FED AFFIRMS EASY MONEY TILT
-WSJ July 11, 2013
Trying to re-assure the markets and investors - Uncle Benny does it again......he tries to differentiate between tapering and tightening....but either way - THE FED IS NOT ABANDONING THEIR BROADER COMMITMENT TO EASY MONEY POLICIES.
"You can only conclude that highly accommodative monetary policy is for the FORESEEABLE future is what's needed in the US Economy..." - Ben Bernanke - July 10th National Bureau of Economic Research (post US mkt close at 4 pm)
T MINUS 10,9,8...3,2,1 - BLASTOFF!!! Global markets exploded overnight - US Futures follow suit currently +16 pts (1+%) trending at 1664 all in celebration that any thought of a September tapering has been put to rest....the FED has two main monetary policy goals - Maximum Employment and Stable prices/Moderate long term interest rates and so far that mandate has NOT been met...and although he is trying to be 'somewhat optimistic' about the economy - he did concede that the June unemployment rate and jobs report
"probably understates the weakness in the labor market" Do you think?
All he has to do is go out to the street - talk to the people, not his inner circle but to THE PEOPLE.....they will give him and anyone else that wants to listen - the lowdown....
Now that being said - The Fed (and other central banks) is in deep.....I mean really deep and getting deeper......and the fact that it is full steam ahead only seeks to drive capital into the stock market as much as possible to help big bank’s unload equity positions, bring stability to the bond market to recoup some of the $40 bil in paper losses and hopefully create excess reserves along the way.......recall that I told you about the Basel III agreement and the US decision to increase reserves beyond Basel III...all putting pressure on Benny to remain accommodative.....The Basil agreement is trying to prepare the biggies for the likelihood of the next recession by forcing them to increase their capital reserves and decrease leverage to weather the next storm....
As noted yesterday - the next storm is brewing.... China’s exports fell 3.1 percent in June against forecasts for a rise of 4 percent. Those are horrible numbers for the world’s second largest economy. Watch for China’s GDP report to be negatively impacted next Monday. Exports in the third quarter also look "not so good". Expect continued volatility......
"The Captain has turned on the fasten seatbelt sign - please return to your seats, fasten your seatbelt and remain seated until it has been turned off"
China is nose diving, with significant worldwide implications. Europe continuing the drama, Japan signaling a 'turn-around' after a decade of destruction and even though they talked of recovery - they are maintaining their asset purchases as expected and at home yesterday...we saw US wholesale inventories fall the most in over a year...(Wholesale inventories fell -0.5% on expectations of a +0.3% increase.)- the 2nd monthly decline and a sign that restocking by businesses could put pressure on economic growth in the 2Qtr. This decline was the sharpest since September of 2011....and this correlates nicely with the rise in oil prices during the summer of 2011 - causing gas prices to skyrocket, putting pressure on the consumer causing wholesale inventories to suffer - what do they say? History has a way of repeating itself? FYI - in the last 12 days alone - WTI Crude is +12% - keep your eyes on the gas pump....
After this report - Barclay's Investment Bank - CUT its US 2Q GDP forecast to 0.6% - but hey - no worries - we are right on the cusp of a turn-around.
Overnight - stocks around the world rallied, metals gained and the US $ backs off .....the MSCI All Country World Index up by 1% , Emerging markets enjoying a banner day as they celebrate the biggest advance in 8 months....treasuries higher (yields lower) and even Gold is joining in the party - +2%. ECB, BoE, PBoC all to remain in 'accommodative mode'. There is relief in global markets.. and the disconnect continues.......
US futures are now +16 pts....at 1664....we have clearly blasted through resistance at 1652 ish...and the failure to pullback would suggest that we can now clearly challenge the yrs high of 1680.....Will we get more post mortem from the FED today? Will the army of Fed Gov/Pres start hitting the media circuits to defend/explain/calm/clarify/translate/decipher any misunderstanding from yesterday? Today we get Init Jobless Claims - exp of 340k, Cont Claims of 2.955 and the Bloomberg Comfort Index.
Tomorrow we get JPM and WFC - expect the reports to show 'better than expected' - but listen for the details....are the numbers as good as they appear? Will it be more smoke and mirrors?
Asian markets Nikkei +0.35%, Hong Kong +2.55%, China+3.43% and ASX +1.31%.
In Europe - FTSE +0.51%, CAC 40 +0.64%, DAX +1.0%, Eurostoxx +0.81%, Spain +0.2% and Italy +0.2%.
For this you need: Eggs, potatoes, garlic, onion, s&p, butter, olive oil, fresh grated Parmegiana Cheese and if you prefer a pinch of Italian seasoning.
Preheat the broiler (oven) to high.
Peel a couple of russet potatoes and then slice - now toss into a pot of boiling water - bring the pot back to a boil and blanch for 3 - 5 mins....Remove - strain and set aside.
In a large bowl - crack 6 to 8 eggs - Beat well - add a splash of whole milk (or 1/2 & 1/2), season with s&p (and if you like a pinch of the Italian seasoning). Add a handful of grated cheese. Mix well - set aside.
In a large oven safe frying pan - melt a dab of butter, add a squirt of olive oil and heat. Now add in chopped garlic and sauté. Next add some sliced onions and sauté - until soft and golden.....add back the potatoes and brown on both sides. Next - pour the egg mixture into the pan and allow to set. Twirl the pan to allow the egg to spread and cook. Once the edges begin to pull away - place the pan into the oven under the broiler.....Watch as it quickly cooks the top of the "frittata". Remove and slide onto a large serving platter - cut like a pizza.
Have toasted slices of Italian bread on the table for your guests to make a sandwich. Serve with Ice Cold whole milk.
Buon Appetito.
