Last Conan O'brien Tonight Show Episode, Last Words to Fans (Videos)

Here is Conan's last show featuring Will Ferrell, Tom Hanks and Steve Carell. I embedded his first episode from June 1, 2009 when Will Ferrell was on. He said he can't host another show for 7 months. If you don't know what happened here is the Chinese version.  In the first video he gives his last words to fans and NBC, the second is the Free Bird performance with Will Ferrell and the last video is the full episode (might cut out after a few weeks). Where is he going next, Fox? The last episodes were amazing.

Illinois Insolvency, Chicago Commercial Real Estate Outlook, Warehouse Vacancies Hit 12.1%


Here is a fiscal and CRE outlook for Illinois and Chicago.  Illinois is on the brink of bankruptcy with "$5.1 Billion of unpaid bills" -Illinois Comptroller Dan Hynes .  Will they send a pension fund to bankruptcy court?   A Crain's Chicago interview brought that up, Illinois enters a state of insolvency (Crain's Chicago VIDEO).  The Illinois 2009 CAFR (annual financial report) should be out soon, all I see is 2008.  In other news, California might issue IOU's again next year.  Cali issued IOUs in July of 2009.  How long can municipalities operate without raising taxes?  It's either that or municipal mergers, issue MORE debt for expenses (Illinois Leads $9.8 Billion Muni Sales Planned for Early 2010, *Illinois Pays Pension Bond Premium as Budget Fix Eludes State), entity bankruptcy or cop a Fed bailout (inflation tax).  How the hell does this end?

Also there's mucho industrial space out there.  The vacancy rate hit 12.15% in Q4 2009 at 159 Million Square Feet, "highest it's been in 20 years" (Warehouse Vacancies 1/20/2010 (Crain's Chicago VIDEO).  Crain's Chicago also had a 2010 commercial real estate outlook video with analysis from Copley Advisors.  The office vacancy rate hit 16.2% in Q4 2009 and Copley thinks it will hit 20% (from last downturn).

Previous municipal posts form 2009:
California Issues IOUs, California GO Bond Bets
Moody's Downgrades Detroit $781M GO Debt Further Into Junk
Oakland, California Denies Bankruptcy Rumors, General Fund Drying Up
Jefferson County Volatility, Interest Rate Swaps to National Guard

SPY, IWM, DIA Downtrend Demon Scares Traders, DIA Pierced 50 Day Moving Average

An update from my previous post: $TRAN, $INDU, $RUT, $SPX Fighting Downtrend Demon From 2007 (IYT, SPY, DIA, IWM, Nasdaq an Outlier) on January 13. It appears that the Downtrend Demon™ scared away some traders recently with the sell off. A variety of catalysts could have been responsible (Obama financial reform, unemployment claims, China tightening, sell earnings? etc.) but it was really the demon imo.  Check out the weekly charts.   SPY, IWM and DIA could not get over the 200 week moving average (in red) and the downtrend from the 2007 market highs.  Also, here we go again with a moving average team work exercise for the index ETFs.  DIA breached its 50 day moving average and a near term uptrend channel as you can see on the chart.  So will SPY (S&P 500) and IWM (Russell small caps) jump off the bridge after DIA, or will they end up saving it from the abyss.  Volume was high but it was also high in October.  I added support levels.  Read more for all charts if on main page.

Nouriel Roubini Speech at Asian Financial Forum, 1/21/2010 (Video)

