Financial Review

The Mark Inside

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1A-01-27-2017.mp3Podcast: Play in new window | Download (Duration: 12:08 — 5.6MB)Subscribe: Apple Podcasts | Android | RSS…..Nasdaq record high. VIX multi-year low. 4Q GDP 1.9%. 2016 GDP 1.6%. Room to grow. Lucha Libre: Trump v. Slim. PM May comes a begging.  UBS redemptions. Sears fading away. Iranian tankers sail. Happy New Year. Financial Review by Sinclair Noe for 01-27-2017

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Financial Review

Sooner Rather Than Later

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-06-18-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 180 = 18,115 SPX + 20 = 2121 NAS + 68 = 5132 10 YR YLD + .04 = 2.35% OIL + .53 = 60.45 GOLD + 16.90 = 1203.00 SILV + .04 = 16.26   Three straight days of gains on Wall Street.  The Nasdaq finished up 68 points, or 1.3%, to 5132.95 and hit a new intraday record high of 5143.32. That tops its previous all-time intraday high of 5132.52, set back in March 10, 2000. The Nasdaq’s previous closing high of 5,106.59 was notched much more recently, on May 27. The rally was broad-based as all 10 S&P sectors rose with health care leading the way and all 30 stocks of the Dow posted gains.   We start with economic data. The consumer price index rose a seasonally adjusted 0.4% last month, almost entirely because of a surge in gasoline prices ahead of the summer driving season. Gas prices shot up 10.4% to mark the largest gain in six years. The overall cost of food, meanwhile, was unchanged for the second month in a row. Stripping out the volatile food and energy categories, so-called core consumer prices rose a much milder 0.1% in May. The cost of housing, airline tickets and medical care all rose while clothing prices declined.   The Conference Board’s leading economic index rose 0.7% in May for the second month …

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Financial Review

A Short Week

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-05-26-2015.mp3Podcast: Play in new window | Download (Duration: 13:15 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 190 = 18,041 SPX – 21 = 2104 NAS – 56 = 5032 10 YR YLD – .08 = 2.14% OIL – 1.37 = 58.35 GOLD – 18.10 = 1188.80 SILV – .35 = 16.82   The S&P/Case-Shiller Home price index shows prices for existing homes rose in March. Both the 10- and 20-City Composites increased significantly, reporting 0.8% and 0.9% month-over-month increases, respectively. Both the 10-City and 20-City Composites saw year-over-year increases in March. The 10-City Composite gained 4.7% year-over-year, while the 20-City Composite gained 5.0% year-over-year.  Phoenix saw prices increase 0.6% in March,

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Financial Review

Ongoing Criminal Enterprises

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-05-20-2015.mp3Podcast: Play in new window | Download (Duration: 13:15 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair noe DOW – 26 = 18,285 SPX – 1 = 2125 NAS + 1 = 5071 10 YR YLD – .01 = 2.25% OIL + .77 = 58.76 GOLD + 1.80 = 1210.80 SILV un = 17.18   April 29 and 30 the Federal Reserve’s Federal Open Market Committee met to determine monetary policy; today, they published the minutes of that meeting. There were no surprises. Policymakers have no plans to increase interest rate targets in June. We all knew that. Officials in April “had increased uncertainty regarding the economic outlook,” the minutes showed. They had no good reason to explain why consumer spending was so weak.  “Most” Fed officials think the dramatic slowdown in growth in the first quarter was transitory and that a moderate rebound would resume in the second quarter. Inflation was also expected to move higher.  The international context isn’t helpful to the US economy. Fed officials deem “foreign economic and financial developments” as constituting “potential downside risks,” and they specifically mention Greece and China. Moreover, despite its recent partial retracement, the dollar’s appreciation is “likely to continue to be a factor restraining US net exports and economic growth for a time.”   This suggests that they see a rate hike coming sometime later this year. Only a “few” on the U.S. central bank questioned whether the Fed was providing enough stimulus for the economy at the …

