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GaltMachine

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  • The ECRI Weekly Leading Index rises to 124.9 for the week ended Sept 7 from 124.1 previously (revised from 123.7). The annual growth rate rises to 2.1% from 1.4%. It's the highest level since August 2011 and one wonders if Lakshman Achuthan is pulling his recession call. [View news story]
    No he hasn't which is actually quite amazing. Here's his latest defense of their call:

    http://bit.ly/SHRXXM

    "Some believe that our own Weekly Leading Index contradicts our U.S. recession call. This is not the first time that charge has been made. Recall that, a couple of years ago, people said that its movements guaranteed a double-dip recession. At the time we flatly and correctly rejected that interpretation. Today we can tell you that the Weekly Leading Index is not pointing to recovery and, more importantly, this is also the message from our full array of leading indexes."
    Sep 14 10:46 AM | Likes Like |Link to Comment
  • The 1.2% dive in industrial production is the biggest decline since the depths of the financial crisis, though 0.3% of the fall is being attributed to Hurricane Isaac. S&P futures add a bit to gains, now +0.3% - maybe in hope the Fed will double QE to $80B/month? [View news story]
    So apparently the genius forecasters that come up with these consensus numbers which are supposed to be based upon the whole universe of data, missed the fact that there was a hurricane last month when they came up with their original forecast?

    Really. Come on.
    Sep 14 09:55 AM | Likes Like |Link to Comment
  • Aug Industrial Production: -1.2% vs. -0.1% expected, +0.5% prior (revised). Capacity utilization 78.2% vs. 79.2% expected. [View news story]
    bbro,

    I know you like to look at the bright side but isn't this a pretty horrible report?

    With a fall of this magnitude, I suspect the revisions will be even worse. It's all blamed on the hurricane so apparently we are back to blaming weather again for these "unexpected" declines.

    Rising inventories and falling demand are not a good combination for an economy.
    Sep 14 09:43 AM | Likes Like |Link to Comment
  • Aug Consumer Price Index: +0.6% in-line with consensus, 0.0% prior. Core CPI +0.1% vs. +0.2% expected, +0.1% prior. [View news story]
    We don't eat or drive core inflation.
    Sep 14 08:41 AM | 2 Likes Like |Link to Comment
  • 3 Reasons The Fed Should Hold Off On QE3 This Week [View article]
    Well if there was no reason to buy a house now, there is even less reason to buy a house now if you expect interest rates to fall even further. We really are in the liquidity trap as per Irving Fisher.
    Sep 13 03:40 PM | Likes Like |Link to Comment
  • Cliff Diving: Will Congress And The President Destroy The U.S. Economy? [View article]
    benny,

    Sorry Obamabot I thought I was communicating with a rational being :)
    Sep 13 01:55 PM | 4 Likes Like |Link to Comment
  • Cliff Diving: Will Congress And The President Destroy The U.S. Economy? [View article]
    Benny,

    So many to choose from, how about this:

    http://abcn.ws/RUxj42
    "President Obama: On all these issues, but particularly missile defense, this, this can be solved but it’s important for him to give me space.
    President Medvedev: Yeah, I understand. I understand your message about space. Space for you…
    President Obama: This is my last election. After my election I have more flexibility.
    President Medvedev: I understand. I will transmit this information to Vladimir."
    Sep 13 01:33 PM | 5 Likes Like |Link to Comment
  • DJIA +0.7%, adding to gains following the QE3 announcement. The big move comes in Treasurys, the long bond diving nearly two full points in price. The dollar slides a bit further against the major currencies. [View news story]
    So interest rates rise on the announcement of QE3 whose purpose was to lower interest rates?

    What a pathetic decision.
    Sep 13 01:13 PM | Likes Like |Link to Comment
  • A rule banning large-size sugary drinks at New York City restaurants and eateries gains approval with the Board of Health. Though movie theaters will fall under the new plan limiting sodas to 16 ounces or less, it's anything goes at supermarkets or convenience stores. Beverage companies such as KO, PEP, MNST, COT, DPS aren't expecting to take a significant hit over the NYC ban, but would just as soon the issue keep to the Big Apple. [View news story]
    Is there an exemption for diet soda? club soda?

    Glad to see that Bloomberg finally got his number 1 legislative priority completed. Now he can back to focusing on putting windmills on the top of every building in NY.

