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  • High Conviction: An Attractive Residential Mortgage REIT (Yes, You Read That Right) [View article]
    Greg you make a decent sell, but the premise is nuts. Whether or not the Federal Funds stays effectively at 0% or not, there are interest rate pressures on long term treasury debt in the U.S. and abroad that will push the 30 year bond yield higher. This is the yield you should be watching, as it is directly effective on residential borrowing costs. Now more than ever the lending capacity of the U.S. government will effect the lending capabilities of her citizens, when you consider the fact that the government owns Fannie Mae and Freddie Mac.

    Also, Bernanke, as the Fed Chairman, has a carte blanche to use terminology like "forseeable future", but those of us that manage accounts for customers need a little more conviction than a trip to the fed minutes for interest rate predictions.

    Sure these REITs have been beat up, but so has my 10 year old Korean made hatchback and people aren't lining up to buy it for good reason.
    Mar 17, 2010. 04:47 AM | 2 Likes Like |Link to Comment
  • AIG: Back From the Dead? [View article]
    Hey Cook, nice recap.

    Concerning AAA, I think it's a crock as well, but it seems to be keeping the bond markets pacified, whether the metrics are antiquated or not. Sounds like the makings for another fiasco...
    Mar 5, 2010. 01:07 AM | Likes Like |Link to Comment
  • Today in Commodities: Wild Wild West [View article]
    It's hit 75 twice and 70 once since jan 1. It isn't a question of if, it's a question of when. Supply is growing and traders are looking to the summer to float demand. Keep an eye on the dollar index, since the Euuro dropping is going to reverse the bullish effect on crude that the dropping dollar has had since now. Don't expect european markets to rally on the dropping Euro though, because it's not an interest rate play, it's driven by instability.
    Mar 5, 2010. 12:47 AM | Likes Like |Link to Comment
  • Jobless Claims Resume Downtrend [View article]
    Bespoke has been bullish all year and it's been doing pretty well for them, obviously. But it doesn't take rocket science, multi-var calculus, or econometrics to look at the 4 week moving average of Joblessness and compare it to Jan.

    I'm so sick and tired of the excuses that the BLS and BEA are spinning into the results. Why not publish a full page PR release about the magnitude of individuals leaving the labor market?

    This government has so much skin in the game, we are going to see some nasty deception before the real reconning hits home. Answering the question, "can you fix a debt crisis, by adding more debt?" similarly to Bill Gross, we say "maybe", recovery or not... but the "ring of fire" will come back to haunt us yet again.

    Take a look at The Gross March outlook for a truly great read:
    Mar 4, 2010. 10:20 PM | 1 Like Like |Link to Comment
  • The Greece / EU Ballet Enters Act III [View article]
    Wow, we thought it was hard for AIG to spin off the Asia arm. Spinning off a country... that's a new one. I love it.
    Mar 4, 2010. 10:15 PM | Likes Like |Link to Comment
  • The Greece / EU Ballet Enters Act III [View article]
    I would expect that the market will not see Greek bonds as German bunds for several reasons, not the least of which is rhetoric ahead of the Greece Merkel talks tomorrow. In the words of German officials, the talks would in no way include commitments of direct aid from Germany. According to FT reporting, the Germans believe that due to a verbal EU commitment to help Greece (perhaps akin to Paulson's Bazooka), the Greeks will be able to sell debt in the private markets. If German banks don't step in to buy the debt directly it might get ugly, particularly considering the fact that future gov. revenues are going to struggle in a socialist economy that is pledging to cut off the public life support funding.

    Yes, Moody's might have kept their rating high, on the premise that "the country is rich while the government is poor", but the private sector won't be paying taxes if they can't sell goods to a socialist government that is literally pulling the plug on social programs across the board.

    Take this lull in the storm to get short everything Greece and add to Short Euro positions. We don't have a dog in the fight, because it's too risky to play with politicians, but this thing is far from over.
    Mar 4, 2010. 10:12 PM | Likes Like |Link to Comment
  • Today in Commodities: Wild Wild West [View article]
    I second Matt's comment. Other than the rhetorical and anecdotal nonsense about ingenuity it sounds like you're in trading as if it's a casino and purely playing with chance. There is a lot to be learned from charts in volatile markets, because it's during such times that sentiment is the main driver of price movement and technicals gauge sentiment. Maybe you should be careful about trying to hold SLV until 19 when the MACD shows it's overbought. Just a thought...
    Mar 3, 2010. 09:29 PM | Likes Like |Link to Comment
  • Today in Commodities: Wild Wild West [View article]
    Hey Matt, I follow some of your stuff and make calls myself on crude and I noticed you have become more bearish on crude since early January when you were suggesting that clients place bets on rising crude prices. What has changed in your opinion that warrants a shift in the sentiment towards crude, other than the charts?
    Mar 2, 2010. 05:22 PM | 1 Like Like |Link to Comment
  • TARP 2.0: EU Bailout Bonanza [View article]
    Isn't it interesting that so many of us can see a world where the EU ceases to exist and countries fail due to this looming crisis?
    Feb 26, 2010. 09:00 PM | Likes Like |Link to Comment
  • Indicators Worth Watching: Oil Appears Oversold (For Now) [View article]
    woahh nelly that's a lot of charts there Andy...

