The news stories of yesterday and today have lots of clues that the decline caused by last fall's panic might be over. Existing home sales increased. Durable goods orders increased. From the past weekend, multiple bidders competed for California homes at the new, low prices. All that is news from the "real" economy.
Meanwhile, reports that short sellers actually increased their positions in recent weeks was quite intriguing. And the ideologues and marionettes of the short sellers are out in force claiming great benefits and little harm from bear raids. Or that such don't exist. One would think the Soros article yesterday would shut them up, but no, the WSJ has another silly piece today. WSJ Online: "The short-sellers probably saved us five to 10 years of poor bank earnings, writes Andy Kessler" What a dope ! They caused a panic that led to a few million people losing their jobs and destroyed a few major financial institutions. I suppose Andy Kessler would write that the Vikings invigorated Europe by looting the monasteries.
Ideology can certainly blind people to facts.
Last week's analysis in this blog on the sleazy role of AIG in the financial markets got proof in today's WSJ Online.
"Banque AIG enabled AIG to generate revenue by helping European banks lower the amount of capital they are required to hold to protect against losses on assets such as mortgage and corporate loans. ...
"In the event of a default, European banks that have done these trades with AIG could be forced to take back responsibility for billions of dollars in assets. That could require them to raise billions of dollars in capital, AIG has said.
"In May 2007, a British executive in the financial-products office in London told investors: 'For the European banks and the Asian banks, this is very much a regulatory capital arbitrage business. By structuring their businesses, whether it's their mortgage lending or their corporate loans into these sorts of trades and tranching the risk up, they're able to significantly reduce the capital they have to hold against their portfolios.' "
It was all just a scam to beat the sleepy or compromised regulators.
Markets
I made some sales in Obama Fund yesterday near the early highs of the day. Obama Fund are at 150% long and I reduced it to about 120% long. I'll reload on a serious dip. Sales: all of GE and FCT; 1/2 of MS, FCX, MT, X; 1/3 of CETV, CAB. All those positions had received had adds much lower, so were a big large. I own more GE in Fido Fund, so just chucked the Obama Fund piece.
By the way, the price of copper is over $1.80 this morning.
Word of the Day
"Monkeyshine" - noun [$10]; US Colloquial, a Mencken word.
Monkeyshine = monkey tricks or monkey business, meaning mischief.
Sentence: Monkeyshine of beefer short sellers is hazardous to the jobs of the common man.
Le Mot du Jour
"Supprimer" - verb, regular -er.
Supprimer means 1. to delete, to remove; 2. to cancel; 3. to do away with, elimnate.
La Phrase: Beaucoup de entreprises suppriment emploies en payant les primes à leurs dirigeants.
Sentence: A great many companies eliminate jobs while paying bonuses to their executives.
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26 comments:
I'll be out all AM, taking the Kelpies to sheep herding lessons.
have to disagree Bman..........i agree with the article on short-sellers in wsj today
BBY good earnings and guidance
what depression ??
Man once that uptick rules comes back I wonder if the US will ever have another recession....
Any skilled institution can get around that stupid rule with ease....sheesh
very good South Park last night huh merny?..lool
A parade of the mathematically innumerate business writers (and even worse headline writers!) continue to misread data. The latest evidence? New Home Sales.
After incorrectly reporting the Existing Home Sales, the mainstream media misread the Census department report of New Homes.
No, New Home Sales data did not improve. In fact, they were not only not positive, they were actually horrific. The year over year number was a terrible down 41%. Sales from this same period a year ago have nearly been halved.
Why did the media report this as positive? If you only read the headline number, you saw a positive datapoint: February was plus 4.7% over January.
To get the the facts, you need to read below the headline. In the present case, it wasn’t the seasonality factor that was confusing, it was the “90-percent confidence intervals” — or as it is more commonly known, the margin of error.
back,
That Mary Shapiro at SEC is such a bureaucrat - SEC is a failure.
hmmm mfl data mining now.
up is up.
year over year is meaningless.
recessions, yes; but a lot fewer panics.
With arson illegal, there are fewer fires.
With short selling legal, but tightly regulated, there would be fewer panics.
has to be broad with no derivative & street loopholes
Sales of new one-family houses in February 2009 were at a seasonally adjusted annual rate of 337,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 4.7 percent (±18.3%)* above the revised January rate of 322,000, but is 41.1 percent (±7.9%) below the February 2008 estimate of 572,000.
The median sales price of new houses sold in February 2009 was $200,900; the average sales price was $251,000. The seasonally adjusted estimate of new houses for sale at the end of February was 330,000. This represents a supply of 12.2 months at the current sales rate.
Note that the month over month data at 4.7% — plus or minus 18.3% — is statistically insignificant. (i.e., meaningless). The reported data does not inform us if sales improved month-over-month or not. It is a range, from down -13.6% to plus 23%. Since “zero” is part of that range, we can draw no conclusion. As the Census Department itself notes, “the change is not statistically significant; that is, it is uncertain whether there was an increase or decrease.”
The data does however, tell us that the year-over-year sales fell 41.1% plus or minus 7.9% gives us a range of -49% to -33.2%. The entire range is negative, therefore we can conclude sales fell year-over-year.
is this ur way of sayin you dont like BZH mike????..loool
whoever is doing those numbers needs a remedial course in either statistics or writing.
18% of 337,000 is 60,000. No way those data are in the range 397,000 to 273,000.
or is does that +/- 18% mean 18% of 4.7%, which is 0.84%, meaning the range is +3.86 to + +5.5%
suddenly I sound like zeta...oh man...I better stop....
USA USA USA
looooooool
4.72 million units in February
4.49 million units in January,
4.74 million in December.
No way that series has 18% standard deviation.
yes that seemed like an awfully wide confidence interval...
you tell'em Bman !!!!
ace ........what a punk
It probably means my second possibility, 18% of the 4.7% viz. between 3.9% and 5.5%
After all they do give those munbers to 3 signifcant digits.
"you tell him"
lmaoooooooooooo
hmmm I thought today's "word of the day" would stimulate a bit of banter.
I suppose if I had applied it to ...
nahhhh.
http://finance.yahoo.com/news/Direxion-To-Tie-Leverage-To-indexuniverse-14755114.html
I loathe these leveraged etf crap but have to deal with it.
need to read if u mess with em
monkeyshine didn't cause any bantor cuz you are of the belief that the arsonists caused this crash
they did not......the forest was already on fire..........sure..........they threw some molotovs.........but the fire was well underway
PS......does it apply to the president ?? to quote sarah palin
" you betcha ! "
a brush fire turned into a forest fire, thanks to the raiders.
And no doubt the forest was full of dead trees & brush ... but the wholesale liqudation spiral wouldn't have happened.
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