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Financial Review

Inmates Run the Asylum

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-05-15-2015.mp3Podcast: Play in new window | Download (Duration: 13:15 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 20 = 18,272 SPX + 1 = 2122 NAS – 2 = 5048 10 YR YLD – .10 = 2.14% OIL – .01 = 59.87   The S&P 500 index hit a record high close for the second day in a row. The S&P added 0.3 percent this week for its first back-to-back weekly gain in more than a month. The Nasdaq posted a small gain for the week.  The Dow Jones Industrial Average gained about 0.4 percent for the week. The Dow is close to another record. The old record is 18,288 from March 2.   So, to see if this little rally has legs, we can look at the Dow Jones Transportation Index, because according to Dow Theory, if the industrials are performing, they have to ship their products to market, so the Dow Transports should confirm any move by the Industrials. We are not getting confirmation. Transports topped out in November, and then there were 4 failed attempts to break through the high of 9310. And since March, the Transports have been consolidating lower. Now this doesn’t mean that the Industrials can’t hit a new record on Monday; after all the index is within spitting distance of the old record; but if the rally has legs, we would need to see Transports exhibit some signs of life. When we see a divergence, the we …

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Financial Review

No Small Thing

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-05-13-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 7 = 18,060 SPX – 0.64 = 2098 NAS + 5 = 4981 10 YR YLD + .02 = 2.28% OIL – .62 = 60.13 GOLD + 22.10 = 1216.10 SILV + .61 = 17.19   U.S. retail sales were flat in April. Americans went out to eat more and made plenty of Internet purchases, but we cut back on gasoline, autos, home furnishings and electronic goods, among other things. While March’s retail sales were revised up to show a 1.1 percent increase instead of the previously reported 0.9 percent rise, that was not enough to offset the general weak tone of the report. Retail sales excluding automobiles, gasoline, building materials and food services were also unchanged. Core retail sales correspond most closely with the consumer spending component of gross domestic product.   You can’t blame the bad winter weather for this report. The American consumer is acting in a most bizarre manner…, they are not spending, they are saving. The most recent data, from March, shows that Americans saved 5.3% of their pre-tax income, down from 5.7% in February. But the average savings rate so far in 2015 is higher than it was last year and in 2013. Savings spiked following the recession, but it was widely expected the savings rate would eventually fall back to the pre-bubble rates of 3% or 4%. Yea, that’s not …

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Financial Review

Upside-Down World

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-12-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 110 = 17,972 SPX + 19 = 2088 NAS + 56 = 4857 10 YR YLD un 1.98% OIL + 2.28 = 51.12   A ceasefire between Russia and Ukraine is scheduled to start February 15, which apparently means that Putin’s little green men still have 2 days to grab as much land as they can. The agreement follows a 17 hour, four-way meeting between Russia, Ukraine, France and Germany in Minsk. The new deal revived a failed September ceasefire agreement, with commitments from each side to pull back heavy weapons, as well as greater autonomy for separatist regions in eastern Ukraine. IMF chief Christine Lagarde also announced today that Ukraine will receive about $40B in funding over the next four years.   Along with the new cease-fire agreement, that won’t actually end the fighting; there was a non-agreement agreement between Eurozone finance ministers to put off decisions on Greece’s bailout terms until next week. Greek officials were unable to reach a deal over its bailout program yesterday, but will return to Brussels on Monday to try to end the deadlock.   Meanwhile, Sweden’s central bank cut its main interest rate into negative territory and announced a bond-buying program this morning. Sweden now joins Denmark and Switzerland and the European Central Bank in negative rate land. So, now, if you want to make a deposit in Sweden, you …

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Financial Review

HSBC – Too Big To Jail

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-09-2015.mp3Podcast: Play in new window | Download (Duration: 13:18 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 95 = 17,729 SPX – 8 = 2046 NAS – 18 = 4726 10 YR YLD + .02 = 1.95% OIL + .90 = 52.59 GOLD + 5.40 = 1239.70 SILV + .28 = 17.07 Let’s start with oil; OPEC lowered its estimate for non-OPEC supply growth this year by about 400,000 barrels a day, the biggest reduction since the forecast was introduced in August. The US led with a cut of 130,000 barrels a day while estimates for Colombia, Canada and Yemen were also trimmed. The group said it may boost global demand forecasts beyond this month’s slight increase amid rising U.S. gasoline use.   OPEC’s research department said: “The main factors for the lower growth prediction in 2015 are price expectations, a declining number of active rigs in North America, a decrease in drilling permits in the US and a reduction in the 2015 spending plans of international oil companies.”   The United Steelworkers strike continues with walkouts at two of BP’s refineries over the weekend. The strike now encompasses more than 5,000 workers at 11 refineries across the country, which account for about 13% of U.S. fuel-making capacity. Facility owners also hit by the strike include Shell, Tesoro, Marathon Petroleum and LyondellBasell.   Cheap gasoline prices have increased 13 cents in the past two weeks to $2.20 a gallon, nationwide average; but not everybody is buying …

