http://finance.yahoo.com/intlindices
Full Version: IDS World Markets Fri 29th June 07
Stool Pigeons Wire Message Board > Stock Market Message Board > Intraday Stool- Stock Market Short Term Trading
A relatively weak day overall, not surprising as yesterday's run took us to a resistance area on the daily chart. All Ords flat with only a sprinkling of green sectors; Consumer Staples is up the most at a mere +0.3%. At the other end, IT is in a dive, -2.2%.
Not much movement in the miners: BHP +0.5%, RIO +0.9%, Newmont -1.3% and Newcrest +0.3%.
Big volume on the oils but not much traction: Woodside +0.8% and Santos -0.1%.
Japan Consumer Prices Fall, Jobless Is at 9-Year Low
June 29 (Bloomberg) -- Japan's consumer prices fell 0.1 percent in May, a pace of decline that's unlikely to deter the central bank from raising its benchmark interest rate, the lowest among major economies.
Consumer prices excluding fresh food decreased for a fourth month from a year ago, the statistics bureau said today in Tokyo.
Bank of Japan Governor Toshihiko Fukui said last month that price declines wouldn't necessarily prevent the bank from raising the key rate from 0.5 percent as long as it's confident about the prospects for economic growth. The jobless rate held at a nine- year low of 3.8 percent in May and household spending rose for a fifth month, separate reports showed.
June 29 (Bloomberg) -- Japan's consumer prices fell 0.1 percent in May, a pace of decline that's unlikely to deter the central bank from raising its benchmark interest rate, the lowest among major economies.
Consumer prices excluding fresh food decreased for a fourth month from a year ago, the statistics bureau said today in Tokyo.
Bank of Japan Governor Toshihiko Fukui said last month that price declines wouldn't necessarily prevent the bank from raising the key rate from 0.5 percent as long as it's confident about the prospects for economic growth. The jobless rate held at a nine- year low of 3.8 percent in May and household spending rose for a fifth month, separate reports showed.
New Zealand's Economic Growth Accelerates on Spending
June 29 (Bloomberg) -- New Zealand's economic growth accelerated in the first quarter as record high interest rates drove up the currency, spurring demand for cheaper imports and hurting exporters.
Gross domestic product increased 1 percent in the three months ended March 31 from the fourth quarter when the economy expanded 0.8 percent, Statistics New Zealand said in Wellington today.
Accelerating growth has caused a dilemma for the central bank, which has raised its benchmark rate to 8 percent to quell inflation, making New Zealand's dollar a favorite for investors seeking high yields. The currency's gain, to a 22-year high earlier today, has sapped exporters' earnings and forced companies to shift factories overseas.
June 29 (Bloomberg) -- New Zealand's economic growth accelerated in the first quarter as record high interest rates drove up the currency, spurring demand for cheaper imports and hurting exporters.
Gross domestic product increased 1 percent in the three months ended March 31 from the fourth quarter when the economy expanded 0.8 percent, Statistics New Zealand said in Wellington today.
Accelerating growth has caused a dilemma for the central bank, which has raised its benchmark rate to 8 percent to quell inflation, making New Zealand's dollar a favorite for investors seeking high yields. The currency's gain, to a 22-year high earlier today, has sapped exporters' earnings and forced companies to shift factories overseas.
U.K. House Prices Rise More Than Forecast in June
June 28 (Bloomberg) -- U.K. house prices advanced this month at the fastest pace since December, bolstering the case for an interest-rate increase by the Bank of England next week.
The average cost of a home rose 1.1 percent from May to 184,070 pounds ($368,000), according to figures from Nationwide Building Society, the biggest U.K. mortgage lender. The annual pace of house price growth accelerated to 11.1 percent, the fastest since January 2005.
June 28 (Bloomberg) -- U.K. house prices advanced this month at the fastest pace since December, bolstering the case for an interest-rate increase by the Bank of England next week.
The average cost of a home rose 1.1 percent from May to 184,070 pounds ($368,000), according to figures from Nationwide Building Society, the biggest U.K. mortgage lender. The annual pace of house price growth accelerated to 11.1 percent, the fastest since January 2005.
German Unemployment Falls to 12-Year Low on Growth
June 28 (Bloomberg) -- Germany's unemployment rate fell to the lowest level in 12 years in June as growth in Europe's largest economy encouraged companies to invest and hire.
The jobless rate, adjusted for seasonal swings, declined to 9.1 percent from 9.2 percent last month, the lowest since March 1995, the Nuremberg-based Labor Agency said today. The adjusted number of people out of work fell 37,000 to 3.82 million. Economists expected a drop of 20,000, according to the median of 39 forecasts in a Bloomberg News survey.
---------------
German Consumer Prices Barely Rise in June
June 28 (Bloomberg) -- Consumer prices in Germany, Europe's largest economy, barely rose in June as lower costs for goods such as clothing and shoes helped offset higher energy prices.
German inflation may be pushed higher in coming months as an expanding economy and faster hiring make it easier for companies to raise prices and for workers to demand more pay. Oil prices have gained 39 percent since mid-January. The European Central Bank has already signaled it's ready to raise interest rates further to prevent consumer-price gains.
June 28 (Bloomberg) -- Germany's unemployment rate fell to the lowest level in 12 years in June as growth in Europe's largest economy encouraged companies to invest and hire.
The jobless rate, adjusted for seasonal swings, declined to 9.1 percent from 9.2 percent last month, the lowest since March 1995, the Nuremberg-based Labor Agency said today. The adjusted number of people out of work fell 37,000 to 3.82 million. Economists expected a drop of 20,000, according to the median of 39 forecasts in a Bloomberg News survey.
---------------
German Consumer Prices Barely Rise in June
June 28 (Bloomberg) -- Consumer prices in Germany, Europe's largest economy, barely rose in June as lower costs for goods such as clothing and shoes helped offset higher energy prices.
German inflation may be pushed higher in coming months as an expanding economy and faster hiring make it easier for companies to raise prices and for workers to demand more pay. Oil prices have gained 39 percent since mid-January. The European Central Bank has already signaled it's ready to raise interest rates further to prevent consumer-price gains.
I’ve got curious enough to learn why the Japanese yen getting cheaper. Normally, I don’t bother myself with such a subject because I don’t exactly understand an elaborate explanation about causal relationships among several factors such as nominal interest rate, bonds and etc, each of which is by itself a mysterious subject to me. 
I checked one of the major Japanese newspapers to see how Japanese people are explained about why the Japanese yen keeps going down against foreign currencies such as NZD, XAD and XEU.
According to an article published on 6/18/07, there are 3 reasons. One is difference in interest rates. We already know this because it has been discussed on Intra and M2M.
(By the way, I prefer separate boards because it's easy to distinguish what's discussed during and after)
Globally higher stock price is the second reason mentioned. Investors’ tolerance of risk increases as stock prices rise and facilitates the selling of their borrowed Yen to buy other currencies in order to invest in markets other than Japan’s. We know that too.
