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Dr. Duru  

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  • The European Central Bank Did More Than Frontload Quantitative Easing [View article]
    Thanks for that extensive and informative reply! There is too much in there for me to respond to except to say that you should have written this as your own SA post! :)

    I will also say that I think what your irony speaks to is the limits of monetary policy when an economy is suffering from severe structural issues. The central bank can only do so much, yet, so many are exactly expecting a lot out of the central bank...especially where the politicians cannot agree or execute where needed to address structural issues.
    May 29, 2015. 09:53 AM | Likes Like |Link to Comment
  • Dollar At Multi-Year Highs Against Yen [View article]
    Sorry, I guess I was looking at it with a different angle or through a different lens. I had thought the earlier trading range meant something given the U.S. dollar was still rising against other major currencies and the index soared to a peak in March.

    So, when the USD/JPY breakout occurred, I strictly interpreted that as having to do with a yen-specific narrative, not just the dollar's resurgence. So, I get #3, because if had been short the yen, I would have lightened up too thinking that the yen's resilience against the dollar and thus strength against other major currencies was a major yen-positive. So after shorts are done covering, the yen should gradually gain strength again? On your #1 and #2, I am still not sure why yen traders didn't care about the dollar-positives earlier in the year...
    May 29, 2015. 09:41 AM | Likes Like |Link to Comment
  • Why Linn Energy's Public Offering Is Troubling For Investors [View article]
    Thanks for that background...
    May 29, 2015. 09:27 AM | 1 Like Like |Link to Comment
  • The Dollar And Commodities: Which Is The Leader? [View article]
    I am looking for some clarity on causation here. You say "The dollar clearly leads moves in commodity prices." That is correlation. You also say "The decrease in commodity prices was a result of dollar strength and in many ways." But I did not see you quantify the mechanism for this driver. Since markets are forward-looking, isn't it just as plausible in this particular episode of trading to say that currency traders looked ahead and saw likely supply and demand imbalances in the commodity market and started running for cover in the U.S. dollar? After all, we have seen some remarkable amounts of over-supply in both oil and iron ore as two of the biggest examples. Thus, in the short-term there would be correlation but not necessarily causation. Certainly, once the ball gets rolling, the whole mechanism gains its own self-reinforcing momentum. Since the stronger dollar signals weak commodity prices, and weak commodity prices signal a stronger dollar...
    May 28, 2015. 06:22 PM | Likes Like |Link to Comment
  • Why Linn Energy's Public Offering Is Troubling For Investors [View article]
    Prescient: "Linn said on its Q1 conference call that internally generated cash flow would fund capital expenditures and the distribution. Thus the size of the company's offering is negative. The sale suggests management does not believe the $13 - $14 stock price will hold."

    I am still trying to figure out why LINE is sooo popular with oil investors. The technicals are horrible and this piece suggests that the financials are challenged too.

    However, I DO find it interesting/odd/whatever that LINE was able to get a lot of major banks on board to help with the offering...except Goldman Sachs. Goldman on the same day of the announcement, downgraded LINE from neutral to sell. Hmmm....
    May 28, 2015. 05:33 PM | 1 Like Like |Link to Comment
  • Splunk -3% in spite of beat-and-raise quarter; license revenue up 40% [View news story]
    High valuation and very poor operational margins. Company needs to absolutely crush numbers at these levels.
    May 28, 2015. 05:21 PM | Likes Like |Link to Comment
  • Dollar At Multi-Year Highs Against Yen [View article]
    So what exactly then is driving the yen to this extra bout of weakness? I have yet to see even a narrative created to explain it. It still seems like the breakout came "out of nowhere" and is gathering its own self-reinforcing momentum on a technical basis.
    May 28, 2015. 11:56 AM | Likes Like |Link to Comment
  • Capital Expenditure Data Sends The Australian Dollar Reeling [View article]
    That's bearish! But I definitely have not given the case for a recession much thought. The cash rate will easily hit 1% if the RBA finds itself on its heels with the economy continuing to descend. For now though, I am looking for a bounce...and gulping hard.
    May 28, 2015. 11:53 AM | Likes Like |Link to Comment
  • Capital Expenditure Data Sends The Australian Dollar Reeling [View article]
    Very well could be a tad early. GBP/AUD has consistently topped out around current levels though, so I like starting the trade here. Still looking to the RBA next week as a key wildcard!
    May 28, 2015. 11:50 AM | Likes Like |Link to Comment
  • The European Central Bank Did More Than Frontload Quantitative Easing [View article]
    I forgot to add: refer back to "Greenspan's conundrum." He was baffled that long-term interest rate declined at the same time the Fed was lifting rates. He blamed a glut of savings looking for a home...and finding it in bonds. So, a preference for and a large supply of savings SHOULD drive rates down...
    May 28, 2015. 01:25 AM | 1 Like Like |Link to Comment
  • The European Central Bank Did More Than Frontload Quantitative Easing [View article]
    This is a fascinating discussion. I think textbooks will get rewritten a generation from now based on the better perspective we gain on all these historic monetary measures.

    I will just add that I do no understand how rates go up when savers save and refuse to borrow. Rates should go DOWN. Banks will have to drop rates on loans to get business and will be able to get away with lower rates on deposits because demand for savings will be so high...

    Bringing it back to the ECB, the frontloading did not change anything real but it did work wonders on market psyche. This psyche was preparing for the end of QE, and the ECB effectively shook the market out of that notion...
    May 28, 2015. 01:14 AM | 1 Like Like |Link to Comment
  • The European Central Bank Did More Than Frontload Quantitative Easing [View article]
    Almost like a relay race...
    May 28, 2015. 01:07 AM | Likes Like |Link to Comment
  • Oil, gold prices hurt by dollar's rise [View news story]
    ....higher oil.
    May 26, 2015. 03:36 PM | 1 Like Like |Link to Comment
  • Oil, gold prices hurt by dollar's rise [View news story]
    Better Goldman help drive oil lower than sky high like pre-crisis. The majority of consumers do better with low oil, not high. This is where the interests of the majority of buyers sharply diverge from the traders and investors hoping for higher oil prices.
    May 26, 2015. 03:36 PM | 3 Likes Like |Link to Comment
  • Dollar up big as economic reports impress and Europe stumbles [View news story]
    The dollar was ripping ahead of the economic reports. I still haven't seen any convincing explanation for the accelerated strength. Maybe it is simply follow on momentum after holiday trading in the U.S. ended.
    May 26, 2015. 02:16 PM | 5 Likes Like |Link to Comment
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