Earnings Outside the Vacuum
Since it has been a slow week in terms of economic data, we can take some time to review corporate earnings season. The current estimate for Q1 2013 operating earnings on the S&P 500 (with 465 companies reporting so far) is for 6.2% Y/Y growth. That is up from -2.44% and -5.10% the previous two .. read more
Ghosts of Modeled Financial Math
The volatility in yen markets, both stocks and credit, continued again with wild swings seemingly everywhere. The Bank of Japan also continued to promise measures aimed restoring calm, including outright purchases of ¥600 billion ($6 billion) JGB’s in the 5-10 year maturity range and an additional ¥300 billion ($3 billion) of maturities beyond 10-years. The .. read more
China Confirms Australia and the Global Chain
The HSBC/Markit PMI for China fell back below 50 for the first time in seven months. This rebound has been relatively minor, more like an absence of contraction than a surge in manufacturing activity. Nearly every subindex, including all the major components, also fell under 50. These results correlate with the Australian collapse I noted a .. read more
Cry Yen and Let Slip the Dogs of Negative Convexity
Despite repeated assurances that the Bank of Japan would do whatever monetarisms it could to calm the Japanese bond markets, the persistent stain of selling pressure has not abated, rather it has increased. While to this point it had been relatively benign in the most obvious correlations, the Nikkei has risen steadily throughout, for example, .. read more
Greenspan’s Market Persists
I wanted to concur but take Joe’s weekend proposition in a slightly different direction. I think it is relatively clear that the Federal Reserve and Chairman Bernanke are intentionally hinting at “tapering” QE purchases in order to “talk the market down”. There are a lot of similarities between the monetary communications right now and 1996 .. read more
A Key Reversal?
If we close on or near the low today, we will have printed what is known in candlestick charting as shooting star. I don’t put a lot of faith in technical analysis but this pattern and its reverse, called a hammer, are the most predictive technical patterns I’ve seen in my long career. The shooting .. read more
Where’s the Butterfly?
A healthy caterpillar will always turn into a butterfly, a beautiful, stunning representation of a natural system in good balance with sustainable proportions. Likewise, a healthy Caterpillar is a sign of a stable and healthy economic system, whether defined by region or the entire globe. If we look at Caterpillar’s dealer sales figures, it gives .. read more
Sunday Gold Fix – Monday GOFO Plunges With Gold
I delayed posting in its regular Sunday spot to see if there were any additional pressures in gold prices over the weekend. Sure enough, gold sold off again seemingly in tandem with Japanese financial events. Both gold and silver were sold hard right at the open, bringing in a morning London fix well below the .. read more