The third one is a new one noticed by this respected newspaper: Japanese individual investors (I know Wyndy talked about Japanese housewives trading at home). They’ve got tired of meager gains available in the Japanese market and began purchasing trust funds investing in profitable foreign stocks, which is the same thing as selling the Japanese yen.
The total net asset of such international trust funds amounts to 859,800M Yen ($69,902,400 $1=Y123. This is today’s rate), as of the end of May, 2007. The total net asset of Japanese type trust funds investing in Japanese stocks is 778,470M Yen. This is the first time that the asset of the international type exceeded that of the Japanese type.
Japanese employees are customarily paid a bonus equivalent to two to several months’ monthly pay twice a year: June and December. Many Japanese investors may use part of this money for the international type, which in turn may further decrease the value of Yen against foreign currencies.
How much will they receive or have they received in this summer bonus season?
According to another article I browsed, about 70 percent of the Japanese employees receive summer bonuses this year. An average bonus amount of a major corporation is about 890,000 yen or $7,200 ($1=Y123 Today’s rate). 19 percent of the total bonus goes to saving, which is about $1,400.
Although I don’t know how much out of $1,400 is go to international type, I know that many of my friends in Japan have saving accounts based on foreign currencies. Major banks and City Group usually offers six currency choices. They are $, XED, XAD, NZD, British Pond and Canadian Dollar.
Assuming that the reasoning of the 6/18/07 article is sound, the cheap yen will then at least continue till Japanese people finish taking vacation and purchasing big items and decide what to do about the rest of the bonus.
My WAG is that they’ll decide by the end of August, which mean that the cheap yen will continue around that time. My basis of this WAG is a Japanese advertisement I saw. It invites readers to financial seminars on how to manage money. This seminar offered by a major financial institution takes place at the beginning of June and that of September.
http://www.yomiuri.co.jp/atmoney/mnews/20070619mh09.htm
http://japan.cnet.com/column/naruhodo/stor...20161807,00.htm
I checked one of the major Japanese newspapers to see how Japanese people are explained about why the Japanese yen keeps going down against foreign currencies such as NZD, XAD and XEU.
According to an article published on 6/18/07, there are 3 reasons. One is difference in interest rates. We already know this because it has been discussed on Intra and M2M.
(By the way, I prefer separate boards because it's easy to distinguish what's discussed during and after)
Globally higher stock price is the second reason mentioned. Investors’ tolerance of risk increases as stock prices rise and facilitates the selling of their borrowed Yen to buy other currencies in order to invest in markets other than Japan’s. We know that too.
The third one is a new one noticed by this respected newspaper: Japanese individual investors (I know Wyndy talked about Japanese housewives trading at home). They’ve got tired of meager gains available in the Japanese market and began purchasing trust funds investing in profitable foreign stocks, which is the same thing as selling the Japanese yen.
The total net asset of such international trust funds amounts to 859,800M Yen ($69,902,400 $1=Y123. This is today’s rate), as of the end of May, 2007. The total net asset of Japanese type trust funds investing in Japanese stocks is 778,470M Yen. This is the first time that the asset of the international type exceeded that of the Japanese type.
Japanese employees are customarily paid a bonus equivalent to two to several months’ monthly pay twice a year: June and December. Many Japanese investors may use part of this money for the international type, which in turn may further decrease the value of Yen against foreign currencies.
How much will they receive or have they received in this summer bonus season?
According to another article I browsed, about 70 percent of the Japanese employees receive summer bonuses this year. An average bonus amount of a major corporation is about 890,000 yen or $7,200 ($1=Y123 Today’s rate). 19 percent of the total bonus goes to saving, which is about $1,400.
Although I don’t know how much out of $1,400 is go to international type, I know that many of my friends in Japan have saving accounts based on foreign currencies. Major banks and City Group usually offers six currency choices. They are $, XED, XAD, NZD, British Pond and Canadian Dollar.
Assuming that the reasoning of the 6/18/07 article is sound, the cheap yen will then at least continue till Japanese people finish taking vacation and purchasing big items and decide what to do about the rest of the bonus.
My WAG is that they’ll decide by the end of August, which mean that the cheap yen will continue around that time. My basis of this WAG is a Japanese advertisement I saw. It invites readers to financial seminars on how to manage money. This seminar offered by a major financial institution takes place at the beginning of June and that of September.
http://www.yomiuri.co.jp/atmoney/mnews/20070619mh09.htm
http://japan.cnet.com/column/naruhodo/stor...20161807,00.htm
Morning Stoolers
Big up day expected in Jo'burg today - end of month shenanigans
Doc, let's keep two threads, please. It is just more orderly and hopefully Mark will return to open M2M in the near future. We need him to blance the Stool Universe. He is the yang to our yin. Shorty and Mark, Mork and Mindy, Coke and Pepsi
You need the oppsite to appreciate the similiar.
{end of rant}
In other world events Macquirie Bank taking the pipe in Sydney?
Big up day expected in Jo'burg today - end of month shenanigans
Doc, let's keep two threads, please. It is just more orderly and hopefully Mark will return to open M2M in the near future. We need him to blance the Stool Universe. He is the yang to our yin. Shorty and Mark, Mork and Mindy, Coke and Pepsi
You need the oppsite to appreciate the similiar.
{end of rant}
In other world events Macquirie Bank taking the pipe in Sydney?
The dual concepts of yin and yang – or the single concept Yin-Yang – originate in ancient Chinese philosophy and metaphysics, which describe two primal opposing but complementary principles or cosmic forces said to be found in all non-static objects and processes in the universe. The concept is the cornerstone for Taoism and traditional Chinese medicine.
Yīn (陰 or 阴 "shady place, north slope, south bank (river); cloudy, overcast"; Japanese: in or on) is the dark element: it is passive, dark, feminine, downward-seeking, and corresponds to the night.
Yáng (陽 or 阳 "sunny place, south slope, north bank (river), sunshine"; Japanese: yō) is the bright element: it is active, light, masculine, upward-seeking and corresponds to the daytime.
Yin is often symbolized by water and earth, while yang is symbolized by fire and wind.
Yin (the receptive, feminine, dark, passive force) and yang (the creative, masculine, bright, active force) are descriptions of complementary opposites rather than absolutes. Any yin/yang dichotomy can be viewed from another perspective. All forces in nature can be seen as having yin and yang states, and the two are in movement rather than held in absolute stasis.
from Wikipedia Are Bears feminine?
Yīn (陰 or 阴 "shady place, north slope, south bank (river); cloudy, overcast"; Japanese: in or on) is the dark element: it is passive, dark, feminine, downward-seeking, and corresponds to the night.
Yáng (陽 or 阳 "sunny place, south slope, north bank (river), sunshine"; Japanese: yō) is the bright element: it is active, light, masculine, upward-seeking and corresponds to the daytime.
Yin is often symbolized by water and earth, while yang is symbolized by fire and wind.