Nouriel Roubini (NYU Professor, economist) gave a speech at the Asian Financial Forum (AFF) in Hong Kong on January 21, 2010.  It's a great speech/lecture and you can learn real time macroeconomics for free.  He thinks we see a market correction in the second half of the year. Here are more points he made:
  • Market correction in second half of year
  • Pessimistic, sub-par recovery with below trend growth, U-shape recovery
  • Damned if you do, damned if you don't (de-stimulus risks deflation, more stimulus risks inflation)
  • Good news: light at end of tunnel, gives credit to policy makers for backstopping freefall
  • Labor market remains very weak, unemployment in US 10%, creation of jobs < labor force
  • Private sector debt ratios have stabilized at a high level, barley starting to fall
  • Private losses being socialized by public sector in major way
  • More savings will weigh on consumption, major component of GDP
  • In a typical V-shaped recovery capex spending is very strong, now 1/3 of capacity not utilized
  • Glut of capacity, housing, commercial real estate, financial system/credit markets still damaged
  • Still credit contraction in system, when it's time to re-lever economy financing will be limited
  • Affect of fiscal policy becomes drag on economic growth in US, Europe, Japan in 2nd half
  • If oversaving countries don't pick up overspenders slack it will affect overcapacity around world
  • EMERGING MARKETS (China, Asia) will see a V-shaped recovery, growth rate 5-8%
  • Emerging markets did not have leveraged household sector that ruined US, Europe
  • China cannot be "main locomotive" for growth.......
  • Emerging markets were net exporters w/ cheap currencies, they no longer have US buying...
  • Switched from net exports to public demand (fiscal stimulus, infrastructure), must switch to private consumption, will take years
  • More deflationary pressures in advanced economies (slack in goods, pricing, labor markets)
  • Base money doubled but not inflationary due to the collapse in velocity, hoarding by banks..
  • Inflation could come back in 2012 (expected inflation, commodity chasing, weakened US Dollar,  growth...)
  • Recovery since March is a shift to more risky assets from T-bills, wall of liquidity chasing assets, momentum, dollar funded carry trade...


Roubini Speech at AFF (Bloomberg.com video link)



More speeches by Roubini can be found here.

Obama's Volcker Rule Outlaws Trading, Hedge Funds at Banks (Video/Text)

Obama, with insight from Paul Volcker, announced today that he's outlawing proprietary trading and in-house hedge/private equity funds at banks.  They would be allowed to trade on behalf of clients only.  How does this affect Goldman Sachs?   10% of their revenues come from proprietary trading and they said it's hard to distinguish from client trading and "proprietary risk".  Also, Goldman Sachs CFO: Pure 'Walled Off' Proprietary Business At Firm Not Very Big. Well, it was fun for the ex-TARP banks while it lasted.

Goldman Will Benefit From Obama’s Proposal, Bove Says (BusinessWeek)
Goldman Sachs Calls Idea of Dropping Bank Status ‘Unrealistic’ (BusinessWeek)
The Beginning Of The End For Wall Street's Various Prop Trading Desks (ZeroHedge)
The Volcker Rule & AIG: It’s Not About Prop Trading (ZeroHedge)

The market didn't buy the news, nor the unemployment insurance data. $SPY (S&P 500 ETF) ended down 1.92% at 111.70, testing the 50 day moving average. I'll do more technicals on next post.  Below is Obama's press release and announcement video.

SPY Intraday (freestockcharts.com)



"For Immediate Release
January 21, 2010
Remarks by the President on Financial Reform
Diplomatic Reception Room

11:34 A.M. EST

THE PRESIDENT: Good morning, everybody. I just had a very productive meeting with two members of my Economic Recovery Advisory Board: Paul Volcker, who's the former chair of the Federal Reserve Board; and Bill Donaldson, previously the head of the SEC. And I deeply appreciate the counsel of these two leaders and the board that they've offered as we have dealt with a broad array of very difficult economic challenges.

Over the past two years, more than seven million Americans have lost their jobs in the deepest recession our country has known in generations. Rarely does a day go by that I don't hear from folks who are hurting. And every day, we are working to put our economy back on track and put America back to work. But even as we dig our way out of this deep hole, it's important that we not lose sight of what led us into this mess in the first place.

This economic crisis began as a financial crisis, when banks and financial institutions took huge, reckless risks in pursuit of quick profits and massive bonuses. When the dust settled, and this binge of irresponsibility was over, several of the world's oldest and largest financial institutions had collapsed, or were on the verge of doing so. Markets plummeted, credit dried up, and jobs were vanishing by the hundreds of thousands each month. We were on the precipice of a second Great Depression.

