The Last Dance
Who can blame the Greeks for voting to stay in the Euro. Their credit cards are maxed out and this vote will give them another card. Even if it is for a short time, it keeps the party going. The Titanic – in this case the Euro – is getting closer to the iceberg and […]
"We Don't Get Fooled Again" – The Who
Many thought that the Spain bailout would lift the markets higher, and it did temporarily. Yesterday, 10-year rates on Spanish bonds dropped from 6.20% to 6.00% in the first few hours of trading, but quickly rose to 6.48% by the close. This morning, the rate is already over 6.7%. The bond market is voting and […]
Uncertainty?
We love the pundits in the papers and on CNBC that continue to say that it is uncertainty alone that is causing the market to dip. While we do agree there are some major uncertainties out there causing angst, there are always uncertainties about the market. The major uncertainties today include Europe, the upcoming US […]
A House Of Cards Ready To Fall
Hopefully we don’t sound like a broken record, but the news from Europe is, and will be for the near future, the deciding factor for the direction of the market. The potential problems with the Euro were well known when it was created. Recent documents from Germany demonstrate that there were concerns about the Euro’s […]
April 30 – The Pain in Spain
As the chart below shows, the economic problems in Spain are wreaking havoc on the financial markets. With the 12%+ drop in the value of their stock market this month, Spain’s stock market will close at the lowest monthly close since 2003. What is more disconcerting is that their market is lower than what it […]
April 18 – Ground Hog Day – Again!
The Euro Crisis is ready to show its ugly head again. The short-term fix for Europe, which included the ECB dramatically expanding their balance sheet and banks buying sovereign debt, is starting to wear off. Over the next few weeks, there are some major European events that might spark a more significant European crisis: 1) […]
April 3 – Expect Higher Gas Prices Ahead
As we look out of our office at the BP station, we see the rapidly changing numbers as the price of gas continues higher. Not only is gasoline high, but diesel fuel is at a 31 month high. The impact of rising gas prices is as follows: 1) every one penny increase in retail gasoline […]
March 15 – The Battle Between Fear and Greed
The stock market is a great barometer for measuring both fear (2008-2009 crash) and greed (technology market in the late 1990’s). One such stock market related tool that can be used to measure fear in the market is the Chicago Board Option Exchange Market Volatility Index (the VIX Index). This index measures the implied volatility […]
March 6 – ECB'S new song – "A printing we will go, a printing we will go. Hi, ho the cherry-o, a printing we will go
Today, the European Central Bank (ECB) completed its second round – a total of 3 rounds are expected – of its “quantitative easing” program, referred to as the Long-Term Refinancing Operation (“LTRO”). Over 800 banks in Europe took advantage of this LTRO by borrowing an additional 529.5 Billion Euro – $713.4 billion. These are three […]
February 17 – Today's Risk In The Market
Risk: is the potential that a chosen action or activity (including the choice of inaction) will lead to a loss. The notion implies that a choice having an influence on the outcome exists. When investing, risk is always involved. There is risk of loss of principal if an investment goes down in value. There is […]