Yin (the receptive, feminine, dark, passive force) and yang (the creative, masculine, bright, active force) are descriptions of complementary opposites rather than absolutes. Any yin/yang dichotomy can be viewed from another perspective. All forces in nature can be seen as having yin and yang states, and the two are in movement rather than held in absolute stasis.
from Wikipedia Are Bears feminine?
End of financial year shenanigans today. All Ords closed +0.2% with nothing particularly exciting to report on the action. Consumer Staples continued in the lead, +1% followed by Materials +0.5%. Telecomms ended down the most, -1.8%.
Miners stayed pretty much in stagnant mode: BHP and RIO both +0.4%, Newcrest flat and Newmont -0.9%.
Not much joy in the oils either: Woodside flat and Santos -0.4%.
Over in Asia, Nikkers the only one showing much enthusiasm, +1.2% with the rest having minor gains or losses.
Over to UK/Europe:
http://finance.yahoo.com/intlindices?e=europe
Regarding the two-thread discussion maybe there's a Stoolie (approved by Doc, of course) who would be willing to step up and take over M2M? IDS is really more for short posts during US trading hours and it would also be hard to know when to close the thread. If I do it when the new trading day starts in the Antipodes then I'm gonna cut off US evening discussion and if the thread is left open I'm going to be butting in with stuff that is more relevant to the next trading day in the US.....
QUOTE(DrStool @ Jun 28 2007, 09:01 PM)
Let the games begin.
Exhibit A- something for everyone.
Exhibit A- something for everyone.
Much to my wallet's pain as a consumer, I still have to disagree, or lets say there is a big chance that black gold can top 100 bucks soon or remain at these inflated levels.
Currently analcysts aren't überbullish and no top has been made without that condition, labeling it sine qua non for a significant top formation in my view. This can change over the coming weeks though, but the channel that you propose and the H&S probably isn't going to stick.
RSI looks poised for a drop, but it could very well go to 80 blowing off to a new ATH before disturbation starts. Equities are showing the way, and excluding a transversal correction (it can happen with china shlock market debacle kicking this off soon in the global growth plays) big earl won't be going down soon.
Regarding those touting magazines and articles about the "oil glut" I leave you with this magazine cover circa early 1999 (d bootoom of earl, 1 dollar short of reaching single digits per barrel)
"Standard & Poor's, Moody's Investors Service and Fitch Ratings are masking burgeoning losses in the market for subprime mortgage bonds by failing to cut the credit ratings on about $200 billion of securities backed by home loans."
"Losses may rival the savings and loan crisis of the 1980s and 1990s. The Resolution Trust Corp., formed by the U.S. government to resolve the thrift crisis, sold $452 billion of assets at a cost to taxpayers of about $140 billion."
Is that inflation adjusted?
" All but five of 120 securities in BBB or BBB- rated portions of the mortgage-backed securities would have failed S&P's criteria, according to data compiled by Bloomberg.
None have been downgraded, though S&P and Moody's have parts of three pools of securities linked to the index under review for a downgrade. Fitch has downgraded parts of three mortgage pools tied to the ABX and put four on watch for downgrade. "
Warning: big Gloomberg article:
http://www.bloomberg.com/apps/news?pid=206...19xc&refer=home
I'm a bit skeptical of some of this, it sounds like they are trying to get bagholders in to panic and throw the baby out with the water to the voracious pigmen.
QUOTE(Jetlag @ Jun 29 2007, 09:54 AM)
QUOTE(DrStool @ Jun 28 2007, 09:01 PM)
Let the games begin.
Exhibit A- something for everyone.
Exhibit A- something for everyone.
Much to my wallet's pain as a consumer, I still have to disagree, or lets say there is a big chance that black gold can top 100 bucks soon or remain at these inflated levels.
Currently analcysts aren't überbullish and no top has been made without that condition, labeling it sine qua non for a significant top formation in my view. This can change over the coming weeks though, but the channel that you propose and the H&S probably isn't going to stick.
RSI looks poised for a drop, but it could very well go to 80 blowing off to a new ATH before disturbation starts. Equities are showing the way, and excluding a transversal correction (it can happen with china shlock market debacle kicking this off soon in the global growth plays) big earl won't be going down soon.
Regarding those touting magazines and articles about the "oil glut" I leave you with this magazine cover circa early 1999 (d bootoom of earl, 1 dollar short of reaching single digits per barrel)
Some people on this board were looking for lot less then $10 during 2001-2003
QUOTE(Jetlag @ Jun 29 2007, 10:54 AM)
QUOTE(DrStool @ Jun 28 2007, 09:01 PM)
Let the games begin.
Exhibit A- something for everyone.
Exhibit A- something for everyone.
Much to my wallet's pain as a consumer, I still have to disagree, or lets say there is a big chance that black gold can top 100 bucks soon or remain at these inflated levels.
Currently analcysts aren't überbullish and no top has been made without that condition, labeling it sine qua non for a significant top formation in my view. This can change over the coming weeks though, but the channel that you propose and the H&S probably isn't going to stick.
RSI looks poised for a drop, but it could very well go to 80 blowing off to a new ATH before disturbation starts. Equities are showing the way, and excluding a transversal correction (it can happen with china shlock market debacle kicking this off soon in the global growth plays) big earl won't be going down soon.
Regarding those touting magazines and articles about the "oil glut" I leave you with this magazine cover circa early 1999 (d bootoom of earl, 1 dollar short of reaching single digits per barrel)
***************
JETLAG, you make my point about a well supplied oil market. And once again, as in 1998 1999, it is an absolute fact that we are currently well supplied in oil.
Therefore, like many other asset prices in this market, the price of commodities can, have and will trended higher due to other forces (as stated in the previous post) than traditional market place inputs.
Exhibit A is housing, exhibit B is copper, nickel, zinc, uranium, steel, etc...
The energy complex is always the last commodity group to peak prior to the bust.
It would not surpise me that oil does run up much further. As stated, in the previous post you referred to, we have many "if's" to occur for oil to fall.
Heck, if a pipe springs a leak, traders use this to run up prices. It is just a super hyper active market. Take advantage while you can. However such incidents are a drop in the bucket to overall total supply. Such news events have nothing to do with reality.
I handled contracts and dealt with on a direct basis with majors out of their NY trading desks and purchased tanker loads of oil for years. Dealt directly with Exxon. Believe me, Exxon is a very, very, confident organization. It did not surprise me that they pulled out. Conoco is also a very entrenched org. These guys are some of the toughest guys to deal with than any other single industry. They eat nails for breakfast.
QUOTE(Jetlag @ Jun 29 2007, 10:10 AM)
"Standard & Poor's, Moody's Investors Service and Fitch Ratings are masking burgeoning losses in the market for subprime mortgage bonds by failing to cut the credit ratings on about $200 billion of securities backed by home loans."
"Losses may rival the savings and loan crisis of the 1980s and 1990s. The Resolution Trust Corp., formed by the U.S. government to resolve the thrift crisis, sold $452 billion of assets at a cost to taxpayers of about $140 billion."
Is that inflation adjusted?
