer Is Out, Looks Good

Floored looks good. It's an inside look at the trading floor and the transition to computerized trading.  Go to the site for more information.

Bank Failures Reach 140, FDIC List

Insane in the membrane..
"Bank Failures in Brief 2009

The list of Bank Failures in Brief is updated through December 18, 2009. Please address questions on this subject to the Customer Service Hotline (telephone: 888-206-4662).

December

First Federal Bank of California, F.S.B., Santa Monica, CA with approximately $6.1 billion in assets and approximately $4.5 billion in deposits was closed. OneWest Bank, Pasadena, CA has agreed to assume all deposits. (PR-239-2009)

Imperial Capital Bank, La Jolla, CA with approximately $4.0 billion in assets and approximately $2.8 billion in deposits was closed. City National Bank, Los Angeles, CA has agreed to assume all deposits, excluding certain brokered deposits. (PR-238-2009)

Independent Bankers' Bank, Springfield, IL, with approximately $585.5 million in assets and $511.5 million in deposits was closed. The FDIC created a bridge bank, Independent Bankers' Bank Bridge Bank (IBB Bridge Bank, N.A.), to take over operations. (PR-237-2009)

What Level is the "New" Normal For Distressed Volatility, 10 or 20?

For you volatility valuation analysts out there, what level is the new (or old) normal for distressed volatility, 10 or 20? We hit the 10s in 2007 before the market peak and now we are around 20. Is buy and hold back which will push volatility back to 10 or are we in a new era of heightened volatility. Below I provided a VIX spot chart, futures curve and a video from the most recent Sonar.

David Rosenberg thinks the VIX will be between 30 and 40 next year and if Prechter's right that a new wave is coming in 2010, perhaps he's right. The S&P still needs to break the uptrend. I'd like to hear what the VIX pros have to say. Good places I like to check.

Morgan Stanley Now Bullish on US Dollar, CMC's Laidi on USD/JPY (video, chart)

Sara Eisen of Bloomberg said Morgan Stanley is now bullish on the US Dollar...

Roubini Discusses Dollar Carry Trade, Emerging Markets, Slack In US Economy

From the HKTDC press release + video below, Roubini was interviewed ahead of the Asian Financial Forum in Hong Kong coming up on January 21, 2010. He said a reversal in the USD carry trade, which could take a while, could affect asset prices in Asia and emerging markets. Also there's a 20% chance of a double dip recession.

"14 December 2009 – Asian markets can expect a rough start to 2010 as low interest rates push down the value of the US dollar and create asset bubbles, particularly in emerging markets, according to the New York-based economist, Professor Nouriel Roubini.

In an interview with the Hong Kong Trade Development Council (HKTDC), Prof Roubini said the trend is likely to continue for another six to 12 months, with near-zero interest rates prompting global investors to take short positions on the US dollar and long on relatively risky assets.

“Asian, Latin American and emerging markets will have to close their short dollar position, and dump their leverage long positions in the assets,” said Prof Roubini. “And that would lead to a very classic, dramatic snap back of the dollar, and also sharp correction of asset prices in Asia and in other emerging market economies. But it’s not going to happen anytime soon." Source: HKTDC.com

Roubini: Dollar Carry Trade Has Legs, Brazil Real Overvalued (USD/BRL, Global Interest Rates)

Roubini believes the rally in risky assets has further to run on the US Dollar carry trade. From Reuters yesterday: Roubini: carry trade to last at least 6 more months. He also believes the Brazil Real is overvalued (Bloomberg). Others are hopping on the BRL is overdone train (Demand for Brazilian Real May Wane in 2010, Levycam Says).  So who will pick up BRLs carry trade slack, AUD? Here's a 1 year chart of USD/BRL and global interest rates.

BRL/USD (courtesy quote.com)





Interest Rates Powered by Forex Pros

Three Gold Support Levels To Watch (GLD), Watching SEA/Shippers As Well

Gold stabbed through it's 50 day moving average today. Crazy moves. It was definitely a good idea to buy put protection on December 2! Gold has a few support levels to battle (1075, 1025, 1000 and 985). Gold is at 1100 and Jim Rogers said he'd nibble at $1000. The 200 day moving average is at 985.

Gold Continuous Contract (Courtesy of Stockcharts.com)


US Dollar Index Short Squeeze Continues, UUP Calls, Large Specs Making Money! (12/17)

Nice move tonight on the US Dollar Index. It is up 0.55% to 77.41 and hit an intraday high of 77.60. The catalyst for the Dollar rally could have been from the mess in Dubai on Thanksgiving.  Investors were piling into UUP calls at the beginning of November.  UUP call buying continued in December and large specs were also loading up on futures. From the chart tonight it looks as if the short squeeze is still in play.  It is close to testing August resistance and now has the 50dma to act as support.



(DXY Courtesy of INO.com)

So UUP/UUP calls, DXY large specs should be making some money here on this parabolic move from 74.50.  Whether it's a new long term trend to 90 is a wait and see.  Big money could be covering their shorts and riding some money to the upside on this crowded trade, imo.  Jim Rogers is making some dough on this move, he told you on a Tech Ticker video.  This move in USDX could be related to: Sovereign debt downgrades in Dubai and Greece and possible bank nationalizations in Ireland, a potential S&P downgrade of EUR1.46 trillion covered bond programs, US Growth (or not) and/or Bernanke hawkishness, and maybe PMs are taking risk off the table and/or switching to Yen as a funding currency.  *Update on US data today (FedEx issues cautious 3Q forecast, Claims for jobless aid rise).  It will be interesting to see how the S&P reacts to the Dollar.  A higher dollar cuts into overseas profits.

Also, Adam Hewison of MarketClub just released a US Dollar, crude oil and gold technical trading video update on his blog.  I'm going to check out shippers, coppers and a potential play.  мир.  Full disclosure, although I work as an affiliate for MarketClub, I have followed Adam's work and am confident in his services.

