Global Market Commentary, Analysis and Investments
A stitch in time…
Okay… We have left 2011 behind. We are rid of it forever. It won’t come back. Never. Not even if the universe lasts a million years, we will never see it again.
Or will we? One of the intriguing discoveries of 2011 came the giant particle accelerator in Switzerland. Those clever scientists set up a race, from Geneva to a finish line in Italy, 730 kilometers away. It was a race of neutrinos against light. Who do you think won?
[Read more...]If wishes were horses, beggars would ride, according to a 16th century British proverb.
Continuing that logic, if wishes were $1.2 billion of missing client assets at MF Global, the company’s former CEO, Jon Corzine, would not be a criminal. But alas, wishes are neither horses nor missing client funds…so beggars don’t ride and CEO’s that “misplace” $1.2 billion of client funds are criminals.
[Read more...]Japan…wither thou goest…
The US and other developed countries continue to follow Japan.
The Dow rose 131 points yesterday. The 10-year note fell, to yield 1.9%.
Gold rose $25.
What to make of it?
Some reports tell us that Europe is getting close to a deal that will save Greece and other ‘Olive Country’ debtors. Maybe, but IMF chief Christine Lagarde says they have a $3 trillion hole to fill. That’s probably the one and only thing she is right about. The size of the problem is big…bigger than anyone realized.
[Read more...]The financial markets seem to have caught a runny nose. But at this point, it’s hard to say if it’s the runny nose that follows a mild allergic reaction or the one that precedes a life-threatening pneumonia.
Despite a chronic case of the sniffles, the stock and bond markets of the world have performed reasonably well for most of the last of the two years. Even though the financial markets are acutely allergic to most strains of credit distress, Dr. Bernanke’s “Liquidity Elixir” has provided an effective antidote so far.
[Read more...]Debt on one side of the ocean is little different from debt on the other. But most investors don’t seem to see it that way. Instead of learning from the tribulations of their cousins in Europe, they greet the news from the Old World with alarming complacency.
This is too bad. Because the European story tells us something important about the way a debt crisis works. And it gives us a “heads up” about what will happen on a much larger scale in America.
[Read more...]Stocks down yesterday. Gold down. Oil down. Everything was down. The beginning of the end? Beats us. The Fed is still pumping in money. But investors are beginning to look beyond QE2.
If the economy really is recovering, they say to themselves, the Fed will be able to back off from money printing. Stocks, gold, commodities – everything should go down.
[Read more...]A shocking figure came out last week. In the US, fewer new houses were sold last month than in any month since they started keeping records in 1963.
How is it possible? Simple. The houses that would have been sold to today’s able buyers were built and sold years ago. That’s what excess credit does. It doesn’t really enlarge or enrich an economy…it stretches it, bringing things that would have happened tomorrow forward, to yesterday. Only a certain number of people every year can afford a new house. If in 2005, you give credit to buyers who won’t be ready for many years, or perhaps never – who will buy a new house in 2011?
[Read more...]It would be an understatement to say that I was flabbergasted to see that the monetary base jumped $130 billion dollars in two weeks!
Well, using an exclamation point as punctuation seems to confirm my suspicions that I was, indeed, flabbergasted, as the term seems, somehow, appropriate since I felt something more than the usual crushing pains in my chest, numbness running down my left arm, my guts heaving and sphincters tightening kind of reaction I get when I see horrifying, huge increases in money and credit created by the damnable Federal Reserve.
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France Has a Successful Bond Auction
Front and center this morning, the euro (EUR) has plunged overnight, and now sits 2-cents below where it was yesterday when I was writing the Pfennig. France auctioned bonds this morning, and had to ratchet up the yield, as many buyers are afraid of the rumors that France’s AAA rating is about to be slashed. But this is old news, and shouldn’t have caused the move in the euro that we’ve seen since yesterday.
[Read more...]