I guess we know what it looks like when credit conditions get too tight.
“Just between us,” he said on stage at a conference in Chicago on Thursday, according to Bloomberg News, “I recently tried to refinance my mortgage and I was unsuccessful in doing so.”
http://www.nytimes.com/2014/10/03/upshot/why-ben-bernanke-cant-refinance-his-mortgage.html?_r=0&abt=0002&abg=0
I love that anecdote from Bernanke-whether it was true or not. I mean whether it's true or not I love that he told it and really whether it's true or not it's still reflects the fact that it's still tough out there. Obviously if it's true that's crazy but even if it isn't it shows that it's bad enough for him to feel the need to make up such an anecdote.
I tried to trace out how I thought the market might react today to the payroll report and got it wrong.
http://diaryofarepublicanhater.blogspot.com/2014/10/tomorrows-nonfarm-payroll-numbers-hunt.html
I guess the market got its Goldilocks on payroll-245,000 new jobs was in the sweet spot between too little, giving more legs to the idea the economy is slowing, and too high, thereby worrying investors that the Fed is going to cut interest rates sooner rather than later and by too much too quickly.. I won't pretend to know what this move up today means. It could be the end of the broad sell off in equities we've seen the last few weeks. On the other hand, even with this big move up today, the market still had it's worst week in about 6 months. Before the triple move up today on the Dow it was it's worst week in 2 years.
So where to from now? I always thought that the fundamental U.S. economy is pretty good. In the land of the blind-the world economy-we remain king. Europe worries about a triple dip-compared with Draghii how great does Bernanke look?
If predicting the market is just about American fundamentals I think we're in pretty good shape. The only worry I guess is that with China apparently accepting lower growth for now and with Europe so weak and with the Russia-Ukraine conflict and all it's potential collateral damage for Europe and with Japan still not looking so great despite Abenomics, can the U.S economy remain strong within such a 'Sea of Weakness?'
For now we very well may. However, what you can't help but notice is that even with today's up move in the market it was still a horrible week on top of a horrible week last week. On a technical basis, the S&P remains well beneath what had been it's long term support and 50 day moving average until last week-1980.
Indeed some on CNBC wondered if today's up move isn't kind of week on top of such a strong payroll number. Right now the Dow is up 140-it was up as much as 170 earlier and it may well rally back to that level and beyond by the end of today. However, at the end of the day I don't really think today's payroll number is big news. I mean we had one aberration-in August with 142,000. Was the reason the market has been under pressure simply because of that August number which was clearly an outlier?
No, It was about a litany of other things. Jim Cramer always insists that the Russia-Ukraine conflict is the big driver which is hurting Europe and killing commodities.
There's also the worry about the slowdown in Europe and a less rapidly growing China. None of this changes because of today's number. In fact, I deny that today was a surprise. I think it's confirmation of the status quo.
So the market may not be out of the woods yet especially with the S&P so far beneath 1980 still. Another guest on CNBC today pointed out that 2 things about the U.S. economy will drop the market. One is obviously a bad economy. He agrees that the economy is strong. The other reason is if stock prices have gotten ahead of earnings. He thinks that has happened. I don't know for sure myself but I know this is a common worry on the Street.
Finally, there is still worry that this payroll number might mean the Fed is behind the curve and that a couple more like it would mean they have to move quicker on interest rates although it was also pointed out on CNBC that a year ago the market would have sold a strong number like this out of fear of the Fed tightening.
P.S. Again, I did miss my guess about the market reaction this morning and the market looks like it will be up sharply today. Man do I wish I hadn't gotten out my BAC $17 Oct 10 calls yesterday as it spiked up from $16.88 to $17.20. I''d been doing very well going long BAC since it came to an agreement with the DOJ but I got hurt the last week as BAC got dragged down with the rest of the market. Just when I cry uncle it snaps all the way back.
I came into the day short. However my shorts haven't gotten killed as they were XLE-the energy ETF-and Caterpillar (CAT). CAT opened up over $98 but is now up just $.10 cents. As we noted above, a lot of the problem is in Europe, China and Japan. CAT is kind of a proxy for the world economy and with all its exposure in Europe and China, it's not surprising that it's not going through the roof because we learnt what we already knew about the U.S. economy.