FOMC Statement 12/16/2009: Federal Funds Rate Stay at 0 to 1/4 Percent

FYI
"Federal Reserve Press Release

Release Date: December 16, 2009
For immediate release

Information received since the Federal Open Market Committee met in November suggests that economic activity has continued to pick up and that the deterioration in the labor market is abating. The housing sector has shown some signs of improvement over recent months. Household spending appears to be expanding at a moderate rate, though it remains constrained by a weak labor market, modest income growth, lower housing wealth, and tight credit. Businesses are still cutting back on fixed investment, though at a slower pace, and remain reluctant to add to payrolls; they continue to make progress in bringing inventory stocks into better alignment with sales. Financial market conditions have become more supportive of economic growth. Although economic activity is likely to remain weak for a time, the Committee anticipates that policy actions to stabilize financial markets and institutions, fiscal and monetary stimulus, and market forces will contribute to a strengthening of economic growth and a gradual return to higher levels of resource utilization in a context of price stability.

JP Morgan's Thomas Lee on 2010: S&P Will Hit 1300, Cyclicals Still Room To Run

JP Morgan's Tom Lee was on Bloomberg with his 2010 outlook (JPMorgan's Lee Interview About U.S. Stocks, Economy: Video).  Here's a short summary I came up with.
  • Forecasts S&P will hit 1300 by end of 2010, +18% from here.
  • Room for rates to rise and not hurt equities:  Credit spreads still going through compression, equities take cues from high grade and high yield.
  • JPM forecasts unemployment to fall by 50 basis points (0.50%).
  • Retail sales, inventories, claims improvement points to more vigorous recovery, "I think that's not discounted in stocks".
  • Cyclicals will run their course when "we've embraced broad recognition that a recovery is underway and you'll see it when the ISM hits 57.  Also when people start worrying about inflation and when earnings revisions runs their course".....  He gives views on specific sectors as well.
Thomas Lee has been right.  For proof here's a search by date with "Lee" in title or click the label.  For Abby Cohen's 2010 estimate click here (previous post).

Goldman's Abby Cohen 2010 Estimate: Growth to Slow, S&P Range 1250-1300 and Likes Energy

Goldman's Chief Equity Strategist Abby Cohen says growth will slow in 2010 based on fading inventory builds and less "pop" from stimulus. Next year Goldman's range for the S&P is between 1250-1300. She likes energy next year. Robert Doll of Blackrock sees the S&P at 1250 and Vanguard's Jack Vogel is skeptical on various valuation measures and worried about deficits. CNBC videos below.

More earnings S&P estimates:
S&P 500 to Climb to 1,350 Next Year, Prudential’s Praveen Says (Bloomberg)
Morgan Stanley Sees 8% Gain in S&P 500 by End of 2010 (Bloomberg)
Praveen Says Emerging-Market Stocks May Rise 25% in 2010 (Bloomberg Video)
JPMorgan Says S&P 500 Will Rise 18% by End of 2010, 1300 (Bloomberg)
The S&P 500 May Climb to 1,250 Next Year, UBS Says (Bloomberg)
*Societe Generale's Edwards Says U.S. Stocks Will Plunge Below March Lows (Bloomberg)
S&P 500 Rallying 9.8% Is Forecast of U.S. Strategists, S&P 1223 (Bloomberg)

Elliott Wave's Prechter: Market Topping Out Amidst Good News, 2010 Will Be A Down Year

I've posted about Robert Prechter of Elliott Wave International many times this year. He's been warning for months now that a big decline is coming and that we're in the largest wave we've ever lived through. Below I provided the full interview, a long term chart of $SPY and links to reports. Here are quotes from the Bloomberg interview:
"..Now we're looking at a more normal valuation market. So far the retracement rally that we were looking for is perfectly on track. The first quarter was very exciting because we had an oversold market bottoming amid bad news and now we have a stock market topping out amidst good news.."

"..What creates a bubble is excess credit being focused on a market and there was so much credit available from 1999 to 2007 that it ballooned markets way passed historical norms and that's what a bubble is. The last time we saw anything that extreme was the South Sea Bubble of 1720.. These are once in a century extremes.."

Ken Fisher Disses PIMCO's "New Normal" Declaration

The Old Normal
Ken Fisher, 11.29.09, 06:00 PM EST
Forbes Magazine dated December 14, 2009
 http://www.forbes.com/forbes/2009/1214/investment-guide-10-brazil-stocks-pimco-portfolio-strategies.html 
"the "new normal" is Pimco's way of declaring that the decade ahead will be lackluster. The slogan has taken on a life of its own and been widely adopted. It's also utter nonsense--rubbish of the first caliber."

"Take note: Pimco, a division of Allianz, is getting into the equity business right now. Watch what its managers do, not what they say."

Does Fisher Investments have mutual funds?

Activity in US Dollar ETF Options and ETF (100k UUP January 2011 Calls)

Someone is maneuvering in UUP stock and options in size again (Big Volume in $UUP March 23 Call Friday, US Dollar COT etc). The US Dollar Bullish ETF options saw 203k calls/42k puts trade total. Today had the most put action on the month (whatstrading's UUP chart). CrimsonMind Activity Watch laid down the trade in detail: "100,000 Jan (2011) 24 calls traded at $1.00 (bid:0.90 ask:1.10)". That's 10 million dollars. UUP calls/puts were 2nd most most active on the ISE, 9,887 calls vs. 509 puts opened giving it an ISEE ratio of 1,942. UUP itself traded 14.6 million shares today and closed at 22.79. Short interest as of 12/1 was at 810,000 shares vs. 3.14 million on 10/1 (SchaeffersResearch). It will be interesting to see what happens with the US Dollar/S&P relationship, previous post (The S&P/US Dollar Have Been Dating Since Nov 30 (Gold, Oil, Treasury Yield, $SPX, $USD Charts).

