PoopInPant 44

South Korea Economy: Signs of an Earlier than Expected Turnaround

The Korean sentiment is a fragile, trend like state - this has lead to drops in confidence levels based on the global conditions.

Currently the greatest negative impacts to GDP have to be their exports and consumption - namely retail and housing.
Just a walk along the famous streets in Korea will have u seeing the same number of people walking around, but less people opening their wallets for things other than starbucks and pascucci.
You'll also see that there are 1/5 shops up for lease even in the most established areas.

However, the Koreans have already dealt with the IMF and this is still an anchoring bias that will help the Koreans overcome difficult conditions and just as easily get their confidence back to par.

The Seven Immutable Laws of Bubbles

Do bubbles in one asset class or region have effects on other bubbles?

Can you bubbles form due to other economic pressures?
i.e Australia - stimulatory reductions in interest rates to 49 year lows and first home owners grants - looks like a similar property bubble forming to which the US has experienced. This scenario does seem to lack the new paradigm rule though.

The Market Bounces Through Bad News

cooked books = positive market looks -> trader chooks?

Chart of the Day: Goldman VaR

or why not do some PROP trading with TARP funds!, pay them back with excess profits and split the rest up in bonuses!

Rio Tinto's Chinese Mistake

I'm really enjoying the RIO situation on a few levels.

1/ The rights issue - RIO has obviously had the need to shore up their debt levels - and they have picked the perfect time in the bearmarket cycle to do this - they are pretty much expecting that the current commodity price increase has been a lucky windfall to their expectations.

2/ The Chinese has been taking advantage of the low prices and this has lead to the recent run up in commodities; although they are now publicly stating that the prices are too high - which has lead to falling commodity prices and the baltic index.

3/ The final point is more speculative/cultural - the Rio execs were definitely stretching the boundaries of information as a power of negotiation tactics, the Chinese would no sooner take the smallest piece of foul play/rhetoric and turn it into a huge public incident - for the benefit of long term price negotiations. I hardly think the Chinese will make a big deal out of this whole spectacle once the negotiations of prices are completed.
I wouldn't put it past them to have baited RIO execs into fishing out state secrets, for the sake of this master stroke by the Chinese buyers.

Commodities Today: A Traders' Market

Other than a technical bounce, are there many fundamental issues that could cause a significant bounce at the $58.82 mark?