" All but five of 120 securities in BBB or BBB- rated portions of the mortgage-backed securities would have failed S&P's criteria, according to data compiled by Bloomberg.
None have been downgraded, though S&P and Moody's have parts of three pools of securities linked to the index under review for a downgrade. Fitch has downgraded parts of three mortgage pools tied to the ABX and put four on watch for downgrade. "
Warning: big Gloomberg article:
http://www.bloomberg.com/apps/news?pid=206...19xc&refer=home
I'm a bit skeptical of some of this, it sounds like they are trying to get bagholders in to panic and throw the baby out with the water to the voracious pigmen.
Toxic waste may be good for Government sponsored institutions or FCB
Click and see toxic waste holder
OMG Toxic waste holder may also do well during those dark days
QUOTE(FeedFool @ Jun 29 2007, 06:32 AM)
QUOTE(Jetlag @ Jun 29 2007, 10:10 AM)
"Standard & Poor's, Moody's Investors Service and Fitch Ratings are masking burgeoning losses in the market for subprime mortgage bonds by failing to cut the credit ratings on about $200 billion of securities backed by home loans."
"Losses may rival the savings and loan crisis of the 1980s and 1990s. The Resolution Trust Corp., formed by the U.S. government to resolve the thrift crisis, sold $452 billion of assets at a cost to taxpayers of about $140 billion."
Is that inflation adjusted?
" All but five of 120 securities in BBB or BBB- rated portions of the mortgage-backed securities would have failed S&P's criteria, according to data compiled by Bloomberg.
None have been downgraded, though S&P and Moody's have parts of three pools of securities linked to the index under review for a downgrade. Fitch has downgraded parts of three mortgage pools tied to the ABX and put four on watch for downgrade. "
Warning: big Gloomberg article:
http://www.bloomberg.com/apps/news?pid=206...19xc&refer=home
I'm a bit skeptical of some of this, it sounds like they are trying to get bagholders in to panic and throw the baby out with the water to the voracious pigmen.
Toxic waste may be good for Government sponsored institutions or FCB
Click and see
I wouldn't underestimate the power of Government to screw the taxpayers over, don't short government sponsored zombies.
QUOTE(FeedFool @ Jun 29 2007, 07:28 AM)
QUOTE(Jetlag @ Jun 29 2007, 09:54 AM)
QUOTE(DrStool @ Jun 28 2007, 09:01 PM)
Let the games begin.
Exhibit A- something for everyone.
Exhibit A- something for everyone.
Much to my wallet's pain as a consumer, I still have to disagree, or lets say there is a big chance that black gold can top 100 bucks soon or remain at these inflated levels.
Currently analcysts aren't überbullish and no top has been made without that condition, labeling it sine qua non for a significant top formation in my view. This can change over the coming weeks though, but the channel that you propose and the H&S probably isn't going to stick.
RSI looks poised for a drop, but it could very well go to 80 blowing off to a new ATH before disturbation starts. Equities are showing the way, and excluding a transversal correction (it can happen with china shlock market debacle kicking this off soon in the global growth plays) big earl won't be going down soon.
Regarding those touting magazines and articles about the "oil glut" I leave you with this magazine cover circa early 1999 (d bootoom of earl, 1 dollar short of reaching single digits per barrel)
Some people on this board were looking for lot less then $10 during 2001-2003
To the best of my recollection, and in this case I have been here the whole time and read every post, and my memory is pretty good on this stuff, I don't remember anyone saying that. Perhaps you could find an example of someone who did.
In fact, contrary to that idea, there were quite a few energy bulls here very early in the game. If you dig down, you will find that when it comes to sectors and individual stocks stoolies have time and time again made fantastic calls.
Aussibear- good points. Opinions seem evenly split and that's good enough for me to just leave things the way they are. If there were a groundswell asking for one forum instead of two, we can always change.
As for Mark opening M2M, Mark says that his new employer has basically shut down internet access at work. So unless he gets a different job, or finds some other way around the ban, we don't have a regular opener for M2M.
On the days when I'm not around, any registered member can start the thread, but we just have to be careful there aren't multiple competing threads. That could be cumbersome.
Or fun... who knows.
As for Mark opening M2M, Mark says that his new employer has basically shut down internet access at work. So unless he gets a different job, or finds some other way around the ban, we don't have a regular opener for M2M.
On the days when I'm not around, any registered member can start the thread, but we just have to be careful there aren't multiple competing threads. That could be cumbersome.
Or fun... who knows.
I warned of the mortgage meltdown to come back in 2004 in my Wall Street Examiner Professional Edition real estate reports. I even gave a timeline back in 2005 and last year, which has pretty much been on the money.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
Good Morning!
Welcome to Intraday Stool! Thanks to aussiebear for her daily opening!
You can join the discussion by registering (PG rated user names only, please) and posting here as well.
Registration is easy. Just click the Register link above, enter your email address (which you have the option to keep confidential), and enter a user name. To keep out spammers and scammers, I'll send you an email with a few Monty Python type questions. Just reply with your answers, and I'll approve your registration as soon as I receive your reply.
If you have questions about how to register and post, use the Help link in the menu bar at the top of the page.
If you know others who might be interested in joining us, use the email to a friend link above the thread.
Many tanks for joining us!
Doc
Try the Professional Edition risk free for thirty days. If, within that time you don't find the information helpful, I'll give you a full refund. It's that simple!Click here for more information.
Subscribe to the Wall Street Examiner Professional Edition Precious Metals Daily, just $39 quarterly. Try it risk free for 30 days!
Get this indispensable daily analysis and support the Stool!
Welcome to Intraday Stool! Thanks to aussiebear for her daily opening!
You can join the discussion by registering (PG rated user names only, please) and posting here as well.
Registration is easy. Just click the Register link above, enter your email address (which you have the option to keep confidential), and enter a user name. To keep out spammers and scammers, I'll send you an email with a few Monty Python type questions. Just reply with your answers, and I'll approve your registration as soon as I receive your reply.
If you have questions about how to register and post, use the Help link in the menu bar at the top of the page.
If you know others who might be interested in joining us, use the email to a friend link above the thread.
Many tanks for joining us!
Doc
Try the Professional Edition risk free for thirty days. If, within that time you don't find the information helpful, I'll give you a full refund. It's that simple!Click here for more information.
Subscribe to the Wall Street Examiner Professional Edition Precious Metals Daily, just $39 quarterly. Try it risk free for 30 days!
Get this indispensable daily analysis and support the Stool!
QUOTE(Schonthaler @ Jun 29 2007, 06:31 AM)
QUOTE(Jetlag @ Jun 29 2007, 10:54 AM)
QUOTE(DrStool @ Jun 28 2007, 09:01 PM)
Let the games begin.
Exhibit A- something for everyone.
Exhibit A- something for everyone.
Regarding those touting magazines and articles about the "oil glut" I leave you with this magazine cover circa early 1999 (d bootoom of earl, 1 dollar short of reaching single digits per barrel)
***************
JETLAG, you make my point about a well supplied oil market. And once again, as in 1998 1999, it is an absolute fact that we are currently well supplied in oil.