Links:
Constructive Action in US Dollar (UUP) (Benzinga)
Bucking the Dollar (Minyanville)
Tuesday Options Update: CAT, MS, UUP, STI, WFC, MCO, M, ROK (SeekingAlpha)

Jim Chanos: Demand For Raw Materials In China Is Overinflated (CNBC)

Jim Chanos shares his views on Wells Fargo, Airbus, the autos, OEMs, China, raw material demand etc.

John Williams Warns Of Hyperinflation, Look At Germany In 1923 (Video)

Re-blogging Zero Hedge's post in a way. I'm not promoting doom here but history says inflation can be a deadly disease.  Look at Germany in 1923 (video below) and the Zimbabwe example.

John Williams of Shadowstats put out a research piece warning about hyperinflation and the negative consequences, including a deeper depression.  He calls today a modern day depression.  ZeroHedge covers it well here (must read) and KingWorldNews recently interviewed him here.  I'm not trying to be all gloom and doom but the pricing of purchasing power risk is probably important.  Hopefully Bernanke is on top of this.  We saw what happened to Zimbabwe (Zimbabwe Inflation Rate Hits 231 Million Percent, In Crisis (Videos, 11/2/08)). Also while I'm on the topic read this at Gregor.us: California Enters Inflationary Depression from 10/28/09.

The S&P/US Dollar Have Been Dating Since Nov 30 (Gold, Oil, Treasury Yield, $SPX, $USD Charts)

Here's a chart of the first half of December comparing the performance of oil, gold, S&P and the US Dollar.  Since November 30, gold is down 4.47%, oil is down 7.01%, the US Dollar is up 2.06% and the S&P is up 1.69%.  Usually we would've seen an inverse move with SPX/USD however this time they moved up in tandem.  The US Dollar and S&P are dating WHO would've thought.  We'll see how long it lasts.  Also take a look at the 30 Year Treasury Yield Index which is up 6.7% month to date (oil down 7%).  Yields could take control of the market(s) here if they continue to rise, imho.  In that case it will be rising yields vs. equities imo.  If flight to quality (deflation whale) re-emerges then it's a different story.  Thoughts?

Gold, $USD, $WTIC (oil), $SPX (Courtesy of Stockcharts.com)

Gold, $USD, $TYX (30Y-Treasury Yield, $SPX (Courtesy of Stockcharts.com)

Also look at the S&P 500.  It's been riding a rising wedge above 1,100 support and could break out to test the 1,121 50% retracement level (2007 peak/2009 trough).  I'd like to see the S&P correct 12% to give the chart a breather but, until 1,100 is stabbed, the S&P could rise to pre-Lehman levels like JP Morgan's Thomas Lee said.  Maybe the market wants to visit pre-Lehman levels to be at peace and then proceed to 0.

 $SPX (S&P 500 Large Cap Index) (Stockcharts.com)

Big Volume in $UUP March 23 Call Friday, US Dollar COT etc (12/11/09)

There was interesting activity in the $UUP (US Dollar Bullish ETF) call options and US Dollar Index COT (commitment of traders by CFTC). 39k traded on the December $23 CALL with 300k open (expires next Fri), 20k traded on the January $23 CALL with 100k open, 15k traded on the January $24 CALL with 20k open and most notably, 342k traded on the March $23 CALL with 100k open. Looking closer at the March $23 trade, according to Crimson Mind, "top blocks: 216,000 March 23 calls traded at $0.55 (bid:0.50 ask:0.55) and 102,500 traded at $0.55 (bid:0.50 ask:0.55). This will be an interesting trade to watch. Hedge fund X threw down $17.5 million for the right to own 31,850,000 shares of UUP above $23 before March 19, 2009. Profits above $23.55. This could be a hedge or an institution trying to game a trend break in size.

Iowa Farmers Being Squeezed By Recession, Lower Debt Levels Help

PBS Newshour had a special on how Iowa farmers in Sioux Center are coping with the slowdown. If you watch the video they say Sioux's unemployment rate is half the national average and they are fiscally sound, while other Municipalities are servicing debt with IOUs. I peeked at the Sioux Center Annual FY2009 CAFR and their total fund balance was +$2.9 Million. Some farmers in Sioux are cutting production due to the lack of demand for expensive products and lower exports.  Also higher input prices (feed for livestock) are squeezing the bottom line and machines cost a million dollars. Is reflation working yet?

Obama: People on Wall Street Still Don't Get It (60 Minutes Video 12/16)

Obama had some harsh words about Wall Street and the banks. "I did not run for office to be helping out a bunch of fat cat bankers on Wall Street".... "people on Wall Street still don't get it". He brings up TARP paybacks and bank bonuses.

Rick Santelli, Steve Liesman on Emergency Unemployment Compensation, Charts of Initial Claims Data

Steve Liesman and Rick Santelli on CNBC argued about emergency claims data which I found interesting (CNBC video below).  First some data:  Initial claims for employment insurance were +17,000 to 474,000 seasonally adjusted and +204,703 to 664,865 unadjusted for the week ending December 5 (find data at dol.gov).  Here is a chart of initial claims going back 5 years (not seasonally adjusted) from the St. Louis FED FRED database.



Jim Rogers Betting On US Dollar Rally, Would Buy Gold At $1000

Jim Rogers was on Tech Ticker and ReutersTV (Reuters: Investor bets on USD rally) recently and he's betting on a US Dollar short squeeze.  He also said commodities will do well if there's massive growth, a currency crisis, continued money printing or WW3.  He told Reuters he'd buy more gold around $1,000.

FDIC Commercial Real Estate Loan Workouts Seminar (Audio)

I found this presentation interesting on FDIC's youtube site.  Also we hit 133 bank failures today, wow.
"The federal financial institution regulatory agencies hosted a free interagency telephone seminar on the Policy Statement on Prudent Commercial Real Estate Loan Workouts (Workout Guidance) on Thursday, December 3, 2009. Audio only."