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Financial Review

A Grain of Salt

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-05-2015.mp3Podcast: Play in new window | Download (Duration: 13:17 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 211 = 17,884 SPX + 21 = 2062 NAS + 48 = 4765 10 YR YLD + .02 = 1.82% OIL + 2.26 = 50.71 GOLD – 4.40 = 1265.50 SILV – .11 = 17.32   More people sought unemployment benefits last week, but the number of applicants remained near historic lows in a positive sign for job growth. The Labor Department says that weekly applications rose 11,000 to a seasonally adjusted 278,000. The four-week average, a less volatile measure, fell 6,500 to 292,750. That average has plunged 15 percent over the past 12 months.   Worker productivity declined in the fourth quarter of 2014, while labor costs increased. Productivity, the amount of output per hour of work, fell at 1.8 percent rate in the fourth quarter after rising at a 3.7 percent rate in the third quarter. Labor costs increased at a 2.7 percent rate in the fourth quarter after having fallen at a 2.3 percent rate in the third quarter. The drop in productivity and rise in labor costs are reflected in the fact that the growth in overall output slowed in the fourth quarter.   The U.S. trade deficit jumped 17.1% in December to a two-year high. The nation’s trade gap jumped to a seasonally adjusted $46 billion in December from a revised $39 billion in the prior month.   If Anthem is your …

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Financial Review

Catch a Falling Star

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-11-12-2014.mp3Podcast: Play in new window | Download (Duration: 13:20 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW – 2 = 17,612 SPX – 1 = 2038 NAS + 14 = 4675 10 YR YLD un = 2.36% OIL – 1.19 = 76.75 GOLD – 2.80 = 1161.10 SILV – .04 = 15.76 Stocks have been on a run lately, with the Dow Industrials and the S&P 500 hitting record highs yesterday, and the Dow Transports closing at a new high today. Yesterday, the S&P 500 marked its 40th new closing high of the year, versus 45 in 2013. The last five-day streak of record highs was in May 2013, and the next longest was eight days in June 1997. The Dow also hit a record yesterday, marking 6 consecutive record highs, its longest since June. The S&P 500 has closed above its 5 day moving average for the 19th consecutive session, a streak that has only occurred seven times in the past 20 years. And today did not reverse the trend. Typically, after a rally like this you might expect a pullback; not necessarily a correction, but a pullback; a pause to catch your breath. And so, now would not look like a good time to buy, but you also haven’t seen a signal to sell, at least not yet. Meanwhile, the advance has been so straight and fast that it hasn’t left any support levels in its wake. You might look at S&P 2000 as a round …

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Financial Review

Net Neutrality

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-11-10-2014.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW + 39 = 17,613 SPX + 6 = 2038 NAS + 19 = 4651 10 YR YLD + .05 = 2.36% OIL – 1.43 = 77.22 GOLD – 26.90 = 1152.60 SILV – .22 = 15.71 Record highs for the Dow Industrial Average and the S&P 500 index, plus new records for the Dow Transportation Average. We enjoy milk and cookies. The S&P 500 has rebounded 9.4 percent from a six-month low on Oct. 15. We’re still a couple of weeks away from Thanksgiving but third quarter earnings season is wrapping up, and analysts are already looking to next year, anticipating earnings will rise another 7% or so to around $126. And while stock prices have been hitting highs, volatility has dropped; the VIX is back down to 12 or so, indicating a fair amount of complacency, even as stocks hit highs. Commodity prices have been scraping the bottom of the barrel, with oil and gold near multi-year lows; one exception is cattle prices. Live-cattle futures last week hit an all-time high on CME, and prices are unlikely to come down anytime soon. In addition to increasing demand for beef, the recent drought in Texas and Oklahoma dented cattle herds, which has forced farmer to undergo a lengthy cattle replacement process. Stock market analysts aren’t the only ones looking to next year. The World Economic Forum is out with its new …

