Big Wednesday Surrender, Sandy Beach Oahu
Yeah, I’m thinkin’ Big Wednesday once again and thanking family friend Chris Spezzano for the image. When I was young I used to… never mind.
Blogging this market everyday shortly after the close seems useless since the news cycle is moving faster than prices. I’m just gonna say this is as volatile a week as we and most others predicted, and it’s not over.
Imagine: the government is now a constituent member of the DJIA through its ownership of AIG (NYSE:AIG). What financial company is left as a substitution? Should it be another financial company? Or, will the powers that be do something sexier and more contemporary like Google (NASDAQ:GOOG)?
The government is more active directly or indirectly in markets, as many Plunge Protection Team conspirators believed there can be no doubt.
ETN [Exchange Traded Notes] sponsors are starting to feel the heat as investors doubt the quality of guarantees. CNY [Van Eck Renminbi ETN] is a case in point where yesterday, without much movement in the currency, the issue was down 6%. Today it was as low as $29.37 or another 22% before recouping on heavy volume to over $39.
We, Greg Newton and I, were in communication yesterday and today with both Van Eck and Morgan Stanley, with the latter having the guarantee. With pressure mounting on MS it seems holders of CNY are questioning this guarantee.
Speaking of the renminbi and China, there’s this little article from the People’s Daily suggesting a new world currency arrangement. It’s pretty pathetic to have them lecture us about regulation and corporate governance issues since things have yet to be tested there. I remember visiting the Chairman of the Shanghai Exchange in 1993 and his knowledge of these issues was poor. But they’ve learned much since then. In fact, global conditions probably require some realignment which isn’t necessarily a bad thing since we asked for it with our stupid policies.
Volume remains heavy and breadth probably posting another negative 90/10 day.
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