Doug Kass At Highest Net Short Position All Year, Provides Long Ideas

Doug Kass tweeted on December 10 that he's at his "highest net short position all year. My signal is the weakening financials" (tweet).  He also tweeted that the weak Treasury auction could place "continued pressure on reits, banks and other financials" (tweet) and his "favorite short is IYR" (tweet).  Tweet Tweet.  Follow @DougKass. *Kass was interviewed in Barron's today: Skeptical That Growth Will Take Root, Kass' Picks and Pans... (firm/Seabreeze Partners Management).

Recent articles by Doug Kass on TheStreet.com:
Kass: A Couple of Concerns (12/9/09)
Favorite Long and Short (RealMoney Silver)
Back Shorting Retail (RealMoney Silver)
Awful Treasury Auction (RealMoney Silver)

Dubai Equity Index is Testing March 2009 Lows (Chart, 12/11/2009)

Check out the 1 year "Dubai Financial Market General Index" chart.  It is testing the February/March 2009 lows.  Why?  Search Dubai on my blog or click the label.  Sovereign debt and muni debt might need some help from a printing press.  Who else will be lucky enough to test their March lows?

Dubai Index

(source: bloomberg.com)

$SPY One Month Move Unchanged, You Should've Gone To Barbados (Charts)

$SPY is unchanged on the month.  To move higher $SPY needs to break above 112 or below $109 for a breakdown.  You all should've gone to Barbados.  Here is the one month hourly static and live java chart from freestockcharts.com and some old school calypso tunes.



IWM Put Action on ISE Most Actives, Also SPY Dec 2010 Hedge (Chart)

I saw that $IWM was on the ISE's most active PUT list today. I found it on the ISE Put/Call widget on the side of my blog. It showed that ISE customers opened 21,701 PUTS vs. 1,600 CALLS (13.6 puts/calls). There was also big put volume in general today.  Regarding the chart, IWM is testing the 50dma.

Dec 60 put 35,142 w/97,193 open
Dec 61 put 12,883 w/11,458 open
Jan 57 put 18,027 w/86,404 open
Feb 55 put 15,024 w/3,294 open
Jun 58 put 6,010 w/23,022 open
Jun 46 put 13,000 w/33 open (spread?)

David Rosenberg 2010 Outlook, Predicts Higher VIX Next Year (Audio Interview)

David Rosenberg released his 2010 outlook.  Here is the second paragraph.
"In addition, we have characterized the rally in the economy and global equity markets appropriately as a bear market rally from the March lows, influenced by the heavy hand of government intervention and stimulus. But in classic Bob Farrell form, 2010 may well be seen as the year in which we witness the inevitable drawn out decline that is typical of secular bear markets."

Read his full 2010 outlook "Gluskin Sheff's "Breakfast With Dave" at The Business Insider.

Branson's Virgin Galactic Will Take You To Space In 2 Years for $200,000

Richard Branson created a commercial space aircraft on Virgin Galactic. Below is a video from Aljazeera and a Virgin Galactic introduction video. I'm down...

30-Year Auction Boosts Yields, TLT Weak, Yield Curve Steep, 3 Month Bills at 0.25% ($TYX, $IRX, TLT)

The 30 Year auction today is moving 30 Year Treasury yields higher (bonds lower) and the yield curve is very steep (2s-30s via Zero Hedge). The 30-Year Treasury Yield is at 4.492% and 3 Month T-Bills are yielding 0.25%. Lend it out banks!  Markets are up with higher long term yields and steep curve (less Gov interventions, that would mean growth and inflation long term if the trend sticks, imho).  So what is going to give, the short end or equities?  IRX, TYX and TLT charts below.

House Extends Tax Breaks, Squeezes Investment Fund Manager Income

Interesting political news just hit.  The House just passed the Tax Extenders Act of 2009 (full text) which extends individual and business tax breaks for another year.  To finance this they are taxing investment fund manager gains as ordinary income instead of investment income (35% vs. 15%).  For example a hedge fund may charge 2% of assets and 20% of investment gains annually.  The gains would now be taxed as a service instead of investment income.  I'm wondering how the billi hedge fund managers will react to this.  Perhaps it is fair but is this the right time to do this, when we desperately need the allocators of capital to invest/hire/turn around the economy?  This also affects private equity and real estate partnerships if I'm not mistaken.  It is headed to the Senate.  Here is selected text from the bill. 

DRYS Charts, Analysis, News Updates On Google Wave

I'm starting up a continuous Google Wave for DRYS (Dryships) analysis. Here's why.... First check out the symmetrical triangle inflection point.



It is just the preview version for now but it's a start.  So here are a few DRYS charts I'm looking at on a yearly and weekly basis.  In order to see this wave you need a Google Wave account.  If anything it will be a new way to present price action/information/research/news links without repetitive blog posts.  Here are snapshots of the $DRYS wave.  Inflecting at the $6, symmetrical triangle inflection point under 50/200dma.

Stephen Colbert On The Fed, Senator Sanders (Colbert Report Video, CSPAN)

Stephen Colbert for President... Since he had Senator Sanders on his show I also provided a video of Sanders on the Fed.

Geithner Letter: Extends TARP to 2010, Talks Exit Strategy (Full Text, Video)

When does our dividend check come in the mail from the equity/warrant investments?
"December 9, 2009
TG-433

Treasury Department Releases Text of Letter from Secretary Geithner
to Hill Leadership on Administration’s Exit Strategy for TARP

WASHINGTON – The U.S. Department of the Treasury released the text of identical letters sent today from Secretary Tim Geithner to Speaker Nancy Pelosi and Senator Harry Reid outlining the Administration's exit strategy for the Troubled Asset Relief Program (TARP) established by the Emergency Economic Stabilization Act of 2008 (EESA). The text of the letter to Speaker Pelosi follows.

December 9, 2009

The Honorable Nancy Pelosi
Speaker
U.S. House of Representatives
Washington, DC 20515

Dear Madam Speaker:

I am writing to update you on the status of the Obama Administration's financial policies, including programs initiated under the Troubled Asset Relief Program (TARP) established by the Emergency Economic Stabilization Act of 2008 (EESA), the results they have achieved, the challenges ahead, and our plan for exiting TARP.