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Friday, March 14, 2014 – The Circle of Life

The Circle of Life by Sinclair Noe DOW – 43 = 16,065SPX – 5 = 1841NAS – 15 = 424510 YR YLD – .01 = 2.64%OIL + .81 = 99.01 GOLD + 10.90 = 1383.00SILV + .29 = 21.56 In economic news, the early-March consumer sentiment index fell to 79.9. That’s down from a final February reading of 81.6 but the latest number is within the range of numbers posted since November. A separate report from the Labor Department shows the producer price index dropped o.1% last month. The PPI measures inflation at the wholesale level. Final demand for goods rose 0.4% in February. Final demand for services dropped 0.3%. Producer prices excluding volatile food and energy costs fell 0.2%. In the 12 months through February, producer prices increased 0.9%, the smallest one-year gain since May 2013. Inflation is not a concern. The economy is still too sluggish to generate inflation. There are two big news stories of the day: Flight 370 and Ukraine. We don’t know anything about either. A total absence of actual information about the missing Malaysian flight is not in any way hindering 24 hour news coverage of the story. Facts have given way to fantastic fantasizing about everything from terrorism to hidden island airstrips to alien abductions. The news networks have been gathering tons of erroneous and conflicting reports which they immediately pass to their viewers. They must think we’re all morons. Secretary of State John Kerry and his Russian counterpart Sergei Lavrov wrapped up …

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Friday, December 27, 2013 – Fooled Again

Fooled Again by Sinclair Noe And now we present the curious case of Michael Steinberg. Not familiar? That’s understandable; Michael Steinberg is a convicted felon, securities fraud and conspiracy, specifically insider trading. Steinberg is a close personal friend and former trader with Steven A. Cohen. You’ve likely heard that name. Cohen is the billionaire, stock picker who runs SAC Capital hedge fund; recently fined $1.2 billion by the SEC for insider trading and not maintaining adequate supervision of his employees. Cohen has not been charged as an individual. Eight SAC employees have been criminally charged; six have pleaded guilty and are cooperating with the government; one faces trial in January; Steinberg just lost his trial, and when the verdict was announced, the fellow fainted. The other guy who faces trial in January fainted when he was arrested. It’s a bit funny, a bit pathetic. Steinberg faces a maximum of 85 years but that won’t happen. Still, it looks like a potential case against Cohen could gain traction. The US Attorney’s Office in Manhattan has secured 77 insider trading convictions since 2009, without losing a single case. Jurors are capable of understanding insider trading. It’s a fairly simple form of cheating. Jurors are also capable of understanding more complex forms of cheating. The markets are rigged by cheaters, in the form of insider trading and other, more complex scams. There are many honest people who earn god livings in the markets, but there are plenty of cheaters. The prosecutors aren’t even …

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Friday, July 26, 2013 – Notes from the Favela

Notes from the Favela by Sinclair Noe DOW + 3 = 15,558SPX + 1 = 1691NAS + 7 = 3613 10 YR YLD – .01 = 2.56%OIL – .82 = 104.67GOLD – .30 = 1334.80SILV – .26 = 20.09 Earlier in the week, the Dow and S&P hit record highs but the markets slipped; earlier today the Dow was down 150 points. For the week, the Dow rose 0.1 percent, the S&P 500 was flat (even as it hit a record) and the Nasdaq rose 0.7 percent. It’s Friday, and I have a bunch of notes and scraps that have been piling up, so we’ll clean the desk, in no particular order. The Thomson Reuters/University of Michigan’s final reading on the overall index on consumer sentiment climbed to 85.1 from 84.1 in June, topping expectations for 84. It was the highest level since July 2007 and was also an improvement from July’s initial reading of 83.9. Of course, if you paid a premium subscription, you could have had that information before the rest of the market. Yesterday, I mentioned former Fed Chairman Paul Volker’s remark that the only real financial innovation in the past 20 years was the ATM, which is actually about 30 years old now. And Volker wasn’t quite right; the banks haven’t done any real innovation but the hackers have. For nearly a decade, a band of cybercriminals rampaged through the servers of a global business who’s who: Among the victims were 7-Eleven, Dow Jones, Nasdaq, JetBlue …