As for XLE it started up in sympathy with the rest of the market but with oil now today another $2 it is now down for the day-though not enough yet for me to make any money on it. Hopefully next week...
For now, as for as making money in the market I've had more luck in the first 4 weeks in the NFL-this is hte first year I've tried it; of course its' the first year I could afford it-in 4 weeks I'm 9-6 on my picks and am up 40% or $1700 bucks.
This week I'm breaking my rules again on the Giants. Let's face it this rule is over.
I like them giving 4 against the Atlanta Falcons. I got the Philly Eagles giving 7 against the Rams. If the Eagles can't be the Rams by 8 points there's something wrong. I think the Falcons defense will be picked apart against the Giants. It was something to see the Vikings team that beat them 41-28 on Sunday get dismantled by the Packers last night, 42-10.
I have to think that the Saints will come back this week with the Bucs at home. If they can't beat them by 11 at home they've truly lost their edge. I do think they may have lost their edge some but surely not this much. If they can't cover here that's a very bad sign.
Likewise I got to think the Steelers come back and cover a 6 point line at Jacksonville. The Jaguars at this point are flat out the worst team in football on both sides of the football. If Pittsburgh can't cover here they truly are pretenders.
I'm also considering the Browns. Yes, they're 1-2 but they lost by 3 to the Steelers on the road and by 2 points to the Browns. The Titans on the other hand have been blown out three straight weeks. According to Fancy Stats that's very important in figuring a team's power rankings.
http://www.washingtonpost.com/news/fancy-stats/wp/2014/09/30/nfl-power-rankings-giants-ravens-move-up-in-fancy-stats-rankings-after-week-4/
I also have the Charger over the Jets giving 7, the Seahawks over the Redskins Monday night giving 7. I'm also tempted to take the Bengals over the Pats on Sunday night. The Bengals were actually originally 2 1/2 point underdogs but the Pats' 41-14 Monday night loss flipped it and now the Bengals are favored by 1-so there's no difference between taking them straight up and against the spread!
“Just between us,” he said on stage at a conference in Chicago on Thursday, according to Bloomberg News, “I recently tried to refinance my mortgage and I was unsuccessful in doing so.”
http://www.nytimes.com/2014/10/03/upshot/why-ben-bernanke-cant-refinance-his-mortgage.html?_r=0&abt=0002&abg=0
I love that anecdote from Bernanke-whether it was true or not. I mean whether it's true or not I love that he told it and really whether it's true or not it's still reflects the fact that it's still tough out there. Obviously if it's true that's crazy but even if it isn't it shows that it's bad enough for him to feel the need to make up such an anecdote.
I tried to trace out how I thought the market might react today to the payroll report and got it wrong.
http://diaryofarepublicanhater.blogspot.com/2014/10/tomorrows-nonfarm-payroll-numbers-hunt.html
I guess the market got its Goldilocks on payroll-245,000 new jobs was in the sweet spot between too little, giving more legs to the idea the economy is slowing, and too high, thereby worrying investors that the Fed is going to cut interest rates sooner rather than later and by too much too quickly.. I won't pretend to know what this move up today means. It could be the end of the broad sell off in equities we've seen the last few weeks. On the other hand, even with this big move up today, the market still had it's worst week in about 6 months. Before the triple move up today on the Dow it was it's worst week in 2 years.
So where to from now? I always thought that the fundamental U.S. economy is pretty good. In the land of the blind-the world economy-we remain king. Europe worries about a triple dip-compared with Draghii how great does Bernanke look?
If predicting the market is just about American fundamentals I think we're in pretty good shape. The only worry I guess is that with China apparently accepting lower growth for now and with Europe so weak and with the Russia-Ukraine conflict and all it's potential collateral damage for Europe and with Japan still not looking so great despite Abenomics, can the U.S economy remain strong within such a 'Sea of Weakness?'
For now we very well may. However, what you can't help but notice is that even with today's up move in the market it was still a horrible week on top of a horrible week last week. On a technical basis, the S&P remains well beneath what had been it's long term support and 50 day moving average until last week-1980.