Meredith Whitney: Consumer Not Better, Market Overextended, States Underfunded (Squawk Box)

Analyst Meredith Whitney was on CNBC's Squawk Box today with strong opinions. She's confident that the overall market is overextended and the consumer will drag on the S&P.  Is it time to wax up a surf board for Wave C?
"The Government's been providing so much of the flow in capital markets in terms of buying agency paper, supporting the housing market and as bold as this is to say, I think they are out of bullets. If it's not this quarter it is certainly the first quarter where the sand really hit's the fan, and the underlying earnings power starts to show that it's not where people expected it to be"

"70% of the US economy is driven by the consumer. I have 100% conviction that the consumer is not getting better and there's not more liquidity.  So if everything that touches the consumer is going to be represented in the S&P, the S&P is going to be under pressure. Next year there is no place to go."

"Stocks don't go up when estimates are coming down, and they will come down."

She also said core loan books are down and States are underfunded. Next year will be interesting.

Bernanke Speech at Economic Club of Washington DC, Q&A Video

Here is Bernanke's recent speech at the Economic Club of Washington DC with the speech and Q&A video below.
"Chairman Ben S. Bernanke

At the Economic Club of Washington D.C., Washington D.C. 

December 7, 2009

Frequently Asked Questions

It is a pleasure to speak once again before the Economic Club of Washington. Having faced the most serious financial crisis and the worst recession since the Great Depression, our economy has made important progress during the past year. Although the economic stress faced by many families and businesses remains intense, with job openings scarce and credit still hard to come by, the financial system and the economy have moved back from the brink of collapse, economic growth has returned, and the signs of recovery have become more widespread.

Understandably, in a situation as complicated as this one, people have many questions about the current situation and the path forward. Accordingly, taking inspiration from the ubiquitous frequently-asked-questions lists, or FAQs, on Internet websites, in my remarks today I'd like to address four important FAQs about the economy and the Federal Reserve. They are:
  1. Where is the economy headed?
  2. What has the Federal Reserve been doing to support the economy and the financial system?
  3. Will the Federal Reserve's actions lead to higher inflation down the road?
  4. How can we avoid a similar crisis in the future" (read full speech at federalreserve.gov)

Bernanke on interest rates: "WELL, THEY CANNOT GO MUCH FURTHER DOWN. [LAUGHTER] [LAUGHTER] OK. [LAUGHTER] OBVIOUSLY, THE COMMITTEE..."

John Paulson Has Highest Net Long Exposure Ever (BAC, CMCSA, HEIG)

John Paulson speaks...  He sees compelling investments on the equity side, none on the short side in credit (likes Gov involved GMAC debt over Treasuries) and is concerned about inflation (re: gold).  So in a sense he likes high yield Government debt and equities (bac, cmcsa, heig).   Simple hedged macro call.  Here is Paulson & Co's 3Q holdings and investment letter if you are interested.
""Today our net long exposure is perhaps the highest it has ever been in our portfolio," Paulson said during a luncheon presentation at the Japan Society"... "we don't have any shorts in credit", he said." read the full article at Reuters.

Hat tip Business Insider

$USD/CAD Challenging August Downtrend On Bank of Canada Announcement, Commodities and Technicals

I'm watching USD/CAD because of the Bank of Canada announcement that "interest rates would remain at 0.25 percent until June 2010 and that it was still concerned about the strength of the currency and its possible negative affect on exports" (ForexHound), chart technicals and commodity weakness (focused on oil, xlf on last post). On the chart $USD/CAD is challenging the downtrend that commenced in August. It already broke through the downtrend formed from the March highs.  I have questions for the professional geometrical chart technologists.  How will CAD break the symmetrical triangle and is there a descending triangle forming using 2008 support?  Moves take longer now given the decreased volatility but I'll keep observing. Speaking of FX options, CDD (ISE FX Canadian Dollar USD/CAD pair) has an implied volatility of 14.11 and historical of 15.22 (hit highs of 25). Below I provided a live and static USD/CAD chart w/ trends plus articles and the Bank of Canada statement (12/8/09).

News Link Fest For The Investment Community (12.8.09)

Links chosen from twitter stream and google news search.

Oil, XLE, Dollar Technical Update Plus $OVX vs. $XLE Volatilities (Charts)

First look at XLE (energy ETF) volatility vs. $OVX (crude oil volatility). The Oil VIX moved up with the Gold VIX recently while XLE hasn't really budged (the XLE implied volatility chart is from yesterday's close I believe). Makes sense given that it's equity vs. underlying commodity but they are both wrecking technical levels.  I don't follow these vol's every day but it s an interesting comparable. XLE is down 1.49% today and January Oil is down 1.58%. XLE broke below the 50 day moving average and a minor uptrend channel and could test the June highs/major uptrend support around $53.  The 200dma at $50.3 is not too far off (would get there if it broke that uptrend from March imo).

Oil on the other hand pierced through (as of right now 1:06e) a symmetrical triangle and broke below summer support (was an ascending triangle before).  If oil loses control here, next support hits around $65+/- and $70 looks crowded.  It should be known that this is for the January oil contract.  When looking at oil in Feburary it is still TESTING the uptrend and is a couple bucks higher.  Watch that month as well.  This all could be part of a normal correction given that volatility is still relatively low compared to last year, but the chart will tell me what's up. To my foreign readers: 享受圖, يتمتع الخرائط, magtatamasa ng mga chart, карыстацца charts, disfrutar de las cartas, ליהנות תרשימים, グラフを楽しむ and अच्छा दोपहर, शाम और अच्छा शुभ रात्रि.

