Equities Archive

From JJ Lando at Nomura

Some very interesting trends/divergences emerging: 1. Staples/Tech or cyclicals/defensives or low vol or correlations all falling completely off a cliff in spectacular fashion. 2. Forward P/Es in Japan vs in China and Korea massively diverging (fx-driven earnings drain, effectively, but only affects fwd PE this much if street is dramatically dramatically underestimating ...Read More

Japanese equity rally

Not that the presumptions will turn out to be right, but just based on the presumptions: The presumption is that the BOJ’s action will weaken the currency, stocks are up due to the weaker yen, which is presumed to support exports and restrain imports, and help with earnings translations So the presumed ...Read More

CSRCs Guo Says Intervention in Stock Market Necessary: Xinhua

Not that a stock market is ‘necessary’. And not to forget that a 30% corporate income tax, as in the US, is at least as good as owning 30% of all taxable enterprises. If govt, want’s a larger share of corporate profits, it can just hike the tax rather than buy the ...Read More

Friday update

So just like Japan, as soon as the economy starts doing a bit better we hike taxes. Still too early to say how the FICA hike will impact sales and profits, but it will. And spending cuts are on the way, though they may be delayed. Not to forget the debt ceiling ...Read More

Early Thought follow up… A follow up conversation with Warren Mosler

Please click here to listen to a conversation with Warren Mosler. We did an audio call with Warren in late June and he was spot on. So I thought it was a good time to circle back with him. Topics include: US stocks (they look good…deficit to GDP in US a support ...Read More

more on the cliff

Stocks down again yesterday but interestingly bond yields up a tad, dollar down a tad, oil and metals up, and even long BMA ratios holding steady, etc. The cliff isn’t nearly as large and threatening as the debt ceiling cliff would have been in 2011 if that thing hadn’t been extended, and ...Read More

feels like time to buy equities in general

I’m thinking it’s about that time for portfolio managers to buy stocks and go play golf for a few years, with the following very caveats. 1. A serious spike in crude oil/gasoline prices that undermines consumption 2. The euro zone could break down socially under the stress of continued austerity 3. Congress ...Read More

Payrolls: Bleak with 1 Silver Lining

Karim writes: Payrolls: Bleak with 1 Silver Lining Highlights Most of the key headlines of the survey were weak Payrolls up only 69k with net revisions of -49k (April now +77k not 115k) Unemployment rate up from 8.1% to 8.2% (labor force up 622k and household survey up 422k) Average hourly earnings ...Read More

Video from Venice presentation

Venice video link here. Also, Trichet Friday, the German elections, and G8 reports seem to be setting the tone for the euro zone to do something about the solvency issue. This is very good for equities and the rest of the credit stack. At the same time it does not seem likely ...Read More

Quick update

US economy muddling through, growing modestly, particularly given the output gap, but growing nonetheless. Lower crude prices should also help some. I had guessed the Saudis would hold prices at the $120 Brent level, given their output of just over 10 million bpd showed strong demand and their capacity to increase to ...Read More