Friday, December 14, 2012 –

A Sad Day by Sinclair Noe DOW – 35 = 13,135SPX – 5 = 1413NAS – 20 = 297110 YR YLD -.02 = 1.71%OIL +.97 = 86.86GOLD – 1.10 = 1697.20SILV – .23 = 32.31 A total of 27 people dead at school in Newtown, Connecticut; 20 children, 6 adults, and the shooter; the kids were between the ages of 5 and 10. There was possibly another person shot before the massacre at the school. The shooter’s mother was a teacher at the school and she was killed, but it is pretty clear this was more than just an attack on the mother. So, if you see the flags at half mast today, this is why. We’ve seen it before at Columbine, at Virginia Tech, at Aurora, and just earlier this week in a mall in Portland. This time it was especially horrible because it was mostly children; the innocents. It is estimated that there are 87 gun related deaths per day in the US, and this week it was kids. I understand that tragedy is a part of life. I understand that other places in the world experience tragedy. What is happening in Syria is tragic, what is happening in the Sudan is tragic. What is happening in Afghanistan is tragic. None of that discounts the tragedy in Connecticut. Thoughts and prayers and consolation for the victims are appropriate and comforting to some extent, but there should be something more. Something is wrong in this country. I have no …

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Tuesday, November 27, 2012 – Economic Data, Geithner’s Cliff, Greek Bailout, Warren’s Pitch, Blankfein’s Irony

Economic Data, Geithner’s Cliff, Greek Bailout, Warren’s Pitch, Blankfein’s Irony by Sinclair Noe DOW – 89 = 12,878SPX – 7 = 1398NAS – 8 = 296710 YR YLD -.02 = 1.65%OIL – .45 = 87.29GOLD – 7.60 = 1742.80SILV – – .13 = 34.15 Durable goods orders leveled off in October, mainly because of slack demand for automobiles and airplanes and a reversal in defense orders. Most other manufacturers saw an uptick in demand; so, conditions aren’t getting worse; they aren’t getting better either. Or at least that is how it looks at first blush. Overall orders for durable goods were virtually flat in October, but factoring out the volatile defense and transportation industries, so-called core capital orders jumped 1.7% last month to mark the strongest gain since May. Home prices rose in September for the sixth straight month. The S&P/Case-Shiller 20-city composite posted a non-seasonally adjusted 0.3% increase in September to reach the highest level in two years, following a 0.8% gain in August. Home prices were up 3% from September 2011 for the largest annual percentage growth since July 2010. In the latest Quarterly Report on Household Debt and Credit, the Federal Reserve Bank of New York reports that non-real estate debt jumped 2.3% to 2.7 trillion, with increases in student loans, auto loans, and credit card balances. Overall consumer debt shrank $74 billion to $11.3 trillion as mortgage debt decrease more than $120 billion. Nearly a quarter of a million people had a foreclosure tacked onto their …

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Friday, October 12, 2012 – Peace Out

Peace Out by Sinclair Noe DOW + 2 = 13,328SPX – 4 = 1428NAS – 5 = 304410 YR YLD -.01 = 1.66%OIL – .43 = 91.64GOLD – 12.90 = 1755.30SILV – .52 = 33.58PLAT – 23.00 = 1660.00 Two down, two to go; debates that is. So far, it has been great entertainment; and we all get to play critic; too polite, too disrespectful, too vague, too mendacious, big flag pin, little flag pin, too much style and not enough substance. In addition to a dearth of veracity, there were other glaring omissions, such as details, specifics, and of course, the Federal Reserve. Pay no attention to the man behind the curtain. Maybe the marching orders came from Jamie Dimon, speaking before the CFR the other day, Dimon discounted all this QE stuff. Dimon says QE1, 2, and 3 added together are only about $3 trillion dollars,… so far. Now that might sound like a significant sum to a bumpkin like me, but Dimon puts it in perspective; it is just a small part of the total financial assets of America, $80 trillion dollars. I didn’t see much in the itemized columns about that $80 trillion but it seems that much of it is securitized debt, backstopped by the Federal Reserve, and without the Fed “Put”, that $80 trillion in financial assets might just be so much paper; in other words, it remains susceptible to massive deleveraging. Profit for JPMorgan rose 34% to $5.71 billion, or $1.40 a share, …

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Friday, June 29, 2012 – It’s Almost Like Free Money, Woohoo!

