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Some Perspective On Federal Reserve Bond Purchases

February 10, 2011

Real Time Economics (WSJ Blog) – NY Fed Official: Bond Buying Hasn’t Compromised Treasury Market The Treasury market continues to function normally despite significantly sized bond buying by the Federal Reserve, a key central bank staffer said Wednesday. “Our purchases do not appear to be causing significant strains on the liquidity or functioning of the… Continue reading Some Perspective On Federal Reserve Bond Purchases

Newsclips

More On Bernanke vs. Congress

February 10, 2011

Bloomberg.com – Bernanke Makes Sure Fed Reminds Congress Deficit Bigger Than QE2 Federal Reserve Chairman Ben S. Bernanke is trying to make sure the U.S. central bank doesn’t become a scapegoat for fiscal profligacy. Fed officials are warning that Congress needs to balance the nation’s budget, showing that policy makers are concerned about a loss… Continue reading More On Bernanke vs. Congress

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Newsclips

Note To U.S. Government: Lock In Low Rates Before It Is Too Late

February 10, 2011

<Click on chart for larger image> The Wall Street Journal – Better Late Than Never for the Treasury The U.S. government is rightly moving to lock in low, long-term borrowing rates. It is just a bit late to the game. Thursday’s auction of $16 billion in 30-year Treasury bonds is part of that effort. The… Continue reading Note To U.S. Government: Lock In Low Rates Before It Is Too Late

Newsclips

Shorting Munis

February 10, 2011

The Financial Times – Hedge funds search for way to short munis “There is a lot of blood in the water in the municipal space. Hedge funds smell that blood and are trying to figure out the best way to make money in the marketplace,” says Rob Novembre, head of municipals at Arbor Research and… Continue reading Shorting Munis

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Newsclips

Portugal

February 10, 2011

<Click on chart for larger image> The Financial Times – Soaring debt pushes Portugal towards bail-out Portugal’s cost of borrowing hit a euro-era high on Wednesday amid growing concerns that Lisbon will have to turn to bail-out funds to revive its stagnating economy. Hedge funds were selling Portuguese debt after purchasing bonds at a syndication… Continue reading Portugal

Newsclips

QE2 Has Killed The Triple Short ETF

February 10, 2011

Index Universe – Barclays Halts Creations Of ETN BXDD Barclays Bank is suspending creations of its inverse leveraged ETN that provides investors with triple the inverse of the daily performance of the S&P 500 Total Return Index, a reflection of what rising stock prices can do to the price of a security designed to produce… Continue reading QE2 Has Killed The Triple Short ETF

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Newsclips

Commodity Inflation

February 10, 2011

Bloomberg.com – Caroline Baum: Bernanke Worst Nightmare Is This Man’s Boxes Forget the frequent references to “food inflation,” “commodity inflation” or, even worse, “cost inflation.” (Thank goodness there’s no “wage inflation” at the moment!) These are all misnomers. Yes, food prices are rising, as are commodity prices. They aren’t inflationary per se unless the Fed… Continue reading Commodity Inflation

Newsclips

Measuring The Likelihood Of A Black Swan Event

February 10, 2011

FT Alphaville (FT Blog) – Skewed – the CBOE’s new fear indicator The Chicago Board Options Exchange has just launched a new ‘fear factor’ index to sit alongside the now-famous Vix. Meet the Six, or the CBOE S&P 500 Skew Index. The ‘SKEW’ is an option-based indicator that measures the perceived tail risk of the… Continue reading Measuring The Likelihood Of A Black Swan Event

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Newsclips

Cartoons

February 10, 2011

None Today

Charts of the Week

Untitled

February 9, 2011

Charts of the Week Topics Covered This Week Include: Why Crude Oil Prices Are Now Above $100/Barrel Crude Oil Mid-Continent Dislocation Returns TIPS’ Forecasting Record Still Better Than Economists’ Betting On Metals Declining Carry Trade Again A Warning To Global Equities Russian Markets Facing Rising Inflation Carry Into Filipino Markets Fading Thailand Turns Lower As… Continue reading Untitled

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Market Talk

Why Crude Oil Prices Are Now Above $100/Barrel

February 9, 2011

What is the worldwide price of crude oil? If you’re like most, you will look up the nearby crude oil futures contract that trades on the New York Mercantile Exchange (NYMEX).  Yesterday (February 8th) the March 2011 NYMEX contract closed at $86.94/barrel, down 43 cents.  This contract is based on the price for “sweet” (low… Continue reading Why Crude Oil Prices Are Now Above $100/Barrel

Newsclips

Discussing Munis

February 9, 2011

<Click on chart for larger image> Bloomberg.com – U.S. Municipal Bond Market `Swung Too Far Into Default Panic,’ Pimco Says State and local bonds offer some of the most compelling value in credit markets because the U.S. municipal debt market has “swung too far into default panic,” according to Pacific Investment Management Co. “The real… Continue reading Discussing Munis