Therefore, like many other asset prices in this market, the price of commodities can, have and will trended higher due to other forces (as stated in the previous post) than traditional market place inputs.
Exhibit A is housing, exhibit B is copper, nickel, zinc, uranium, steel, etc...
The energy complex is always the last commodity group to peak prior to the bust.
It would not surpise me that oil does run up much further. As stated, in the previous post you referred to, we have many "if's" to occur for oil to fall.
Heck, if a pipe springs a leak, traders use this to run up prices. It is just a super hyper active market. Take advantage while you can. However such incidents are drop in the bucket to overall total supply. Such news events have nothing to do with reality.
I handled contracts and dealt with on a direct basis with majors out of their NY trading desks and purchased tanker loads of oil for years. Dealt directly with Exxon. Believe me, Exxon is a very, very, arrogant organization. It did not surprise me that they pulled out. Conoco is also a very entrenched org. These guys are some of the toughest guys to deal with than any other single industry. They eat nails for breakfast.
I don't know if I follow you right?
"it is an absolute fact that we are currently well supplied in oil."
What do you mean? Global growth hasn't been this high since the 70's. Are there any serious studies indicating excessive supply? How can you think we're well supplied with oil while China is becoming the biggest auto market in the world? At the current rate it'll take 3 to 4 years. Worldwide growth and demand at the margin is driving up prices.
I agree that Bush, Putin, Nigeria and the refiners take any chance they have to drive up prices with stupid policies, geopolitical fear, terrorist attacks on oil rigs and "maintenance" shut downs, not necessarily in that order of relation to the latter.
"Exhibit A is housing, exhibit B is copper, nickel, zinc, uranium, steel, etc...
The energy complex is always the last commodity group to peak prior to the bust. "
I also think demand destruction will take longer to reach the margin consumers (BRICs) than before.
Regarding the arrogance of Big Oil, maybe it just derives from their feeling of power and oligopoly.
Man, the futes ramp really took a hit overnight. Seems like rallies these days, more and more, are being sold. T'day still could be an EOM launch day, but the window dressing doesn't seem to matter as much around July 4. J6P is more interested in beer, fireworks and NASCAR.
NASCAR is, after all, just a beer thing anyway.
re M2M - I miss the Mark of 2000-2002. I still have some of his original pieces saved to disc. Since 2003, Mark has largely sacrificed eloquence for correct market calls, in the face of a largely stubbornly bearish blog board. Myself included. I'd be happy to see him continue his own blog.
NASCAR is, after all, just a beer thing anyway.
re M2M - I miss the Mark of 2000-2002. I still have some of his original pieces saved to disc. Since 2003, Mark has largely sacrificed eloquence for correct market calls, in the face of a largely stubbornly bearish blog board. Myself included. I'd be happy to see him continue his own blog.
QUOTE(Jetlag @ Jun 29 2007, 12:56 PM)
QUOTE(Schonthaler @ Jun 29 2007, 06:31 AM)
QUOTE(Jetlag @ Jun 29 2007, 10:54 AM)
QUOTE(DrStool @ Jun 28 2007, 09:01 PM)
Let the games begin.
Exhibit A- something for everyone.
Exhibit A- something for everyone.
Regarding those touting magazines and articles about the "oil glut" I leave you with this magazine cover circa early 1999 (d bootoom of earl, 1 dollar short of reaching single digits per barrel)
***************
JETLAG, you make my point about a well supplied oil market. And once again, as in 1998 1999, it is an absolute fact that we are currently well supplied in oil.
Therefore, like many other asset prices in this market, the price of commodities can, have and will trended higher due to other forces (as stated in the previous post) than traditional market place inputs.
Exhibit A is housing, exhibit B is copper, nickel, zinc, uranium, steel, etc...
The energy complex is always the last commodity group to peak prior to the bust.
It would not surpise me that oil does run up much further. As stated, in the previous post you referred to, we have many "if's" to occur for oil to fall.
Heck, if a pipe springs a leak, traders use this to run up prices. It is just a super hyper active market. Take advantage while you can. However such incidents are drop in the bucket to overall total supply. Such news events have nothing to do with reality.
I handled contracts and dealt with on a direct basis with majors out of their NY trading desks and purchased tanker loads of oil for years. Dealt directly with Exxon. Believe me, Exxon is a very, very, arrogant organization. It did not surprise me that they pulled out. Conoco is also a very entrenched org. These guys are some of the toughest guys to deal with than any other single industry. They eat nails for breakfast.
I don't know if I follow you right?
"it is an absolute fact that we are currently well supplied in oil."
What do you mean? Global growth hasn't been this high since the 70's. Are there any serious studies indicating excessive supply? How can you think we're well supplied with oil while China is becoming the biggest auto market in the world? At the current rate it'll take 3 to 4 years. Worldwide growth and demand at the margin is driving up prices.
I agree that Bush, Putin, Nigeria and the refiners take any chance they have to drive up prices with stupid policies, geopolitical fear, terrorist attacks on oil rigs and "maintenance" shut downs, not necessarily in that order of relation to the latter.
"Exhibit A is housing, exhibit B is copper, nickel, zinc, uranium, steel, etc...
The energy complex is always the last commodity group to peak prior to the bust. "
I also think demand destruction will take longer to reach the margin consumers (BRICs) than before.
Regarding the arrogance of Big Oil, maybe it just derives from their feeling of power and oligopoly.
***************
All good points. Just stating that multiple views can co-exist on any analysis.
I posted the long term chart of oil last night over there. It prompted diametrically opposed views, which is exactly what I expected. The chart is very much on the fulcrum, and over the next year it should either top out around here, or around 80, or break out and give the bulls their next leg up. Right now, all I can say is wait and see.
I won't get into an argument about fundamentals. I don't have the facts, and I don't think they matter all that much anyway. It's a speculators market.
I will say that at an intuitive level, looking at where the chart has been and is now, I think this run is all but over, and that oil will top out this year, probably around 80. Certainly if it breaks 80 with good momo, it's going a lot higher, but right now I'm leaning toward the negative view.
Stay tuned.
I won't get into an argument about fundamentals. I don't have the facts, and I don't think they matter all that much anyway. It's a speculators market.
I will say that at an intuitive level, looking at where the chart has been and is now, I think this run is all but over, and that oil will top out this year, probably around 80. Certainly if it breaks 80 with good momo, it's going a lot higher, but right now I'm leaning toward the negative view.
Stay tuned.
QUOTE(Peek Paper @ Jun 29 2007, 07:02 AM)
re M2M - I miss the Mark of 2000-2002.
wish i were around then....