It’s Almost Like Free Money, Woohoo! – by Sinclair NoeDOW + 277 = 12,880SPX + 33 = 1362NAS + 85 = 293510 YR YLD + .08 = 1.66%OIL + 7.18 = 84.87GOLD + 47.10 = 1600.10SILV + 1.17 = 27.59PLAT + 58.00 = 1454.00All right gang – what do the markets love? Free money. When central banks give free money to the banks (and let’s be clear, they only give free money to banks not to regular people) the bank traders grab the loot and scamper off to the casino or to the trading desk (same difference), and it’s risk on.  Next thing you know the Dow is up 277. Woohoo, this economics stuff is easy. Sometimes, just the promise of free money is enough.The past couple of days the big wigs in Euro-land held an emergency summit in Brussels. This was their 20th emergency summit, so expectations were diminished. And just when it looked like an unproductive weekend full of waffles and chocolates; they announced a blockbuster deal (think John Carter, not Avatar). They have a plan for long term fiscal union, and a plan to save Spain and Italy from contagion. They’ll use the ESM, the European Slush Mechanism to directly inject capital straight into the banks, just like junkies on the mainline. And this bailout money would not be senior to existing debt. You may remember that caused  a problem for the Greek bailout, when the ECB forced Greek bondholders to take big haircuts but the ECB debt was not discounted at …

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Wednesday, June 20, 2012 – A Twisted World – by Sinclair Noe

DOW  – 12 = 12,824SPX – 2= 1355NAS +0.69 = 293010 YR YLD +.02 = 1.64%OIL – 3.25 = 81.10GOLD – 11.10 = 1607.80SILV – .30 = 28.22PLAT – 23.00 = 1464.00Quite frankly the Federal Reserve FOMC meetings have become a bit too predictable. They didn’t lower interest rates because rates are already at zero. They didn’t raise interest rates because that would be a total freak out and the financial markets would collapse. The Fed does not have an exit plan from their zero interest rate policy. They didn’t announce QE3 because that would be a blatant destruction of the currency which would send the price of gold soaring; also because they are holding back and waiting just in case Europe hits the self destruct button. The Fed expanded Operation Twist by $267 billion, meaning it will sell short-term securities and buy long-term ones in an effort to keep borrowing costs down. The program, which was due to expire this month, will now run through the end of the year. Operation Twist is a wash; it really doesn’t cost anything; they buy, they sell, it all equals out. The next question is whether Operation Twist actually does anything. Here the results are inconclusive. Long term rates are at historic lows but we don’t know if rates would have been low even without Operation Twist. Perhaps the most pathetic part of the FOMC statement was this: “Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The …

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Monday, June 18, 2012 – G-20 Declares Ceviche Tasty and Democracy Messy – by Sinclair Noe

DOW – 25 = 12,741SPX +1 = 1344NAS + 22 = 289510 YR YLD un=1.58%OIL -.26 = 83.01GOLD + 2.00 = 1629.70SILV un= 28.84PLAT – 1.00 = 1489.00The results of the Greek election shows conservative New Democracy taking 29 percent, with the radical leftist Syriza bloc just behind on 27. The Pasok Socialists were set to take 12 percent of the vote. The scenario is similar to the results of an earlier round of voting. ND also came in first in May 6 elections, again with Syriza running a close second, but failed to form a government then. And 38% of eligible voters did not vote yesterday; that’s more votes than any one party received. The headlines say that a pro-bailout, pro-remain in the Euro-union party won the Greek elections; it’s not that simple. There was no majority. The next step is for New Democracy leader Antonis Samaras to form a coalition government; not an easy or certain task, and it must be done within the next 10 days. Look for a combo of the New Democracy conservatives and  the Pasok socialists; the same group that governed Greece into this mess in the first place. Pasok, the Socialist party, called for a government that would include Syriza, the far left party, but  Syriza ruled out joining a coalition that would stick to the punishing bailout terms that have helped condemn Greece to five years of record recession. Alexix Tsipras, the leader of Syriza, had vowed to tear up the terms, betting that …

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Thursday, June 14, 2012 – Just In Case There is a Glitch in the Vote – by Sinclair Noe

DOW + 155 = 112,651SPX + 14 = 1329NAS + 17 = 283610 YR YLD +.01 = 1.61 OIL +.44 = 84.35GOLD + 5.70 = 1624.30SILV – .22 = 28.74PLAT + 27.00 = 1498.00All righty class, it is time for a pop quiz. Please answer the following question: What is the Ironclad Rule of Wall Street?Put down you pencils.And the answer is: Wall Street loves free money.And where does free money come from? And the answer is: Central banks. If you answered the Federal Reserve and Helicopter Ben, give yourself a partial credit; if you answered taxpayers, give yourself partial credit; while those answers are technically correct it is outdated and more than a tad provincial. Think bigger, think globally.Today, Greek bank stocks surged more than 20 percent, with speculators betting on a favorable pro-bailout outcome after Sunday’s election. The action there drew the attention of traders on Wall Street. Officials from the G-20 confirmed today that the central banks from major economies stand ready to take steps to stabilize financial markets by providing liquidity and preventing a credit squeeze if the outcome of Greek elections on Sunday causes tumultuous trading even if the Greek election will not provide “the definitive signal on what happens next” in the euro-zone economic crisis.The Greek election is Sunday and then there is a G20 summit of world leaders in Los Cabos, Mexico, on Monday and Tuesday, with Europe’s escalating crisis topping the agenda. Leaders will be accompanied by finance ministers playing an advisory role. Depending on …