To avoid this calamity, the American people -- who were already struggling in their own right -- were forced to rescue financial firms facing crises largely of their own creation. And that rescue, undertaken by the previous administration, was deeply offensive but it was a necessary thing to do, and it succeeded in stabilizing the financial system and helping to avert that depression.

Since that time, over the past year, my administration has recovered most of what the federal government provided to banks. And last week, I proposed a fee to be paid by the largest financial firms in order to recover every last dime. But that's not all we have to do. We have to enact common-sense reforms that will protect American taxpayers -– and the American economy -– from future crises as well.

For while the financial system is far stronger today than it was one year ago, it's still operating under the same rules that led to its near collapse. These are rules that allowed firms to act contrary to the interests of customers; to conceal their exposure to debt through complex financial dealings; to benefit from taxpayer-insured deposits while making speculative investments; and to take on risks so vast that they posed threats to the entire system.

That's why we are seeking reforms to protect consumers; we intend to close loopholes that allowed big financial firms to trade risky financial products like credit defaults swaps and other derivatives without oversight; to identify system-wide risks that could cause a meltdown; to strengthen capital and liquidity requirements to make the system more stable; and to ensure that the failure of any large firm does not take the entire economy down with it. Never again will the American taxpayer be held hostage by a bank that is "too big to fail."

Now, limits on the risks major financial firms can take are central to the reforms that I've proposed. They are central to the legislation that has passed the House under the leadership of Chairman Barney Frank, and that we're working to pass in the Senate under the leadership of Chairman Chris Dodd. As part of these efforts, today I'm proposing two additional reforms that I believe will strengthen the financial system while preventing future crises.

First, we should no longer allow banks to stray too far from their central mission of serving their customers. In recent years, too many financial firms have put taxpayer money at risk by operating hedge funds and private equity funds and making riskier investments to reap a quick reward. And these firms have taken these risks while benefiting from special financial privileges that are reserved only for banks.

Our government provides deposit insurance and other safeguards and guarantees to firms that operate banks. We do so because a stable and reliable banking system promotes sustained growth, and because we learned how dangerous the failure of that system can be during the Great Depression.

But these privileges were not created to bestow banks operating hedge funds or private equity funds with an unfair advantage. When banks benefit from the safety net that taxpayers provide –- which includes lower-cost capital –- it is not appropriate for them to turn around and use that cheap money to trade for profit. And that is especially true when this kind of trading often puts banks in direct conflict with their customers' interests.

The fact is, these kinds of trading operations can create enormous and costly risks, endangering the entire bank if things go wrong. We simply cannot accept a system in which hedge funds or private equity firms inside banks can place huge, risky bets that are subsidized by taxpayers and that could pose a conflict of interest. And we cannot accept a system in which shareholders make money on these operations if the bank wins but taxpayers foot the bill if the bank loses.

It's for these reasons that I'm proposing a simple and common-sense reform, which we're calling the "Volcker Rule" -- after this tall guy behind me. Banks will no longer be allowed to own, invest, or sponsor hedge funds, private equity funds, or proprietary trading operations for their own profit, unrelated to serving their customers. If financial firms want to trade for profit, that's something they're free to do. Indeed, doing so –- responsibly –- is a good thing for the markets and the economy. But these firms should not be allowed to run these hedge funds and private equities funds while running a bank backed by the American people.

In addition, as part of our efforts to protect against future crises, I'm also proposing that we prevent the further consolidation of our financial system. There has long been a deposit cap in place to guard against too much risk being concentrated in a single bank. The same principle should apply to wider forms of funding employed by large financial institutions in today's economy. The American people will not be served by a financial system that comprises just a few massive firms. That's not good for consumers; it's not good for the economy. And through this policy, that is an outcome we will avoid.