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Thursday, February 07, 2013 –

Waiting for the Apocalypse by Sinclair Noe DOW – 42 = 13,944SPX – 2 = 1509NAS – 3 = 316510 YR YLD -.02 = 1.95%OIL – .74 = 95.88GOLD – 6.30 = 1672.00SILV – .39 = 31.56 Some day this war will end. Some day we will have an apocalypse, not in the terrifying version of the word but in the original Greek definition of “apokalypsis”, meaning an “uncovering”, a “lifting of the veil”, or “the disclosure of something hidden”. One day we will wake up and realize that money is printed out of thin air and it is not a store of wealth but a vessel of debt; the veil will be lifted and we will see the debt masters for what they truly are. Until then we get little surprises in the form of troves of emails revealing the reality that the financial markets are not bastions of cool rationalism, nor are they temples to integrity; and the lubricant of commerce may be nothing more than a tar pit. We have been reading the emails from Barclays, UBS, and S&P describing how they would rig rates or rate deals for a cow if only they could get their cut. Sometimes the language is clipped in an instant messaging style of prose, sometimes it is profane in a way that would make Tony Soprano blush, and it seems to be flowing forth in a never-ending stream of culpability. Some day this war will end. But not today. Today we …

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Tuesday, February 05, 2013 – Cutting to Spite Ourselves

Cutting to Spite Ourselves by Sinclair Noe DOW + 99 = 13,979SPX + 15 = 1511NAS + 40 = 317110 YR YLD +.04 = 2.02%OIL + .47 = 96.64GOLD – 1.40 = 1674.00SILV +.06 = 31.92 The Congressional Budget Office released revised budget projections that show the federal deficit will drop to $845 billion this year, the first time during Obama’s presidency that the red ink would fall below $1 trillion. The budget office also said the economy will grow slowly in 2013. The reason for the slowdown is a tax increase in January and spending cuts coming in the next couple of months. A few minutes after the CBO report, President Obama spoke to the press and said those spending cuts would damage the economy and must be avoided. He asked Congress for a short-term deficit reduction package that will delay deeper cuts past the automatic start date of March 1, also known as the sequester. The automatic cuts are part of a 10-year, $1 trillion deficit reduction plan that was supposed to spur Congress and the administration to act on long-term fiscal policies that would stabilize the nation’s debt. Though Congress and the White House have agreed on about $2.6 trillion in cuts and higher taxes since the beginning of 2011, they have been unable to close the deal on their ultimate goal of reducing deficits by about $4 trillion over a decade. If the automatic cuts are allowed to kick in, they would reduce Pentagon spending by …

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Wednesday, January 09, 2013 – Miscellaneous Financial News

Miscellaneous Financial Newsby Sinclair Noe DOW + 61 = 13,390SPX + 3 = 1461NAS + 61 = 13,39010 YR YLD -.02 = 1.85%OIL +.01 = 93.16GOLD – 2.80 = 1659.00SILV – .05 = 30.46 AIG, the insurance company won’t join ex-CEO Maurice “Hank” Greenberg’s lawsuit against the US government over the insurance giant’s financial crisis bailout. Greenberg has filed a $25 billion lawsuit accusing the government of violating shareholders’ rights by bailing out AIG, because the terms of the bailout weren’t as cushy as Greenberg wanted. Thank you, AIG. Earlier this week I told you about an $8.5 billion settlement announced between the Federal Reserve and the Office of the Comptroller of the Currency with 10 big mortgage services, including Citigroup, JPMorgan and Wells Fargo over botched foreclosure claims. Now, Goldman Sachs and Morgan Stanley and other banks are expected to agree to a $1.5 billion settlement with the regulators sometime this week. The other banks haven’t been officially identified but best guess is that the group includes HSBC, Ally, EverBank, and OneWest Bank. Goldman got into the mortgage servicing business by purchased Litton Loan Servicing and Morgan Stanley bought Saxon Capital. The Fed has ordered both firms to conduct case by case reviews of foreclosures after widespread mistakes were discovered in how the firms processed home seizures. Meanwhile, Morgan Stanley plans to cut about 1,600 jobs, nearly 3 percent of its workforce. The cuts will focus on senior ranks at the bank. About half of the cuts will be …