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Wednesday, June 13, 2012 – To Hedge or Not to Hedge – by Sinclair Noe

DOW – 77= 12,496SPX – 9 = 1314NAS – 24 = 281810 YR YLD -.06 = 1.60%OIL – .86 = 84.03GOLD + 7.80 = 1618.60SILV -.11 = 28.96PLAT + 11.00 = 1471.00If I went before the Senate Banking Committee and told lies, you can bet they would throw me into the gray bar hotel and toss the key. Today, Jamie Dimon, the CEO of JPMorgan Chase went before the Senate Banking Committee and as he took his seat in the Senate hearing room a protestor yelled, “This man is a crook and he needs to go to jail.” And then Jamie Dimon started talking and proved the protestor’s point. During questioning, Dimon was asked if the Volcker rule would have prevented the trades that led to $2 billion in losses (give or take a few billion) at JPMorgan? Dimon answered: “I don’t know what the Volcker Rule is, it hasn’t been written yet.” The proposed rule, mandated by the Dodd-Frank legislation, was published in November in the Federal Register and opened for public comment. Financial regulators are now in the process of finalizing it. Jamie Dimon is a board member of the New York Federal Reserve and as such is charged with regulating banking activity in accord with legislation such as the Dodd-Frank reforms and the Volker Rule; as CEO of JPMorgan, Dimon must certainly be familiar with the Volker Rule which would dramatically alter the rules of trading for a major part of his company. Of course the other option is …

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Tuesday, May 22, 2012 – Bank Scum – by Sinclair Noe

DOW – 1 = 12,502 SPX +0.64 = 1316NAS – 8 = 283910 YR YLD +.06 = 1.79%OIL – .92 = 91.65GOLD – 24.10 = 1569.30SILV – .27 = 28.30PLAT – 23.00 = 1451.00 Morgan Stanley, JPMorgan and Goldman Sachs are just pure scum. No wait, I shouldn’t say that; it’s much too kind; they are lying, stinking, thieving, dangerous scum. Maybe you heard about a little company called Facebook; it went public last Friday. Today, Reuters is reporting Morgan Stanley, JPMorgan and Goldman Sachs all cut their earning forecasts for Facebook in the middle of the IPO roadshow. You didn’t hear about that? No, you did not hear about that because the big banksters didn’t tell you. Why didn’t they tell you? Because they thought it would be much better to screw the public and try to make a quick buck on insider information, which they are required by law to report. Instead, the banksters passed the information only to a handful of big investor clients. This is a problem because earnings forecasts are material information, especially when they are prepared by analysts who have special access to company information and company management. Everybody who invested in Facebook would consider this material information when making an informed decision. The handful of big investors that did receive the information about reduced revenue forecasts were reportedly shocked. The change in Morgan Stanley’s estimates came on the heels of Facebook’s filing of an amended prospectus with the U.S. Securities and Exchange Commission (SEC), in …

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Monday, May 21, 2012 – Markets Bounce, Greece Doesn’t, JPMorgan Stonewalls – by Sinclair Noe

DOW + 135 = 12,504SPX + 20 = 1315NAS + 68 = 284710 YR YLD +.03 = 1.74% OIL + .12 = 92.69GOLD +.30 = 1593.40SILV -.25 = 28.57PLAT + 13.00 = 1474.00 Remember last summer, when the living was easy and the Dow Industrials dropped like bricks from 12,724 down to 10,719? Two-thousand points in just a few weeks? Remember in October, the Dow had recovered from the Dog Days of Summer and climbed all the way back to 12, 078, only to fall more than 800 points in just a couple of weeks? The past three weeks have been kind of like that. Of course, there will be bounces. Today we bounced. Why did we bounce today? Make up any reason you wish. Europe didn’t collapse, Greeks shifted to a pro-bailout party, the Facebook frenzy is finished, Jamie Dimon hypnotized investors to forget about losses at JPMorgan, the G8 is feeling optimistic, China isn’t planning to crush the US economy – at least not this week; the sun was eclipsed by the moon but it was only temporary. Pick a reason or create your own. Stocks bounce. One day does not make a trend. Over the weekend the G8 met at Camp David. It might have made better sense to hold the meeting in Chicago, where NATO was holding a meeting, a rare United States based NATO summit, but there would have been too many protesters. So the G8 met in the wooded seclusion of Maryland and they …

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