moneyneversleeps

GM May Be Heading for Quick, Packaged Bankruptcy

any predictions as to who will replace GM in the S&P? We are going with Visa, Ross Stores or Western Digital. The Dow is a wildcard, but we have some thoughts on that here:
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what I want to know is who the hell is still buying GM stock?! and why??!! Time to suspend trading and turn out the lights...

VIX: Where Will It Bottom?

the media has been loving the vix as some sort of positive indicator which is reading it completely wrong...

more here:
moneyneversleepsblog.b...

With 34% of S&P 500 companies now trading above their price targets for the next 12 months, some analysts say upside from here is limited: "We're going to have a sudden jamming on the brakes of investors' enthusiasm for early-cycle stocks when they realize they made a big mistake."

Perhaps it is time for a new round of upgrades! Interesting study out showing that over the long term the vast majority of stocks are losers.. the gains in the market are all from the leaders.. pretty fascinating!

moneyneversleepsblog.b...

Bernanke: Economy Will Turn Up This Year

the obvious issue here is the fed's inability to get out in front of the recession so why should anyone care when they try to forecast a bottom? It is good that bernanke is attempting to bring down the expectations for the recovery because jobs will continue to decline and the recovery could be very weak which could make for a lot of irritated consumers...

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FOMC: Notes on the Fed Minutes

Surprised they didn't end up buying in longer dated treasuries.. no wonder treasury yields are right back to the last fed meeting.
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It will be interesting to see if their $300b is enough to move the treasury market and keep rates low especially if the market momentum keeps up!

Every chartist knows it took 25 years for stocks to recover pre-1929 crash highs. Except it didn't. Not even 5 years.

It's time like these that reinforce how damaging index investing can be. An individual investor cannot afford to take losses of 40-50%, it is very hard to recover from that and double your money just to get back to breakeven..

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Nouriel Roubini laughs off the "V" seekers. "My analysis of the data suggests that the global economic contraction is still in full swing with a very severe, deep and protracted U-shaped recession."

Roubini isn't depressed.. the dude loves to party and have a good time.. enjoying the fame for sure.

Back to the economy, doesn't matter what letter it is, the market will have plenty of opportunities either way, just have to be ready and a little more active given the volatility...

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Nouriel Roubini laughs off the "V" seekers. "My analysis of the data suggests that the global economic contraction is still in full swing with a very severe, deep and protracted U-shaped recession."

The real question to debate is whether you can expect a star of the current bear market like Roubini to turn positive when the time comes, history shows that is a difficult task for someone as popular as he is right now, more here:
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Roubini seems to be stretching when he makes stock market calls but of course his economic work has been impressive and ahead of the crowd, have to give him that.

Leveraged ETFs: New Source of Systemic Risk

Leveraged ETF's are still a wonderful too when used correctly, the problem is that most people do not use them correctly... people complain that they don't do what is expected but the ETF's do exactly what they SAY they do. Cramer has been out there complaining about these products every day and he seems to be missing the bigger point.. use them correctly and they are a great way to hedge or actually make a profit even in a declining market.. it is easy and it is efficient.. beautiful.

more here: moneyneversleepsblog.b...

Note to Nassim Taleb: You Can't Kill Off Black Swans

Interesting rules, unlikely that anyone in gov't is listening.

We've got more on the black swan issue over at our blog:
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Love his work but will Taleb still be relevent when the economy/market recovers?

New Direxion 3x ETFs Offer Investors 'Bonds on Crack'

There is a major issue with liquidity given that there are SO many ETFs many of which are not even known to investors. Plus Cramer has been pretty negative on leveraged ETF's which is a negative for the industry but is really unwarranted given how beneficial these products can be when used correctly.

moneyneversleepsblog.b...

"Whoever thinks the government is pandering to the banks should listen to this morning's earnings call with JP Morgan (JPM) CEO Jamie Dimon. He came about as close to giving the government the middle finger as any bank CEO has done publicly." (Megan Barnett)

Keep an eye on Morgan Stanley's earnings on Wed. It appears like they will pull a Goldman Sachs and make December disappear so perhaps they can put together a nice first quarter...

more here: moneyneversleepsblog.b...

Sucker's Rally Approaching an End

this sucker's rally just doesn't seem to want to give up, hard to ignore that kind of momentum. The pullbacks are measured in hours instead of weeks and the buy the dip crowd is back in full force.

here's our take on the "bear market rally" thesis if anyone is interested: moneyneversleepsblog.b...

Goldman Sachs One-Upped Wells Fargo in Accounting Shenanigans

Pretty shady business.. apparently goldman sachs is saying the reason they changed the fiscal year is because they became a bank holding company.. that occured back in Sept.. they voted on the change in Dec.. still doesn't explain why they did such a poor job of reporting it in the press release.

Also, if bank holding companies must switch to a Dec year end, look for the same gimmicks from Morgan Stanley which used to have a fiscal year ending in Nov...

goldman link: moneyneversleepsblog.b...

moneyneversleepsblog.b...

Goldman Sachs Backlash Is Picking Up Steam

that quarter wouldn't have been so stunning if they didn't change their fiscal year. That change allowed them to report $2.21/sh in losses for the month of December, but all the 1st qtr results were based on Jan/feb/mar...

more here: moneyneversleepsblog.b...