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Thursday, December 20, 2012 – Plan B, Plan S

Plan B, Plan S by Sinclair Noe DOW + 59 = 13,311SPX + 7 = 1443NAS + 6 = 305010 YR YLD un = 1.80%OIL -.03 = 89.95GOLD – 18.70 = 1648.20SILV – 1.06 = 30.02 I’m thinking we just go over the cliff. Why not? It looks more and more that they aren’t going to get anything done. They say they are close, they say it is possible, but really, I don’t have confidence. President Obama held a press conference. And he said he had gone at least halfway in meeting some of the Republican concerns. At least halfway? So he’s admitted that he’s already met them in the middle, and likely gone past the middle into Republican territory. And we’re still two weeks out from the fiscal cliff deadline, with Republicans sitting around waiting for the inevitable further concessions Obama will make. Why didn’t Obama say something like, “I made a more than fair deal. The GOP rejected it. So now I’m pulling the offer off the table and waiting to see what the GOP has to offer. Clock’s ticking!” Instead, the GOP will bank the concessions he’s already made, then demand more. Rinse. Lather. Repeat. Meanwhile, Speaker John Boehner is just playing with himself. He’s offered up a Plan B for a vote in the House. One of the touted benefits of “Plan B” is that it only raises taxes for those making $1 million or more. Eric Cantorsaid this morning, the plan would raise revenue “without …

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Wednesday, December 19, 2012 – You Can’t Kill a Bank, Even With a Bushmaster

You Can’t Kill a Bank, Even With a Bushmaster by Sinclair Noe DOW – 98 = 13,251SPX – 10 = 1435NAS – 10 = 304410 YR YLD -.03 = 1.80%OIL + 1.49 = 89.42GOLD – 5.00 = 1666.90SILV – .66 = 31.08 All right, let’s start with a refresher course; Libor stands for the London Interbank Offered Rate. It’s the rate at which banks are able to borrow money from each other. The lower a bank’s rate (banks submit their own rates) the healthier it’s deemed to be. If you’re balance sheet is healthy, you get a low rate when you borrow. If your balance sheet is known to contain toxic assets, you have to pay a higher rate to borrow. The rates were especially indicative of banks’ health during the peak of the financial crisis when the markets were all but frozen and access to funds were limited. The Libor rate is determined daily; sixteen banks submit their rates to an agency; the four highest rates are wiped out and the four lowest rates are wiped out. The result is averaged and the daily Libor rate is published. It would take more than one bank to manipulate the rates. But once the rate is published it affects trillions of dollars of financial instruments around the globe. More than a dozen banks in the U.S. and Europe are under investigation for Libor rate rigging. Even though it is not really surprising, the sheer scope and audacity of the market manipulation …

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Monday, December 17, 2012 – Unconnected Dots

Unconnected Dots by Sinclair Noe DOW + 100 = 13,235SPX + 16 = 1430NAS + 39 = 301010 YR YLD +.05 = 1.76%OIL +.71 = 87.44GOLD + 1.90 = 1699.10SILV -.03 = 32.38 President Obama and House Speaker Boehner met at the White House today. Aides from both parties said they were optimistic that a deal could be reached in the coming days to avert the “fiscal cliff,” as lawmakers set the stage for action before a year-end deadline. A senior Republican aide said: “There’s been too much progress at this point and neither guy wants to go over the cliff.” Although both sides still had major differences, investors were cheered by signs of progress. Major market indices moved higher in the afternoon, and some of that was the feel good part of the news cycle; we certainly need some good news. Now, we sit back and see whether it was yet another rumor. Boehner, the speaker of the Republican-controlled House of Representatives, has edged closer to Obama’s demand to raise taxes on the wealthiest Americans. In return, Obama is considering a measure that would slow the rate of growth of Social Security retirement benefits by changing the way they are measured against inflation. Boehner has put forward a tax increase for those earning over $1 million annually, while Obama wants that threshold set at $250,000. Republicans could probably stomach a tax hike on incomes above $500,000. Boehner could float the broad outlines of a deal with rank-and-file members on …

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