QUOTE(DrStool @ Jun 29 2007, 06:51 AM)
I warned of the mortgage meltdown to come back in 2004 in my Wall Street Examiner Professional Edition real estate reports. I even gave a timeline back in 2005 and last year, which has pretty much been on the money.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
i have a question ... before most crashes, was the event that caused the crash telegraphed everyday for months and years before it happened or were most crashes from some sort of event from left field ?
seems to me most crashes are started in one day from some event that was not even imagined.
i am leaning towards the next crash from a HUGE natural disaster that makes New Orleans look like a day at the beach. i am talking earth quake or Tsuami. anyway this is a good topic for M2M. i have to get to work ! lol
"8:30U.S. May real consumer spending up 0.1%
8:30U.S. May real disposable incomes fall 0.1%"
ha funny
8:30U.S. May real disposable incomes fall 0.1%"
ha funny
QUOTE(try2win @ Jun 29 2007, 07:22 AM)
QUOTE(DrStool @ Jun 29 2007, 06:51 AM)
I warned of the mortgage meltdown to come back in 2004 in my Wall Street Examiner Professional Edition real estate reports. I even gave a timeline back in 2005 and last year, which has pretty much been on the money.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
i have a question ... before most crashes, was the event that caused the crash telegraphed everyday for months and years before it happened or were most crashes from some sort of event from left field ?
seems to me most crashes are started in one day from some event that was not even imagined.
i am leaning towards the next crash from a HUGE natural disaster that makes New Orleans look like a day at the beach. i am talking earth quake or Tsuami. anyway this is a good topic for M2M. i have to get to work ! lol
I think we've had both, the steepest ones were the most telegraphed?
The only reliable indicator to recession, according to FED studies, has been the negative term spread.
QUOTE(try2win @ Jun 29 2007, 08:22 AM)
QUOTE(DrStool @ Jun 29 2007, 06:51 AM)
I warned of the mortgage meltdown to come back in 2004 in my Wall Street Examiner Professional Edition real estate reports. I even gave a timeline back in 2005 and last year, which has pretty much been on the money.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
i have a question ... before most crashes, was the event that caused the crash telegraphed everyday for months and years before it happened or were most crashes from some sort of event from left field ?
seems to me most crashes are started in one day from some event that was not even imagined.
i am leaning towards the next crash from a HUGE natural disaster that makes New Orleans look like a day at the beach. i am talking earth quake or Tsuami. anyway this is a good topic for M2M. i have to get to work ! lol
They are telegraphed, and there are always a few Cassandras out there warning everybody, but virtually no one listens. Hell, even the NY Times editorial page was warning of a crash before the fact in 1929. There were several others of note, perhaps the best known of whom was Roger Babson, but there were others.
The 87 break was telegraphed by the bond market collapse in May 87. Several forecasters were predicting a big drop. Elaine Garzarelli made her name then. I know of several speculators who made huge fortunes shorting the indexes before the 87 crash.
These things never come out of the blue, and they are NEVER triggered by natural disaster or political events. They are liquidity events-- sudden violent contractions following weeks or months of subtle deterioration in the liquidity picture.
There are some people who feel we are in just such a situation now.
QUOTE(try2win @ Jun 29 2007, 07:40 AM)
"8:30U.S. May real consumer spending up 0.1%
8:30U.S. May real disposable incomes fall 0.1%"
ha funny
8:30U.S. May real disposable incomes fall 0.1%"
ha funny
The consumer can still get credit.
All is well.
Beeg rally here in the premarket.
Everybody's tongue tied.
Covered RIMM at 192 for 6 point beating.
Hope no one listened to me last night.
Hope no one listened to me last night.
QUOTE(DrStool @ Jun 29 2007, 08:38 AM)
Everybody's tongue tied.
You see RIMM..
I'm speechless...
My JBLU breaking out.
explain this.........................
DJ Fed Accepts $3.25 Bln In 3-Day RPs
Type of transaction: 3-Day RPs
Total accepted: $3.25 Bln
Total submitted: $12.2 Bln
Agency Collateral Operation
Total accepted: $2.061 Bln
Total submitted: $3.9 Bln
Stop-Out Rate: 5.25%
Weighted Average: 5.3%
High-rate submitted: 5.31%
Low-rate submitted: 5.2%
Treasury Collateral Operation
Total accepted: $350 Mln
Total submitted: $4.85 Bln
Stop-Out Rate: 4.35%
Weighted Average: 4.49%
High-rate submitted: 4.55%
Low-rate submitted: 4%
Mortgage-Backed Collateral Operations
Total accepted: $839 Mln
Total submitted: $3.45 Bln
Stop-Out Rate: 5.3%
Weighted Average: 5.33%
High-rate submitted: 5.35%
Low-rate submitted: 5.25%
(Data was provided by the New York Federal Reserve Bank).
DJ Fed Accepts $3.25 Bln In 3-Day RPs
Type of transaction: 3-Day RPs
Total accepted: $3.25 Bln
Total submitted: $12.2 Bln
Agency Collateral Operation
Total accepted: $2.061 Bln
Total submitted: $3.9 Bln
Stop-Out Rate: 5.25%
Weighted Average: 5.3%
High-rate submitted: 5.31%
Low-rate submitted: 5.2%
Treasury Collateral Operation
Total accepted: $350 Mln
Total submitted: $4.85 Bln
Stop-Out Rate: 4.35%
Weighted Average: 4.49%
High-rate submitted: 4.55%
Low-rate submitted: 4%
Mortgage-Backed Collateral Operations
Total accepted: $839 Mln
Total submitted: $3.45 Bln
Stop-Out Rate: 5.3%
Weighted Average: 5.33%
High-rate submitted: 5.35%
Low-rate submitted: 5.25%
(Data was provided by the New York Federal Reserve Bank).
What's RIMM doing?
I just did our homeschool evaluation and have to bring our son in for a math test (proctored). I see that the indexes are up a bit. And oil looks solid above $70.
I'm still long like Windy. Took a beating as I mentioned before but things are a lot better now. Unless AMD is heading north. They announced a big delay in the FSN8 product moving it from Q3/Q4 to Q1 of 2008. nVidia announced some new cards at 65 nm that should beat AMD's stuff by a wider margin. nVidia's stuff already beats AMD's stuff.
I just did our homeschool evaluation and have to bring our son in for a math test (proctored). I see that the indexes are up a bit. And oil looks solid above $70.
I'm still long like Windy. Took a beating as I mentioned before but things are a lot better now. Unless AMD is heading north. They announced a big delay in the FSN8 product moving it from Q3/Q4 to Q1 of 2008. nVidia announced some new cards at 65 nm that should beat AMD's stuff by a wider margin. nVidia's stuff already beats AMD's stuff.
QUOTE(potatohead @ Jun 29 2007, 09:44 AM)
explain this.........................
DJ Fed Accepts $3.25 Bln In 3-Day RPs
Type of transaction: 3-Day RPs
Total accepted: $3.25 Bln
Total submitted: $12.2 Bln
Agency Collateral Operation
Total accepted: $2.061 Bln
Total submitted: $3.9 Bln
Stop-Out Rate: 5.25%
Weighted Average: 5.3%
High-rate submitted: 5.31%
Low-rate submitted: 5.2%
Treasury Collateral Operation
Total accepted: $350 Mln
Total submitted: $4.85 Bln
Stop-Out Rate: 4.35%
Weighted Average: 4.49%
High-rate submitted: 4.55%
Low-rate submitted: 4%
Mortgage-Backed Collateral Operations
Total accepted: $839 Mln
Total submitted: $3.45 Bln
Stop-Out Rate: 5.3%
Weighted Average: 5.33%
High-rate submitted: 5.35%
Low-rate submitted: 5.25%
(Data was provided by the New York Federal Reserve Bank).