    Forced breastfeeding, no salt, soda bans, seriously is this guy as whacked out as he seems?
    Sep 13 12:56 PM | 2 Likes Like |Link to Comment
  • FOMC Announcement: QE3 is on to the tune of an open-ended pledge to buy $40B in MBS per month. The pledge to keep rates extraordinarily low is extended until mid-2015. [View news story]
    Personally I think this is shameful. What a joke our economy has become - Amerika is not far off. Interest rates aren't low enough already?

    "To support a stronger economic recovery and to help ensure that inflation, over time, is at the rate most consistent with its dual mandate, the Committee agreed today to increase policy accommodation by purchasing additional agency mortgage-backed securities at a pace of $40 billion per month. The Committee also will continue through the end of the year its program to extend the average maturity of its holdings of securities as announced in June, and it is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities. These actions, which together will increase the Committee’s holdings of longer-term securities by about $85 billion each month through the end of the year, should put downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative.

    "In particular, the Committee also decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that exceptionally low levels for the federal funds rate are likely to be warranted at least through mid-2015."
    Sep 13 12:36 PM | 8 Likes Like |Link to Comment
  • 3 Reasons The Fed Should Hold Off On QE3 This Week [View article]
    Tack,

    Your analysis is good.

    The FED has painted itself into a corner/boxed itself in, and as such, I don't think any decision they make or don't make today will be perceived as the right one.

    Sep 13 12:17 PM | Likes Like |Link to Comment
  • Cliff Diving: Will Congress And The President Destroy The U.S. Economy? [View article]
    The biggest risk for investors is changes to the dividend and cap gains tax rates which are actually not a known, known for the President should he win re-election.

    As I understand it now, the President's policy will be to have dividends taxed as normal income and cap gains tax rate raised to the same rate or something less. Regardless they would be expected to rise in the event of his re-election so in theory the risk is that he doesn't backdown on these policies. However, I just can't see Repubs in the House supporting this regardless of the results of the election if they still control the House. They will wait until the new term to settle the issue.

    Obviously after-tax returns for many investors will be greatly affected by any increase in taxes so that could really setup a late year sell-off for tax purposes as long-term gainers get cashed in.

    The tax argument seems like the most likely catalyst for a sell-off if it lingers into the election.
    Sep 13 10:41 AM | 5 Likes Like |Link to Comment
  • Initial Jobless Claims: 382K vs. 370K consensus, 367K prior revised (prior week 365K). Continuing claims -49K at 3.28M[View news story]
    Looks like September is shaping up to be another weak job creation month - 4 week moving average is going up.

    "In the week ending September 8, the advance figure for seasonally adjusted initial claims was 382,000, an increase of 15,000 from the previous week's revised figure of 367,000. The 4-week moving average was 375,000, an increase of 3,250 from the previous week's revised average of 371,750."
    Sep 13 08:35 AM | Likes Like |Link to Comment
  • Shares of Brazilian electric utilities plunge a day after the country announced a major cut in electricity taxes that will lower energy costs for industries and consumers. UBS says the “stock-price declines on regulatory noise seem exaggerated,” presenting buying opportunities. CIG -20.8%, ELP -8.9%, EBR -7.9%, CPL -3.7%[View news story]
    I think they call that Legislative Risk. Wow!

    However, I don't quite understand why lowering taxes on electricity negatively impacts the producers. You would think it would do the opposite unless they keep a portion of the taxes collected.
    Sep 12 03:15 PM | 1 Like Like |Link to Comment
  • Apple (AAPL -0.1%) closes out its iPhone event by launching new iPods and bringing the Foo Fighters on stage. New iPod Touch models feature 4" displays and are just 6.1mm thick, while a revamped iPod Nano is 5.4mm thick and supports Bluetooth. Apple's earbuds, long a target of criticism, are also getting a refresh that includes an in-line remote. A 32GB Touch goes for $299, while a 16GB Nano sells for $149. iPod sales have been declining, but are still considerable. (live blog) (more[View news story]
    I find that I no longer listen to my music library anymore as I pretty just go with the "juke-box" experience on Jango. On 4g the sound quality is excellent and very reliable. You create a custom station and just add any band you can think of to the mix.

    It gives you a really cool listening experience and its free if you a data plan on your phone.

    I wonder if 4 years from now people will still be buying music.
    Sep 12 03:05 PM | 1 Like Like |Link to Comment
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