Bernie Schaeffer Bullish On Equities, Gold Based On Sentiment Stages, 20 Month Moving Average. Short Term Resistance At Russell Retracement

Bernie Schaeffer of Schaeffers Research is a buyer here. He thinks we are going through a dis-belief phase and the rally in equities and gold will continue. He points out the 50% retracement level on the Russell 2000 acting as short term resistance and the sideways chop during the past month. In the second video Bernie breaks out specific sentiment and psychological indicators. He thinks we are halfway through the rally based on stages of sentiment and the break above the 20 month moving average.  It's interesting how Bernie Schaeffer contrasts with Robert Prechter (we are in for a very large decline in 2010).  Both are respectable views based on sentiment imo, but the chart wins in the end.

Watching XLE, oil technicals, XLE vs. oil volatility and the US Dollar. XLE and $WTIC broke below their 50dma's, $WTIC testing uptrend/floor support. Keep your scope on black gold. Overnight futures are up a tad. Emini S&P 1104.5 +0.07%, Emini Nasdaq 1784.5 +0.03%, Emini Dow 10405 +0.13%.

$NYB Action In Play On The Put Side! Fair Markets My Ass (NY Community Bancorp)

NYB is IN PLAY folks, in many different ways. Remember last Friday's NYB acquisition of AmTrust from the FDIC and the (alleged) insider trades reported by Zero Hedge? Now Reuters and Bloomberg are all over it. Interesting to say the least.

Today FBR Research upgraded NYB to Outperform with a $16 price target. NYB is up 8.68% today to $13.40. On my lonely ISE put/call widget to the right I saw that NYB puts were in play today w/ the ISEE Ratio: 10, PUTS: 10,239 and Calls: 1,021. The Options Intelligence Report sheds more light on this. There appeared to be put activity in the immediate term and call interest into 2010. Also "Fitch affirmed NYB's ratings on the AmTrust acquisition" (businesswire) and they offered 60 million shares today.  It was a DECENT ascending triangle play if nothing else.  Free markets my a$$! Whatever happened with those 3com calls?

Tim Sykes Talks Penny Stocking and Trading Styles With MissTrade TV

@MissTrade (aka Matt Davio, professional trader/market blogger/MissTradeTV) interviewed penny stock legend Tim Sykes. Tim talks about the penny stock game, his trading styles and how he started out. He also disses big media's coverage on penny stocks (including some 2pac'esqe disses).  Tim is up 142% this year (cash and equities) on Covestor. You can find the full interview at MissTrade.net as will as interviews with Karl Denninger (MarketTicker.org), Jon Najarian (OptionMonster), Fari Hamzei of Hamzei Analytics and Larry McMillan (option strategist).  Also watch MissTrade's Live UStream Trading Room.

Hotel, Auto, Credit Card, Jumbos, Small Biz and Alt-A Delinquencies (Links: 11/30-12/6/09)

Is high yield and $SPY right to be fading all of this?

  • TransUnion: US Auto-Loan-Delinquency Rates Up Further in 3Q (WSJ, 12/1)
  • US Credit-Card Delinquencies Near Record Highs In Oct - Fitch (WSJ, 12/2)
  • Illinois auto-loan delinquencies rise to 0.76 percent (medill.northwestern.edu)
  • Hotel mortgage delinquencies up five times (BloggingStocks, 11/30)
  • Delinquencies On Jumbo Mortgages Rise Further, Subprime Up (WSJ, 12/3)
  • This is good:  U.S. small business loans in arrears down: PayNet (Reuters, 12/1)
  • Recent-Vintage Alt-A RMBS Delinquency Rates Continue to Rise (ResearchRecap, 12/4)
  • Hotel Default Raises CMBS Delinquency, Trepp Says (HousingWire)
  • Delinquency ratio for Japanese RMBS rises (Structured Credit Investor)
  • Commercial property weighs on banks -Fed official (Reuters, 11/30)
  • CRE Bank-Loan Defaults hit 3.4%, CMBS Oct Delinquencies at 4.01%, (previouspost)

    Distressed Commercial Real Estate, CMBS Delinquencies, CPPI/TBI Price Indices, $IYR, $KRE


    "The Ghosts escape their prison" (Ghostbusters) via flixter.com

    Here is a collection of news, data and research on commercial real estate and CMBS including the CPPI (price index), TBI (transaction index), IYR/KRE charts and CMBX prices.

    Bloomberg 12/1/09: Commercial Mortgage Defaults at U.S. Banks Reach 3.4%
    "“Mortgages originated in 2006 and 2007 are experiencing the most significant shortfalls in current cash flow relative to current debt-service obligations,” Sam Chandan, chief economist of the firm, said in the report."

    Reuters 11/30/09: US commercial property loan defaults soar-reports
    "Commercial real estate bank-loan defaults hit 3.4 pct. Real Estate Econometrics sees the default rate for commercial real estate mortgages held by depository institutions hitting 4.0 percent in the fourth quarter of 2009, about 5.2 percent by the end of 2010, and peaking at 5.3 percent in 2011."

    RealPoint CMBS ResearchMonthly Delinquency Report - Commentary, November 2009 (Pdf, charts)
    "In October 2009, the delinquent unpaid balance for CMBS increased slightly to $32.55 billion from $31.73 billion a month prior. Such delinquent unpaid balance is up an astounding 504% from one-year ago (when only $5.39 billion of delinquent balance was reported for October 2008), and is now over 14 times the low point of $2.21 billion in March 2007. An increase in four of five delinquent loan categories was noted in September, with a decline experienced in the 60-day bucket. Despite such decline, the distressed 90+-day, Foreclosure and REO categories grew in aggregate for the 23rd straight month – up by $2.36 billion (12%) from the previous month and over $18.77 billion (572%) in the past year (up from only $3.283 billion in October 2008)."