Indeed some on CNBC wondered if today's up move isn't kind of week on top of such a strong payroll number. Right now the Dow is up 140-it was up as much as 170 earlier and it may well rally back to that level and beyond by the end of today. However, at the end of the day I don't really think today's payroll number is big news. I mean we had one aberration-in August with 142,000. Was the reason the market has been under pressure simply because of that August number which was clearly an outlier?
No, It was about a litany of other things. Jim Cramer always insists that the Russia-Ukraine conflict is the big driver which is hurting Europe and killing commodities.
There's also the worry about the slowdown in Europe and a less rapidly growing China. None of this changes because of today's number. In fact, I deny that today was a surprise. I think it's confirmation of the status quo.
So the market may not be out of the woods yet especially with the S&P so far beneath 1980 still. Another guest on CNBC today pointed out that 2 things about the U.S. economy will drop the market. One is obviously a bad economy. He agrees that the economy is strong. The other reason is if stock prices have gotten ahead of earnings. He thinks that has happened. I don't know for sure myself but I know this is a common worry on the Street.
Finally, there is still worry that this payroll number might mean the Fed is behind the curve and that a couple more like it would mean they have to move quicker on interest rates although it was also pointed out on CNBC that a year ago the market would have sold a strong number like this out of fear of the Fed tightening.
P.S. Again, I did miss my guess about the market reaction this morning and the market looks like it will be up sharply today. Man do I wish I hadn't gotten out my BAC $17 Oct 10 calls yesterday as it spiked up from $16.88 to $17.20. I''d been doing very well going long BAC since it came to an agreement with the DOJ but I got hurt the last week as BAC got dragged down with the rest of the market. Just when I cry uncle it snaps all the way back.
I came into the day short. However my shorts haven't gotten killed as they were XLE-the energy ETF-and Caterpillar (CAT). CAT opened up over $98 but is now up just $.10 cents. As we noted above, a lot of the problem is in Europe, China and Japan. CAT is kind of a proxy for the world economy and with all its exposure in Europe and China, it's not surprising that it's not going through the roof because we learnt what we already knew about the U.S. economy.
As for XLE it started up in sympathy with the rest of the market but with oil now today another $2 it is now down for the day-though not enough yet for me to make any money on it. Hopefully next week...
For now, as for as making money in the market I've had more luck in the first 4 weeks in the NFL-this is hte first year I've tried it; of course its' the first year I could afford it-in 4 weeks I'm 9-6 on my picks and am up 40% or $1700 bucks.
This week I'm breaking my rules again on the Giants. Let's face it this rule is over.
I like them giving 4 against the Atlanta Falcons. I got the Philly Eagles giving 7 against the Rams. If the Eagles can't be the Rams by 8 points there's something wrong. I think the Falcons defense will be picked apart against the Giants. It was something to see the Vikings team that beat them 41-28 on Sunday get dismantled by the Packers last night, 42-10.
I have to think that the Saints will come back this week with the Bucs at home. If they can't beat them by 11 at home they've truly lost their edge. I do think they may have lost their edge some but surely not this much. If they can't cover here that's a very bad sign.
Likewise I got to think the Steelers come back and cover a 6 point line at Jacksonville. The Jaguars at this point are flat out the worst team in football on both sides of the football. If Pittsburgh can't cover here they truly are pretenders.
I'm also considering the Browns. Yes, they're 1-2 but they lost by 3 to the Steelers on the road and by 2 points to the Browns. The Titans on the other hand have been blown out three straight weeks. According to Fancy Stats that's very important in figuring a team's power rankings.
http://www.washingtonpost.com/news/fancy-stats/wp/2014/09/30/nfl-power-rankings-giants-ravens-move-up-in-fancy-stats-rankings-after-week-4/
I also have the Charger over the Jets giving 7, the Seahawks over the Redskins Monday night giving 7. I'm also tempted to take the Bengals over the Pats on Sunday night. The Bengals were actually originally 2 1/2 point underdogs but the Pats' 41-14 Monday night loss flipped it and now the Bengals are favored by 1-so there's no difference between taking them straight up and against the spread!
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