Recent Articles
[Premium] Dow Transports lagging is a warning sign
There are still a lot of Dow Theory followers out there even after over 100 years. And the divergence between a bullish DJIA headline number and the lagging Dow Transports is bearish from a technical perspective
Tuesday’s Surprises from Australia and Japan
The dollar is mixed against the majors and EMs but largely remains confined to recent ranges. The EuroStoxx 600 slid for a second straight day, currently down 0.5%; MSCI Asia index holds recent highs. Demand in Greek bill sale eased slightly and refinancing costs moved higher; Portugal’s 10-year up 22bp
News Links: Greek Default: Why Now May Be Best Time to Do It
Greek Default: Why Now May Be Best Time to Do It – US Business News Blog – CNBC Last week in general gave life to the recovery theme, with 15 of 23 indicators beating expectations and causing some economists to raise their growth outlook for the full year. So, with sentiment running so garishly positive,
Quick note on updates at Credit Writedowns
I have instituted a few changes at Credit Writedowns to which I wanted to alert readers. The changes were mostly for members but they affect all readers. I had heard from a few member readers that it wasn’t clear where member content resides as most of it is integrated into the normal post stream. So I have made a number of changes in order to make the member content much more recognizable as members-only content
[Premium] Ireland’s Private Debt Problem
You saw the chart about two weeks ago on Developed economies’ debt levels by sector. Different economies have different debt problems. A few like Greece have public sector debt woes. And this is the sort of problem that forces a default only when the country is a currency user (and not a monopoly issuer of currency) as Japan has demonstrated. Mostly, however, the problem is in the private sector, where all of the indebted parties are currency users
Global Manufacturing Steadies as She Goes, or Does She?
The year got off on a much better foot than might have been expected, at least as far as global manufacturing is concerned. So the fall in global manufacturing has flattened out, even though the bounce back has more of a dead cat look about it than anything else. As usual in recent months the report was very much a mixed bag
[Premium] Growth momentum shift to Emerging Markets continues
Two weeks ago I highlighted the fact that Indonesia has re-attained an investment grade rating, continuing the upward path it has been on since the Asian crisis derailed the Asian growth story 15 years ago. Indeed, we should expect emerging markets, and Asian emerging markets in particular to outperform developed economies
An Update on Italian Sovereign Outperformance
Ahead of the next LTRO at the end of the month, Spanish and Italian bonds may begin consolidating after the large moves seen over the past month. The scope for Italian out performance in the month ahead appears somewhat more limited than over the past month. Indeed, the 5.5% yield level on the Italy’s 10-year generic bond may prove a bit sticky. It also corresponds to trend line on the weekly charts, drawn off the yield low of 3.7% in mid-Oct 2010. Spain’s 10-year yield decline is slowing as it slips through the 5% threshold
The Problem with Success
Cash accounts for almost 6% of all corporate assets and the highest in sixty years. This increase is a result of a number of factors. Record profits give businesses the wherewithal. But corporations are not rewarded for the cash holdings. Moreover, the cash is held in such instruments as money market funds, commercial paper and bank deposits
[PREMIUM]: 2012 an inflection point toward S&P500 margin compression
What I have been saying throughout 2011 is that margin compression is going to happen no matter what. The cuts have been made and so margins cannot grow any higher from cuts. It has to come from operating leverage that increases as a result of revenue growth
Is US democracy being bought and sold?
The answer is yes. video below
Euro Dragged Lower on Greece Uncertainty
The dollar looks set to begin the week higher against the majors and EMs over lack of progress in Greece. European stocks are down 0.6%, with the EuroStoxx 600 trimming its 6-month high; EZ banks down 1.3%. German manufacturing orders higher in December; soft Australian retail sales support further RBA cuts