'09 Q3 SHORT-TERM SENTIMENTS

[rffrydr]

Short View: Great Recession

By John Authers, Investment editor

Published: June 25 2009 20:26 | Last updated: June 25 2009 20:26

After deep confusion, elements of agreement are emerging. Official economists and investors in different countries that have been affected in different ways by the crisis agree on some points.

Wednesday’s economic forecast from the Organisation for Economic Co-operation and Development expressed the emerging orthodoxy as well as any.

Anyone reading a year ago what the OECD had to say would have been horrified. It said the nadir for the developed world had not been reached and a recovery would be so weak that unemployment in the US and western Europe would exceed 10 per cent and stay there.

Yet anyone reading it during the worst months of the crisis late last year would have been relieved. The OECD is arguing that a Great Depression induced by a banking collapse has been averted; we will have a Great Recession instead.

The OECD said that extremely aggressive policy centred on cheap money should stay in force. Only a few weeks ago, this was contentious; now it is accepted.

A disparate group of central banks with different priorities seem to agree. The US Federal Reserve this week refused to offer any guidance on when it would exit from its loose monetary policy; the European Central Bank added liquidity to money markets much more aggressively than had been expected; and it seems the Swiss National Bank pushed down its own currency.

So there is the consensus: disaster averted, no strong recovery as the developed world relies on China for its growth, and no quick end to extreme policy measures.

This consensus is consistent with another consensus, that the nadir for share prices in March was “the” bottom. If the consensus is right, the March bottom should hold. Let us hope it is right.
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Today is the Tomorrow you worried about Yesterday!

[nodoodahs]

Looking more to me like the last few weeks were just a minor pullback on a continued strong move.

Got faked out by steel and by South Africa? Rode Russia too long? Getting out of them and getting more Asian in my ETFs. Tweaking some sizes. Still almost all long emerging markets stocks with some Latin flavor.

Did note some recent strength in mortgage REITs but not doing anything with it.
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I haven’t seen a beatin’ like that since somebody stuck a banana in my pants and turned a monkey loose.

[rffrydr]

CNBC taking our (their) mind off troubled times:

http://www.cnbc.com/id/31586577
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Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Wacky expiration wednesday.
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Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Watch for banks powering up the yield-curve the week following.

At $45 earning basis the SP for the next three years, which the market is beginning to fear, we are rich. They aren't counting on the banks. I'll be using weakness this week to PUT myself in a little more.
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Today is the Tomorrow you worried about Yesterday!

[HenryTo]

The focus will no doubt be on 2Q 2009 earnings (and more importantly, companies' forecasts) over the next couple of weeks. As usual, AA will kick it off this Wednesday evening (although Ruby Tuesday's report this Tuesday will also be interesting for those tracking the casual dining sector):

http://www.briefing.com/GeneralContent/Investor/Active/ArticlePopup/PagePopup.aspx?PageId=3273

The deluge will come next week, as GS and JNJ will kick it off on Tuesday morning (although Charles Schwab's earnings next Monday morning will also be interesting):

http://www.briefing.com/GeneralContent/Investor/Active/ArticlePopup/PagePopup.aspx?PageId=3274

[rffrydr]

3rd Q. battleground:


Market snap-back

Published: July 3 2009 14:45 | Last updated: July 3 2009 21:00

The clues were there for those not dizzy with the sound of their retirement pots quickly filling up again. Even so, Thursday’s US payrolls number was a shocker. For the first time since the turning point in early March, investors are openly worried again that the darkest days may be ahead, not behind them. If trillions of dollars of stimulus spending and half a year of zero interest rates do not help, what will?

Confidence has been ebbing away since mid-June when most equity markets hit their 2009 peaks and bonds slumped to year lows. Some perspective is needed. The S&P 500 and the FTSE 100 indices are only 5 per cent off their highs. Emerging markets such as Brazil are down a tad more, Japan slightly less. The move in bonds is more telling. Given the feverish talk of inflation and sovereign downgrades in America for example, the 50 basis point fall in 10-year yields since June 10 must be a relief to policymakers. Yields on UK gilts of the same duration have dropped even further.

The third quarter will be a battleground. On one side, the “underlying” strength of the global economy remains weak. On the other, the full force of many stimulus measures are only now kicking in. Global banks will report another dazzling quarter. Even if economies stabilise and earnings do not disappoint, however, this could already be discounted. It is more likely to be disappointments, rather than positive surprises, that drive markets from here.

Finally, the decoupling theory has reignited. Chinese stocks hit their year’s high this week without a wobble. In fact, anything linked to China – from commodities to the Australian dollar – barely moved following the poor payrolls report. Another bubble may be building. It would be great if a billion Chinese all bought washing machines now that US consumers are burnt out. But the same promise was made two years ago, when Chinese equities were twice as high as they are today.
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Today is the Tomorrow you worried about Yesterday!

[rffrydr]

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Today is the Tomorrow you worried about Yesterday!

[rffrydr]

From the broker:






After the 2001/2002, 1991, 1980, and 1970/1971 recessions, the ISM survey saw readings over 50 by this time frame of the recovery. Only the recovery in 1982 was weaker in terms of ISM level six months from the low. The recovery is below par, and this could provide a reason for the trade to worry about a double dip recession, although the ISM built steam by February 1983 after the 1982 trough. The slaying of inflation and the Reagan tax cuts played a roll in lifting the recovery in 1983. The current political environment is less economy friendly and could keep a sharp headwind blowing into the economy.


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Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Fidelity into the banks.

HP raises its laptop forecasts.

Oil, Oil, Oil.

Bloomberg comfirms money bid in treas.

VIX new low.
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Today is the Tomorrow you worried about Yesterday!