    Clearwire 4G WiMax Not Everywhere Yet, Need Reliable 4G/3G Data Stick For Laptop For Best Price, Unlimited Data

    Drifting away from the finance theme at the moment.  I need the most reliable 4G/3G data stick for my laptop for unlimited data and the best monthly price.  I want the internet for a long voyage around the US by train.  The problem is 3G data plans are capped at 5Gs so you can use Sprint's unlimited 4G + 3G roll over plan.  As of today Clear has an unlimited data/4G deal out for $30/month for the first 6 months, then switches to $45. They say: "Typical download speeds are 3-6 mbps with bursts over 10 Mbps".  Clear's 4G WiMax coverage area is limited to big cities at the moment.  Does 3G access even work well in rural areas?  There seems to be a tower shortage, long towers.  Most recent Google News search:

    Zero Hedge Catches Trades in New York Community Bancorp NYB and Options Pre-AmTrust Acquisition via FDIC

    Nice work over at ZeroHedge/SEC.  They saw price and call option action in NYB pre-acquisition of failed Amherst Bank via FDIC today.

    "Mary Schapiro Must Immediately Investigate The FDIC's Confidential Information Leak In Another Blatant Insider Trading Case, Then Resign (Link:  http://www.zerohedge.com/article/mary-schapiro-must-immediately-investigate-fdics-confidential-information-leak-another-blata)."

    $USDX, Dollar Rallies Hard On Jobs Catalyst, Pierces Downtrend, Moving Average and Set To Battle $76 Resistance [US Dollar Index Charts, TLT Mention]

    12/4/09:  The US Dollar (DXY) rallied HARD today with the better than expected jobs data. Check out the short and long term DXY charts.  Dvol & Co. has been writing about this downtrend and options activity for the past 90,000 days.  Use the search bar or click UUP or US Dollar for the most recent google search results.  Is the 50 day moving average test DIFFERENT this time?  I've been waiting for a catalyst that would break this trend.  As you can see, US:DXY broke a downtrend from November and pierced through the long term downtrend from March and 50 day moving average.

    DXY is on fire, up 1.6%, 30Y T-bond yields are up ($TYX) is up 1.93% yielding 4.41% which is beheading GLD, down -5% and taking gains away from the S&P.  Finally an interesting day but it is still a mind f--- because it could be that good news is now bad news which rallies yields and the Dollar and corrects commodities and the markets.  Or growth is so strong that the rising cost of capital + top/bottom line earnings absorb valuations.  It will be interesting to see what happens.  Yields and the S&P rallied together after the March lows given that Treasuries hit capitulative highs and markets hit capitulative lows.  Now things are different, the S&P is up 60% and Treasuries are being squashed in a wedge.  Fyi, TLTs 50 and 200dma are at par with price action below both levels now.  Both might act as resistance going forward.  Here are US Dollar Index Charts (Year, 6 mo) courtesy of Stockcharts.com.

    Text from chart.  $76 ceiling break is a must for a hedged squeeze play imo.  $76 also hits a minor downtrend resistance level from September.  If you read my posts during the past month there has been massive call interest in $UUP possibly positioning for a squeeze (like today) and/or hedging their short books.  If traders take profits it could chop around 75-76 before deciding it's ultimate fate.  It is a tough downtrend to battle if you are inclined to do so, bring your teflon vest.  Lows from 2008 aren't that far away...


    Sergey Brin Guest at Search Engine Class (UCBerkeley, 2005), Anatomy of a Large-Scale Web Search Engine (Link)

    This is interesting. "SIMS 141 - Search, Google, and Life: Sergey Brin - Google" (October 2005). Sergey talks about page rank, innovative algorithms, how Google started out and more. He also does a Q&A session. Also check this out: The Anatomy of a Large-Scale Hypertextual Web Search Engine by Sergey Brin and Lawrence Page, Computer Science Department, Stanford University, Stanford, CA 94305".

    Sports Illustrated Touch Screen Tablet Demo, Will They Save Print Media?

    Will the interactive tablet save print media? You buy a touch screen tablet and subscribe to magazines and newspapers, correct? Sounds like an interesting plan. Make it 3D.

    $SPY Chart Technical Analysis: 50, 61.8% Retracements, Downtrend, Ceiling Resistance and Ultimate Wedge [Place Your Market Bets, 12/4/09]

    December 4, 2009: As I've mentioned before, SPY is up against some important technical levels at the moment. It is hitting downtrend resistance from the 2007 highs and the 50% retracement level. If Tom Lee of JP Morgan is right that we see high 1100s on the S&P before year end, the 61.8% retracement/2006 ceiling resistance/pre-Lehman levels could be in the cards. The last time we saw a real correction was in July, when sellers overtook buyers at minor downtrend resistance (from May highs). $SPY is currently in the vertex of the ultimate wedge as you can see. Watch for a decisive move soon.  Look at this long term technical beauty from FreeStockCharts.com. I also provided a live chart below so you can see what happens (requires a plug in I believe).



    Catalyst Watch For S&P, SPY, TLT, GLD and Treasury Yields [12/4/09]

    Whether it was Bernanke's nomination hearing, debt de-leveraging in Dubai, weak service sector data, Treasury yields bouncing, employment worries or Bank of America's $19 Billion capital raise, there was a sharp sell off in the S&P E-Mini Futures and equity markets at the end of the day. The S&P is looking down at the 50 day moving average ($1,076) and is set to battle a rising wedge. All eyes will be on the employment report tomorrow for a catalyst.  Futures are up 0.14%.

    TLT, GLD and Treasury Yields also had an interesting day today.  TLT (20+ T-Bond Prices) broke below the 50 and 200 day moving average and sold off at symmetrical triangle resistance.  $TYX (30 year bond yield) is just above the 50 and 200dma.  GLD is in a very steep rising channel so watch the RSI for a dip below 70 and a breach of channel support.  I want to see how everything reacts after the report.  I think a big catalyst is coming for Treasuries, equities or gold.  Could higher yields (inflation/growth) or lower yields (safe haven covering) choke off the gold and equity rally?  Perhaps gold sticks in the safe haven case.  Something has to give...  Watch the live chart to see what happens. **Update: 10:17am Eastern: Nov. jobless rate falls to 10 pct., 11K job cuts (AP).   TLT -1.31%, GLD -1.63% and SPY +1.41% (Treasuries and Gold gave for now, let the Yields/SPY war begin).

