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Money McBags is the preeminent financial humorist and money maker in the world. While known for his ability to find and invest in undervalued equities, Mr. McBags is also a world class dick joke teller, an aficionado of lovely ladies, and avid reader of books without pictures in them. With... More
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When Genius Prevailed
  • 10/11/10 Midnight Report: Market takes a break, wants to get to know QE2 before going all the way

    It was a quiet day on the Street as the bond markets and federal offices were closed to celebrate one of the greatest threesomes of all time, and no, Money McBags isn't talking about the Three Stooges, the Dahm triplets or that scene in Meggann and Hanna love Manuel, he's talking about the voyage of the Nina, Pinta*, and Santa Maria as today was Columbus day so hopefully you all coughed in to a blanket and handed it to your neighbor in order to celebrate.

    As for the market, investors came down from their weekend long party celebrating the destruction of 95k jobs (minus another 11kish due to the birth/death model) which has made QE2 a near certainty as 93% of economists now surveyed believe Benny B will get his asset buying on at the beginning of November (of course 90%+ of economists didn't see the global financial collapse coming but that is because they were all likely distracted by Art Laffer's oddly dyed hair as the aged and lilliputian witch doctor, which is actually the formal term for economist, tries to blend in to normal society to keep his pot of gold safe).  The market has had a stunning run considering not much is getting better (other than rush hour traffic, prices at WalMart, and Minka Kelly) so it will be interesting to see if buying the rumor will persist until the next Fed meeting in November when the "sell the news" algorithm kicks in for all of the HFT's (and if you haven't watched the 60 Minutes piece on HFTs from last night, it was decent enough in an informative way yet lacked the anger, insight, and Leslie Stahl nip slip that Money McBags would have liked to have seen).

    In macro news, not much happened today other than Foreclosure-gate keeps ramping up as apparently mortgages had less documentation than Meg Whitman's maid.  With foreclosed upon houses driving homes sales as they are cheaper and usually contain less old lady smell than owner occupied houses, a slow down in processing foreclosures will severely impinge upon the government's desire to move housing inventory.   This is because sellers still refuse to come down in price as they try to avoid taking losses on their mortgages which are more underwater than Mary Jo Kopechne.  It will be interesting to see how all of this plays out, though more interesting to see how this plays out.

    The only other interesting piece of macro news was that Janet Yellen (who was speaking for her first time as the Federal Reserve's vice chairperson after taking over for Donald Kohn thanks to her stunning victory in the swimsuit competition where she became the first vice chair candidate to rock a two piece since Frederick H. Schultz in 1979) said that the Fed's accomodative policy of keeping rates low could lead to excessive risk taking as companies can easily lever up now that money is cheaper and easier to access than Paris Hilton's vagina (though with a bit less cocaine on it, but just a bit less).  So it will be up to the Fed to "take the punch bowl away" (her actual words) before the economy overflows it with turds.

    Internationally, nothing really happened today other than...READ MORE....

    Disclosure: No positions
    Oct 12 9:52 AM | Link | Comment!
  • 10/5/10 Midevening Report: Japan says money for nothing and ch(opst)icks for free

    Oh shit is it on.  Japan decided to cut their rates to 0%, the ISM released a number slightly more than a nut hair above guesses, and the lovely yet vibrator-challenged Christine O'Donnell assured voters that she is not a witch (and Money McBags is 95.6% sure that is a real video).  All of those caused the market to run today faster than a Madz Negro (though if you think that name is bad, imagine how her brother Uppity must feel).  So with the currency wars officially on and fiat currency literally no longer being worth the paper on which it is printed, investors are throwing money hand over algorithm into the market because somehow the continual quantitative easing will give the recession a happy ending like a gentle soapy from the lovely Carrie Keagan.  So glad that is out of the way and we can all go back to forgetting about the 10% unemployed (or ~20% if you want to include the discouraged and Mickey Rourke) and roll our gains in to Chinese made 3D flat screen TVs, abandoned houses we can "flip" for profits, and autographed copies of The Age of Turbulence which are now selling for an incredibly overpriced $.01 in some places.


    The big news on the day was that Japan surprised the markets by dramatically lowering their benchmark interest rate to a range of 0% to 0.1% from merely 0.1% and apparently that extra .1% is hu-fucking-uge, well, at least symbolically.  Japan is also setting up a $60B fund to buy government bonds, commercial paper, and first edition Pokemon cards in order to push down the value of the yen in their attempt to bring the barter system back to the country (or stave off deflation and stimulate exports, potato-puhtaato).  Given Japan's past success in spurring their economy out of the doldrums of a deflationary environment, Money McBags is sure these measures will work in the same way that he is sure Oprah Winfrey's next diet will work (and Jay Leno, fell free to steal that one) and Taryn Thomas' new anus will work.