DJ Fed Accepts $3.25 Bln In 3-Day RPs
Type of transaction: 3-Day RPs
Total accepted: $3.25 Bln
Total submitted: $12.2 Bln
Agency Collateral Operation
Total accepted: $2.061 Bln
Total submitted: $3.9 Bln
Stop-Out Rate: 5.25%
Weighted Average: 5.3%
High-rate submitted: 5.31%
Low-rate submitted: 5.2%
Treasury Collateral Operation
Total accepted: $350 Mln
Total submitted: $4.85 Bln
Stop-Out Rate: 4.35%
Weighted Average: 4.49%
High-rate submitted: 4.55%
Low-rate submitted: 4%
Mortgage-Backed Collateral Operations
Total accepted: $839 Mln
Total submitted: $3.45 Bln
Stop-Out Rate: 5.3%
Weighted Average: 5.33%
High-rate submitted: 5.35%
Low-rate submitted: 5.25%
(Data was provided by the New York Federal Reserve Bank).
Temporary shortage of Treasury collateral due to the paydowns on Thursday. Note that the action was all in Agencies and MBS collateral, where the weighted average was 5.3% or higher.
It seems to me that we always have a run up into a holiday (July 4).
Expect a peak of some kind in the S&Pee on July 3 at about 1530 something.
Expect a peak of some kind in the S&Pee on July 3 at about 1530 something.
Very often the case.
Okay, back from the School Administrator's Office with a stamp.
I see that RIMM is up 17%. Is that a lot? Who bought that before the close yesterday?
There's a breakaway gap in late 2004 and a measuring gap in October 2006. The measured move from $30 to $90 is $60. The move from $100 to $60 meets the objective of the measuring gap. So for you gap experts out there, is this the exhaustion gap?
I see that RIMM is up 17%. Is that a lot? Who bought that before the close yesterday?
There's a breakaway gap in late 2004 and a measuring gap in October 2006. The measured move from $30 to $90 is $60. The move from $100 to $60 meets the objective of the measuring gap. So for you gap experts out there, is this the exhaustion gap?
Odd, with such a big move up today you figure the financials will participate.
Currently GS is red...
MER is red...
HBC is red...
LEH is red...
WM is red...
BSC is red..
Currently GS is red...
MER is red...
HBC is red...
LEH is red...
WM is red...
BSC is red..
QUOTE(Sea urchin @ Jun 29 2007, 01:29 AM)
I’ve got curious enough to learn why the Japanese yen getting cheaper. Normally, I don’t bother myself with such a subject because I don’t exactly understand an elaborate explanation about causal relationships among several factors such as nominal interest rate, bonds and etc, each of which is by itself a mysterious subject to me.
I checked one of the major Japanese newspapers to see how Japanese people are explained about why the Japanese yen keeps going down against foreign currencies such as NZD, XAD and XEU.
According to an article published on 6/18/07, there are 3 reasons. One is difference in interest rates. We already know this because it has been discussed on Intra and M2M.
(By the way, I prefer separate boards because it's easy to distinguish what's discussed during and after)
Globally higher stock price is the second reason mentioned. Investors’ tolerance of risk increases as stock prices rise and facilitates the selling of their borrowed Yen to buy other currencies in order to invest in markets other than Japan’s. We know that too.
The third one is a new one noticed by this respected newspaper: Japanese individual investors. They’ve got tired of meager gains available in the Japanese market and began purchasing trust funds investing in profitable foreign stocks, which is the same thing as selling the Japanese yen.
The total net asset of such international trust funds amounts to 859,800M Yen ($69,902,400 $1=Y123. This is today’s rate), as of the end of May, 2007. The total net asset of Japanese type trust funds investing in Japanese stocks is 778,470M Yen. This is the first time that the asset of the international type exceeded that of the Japanese type.
Japan has two bonus seasons. Japanese employees are customarily paid a bonus equivalent to two to several months’ monthly pay twice a year: June and December. Many Japanese investors may use part of this money for the international type, which in turn may further decrease the value of Yen against foreign currencies.
How much bonus will they receive or have they received in this summer bonus season?
According to another article I browsed, about 70 percent of the Japanese employees receive summer bonuses this year. An average bonus amount of a major corporation is about 890,000 yen or $7,200 ($1=Y123 Today’s rate). 19 percent of the total bonus goes to saving, which is about $1,400.
Although I don’t know how much out of $1,400 is go to international type, I know that many of my friends in Japan have saving accounts based on foreign currencies.
Assuming that the reasoning of the 6/18/07 article is sound, the cheap yen will then continue till Japanese people finish taking vacation and purchasing big items and decide what to do about the rest of the bonus.
My WAG is that they’ll decide by the end of August, which mean that the cheap yen will continue around that time. My basis of this WAG is a Japanese advertisement I saw. It invites readers to financial seminars on how to manage money. This seminar takes place at the beginning of Jun and that of September.
http://www.yomiuri.co.jp/atmoney/mnews/20070619mh09.htm
http://japan.cnet.com/column/naruhodo/stor...20161807,00.htm
I checked one of the major Japanese newspapers to see how Japanese people are explained about why the Japanese yen keeps going down against foreign currencies such as NZD, XAD and XEU.
According to an article published on 6/18/07, there are 3 reasons. One is difference in interest rates. We already know this because it has been discussed on Intra and M2M.
(By the way, I prefer separate boards because it's easy to distinguish what's discussed during and after)
Globally higher stock price is the second reason mentioned. Investors’ tolerance of risk increases as stock prices rise and facilitates the selling of their borrowed Yen to buy other currencies in order to invest in markets other than Japan’s. We know that too.
The third one is a new one noticed by this respected newspaper: Japanese individual investors. They’ve got tired of meager gains available in the Japanese market and began purchasing trust funds investing in profitable foreign stocks, which is the same thing as selling the Japanese yen.
The total net asset of such international trust funds amounts to 859,800M Yen ($69,902,400 $1=Y123. This is today’s rate), as of the end of May, 2007. The total net asset of Japanese type trust funds investing in Japanese stocks is 778,470M Yen. This is the first time that the asset of the international type exceeded that of the Japanese type.
Japan has two bonus seasons. Japanese employees are customarily paid a bonus equivalent to two to several months’ monthly pay twice a year: June and December. Many Japanese investors may use part of this money for the international type, which in turn may further decrease the value of Yen against foreign currencies.
How much bonus will they receive or have they received in this summer bonus season?
According to another article I browsed, about 70 percent of the Japanese employees receive summer bonuses this year. An average bonus amount of a major corporation is about 890,000 yen or $7,200 ($1=Y123 Today’s rate). 19 percent of the total bonus goes to saving, which is about $1,400.