    Look Down From Top of Burj Dubai Spire, Helicopter Tour (Videos)

    Amazing views from the top of the Burj Dubai Spire. The second video is on a helicopter tour. It is crazy.

    Google CEO Eric Schmidt on China, Mobile Ads, Android, News Corp, Video, Publishing Crisis and Cloud Computing (12/3)

    Google CEO Eric Schmidt was interviewed on Bloomberg while he was at the White House Jobs Summit in Washington. He gets into China, mobile ads, Android, News Corp, how to get out of publishing crisis and video. Interesting interview. Go Google!

    Asian Carp Invasion Volatility Spikes in Chicago, Great Lakes (Video from WoodTV8)

    Volatility for the fishing industry...  Video from WoodTV8 below.
    • Single Asian carp found in Chicago-area fish kill (AP)
    • States Cast for Way to Stop Carp (WSJ)
    • Fish kill: Day 2 bighead found (Chicago Sun Times)
    • Bighead Asian carp found in Chicago (WOODTV8)

    Huntsman (HUN) Call Options Active, Broke Above $10 Resistance, ISE Put/Call Most Actives, Implied Volatility (12/3/09)

    Interesting day today for chemical company Huntsman ($HUN). It broke through $10 resistance on strong volume. I should have been watching this. Looking at the candle, it formed a tail of profit taking after the initial spike but still closed above $10 resistance at 10.26. If support holds, the next resistance level is around $14 and there is also a gap to fill (eventually). We'll see if the market rolls over here and drags $HUN around. Or it could be in play again but that I do not know.

    Calls were active today. On the ISE widgie (sidebar), HUN had 8,851 customer calls opened and 201 puts, giving it an ISEE ratio of 4,403.  On the ISE, 58,000 options traded (majority calls) vs. the average of 3,700!  Implied volatility is at 69 and crossed above historical volatility 56.64.  IV was up 53% today.  Looking closer, both December and January had monster call volume. Remember 1 call gives the option to buy 100 shares at the strike price if the stock is in the money.  That's if they are fresh longs and not spreads or sellers.

    Bernanke Nomination Hearing Videos, Testimony, Articles (12/3/2009)

    Here are full videos of the hearing on CSPAN, Bernanke's testimony script and related articles below.

    Jon Stewart On Dubai's Real Estate Crash, CNBC Clips From Dubai In 2007

    Jon Stewart talked about the Dubai crisis and showed a clip of CNBCs Erin Burnett reporting from Dubai in 2007. Is there a Case Shiller index for Dubai?

    News: BofA Dilutes Stock To Pay TARP, Zandi On Housing, Rubber Futures, Sugar, Japan Capital Spending, VIX Ratio Risk Reversal, Dubai World, Hong Kong ETF and Asian Carp Invasion

    Financial News Links for 12/2/2009

    Rosenberg: Gold to 2800 on Fiat Money Production Gap, Schiff: Gold To 5000 On Inflation Pressures, Grasso: Initial Superspike 1500-1800 On Inflation Then Pullback Coming

    Gold is the sh*t these days as you can see....  Gold spot is at 1218 and Dvol & Co. reported the ultimate $1000 resistance break in October, or $100 on GLD (Gold ETF).  GLD is up 20% in 2 months and calls are making a killing.  There is no resistance in sight, so get ready for wild swings eventually IMO. Guy Adami talked about buying put protection or using trailing stops on gold a few days ago, doesn't hurt.

    Hussman: 80% Probability of Market Plunge Next Year, Stocks 40% Overvalued Based On q and CAPE Ratios (Cyclically Adjusted P/E)

    From Hussman's November 30, 2009 Report: Reckless Myopia

    "In my estimation, there is still close to an 80% probability (Bayes' Rule) that a second market plunge and economic downturn will unfold during the coming year. This is not certainty, but the evidence that we've observed in the equity market, labor market, and credit markets to-date is simply much more consistent with the recent advance being a component of a more drawn-out and painful deleveraging cycle."

    "Currently, both q and CAPE are saying that the U.S. stock market is about 40% overvalued."

    SPY On ISE Most Actives: March 2010 $110, June $104 Puts With 44000 Traded On Each Strike

    I noticed $SPY options action on the most actives list at the International Securities Exchange.  From the ISEE widget, 53000 puts/3000 calls were opened in the morning.  Is this an out of the money diagonal put time spread of some sort?   44,000 traded on the SPY March $110 with 11,400 open and 44,000 traded on the June $104 Puts with 71,000 open.  As you can see in the charts below, the June 104 put volume traded around $5.40 and the March 110 volume traded around $5.20.  $SPY just broke $111 as I'm typing.  We'll see wtf happens here. It is looking 3-6 months out in the next decade.

    News: Krugman's Double Dip, SocGen Albert Edwards, AIG Put Bet, Rosenberg on $2,600 Gold, Fed Governor Plosser on Liquidity, Greece CDS

    • Double dip warning by Paul Krugman (New York Times)
    • ‘Deep down, even the fiercest equity bulls must be doubting themselves’ (SocGen, FTalphaville)
    • “Apocalypse” Puts Bet on Bad Things for AIG (Barron's Blog)
    • Gold and Silver Soar as Bank of Japan Commits 10 Trillion Yen ($115 Billion) to Combat Deflation (Mish)
    • Debt protection costs soar as markets eye shaky finances in Athens (BusinessDay)
    • Nassim Taleb Swears He’s Done With This Place, Signs Off In A Huff.. (DealBreaker)
    • Significant Risks to U.S. Bank Stocks Exist: Citigroup (Reuters)
    • J.P. Morgan Says Banks Are Loading Up On Cash (WSJ)
    • Rosenberg: Gold Going To $2600 Thanks To China (BusinessInsider)
    • Fed's Plosser: Timely withdrawal of stimulus crucial (Reuters)