As oil price buckles, increase in talk of need to focus on S&P 500 earnings ex-energy Collapse in energy earnings important factor, but SPX ests were too rosy to begin with Sell-side struggles to wrap arms around energy repercussions; hard … Continued
Draghi finally delivers, igniting a global rally in stocks Here in U.S., sustainability in doubt unless stocks attract some of that money U.S. households not likely to be source of funds as money market funds lower than pre-crisis As expected, … Continued
As world’s largest debtor and one running deficit, U.S. needs constant demand for Treasurys Recycling of petrodollars has been reliable source of demand for U.S. federal debt So far, drop in price of crude has not adversely impacted this demand … Continued
Technically strong dollar bumping against two-decade-long resistance Trend-following hedge funds’ net longs in dollar index futures highest ever To watch out for: rise in odds of no rate hikes in U.S. and ECB QE disappointment Not a single day goes … Continued
Draghi drops credible (?) hints Eurozone QE is coming QE no panacea for economy, only a vehicle for transfer of bond ownership Investor reaction post-announcement key, as net shorts in euro futures remain very high “This may imply adjusting the … Continued
One of the perplexing things in the current economic cycle has been the suppressed velocity of money. Six years into recovery, velocity has yet to pick up steam. As the chart below shows, excess reserves have gone toe-to-toe with the … Continued
10-year notes yielding lower vs when Nov’s blockbuster jobs report came out Large speculators’ net shorts in 10-year-note futures at four-plus-year high Bond vigilantes not buying hopes and prayers of escape-velocity backers Treasury bonds continue to catch a bid. A … Continued
Markit forecast of sub-200k private payroll growth this month a surprise U.S. unemployment claims, near historical lows, need catalyst to begin to move up Oil-heavy states are yet to see jobs impact of drop in crude, but only a matter … Continued
Market expectations for rate hike next year runs risk of disappointment With monetary quiver nearly empty, Fed very much focused on wealth effect Job even more difficult, given adverse effects of cheap money beginning to loom Markets are sending mixed … Continued
Soft fundamentals, but gold continues to hold up well Large speculators added further to their net longs in gold futures Overbought near-term, but potential weakness likely gets bought near support Trend followers do what they do best. Large speculators are … Continued