My message to members of Congress of both parties is that we have to get this done. And my message to leaders of the financial industry is to work with us, and not against us, on needed reforms. I welcome constructive input from folks in the financial sector. But what we've seen so far, in recent weeks, is an army of industry lobbyists from Wall Street descending on Capitol Hill to try and block basic and common-sense rules of the road that would protect our economy and the American people.

So if these folks want a fight, it's a fight I'm ready to have. And my resolve is only strengthened when I see a return to old practices at some of the very firms fighting reform; and when I see soaring profits and obscene bonuses at some of the very firms claiming that they can't lend more to small business, they can't keep credit card rates low, they can't pay a fee to refund taxpayers for the bailout without passing on the cost to shareholders or customers -- that's the claims they're making. It's exactly this kind of irresponsibility that makes clear reform is necessary.

We've come through a terrible crisis. The American people have paid a very high price. We simply cannot return to business as usual. That's why we're going to ensure that Wall Street pays back the American people for the bailout. That's why we're going to rein in the excess and abuse that nearly brought down our financial system. That's why we're going to pass these reforms into law.

Thank you very much, everybody.

END
11:42 A.M. EST" (Remarks by the President on Financial Reform, Whitehouse.gov)

New York Times To Charge Fee To Read Additional Articles in 2011 ($NYT)

The New York Times is pulling the trigger on a metered system in 2011 where they will charge a fee to read additional articles.  The Times to Charge for Frequent Access to Its Web Site (New York Times):

"Beginning in January 2011, unlimited access to NYTimes.com will require a paper subscription or payment of a flat fee."

PBS Newshour had Bill Mitchell (Poyner Institute) and Bill Grueskin (Former Managing Editor at Wall Street Journal) on giving their views on this risk. I found the PBS Newshour video through Google search and it is quality news, imo. Subsidized!




As a news junkie and constant link pimp to financial articles found on Google News, even if they are summaries on WSJ, I will not link to something I can't read at least a paragraph on. I will just find a similar story somewhere else that offers it for free. If a story is THAT good and recommended on Twitter, I'd more likely pay a fee. But a trend is a trend.... Go to Business Insider to see how freemium news is destroying the pay and advertising models for online publishers.

Keep an eye on $NYT and options.

Links:
New York Times will charge for news on website (Reuters, Video)
New York Times Users React To Metered Pay Model Decision: 'Good Luck!'(BusinessInsider)
Conde Nast, New York Times, News Corp. In Talks With Apple About Tablet Content (BusinessInsider)
New York Times: Honest work means honest pay (MediaFile: Reuters UK)
Dialing in a Plan: The Times Installs a Meter on Its Future (MediaDecoder: NewYorkTimes)
New York Times to charge for access to news website (TorontoStar)
New York Times to charge for Web access in 2011 (AP)
How The New York Times Should Charge For Content (PaidContent.org)

Research Edge 2010 Outlook: Long US Dollar, XLK, XLV, Short GLD, Treasuries and China, Likes Brazil and Germany

I found an interesting Forbes video featuring Keith McCullough of Research Edge giving his 2010 outlook. He believes the "Fed will raise rates earlier than expected".

2010 Macro bet:  The $USD chases higher interest rates and gold ($GLD) moves lower.  He's buying the US Dollar, shorting short term and intermediate term Treasuries and said he'd be long technology ($XLK) and healthcare ($XLV) to shield against inflation.  He's bullish on Germany and Brazil (high beta exposure) but bearish on China.  Here is the video below from Forbes.



I'm going to chart out $USD, GLD, XLK and XLV on a Google Doc presentation. Any thoughts gold bugs?

Chinese News Reenacts the NBC Conan, Leno, Zucker Debacle

Hahahahaha... NMANews out of Taiwan does a great reenactment of the NBC, Conan and Leno debacle.

NMA 2010.01.19 動新聞 美國深夜脫口秀大風吹


Hat tip Shiny Objects Blog.

