Monthly Archives: April 2010
Not Good Enough!
US GDP figures came in this morning showing an advance of 3.2% annualized, just missing analyst expectations of 3.3%. While there is mild disappointment on the miss, GDP growth of any amount should be seen as positive at this juncture in time. Much of the advance in GDP growth came as a result of personal consumption numbers which were higher than expected, showing that a consumer-led recovery may be underway. In other news, Canadian GDP figures came in as expected but the market is still concerned that the change in language used by the BOC in this week’s interest rate policy meeting could stall future rate hikes. In an opposite turn of change of language, the New Zealand central bank Governor left himself “wriggle room”—I always say wiggle but whatever—as the market is increasing its bet that we’ll see a rate hike earlier than the July meeting as was previously forecast Continue reading
US Economy Grows 3.2% in 1st Quarter
The US Commerce Department said today that the economy grew by 3.2 percent during the first quarter. Continue reading
Month-End needs Overshadow Greece and China
Simply put, today is month-end. Traders all week have been consumed with the peripheral market noise. The Fed, Greece, China, all important, but when it comes to ‘lemming’ revaluation of portfolios for month-end requirements, logic tends to be thrown out the window with the bath water. Continue reading
Markets Force Action!
In the wake of the S&P downgrades of European debt, pressure is being applied to Germany in a call to action, politics be damned. The Euro is in real danger of structural collapse, as exploding debt and rising yields are encouraging defaults every day this continues without resolution. In the meantime, unemployment figures came in better than expected in Germany which may ease the political tension over the bailouts which may allow the government to take action more swiftly. European stocks are higher as earnings have been improving. So what we are seeing is an improving economic picture, with this debt situation looming as the fly in the ointment. While having a lower Euro is good for growth, there needs to be a debt resolution to prevent it from falling beyond the point of no return. Continue reading
Roubini Says Higher Debt, Defaults Means Inflation Inevitable
Nouriel “ Dr. Continue reading
Rating Agencies are Over-rated, China could Re-value this Weekend
The stability of the EURO zone is at stake if a 45b EUR loan package for Greece can’t be delivered quickly. Them are Merkel’s words, but, is it enough as we witness record divesting of contagion tainted Euro bond holdings? The estimation of a 120b Euro price tag (three times more than originally anticipated) continues to burden the EUR Continue reading
Euro Trashed!
I sometimes feel like a broken record when I go on and on about risk in the marketplace, but in my opinion this is the most important factor to consider. Many days worth of gains can be wiped out in one session, and that’s exactly what we saw happen yesterday. It is no great secret that there are problems in the EU with regard to the Greek debt crisis. The mis-management of the situation by the EU has been particularly deplorable. And just yesterday, at roughly 11AM, S&P downgraded both Greek and Portuguese debt to junk status, adding further fuel to the fire. This sent the stock markets considerably lower, and the flight to safety trade strengthened the Dollar and Yen. So while there are individual economic data that are reported for the various regions, this Euro crisis is clearly the elephant in the room. Today, the FOMC decision on interest rates is due out, but don’t expect any change to either the benchmark rate or the language surrounding it. Continue reading