4 replies to this topic

[espresso]

I hate see people yelling their forcast. We don't sell potatoes in the market! Loudy often means wrong!

[hiker]

solid and steady is better...

Edited by hiker, 13 September 2007 - 03:10 PM.

[arbman]

The problem I see here is there was another near record (huge) submitted repos this morning and mostly from the MBS and the Fed instead net drained. The USD bounced sharply today of course, I would think the Fed is more afraid of a currency crisis than an economic slow down. The junk is underperforming. People can fade each other with the bull vs bear talk all they want, but this market is dealing with and trying to discount the macro issues at the moment. Anyone who is taking a trade because there is too much bulls or bears or what not, is simply gambling at the moment.

[ogm]

The problem I see here is there was another near record (huge) submitted repos this morning and mostly from the MBS and the Fed instead net drained. The USD bounced sharply today of course, I would think the Fed is more afraid of a currency crisis than an economic slow down. The junk is underperforming. People can fade each other with the bull vs bear talk all they want, but this market is dealing with and trying to discount the macro issues at the moment. Anyone who is taking a trade because there is too much bulls or bears or what not, is simply gambling at the moment.

CNBC kept talking today about slowdown in contraction rate of the Commercial ABS market. Last week it contracted 70 bil, and this week only 7 bil.... sounded like good news And then about a dozen guests came on and called for test, retest, pullback and even bear market.......


LIBOR fell too.

All surprizes are to the upside.....

Edited by ogm, 13 September 2007 - 06:05 PM.

[arbman]

Falling rates is not an indication of an improving market, it is an indication of a slowing environment. The credit growth rate told us that the economy should be slowing in the months ahead. If we are to expect a decoupling from the credit growth rate, it should come after a catalyst for the market to overlook this situation. The opening of the discount window is too short term of a solution to fix this situation, if the rates can come lower, then market might project a different compounding effect since it will be more permanent. The Fed is basically saying they will not lower before they are sure of such a longer term problem (because they don't want to raise the rates back up in 6 months). I would think there is already enough damage to keep the prices in a trading range and test the untested lows made on high volume until the credit markets start to show enough growth to warrant an earnings growth over the inflation. I believe the inflation is now coming down, however we are yet to see this in the commodity prices. So, people are struggling to find a job or earn more, but the commodity prices are preventing the companies from making price cuts. Hence, the inflation is probably slowing down, but maybe not as much to warrant a rate cut campaign, I think so. This makes the credit market recovery slow and the indices stagnant...

Edited by kisacik, 14 September 2007 - 08:25 AM.