Delinquency Data/January 2010, QABA Community Bank ETF Above July Highs!

They keep going and going and going and traders continue to buy the news.  Is delinquency capitulation right around the corner?  Here's a CMBS, RMBS and credit card debt news link fest.  $QABA (First Trust NASDAQ ABA Community Bank Index Fund) is just above its highs from August, 2009 (chart) and $KRE is testing $25 resistance, while 140 banks failed in 2009 and 4 so far in 2010.
  • CMBS Delinquencies Continue To Rise (Another Financial Portal)
  • Moody's: CMBS Delinquencies Rise To 4.9%; 8%-9% Seen This Year (WSJ)
  • Fitch: U.S. CMBS Delinquencies up 42bps; Peak Not Until 2012 (Fitch Release)
  • CMBS Delinquencies May Double by 2012, Says Fitch (HousingWire)
  • DC, NYC Loans Driving CMBS Defaults (GlobeSt)
  • Fitch: U.S. CREL CDO Delinquencies Up Slightly to 12.3%; 25% Possible by YE (Fitch Release)
  • Shopping Center Receiverships and Foreclosures Usher In New Year (CoStar)
  • Cincinnati’s real estate problems threaten recovery (BusinessCourier)
  • Lodging Stocks In 2010 (Investopedia)
  • Foreign Investors Revive Optimism in US Real Estate (HousingWire/AFIRE Survey)
  • CMBS downgrades hit Asia-Pacific performance (StructuredCreditInvestor/paywall)
  • Multifamily Predicted to Hit Bottom by Year End (HousingFinance)
  • CMBS delinquencies pass 6 pct for first time (Reuters)
  • Lender Processing Services’ December 2009 Mortgage Monitor Report Reveals One in Every 7.5 Properties Behind on Payments or in Foreclosure, 5.01 Percent of Loans Rolled to More Delinquent Status vs. 1.52 Percent That Improved (Lender Processing Services)
  • More than 13% of Mortgages Delinquent or Foreclosed in November: LPS (HousingWire)
  • Credit-Card Trends Mixed, Capital One/Discover/BAC/AMEX/JPM (WSJ)
  • AmEx 30-Day Managed Delinquencies: 3.7% In Dec Vs 3.9% In Nov (WSJ)
  • Fannie’s Serious Delinquencies Nears 5% in November (HousingWire)
  • S&P Revises Method For Estimating Losses On RMBS From 2005-07 (WSJ)
  • Moody's Puts $572.7 Bln In Alt-A RMBS On Watch For Downgrade (WSJ)
  • New RMBS Seeing Some Success Abroad (HousingWire)
  • Prime Jumbo RMBS Delinquencies Swell to 9.2%: Fitch (HousingWire)
  • Invesco Raises Nearly $149m to Buy RMBS, CMBS (HousingWire)
  • Amherst Projects ‘Awful’ Option ARM Performance (HousingWire)

$QABA (First Trust NASDAQ ABA Community Bank Index Fund) (Courtesy of Stockcharts.com)

Jim Jubak: Nervous About UK Crisis, China Bubble, Likes Emerging Markets (EEM, EMB), What About US Dollar Carry Trade?

Interesting articles are out by Jim Jubak who writes for MSN Money. He's nervous about a potential UK financial crisis and ratings downgrade. If there's a debt and currency crisis in the UK it could affect the US. He also believes China is in a bubble.

1) The coming economic crisis in China (MSN Money - 1/14/2009)

2) A new world: Where to put your money now (Emerging Markets, EEM, EMB) (MSN Money - 1/11/2010)

3) Anarchy in the UK (and US, too)? (MSN Money - 1/7/2010)

3.5) The UK could drag the US down (MSN Money Video - 1/13/2010)


I wonder what Jim thinks about Roubini's recent view that a sharp reversal in the US Dollar carry trade could affect emerging market asset prices, even though he thinks it could be 6-12 months out from December, 2009 (post w/video).