When traders and investment banks do it, it’s called “market manipulation”
When the Fed and Treasury do it, it’s called “intervention”.
This market is going higher due to “intervention” on all fronts.
“Don’t fight the tape” and “Don’t fight the Fed” are axioms pertinent to these times.
Comments »[[WB]] is still a good candidate for a short sale (@28.15).
Dividend cut highly likely. They need the money, just like Joey-Bag-O-Donuts.
Puchase of A.G. Edwards will prove to be a bad move.
It all adds up.
Comments »It pleases me now that the recent rally in the market looks like it held up after today’s action.
Disturbed by the prospect of missing out on the bullish optimism, I bought a number of stocks today that have broken out like a funky monkey, including:
[[AKS]] at 58.40
I read that over 70% of all crop production on the planet is by irrigation, so I had to play in the pseudo-favored Ag sector again with [[LNN]] at 107.20
Keeping my stops tight, though.
Also sold all my [[GLD]] at 89.37 (it’s headed down to below $80)
Bullish assault that started on Tuesday is still intact.
[youtube:http://www.youtube.com/watch?v=B02a7GhyAXA&feature=related 450 300]That is all. Good night.
Comments »A report came out this morning from the Office of the Comptroller of the Currency (OCC):
“WASHINGTON — Insured U.S. commercial banks lost $9.97 billion trading cash and derivative instruments in the fourth quarter, down $12.3 billion from third quarter revenues of $2.3 billion. For the full year, banks recorded $5.5 billion in trading revenues, down $13.3 billion from the record of $18.8 billion in 2006, the Office of the Comptroller of the Currency reported today in the OCC’s Quarterly Report on Bank Trading and Derivatives Activities.
“The large losses in the fourth quarter are the result of well-publicized write-downs on the super senior tranches of collateralized debt obligations backed by subprime residential mortgage securities,” said Deputy Comptroller for Credit and Market Risk Kathryn E. Dick. “We expected to see an adverse effect on trading results given current turbulent conditions in the credit and capital markets, particularly in light of the deterioration in market liquidity.”
Commercial banks reported credit trading losses of $11.8 billion in the fourth quarter, compared to losses of $2.7 billion in the third quarter. Revenues from interest rate contracts decreased $3.3 billion to a loss of $357 million. Revenues from foreign exchange transactions decreased 7 percent to $1.9 billion.
The report shows that the notional amount of derivatives held by insured U.S. commercial banks decreased $8.0 trillion in the fourth quarter to $164 trillion. The fourth quarter derivatives total is 25 percent higher than a year ago.
Total interest rate contracts fell $9.2 trillion in the fourth quarter, due to a $9.8 trillion decline in contracts with maturities less than one year. Credit derivatives increased 3 percent during the quarter to a notional level of $14.4 trillion, 60 percent higher than a year ago.
The OCC also reported that the net current credit exposure, the primary metric the OCC uses to measure credit risk in derivatives activities, increased $57 billion, or 22 percent, during the quarter to $309 billion. The measure is 67 percent higher than at the end of 2006.
“The decline in interest rates and widening credit spreads have caused sharp increases in derivatives fair values, and netting benefits have not kept pace the past two quarters,” said Ms. Dick. The percentage of gross fair values offset by netting, which reached a peak of 86.4 percent in the second quarter of 2007, has declined to 83.8 percent in the fourth quarter.
The report also noted that:
De-leveraging, anyone?
Comments »Once in a while, you get stuff in the mail or e-mail that not only gives you a chuckle, but also compels you to pass it on, for the enjoyment of others. Here is one such piece of literature that showed up in my e-mail box……
“Syrians and Palestinians struggle to even read Arabic, much less have a clue about reading English. So, how does a group of Palestinian protesters create the most impact with their signs for the media? Having the standard “Death To Americans”(etc.) slogans printed in English, right?
How do they accomplish that?
Answer: They simply hire a Middle Eastern-looking / English-speaking civilian to translate and write their statements into English.
Unfortunately for them, in this case, they were unaware that the “Middle Eastern-looking civilian” hired for the job was a retired US Army Special Forces Sergeant.
As you might have expected, the pictures of this protest rally never made their way to American or Arab TV networks, but the results were PRICELESS! This picture has not been photoshopped.” 
Have we already seen “The Bottom” in this market?
Can Romanian mountain goats fly?
As someone on this blog aptly pointed out before, a market bottom is a process, not an event. There are three things that I look for during the process of the market forming a major bottom :
1. Extremely bearish sentiment
2. Loss to investors followed by government policy and intervention
3. Stabilization
#1: We have bearish sentiment.
#2. We have people losing money and we are getting government intervention. However, are Helicopter Ben and sidekick Hank done with their “good deeds” at this point?
#3. Lastly, leading economic indicators will have to stabilize and then begin to turn up to help make the case for a floor under the market. It is too early to be sounding the “all clear!” at this point. We’re not there yet. There are still more write-offs that will be coming from the banking sector. More CEOs must resign.
Be well today, and happy trails.
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