Although I don’t know how much out of $1,400 is go to international type, I know that many of my friends in Japan have saving accounts based on foreign currencies.
Assuming that the reasoning of the 6/18/07 article is sound, the cheap yen will then continue till Japanese people finish taking vacation and purchasing big items and decide what to do about the rest of the bonus.
My WAG is that they’ll decide by the end of August, which mean that the cheap yen will continue around that time. My basis of this WAG is a Japanese advertisement I saw. It invites readers to financial seminars on how to manage money. This seminar takes place at the beginning of Jun and that of September.
http://www.yomiuri.co.jp/atmoney/mnews/20070619mh09.htm
http://japan.cnet.com/column/naruhodo/stor...20161807,00.htm
SU glad to see you posting.
seems like everyone and their prior 20 generations is recommending RIMM today... Buy with 225,250,275,
Very nice...
QUOTE(DrStool @ Jun 29 2007, 07:47 AM)
QUOTE(try2win @ Jun 29 2007, 08:22 AM)
QUOTE(DrStool @ Jun 29 2007, 06:51 AM)
I warned of the mortgage meltdown to come back in 2004 in my Wall Street Examiner Professional Edition real estate reports. I even gave a timeline back in 2005 and last year, which has pretty much been on the money.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
We are only seeing the tip of the iceberg. This thing has barely started. The scope of problem will only become clear when the liquidity impacts in the financial markets make themselves felt. I expect that will start to happen as this year unfolds, moreso in 2008 and 2009. By then people will stop saying things like, "the subprime problem and the housing collapse don't matter."
As always, the crowd only recognizes the problem after the elephant has shit on the floor, not when it is entering the building. Then it's too late.
i have a question ... before most crashes, was the event that caused the crash telegraphed everyday for months and years before it happened or were most crashes from some sort of event from left field ?
seems to me most crashes are started in one day from some event that was not even imagined.
i am leaning towards the next crash from a HUGE natural disaster that makes New Orleans look like a day at the beach. i am talking earth quake or Tsuami. anyway this is a good topic for M2M. i have to get to work ! lol
They are telegraphed, and there are always a few Cassandras out there warning everybody, but virtually no one listens. Hell, even the NY Times editorial page was warning of a crash before the fact in 1929. There were several others of note, perhaps the best known of whom was Roger Babson, but there were others.
The 87 break was telegraphed by the bond market collapse in May 87. Several forecasters were predicting a big drop. Elaine Garzarelli made her name then. I know of several speculators who made huge fortunes shorting the indexes before the 87 crash.
These things never come out of the blue, and they are NEVER triggered by natural disaster or political events. They are liquidity events-- sudden violent contractions following weeks or months of subtle deterioration in the liquidity picture.
There are some people who feel we are in just such a situation now.
I don't remember Russia's default in 98 being telegraphed, but you could argue that the Asian crisis was going to cause it.
For all you conspiracy buffs From Bill Cara's blog
Something has to give. As you know, the equity market was ready in mid-May 2006, a year ago, to start a natural primary Bear phase (reverting back to the mean), but, I believe, the US Administration then made a decision to call in the Goldman Sachs team to take control of the Treasury Dept and the Federal Reserve Bank trading desk.
We know the result. The culprit, of course, is Hank Paulson, the man who two days ago told us he has a plan to fix the problems in the system. Look, Hank Paulson is the problem. The week he took office as Treasury Secretary, he visited the floor operations of the exchanges in New York and Chicago, winking and nudging his associates. Oh, to be a fly on the wall to hear his phone calls to his Friends at HPEC and HB&B!
Yes, the past year has been something to behold as the dynamic duo of HPEC and HB&B took control of perhaps a trillion dollars worth of assets by way of Treasury/Fed grease in the form of loans. Life to these people became as simple as hitting the Easy Button.
But the problem for Paulson is that even the most uneducated and unsophisticated of us know you can only hide the growing garbage pile so long before the stench becomes overwhelming.
The reality is that there is not much asset backing to those loans, and HB&B has tried to hide the problem by (i) not pricing those assets to market, and (ii) laying off their risk through credit swaps, which is an incredible Ponzi scheme of sorts. The difference here is that, being a competitive and suspicious marketplace, the returns were not exorbitant, so the high risks involved had to be sold by the Sell-side as being minimal risk.
Oh my, this is not PhD thesis stuff, and moreover, to all those who write in here to say to me ‘Stop the conspiracy theory stuff’ I say find yourself another blog to read. This stuff is in your face and mine every day. The problem is so bad that I truly think that people like Marc Faber and Nouriel Roubini ought to be awarded Nobel Prizes for warning us. In fact, I don’t know how Paulson, Bernanke, and their cronies who head up HB&B, can even sleep at night.
However, that problem is theirs; we must stick to our own knitting. We have capital to protect and to try to grow in the most prudent way possible.
http://www.billcara.com/archives/2007/06/c...jun_4.html#more
From Bill Cara's blogSomething has to give. As you know, the equity market was ready in mid-May 2006, a year ago, to start a natural primary Bear phase (reverting back to the mean), but, I believe, the US Administration then made a decision to call in the Goldman Sachs team to take control of the Treasury Dept and the Federal Reserve Bank trading desk.
We know the result. The culprit, of course, is Hank Paulson, the man who two days ago told us he has a plan to fix the problems in the system. Look, Hank Paulson is the problem. The week he took office as Treasury Secretary, he visited the floor operations of the exchanges in New York and Chicago, winking and nudging his associates. Oh, to be a fly on the wall to hear his phone calls to his Friends at HPEC and HB&B!
Yes, the past year has been something to behold as the dynamic duo of HPEC and HB&B took control of perhaps a trillion dollars worth of assets by way of Treasury/Fed grease in the form of loans. Life to these people became as simple as hitting the Easy Button.
But the problem for Paulson is that even the most uneducated and unsophisticated of us know you can only hide the growing garbage pile so long before the stench becomes overwhelming.
The reality is that there is not much asset backing to those loans, and HB&B has tried to hide the problem by (i) not pricing those assets to market, and (ii) laying off their risk through credit swaps, which is an incredible Ponzi scheme of sorts. The difference here is that, being a competitive and suspicious marketplace, the returns were not exorbitant, so the high risks involved had to be sold by the Sell-side as being minimal risk.
Oh my, this is not PhD thesis stuff, and moreover, to all those who write in here to say to me ‘Stop the conspiracy theory stuff’ I say find yourself another blog to read. This stuff is in your face and mine every day. The problem is so bad that I truly think that people like Marc Faber and Nouriel Roubini ought to be awarded Nobel Prizes for warning us. In fact, I don’t know how Paulson, Bernanke, and their cronies who head up HB&B, can even sleep at night.
However, that problem is theirs; we must stick to our own knitting. We have capital to protect and to try to grow in the most prudent way possible.
http://www.billcara.com/archives/2007/06/c...jun_4.html#more
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