    The upper MACD curve peaked once and then diverged again, whether it can pull that move once more is any man's guess. Tighten stops on short oil positions or wait for a pop, but numbers out of Germany this morning show EU growth to have stagnated as government programs to stimulate the economy dissipated. This will prove bearish for oil, notwithstanding the cooling rhetoric from China.

    Stay vigilant boys...
    Feb 12, 2010. 07:41 AM | 1 Like Like |Link to Comment
  • Another Equity Stampede, Value Notwithstanding [View article]
    Writing style is indeed "fun" but the article was a party bus to nowhere. It turns out they're releasing Bernanke's speech in written form, which considering his stone cold poker face, shouldn't change much. Keep an eye out for the notes.

    Secondly, and more importantly, yesterday's headline might be the one to stick to. There's still a truck full of bulls, betting this correction is about Greece, but they have missed the point. The SPX 50 day SMA has peaked for the first time since march '09 and the price of the index is now treating 100 day SMA as resistance rather than support for the first time in the same period.

    In an early week absent of significant fundamental econ data the EU's bailout, while predictably inevitable, has grabbed headlines and seems to be moving markets. So Germany decided to back a bailout of the most corrupt and insolvent member of the EU and this is good news? Wide spread strikes of schools, public transit, and governmental employees in Greece should ensure confidence in the region right? Wow what a strong Union they have over there in the socialist states.

    I'm going on the record, as I did in my piece two weeks ago, that Crude Oil will see 70 before 80. While the SPX won't see 1100 for a while.
    Feb 10, 2010. 07:27 AM | 3 Likes Like |Link to Comment
  • Capitalizing on U.S. Financial Weakness in 2010 [View article]
    Fair enough, GS will be injured to a certain extent by higher borrowing costs, which will add expenses to aggressive leveraging strategies. However, it's fair to say that an ultra short postion in financials has it's risks, therefore we are hedging that risk by owning shares in the firm that has actually benefited from this crisis, as earnings have actually beaten corporate records at Goldman. They are very narrowly exposed to MBS, through Federally Backed purchase programs, where they literally took their pick of the bundled mortgages and have the cash reserves to hold the debt for years to come.

    GS is a safe play for the long term and a foreward p/e = 7 is incredibly attractive. When investors begin exiting individual names, GS is where financial exposure will settle. If the whole sector is again disgraced, GS will go with the bathwater, but this is a relatively small risk.

    Thanks for your input ryanclarke...
    Feb 4, 2010. 09:08 PM | Likes Like |Link to Comment
  • Fisher's 'The Only Three Questions That Count' [View article]
    I've also read the book, closer to it's release several years ago, and found my way through it in a haphazard fashion. There's a lot of references of certain trends in markets which yield profits until they are discovered, at which point they are priced in to markets. This fundamental assumption was central to most strategies explained in the book, but there wasn't much more to it.

    Save your money and get the Black Swan mentioned above, it deals with random yet significant events which can have extreme ramifications and is more pertinent to our current situation.
    Jan 30, 2010. 12:07 PM | Likes Like |Link to Comment
  • Equities Roundup: Dow's January Decline Is Biggest in 11 Months [View article]
    It's all about the moving averages! S&P 500, 50 day sma peaks & index closes below 100 day sma two days in a row. Both firsts since April...
    Jan 29, 2010. 10:44 PM | 1 Like Like |Link to Comment
  • Negative Convexity: Bernanke's New Conundrum [View article]
    Great article... The Fed has been peddling lies of balance sheet contraction since mid summer '09 while the MBS purchase plans have been overextending the balance sheet towards a record 2 Trillion USD. Of course the Fed acts as if the purchases will actually end, but the carefully slow movement in the Fed's "observations" lag actual market data, which now shows housing is reversing as mortgage resets in 2010 loom. If the fed ends the purchases, shorting the banks looks to be more and more attractive in 2010.

    For a great article on the end of the Chinese led recovery, check out:
    Jan 29, 2010. 02:32 AM | Likes Like |Link to Comment