The Banking and Strategy Initiative

Chillin' out till it needs to be funded

It’s Monday Again: $50 iPhones, 2 for $20, Early Black Friday fun and just Thanksgiving (NIRP or ZIRP is that a question, then?) DIN:US SBUX:US EAT:US JPM:US GS:US WMT:US T:US VZ:US

English: Mushroom rock on James Bond Island, T...

English: Mushroom rock on James Bond Island, Thailand (Photo credit: Wikipedia)

The sneaky fact of the day, Most Bond investors actually sell into these four months and probably take dividends for the year home before they come back t o invest in April, and we are not on the 31st Floor (Lehman reference) when it comes to the Taper


Also 2 for $20 in the spirit of Black Friday is a year round feast offer at your nearby Applebee’s, Chili’s and more one suspects an institution called casual dining itself when you don’t like the Coffee Truck and Pizza (or Hooter’s) ..The Economy has been listening for a while on them too


Thirty first floor: to be on the edge of a precipice, chicken


There are more in agreement this week that Bond yields are headed to 4% in 2014, however there are still many who look as the rally as proof otherwise and the Taper is definitely assume to be behind all things bonds though specialists and traders are moving otherwise without the Taper decision imacting it even as the Taper possibility becomes farther on the horizon for some wrong reasons with the right reasons. Existing Home Sales came close to the 0(ZERO) waterline last week and the Fed is turning closer to a NIRP(Negative Interest Rates Policy) from a Zero Interest Rates Policy even as the compatriots (of Central Bank country) across the pond switch to the QE idea from negative rates. That is all talk and as of this week banks are still earning 0.25% for keeping funds with the Fed and Bond Traders are not up the wall on the rolling trade.


On and around the topic of Central Banks, Economist Paul Krugman is also hanging on to the changing political economic opinions of the failed candidate Larry Summers on his(Paul’s!) blog and mortgage rates are still not going to go beyond 7% but are definitely expected to stay up from here.


The Housing Recovery continues, inflation and Holiday Sales sentiment


As mentioned, Existing Home Sales have foregone double digit growth on annualised basis in October, coming to a low 2% but positive change over 2012 in the latest FRED series while Pending Home Sales signings are still above 100 n the index but 1.6% down from 2012. That hides the fact that (A) Prices have been rising (up to 44% in the Detroit Area) coming t $199,500 or 12% higher on lower inventories with foreclosures halved as a percentage share and mortgage rates still at only 4.5% ; (B) Multi-family units (Condos and co-ops) have been rising 12% on year still without a break too rents holding and number of units in the Existing home sales NAR data back up to 630,000


Also the Treasury conducted another large Long range (110-year) TIPS auction successfully at 0.56% despite inflation data spookily falling through after being upgraded by robust import price data


Questions over Holiday sales seemed to be disappearing fast in the meantime with iPhones and other Apple merchandise now available at below list prices and Radioshack joining the veritable dozen incl Walmart, Amazon and th four operators on mostly sales with 2 year contracts


Thursday’s holiday is the only affected item on the public conscience yet as the Black Friday weekend cuts close to the very end of the month and retailers also look to make up for 6 lost days this season over last year


Average Home prices in Oakland and San Diego are back up the half million mark


JP Morgan settles with investors


JP Morgan closed on a $4.5 Bln settlement with Blackrock and 20  other investors within the initial $4. Bln estimate and its $9 Billion settlement with DoJ also stands as media criticises the 5 page confession signed by the bank to the SAGs at the end of a 5 year investigation. Nevertheless, the mortgage crisis is more or less done and no respite for Trading rooms on Wall Street in Q4 despite their readiness as equities run on sparse holiday volumes and we almost did not have any updates this week to celebrate the Holiday mood


Housing starts data this week will be more of the same from last week followed by the Chicago PMI which is at an all time high of 65 and the UM Consumer Confidence and one suspects Bloomberg data on the consumer confidence which is still negative after all these years. By this time if you are still reading, you have probably found the stash inside the floorboards and ready to join the Q. As most sneak sites advise however, there seems to be no need to start at odd hours as the shops will instead be opening on the Holiday itself and shopping began on the Friday (22nd Nov) itself



taper-1 (Photo credit: Chriszwolle)


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