tranquil trader

China Is Now in Firm Control of U.S. Debt Markets

I too have been very negative on the USD years. However, having seen the rapid reversal of the US current account deficit and household savings over the past year, it leads me to conclude that the USD will be fine, and the FED won't have to print too much to mop up the new supplies of treasuries.

Some numbers, household savings have improved from -2% to +5% ! thats 7% x $8000bn or ~$600bn swing, and i suspect most of that will go into US treasuries via the savings accounts. Current account deficit was running at $800bn a year to Q2 2009 ~$400bn and still improving, so the US is becoming less reliant on foreigh capital inflows..

I am not saying that the USA its currency and treasury bonds are out of the woods, but looking from these statistics, i don;t think the situation is as doom and gloom as many are saying.

Ultra Short Treasury ETF: Have Patience, Money Will Eventually Flow Again

totally agreed with Weiss that the Fed will print as much money as they want to mop up any T bonds to keep long term rates low, but i do think that 30yr bond yield at 2.8% is a bit silly!! (30 years of 0% inflation and a real yield of 2.8%!!)

Definitely worth shorting once there are signs of economic recovery and risk seeking behaviour comes back.

Joy Global's Ludicrous Valuations

hi, interesting article, but i saw no evidence of the buyback anywhere..

besides, with only about $300m in cash it could probably only buy back 20m shares. Unwise in this environment when cash is so precious.

on the earnings front, with all miners cutting doen on output and freezing their CAPEX plans, i can't see how they could sustain the current level of profitability.

Lets suppose that it could garner $200m profits after tax, with the reduced shares in issued down to 85m, that gives an eps of around $2.40 or somewhere around 6x PE. Cheap in absolute terms, but i guess there are better value elsewhere......