    And it wasn't just Japan manipulating their currency as Benny B got his Fed on yesterday as he spoke to the esteemed economists at the University of Rhode Island and gave a not so subtle nod to QE2 by saying the Fed will resume their asset purchasing program.   Though he doesn't have "precise numbers" yet on the $s QE2 would use, he thinks it will be somewhere between 0 and whatever comes after trillion in the short scale number naming system (and for the record, "fuckload" is immediately after "trillion").  Benny B maintains that the last round of quantitative easing saved the US economy from further harm, a speech he will likely repeat when it is time for QE3, QE4, and the exciting QE69.


    In macro news, the ISM services index came in at 53.2 which was above the 51.5 of last month and edged out analyst guesses of 52 which has further caused the market to rally.  Surprisingly, the index showed an increase in employment and new orders while unsurprisingly it showed a decrease in hope and common sense.  Some investors are looking...READ MORE...

    Disclosure: Long AAPL
    Oct 05 6:28 PM | Link | Comment!
  • 10/4/10 Midevening Report: Rally comes to an end, always knew it was an ass man

    The market fell today ahead of Q3 earnings as a result of downgrades, the usual relatively ok yet absolutely shitty macro news (known as the skinny girl in fat camp or the world's tallest midget syndrome, speaking of which , Money McBags did find Mr. Reich's opinion piece surprisingly unfull-of-shit today, but then again, Money McBags only read the first paragraph before scrolling down for the pictures), and the realization that Europe's banking system may be shakier than an angry Michael J. Fox on a magic fingers vibrating bed in the middle of an earthquake.  With earnings estimates coming down ahead of the quarter and the market having risen by ~10% recently, a sell off would be less surprising than Amy Fisher getting in to porn (though remarkably less hurtful to the eyes), so if you are a gambler (Money McBags means equity investor), be careful right now because gold ATMs aren't being installed just for shits and giggles (if you want shits, and perhaps some giggles, use these ATMs).

    As far as macro news, factory orders fell by .5% which was slightly worse than analysts guessed but excluding the volatile transportation number, orders were up by .9% so as long as the Commerce Department tells us which numbers to exclude on a monthly basis, positive economic reports can go on indefinitely.  Along those lines, the government has mandated that all data released from now on be rounded up to the prior release, the unemployed be referred as "pre-employed," and Jaime Edmondson be in charge of reading any and all future economic releases while gently tickling investors taints because that is the easiest way to make sure no one is paying attention to the facts.

    In other macro news, home sales rose by 4.3% which slightly beat analyst guesses though sales were still a full 20% below last year's tax break manipulated number.  The rise was driven by a 7% jump in the South, a 6% jump in the West, and 0% jump in logic.  That said, home sales could start seeing some strange readings with foreclosure paperwork more fucked up than the Boston Globe's new business plan (because readers are really going to pay for shitty undifferentiated journalism when they can read the same shit for free on like every other website in the world, so kudos to the Boston Globe's management team for trying a business model that failed globally in 19 fucking 98) or Jenna Jameson's face (and seriously Jenna, WTF happened to you?  Perhaps there should be a limit on facials one receives?).  Money McBags has sort of avoided this story because he's not quite sure what to do with it (like Christine O'Donnell with a vibrator) but GMAC, JPM, BAC, and NAMBLA have apparently screwed up/misdocumented/mishandled (surprise surprise) a plethora of mortgage/foreclosure documents which will likely at least delay a spate of upcoming foreclosures.  This will probably hurt bank earnings and may or may not have an effect on home sales as it could artificially lower inventory and prop up home prices in the short run, but eventually, the banks will find a way to get paid and home inventory will continue to increase.

    Also the President of the Philly Fed, Charles "Chuckles" Plosser told the FT that he isn't necessarily for QE2 and Benny B. betta check himself before he wrecks himself because printing money forever is bad for the economy's health.  Plosser cited his view that inflation will still be a problem, his fear that the Fed won't be able to undo what QE2 does when the time comes, and his belief in common fucking sense that says that rates are already lower than Rick Sanchez's Q score so trying to lower them further isn't going to accomplish much (other than the collapse of fiat currency, the crumbling of western civilization, and a devaluing of the dollar to a point where it isn't even worth a dong)?  Money McBags likes that there seems to be some actual debate within the Fed, that said, QE2 seems to more of a certainty than Heidi Montag eventually posing nude in Playboy (and Money McBags will take the under on December, 12 2012).

    Internationally, Switzerland proposed tougher rules on banks aimed at making Swiss banks UBS...READ MUCH MORE...

    Disclosure: no positions
    Tags: MSFT, F, AXP
    Oct 04 8:24 PM | Link | Comment!
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