-WSJ July 11, 2013
Trying to re-assure the markets and investors - Uncle Benny does it again......he tries to differentiate between tapering and tightening....but either way - THE FED IS NOT ABANDONING THEIR BROADER COMMITMENT TO EASY MONEY POLICIES.
"You can only conclude that highly accommodative monetary policy is for the FORESEEABLE future is what's needed in the US Economy..." - Ben Bernanke - July 10th National Bureau of Economic Research (post US mkt close at 4 pm)
T MINUS 10,9,8...3,2,1 - BLASTOFF!!! Global markets exploded overnight - US Futures follow suit currently +16 pts (1+%) trending at 1664 all in celebration that any thought of a September tapering has been put to rest....the FED has two main monetary policy goals - Maximum Employment and Stable prices/Moderate long term interest rates and so far that mandate has NOT been met...and although he is trying to be 'somewhat optimistic' about the economy - he did concede that the June unemployment rate and jobs report
"probably understates the weakness in the labor market" Do you think?
All he has to do is go out to the street - talk to the people, not his inner circle but to THE PEOPLE.....they will give him and anyone else that wants to listen - the lowdown....
Now that being said - The Fed (and other central banks) is in deep.....I mean really deep and getting deeper......and the fact that it is full steam ahead only seeks to drive capital into the stock market as much as possible to help big bank’s unload equity positions, bring stability to the bond market to recoup some of the $40 bil in paper losses and hopefully create excess reserves along the way.......recall that I told you about the Basel III agreement and the US decision to increase reserves beyond Basel III...all putting pressure on Benny to remain accommodative.....The Basil agreement is trying to prepare the biggies for the likelihood of the next recession by forcing them to increase their capital reserves and decrease leverage to weather the next storm....
As noted yesterday - the next storm is brewing.... China’s exports fell 3.1 percent in June against forecasts for a rise of 4 percent. Those are horrible numbers for the world’s second largest economy. Watch for China’s GDP report to be negatively impacted next Monday. Exports in the third quarter also look "not so good". Expect continued volatility......
"The Captain has turned on the fasten seatbelt sign - please return to your seats, fasten your seatbelt and remain seated until it has been turned off"
China is nose diving, with significant worldwide implications. Europe continuing the drama, Japan signaling a 'turn-around' after a decade of destruction and even though they talked of recovery - they are maintaining their asset purchases as expected and at home yesterday...we saw US wholesale inventories fall the most in over a year...(Wholesale inventories fell -0.5% on expectations of a +0.3% increase.)- the 2nd monthly decline and a sign that restocking by businesses could put pressure on economic growth in the 2Qtr. This decline was the sharpest since September of 2011....and this correlates nicely with the rise in oil prices during the summer of 2011 - causing gas prices to skyrocket, putting pressure on the consumer causing wholesale inventories to suffer - what do they say? History has a way of repeating itself? FYI - in the last 12 days alone - WTI Crude is +12% - keep your eyes on the gas pump....
After this report - Barclay's Investment Bank - CUT its US 2Q GDP forecast to 0.6% - but hey - no worries - we are right on the cusp of a turn-around.
Overnight - stocks around the world rallied, metals gained and the US $ backs off .....the MSCI All Country World Index up by 1% , Emerging markets enjoying a banner day as they celebrate the biggest advance in 8 months....treasuries higher (yields lower) and even Gold is joining in the party - +2%. ECB, BoE, PBoC all to remain in 'accommodative mode'. There is relief in global markets.. and the disconnect continues.......
US futures are now +16 pts....at 1664....we have clearly blasted through resistance at 1652 ish...and the failure to pullback would suggest that we can now clearly challenge the yrs high of 1680.....Will we get more post mortem from the FED today? Will the army of Fed Gov/Pres start hitting the media circuits to defend/explain/calm/clarify/translate/decipher any misunderstanding from yesterday? Today we get Init Jobless Claims - exp of 340k, Cont Claims of 2.955 and the Bloomberg Comfort Index.
Tomorrow we get JPM and WFC - expect the reports to show 'better than expected' - but listen for the details....are the numbers as good as they appear? Will it be more smoke and mirrors?
Asian markets Nikkei +0.35%, Hong Kong +2.55%, China+3.43% and ASX +1.31%.
In Europe - FTSE +0.51%, CAC 40 +0.64%, DAX +1.0%, Eurostoxx +0.81%, Spain +0.2% and Italy +0.2%.
Potatoes & Eggs
This is one of those basic yet classic dishes that never goes out style...you can eat for breakfast, lunch or dinner - Enjoy.For this you need: Eggs, potatoes, garlic, onion, s&p, butter, olive oil, fresh grated Parmegiana Cheese and if you prefer a pinch of Italian seasoning.
Preheat the broiler (oven) to high.
Peel a couple of russet potatoes and then slice - now toss into a pot of boiling water - bring the pot back to a boil and blanch for 3 - 5 mins....Remove - strain and set aside.
In a large bowl - crack 6 to 8 eggs - Beat well - add a splash of whole milk (or 1/2 & 1/2), season with s&p (and if you like a pinch of the Italian seasoning). Add a handful of grated cheese. Mix well - set aside.
In a large oven safe frying pan - melt a dab of butter, add a squirt of olive oil and heat. Now add in chopped garlic and sauté. Next add some sliced onions and sauté - until soft and golden.....add back the potatoes and brown on both sides. Next - pour the egg mixture into the pan and allow to set. Twirl the pan to allow the egg to spread and cook. Once the edges begin to pull away - place the pan into the oven under the broiler.....Watch as it quickly cooks the top of the "frittata". Remove and slide onto a large serving platter - cut like a pizza.
Have toasted slices of Italian bread on the table for your guests to make a sandwich. Serve with Ice Cold whole milk.
Buon Appetito.
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