Warning: ‘FRIGGATRISKAIDEKAPHOBIA’

A funny expression coined for Fear of Friday the 13th.

As a side bar, i am long with no real hedge and have to be out of the office today. Typically on days like this the market goes against me pretty bad.

Source

“Friggatriskaidekaphobia is the title to Nomura’s Americas Morning Comment this morning. That’s perfect.

 

The word, of course, means fear of Friday the 13th.

It’s perfect since today is Friday the 13th, and there’s all kinds of bad stuff going on.

• China’s GDP report registered a big miss.
• North Korea fired off a rocket last night.
• European markets are getting smashed.
• Italian industrial production fell 0.7%.
• UK PPI increased more than expected.
• US futures are down,
• Spanish CDS are at new highs.
• The Spanish stock market is getting creamed.”

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0.3% is enough to make the world worry, but not so much in Asia. Perhaps Europe and our futures will be a head fake.

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Fun times in banking these past few years…..

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Europe’s chances of escaping recession is looking grim…..

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“The European Central Bank will restart its controversial government bond purchases rather than offer banks another round of unlimited three-year loans as the sovereign debt crisis worsens, a survey of economists shows.

Of 22 economists polled this week, 17 predicted the ECB will be forced to resume theSecurities Markets Program (ECBCSMP), while only one forecast it will offer another batch of three-year cash. Nine said the central bank may consider shorter maturity loans of one or two years.

“Market stresses will eventually force the ECB to restart the bond program, but it’s not imminent,” said Ken Wattret, chief euro-area economist at BNP Paribas in London, who participated in the survey conducted April 11-12. “Trying to get consensus on the council for it will be difficult.”

The bond purchases have split the ECB’s Governing Council, with German policy makers in particular arguing they blur the line between monetary and fiscal policy. The program was mothballed a month ago after the ECB’s 1 trillion euros ($1.3 trillion) of three-year loans reversed a sell-off in Italian and Spanish bonds that threatened to splinter the 17-nation euro region.

With tensions returning and driving up borrowing costs again in Spain and Italy, some economists say the so-called Longer Term Refinancing Operations aren’t the game-changer they were hailed to be.

‘Toxic’ Loans

“There is mounting evidence that the LTRO is pretty toxic for banks and isn’t working,” said James Nixon, chief European economist at Societe Generale in London and a former ECB official. “I don’t think there will be another one.”

Spain’s 10-year yield jumped to 5.99 percent earlier this week, nearing levels that prompted Greece, Ireland and Portugal to seek bailouts. Italian three-year borrowing costs rose more than 1 percentage point at an auction yesterday.

Debt markets rallied after the ECB’s three-year tenders in December and February as banks used some of the cheap cash to buy government bonds. Investment in government debt by Spanish banks climbed to a record 246 billion euros in February, an increase of 20 percent from December, ECB figures show.

The effect on bond markets is waning now and banks are left with assets that investors are increasingly wary of, saidJacques Cailloux, chief European economist at Royal Bank of Scotland Group Plc (RBS) in London…”

‘Something is Wrong’

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“The euro area’s financial troubles appear to be flaring up again, as this week’s gyrations in the Spanish bond market show. In reality, they never went away. And judging from the flood of money moving across borders in the region, Europeans are increasingly losing faith that the currency union will hold together at all.

In recent months, even as markets seemed calm, sophisticated investors and regular depositors alike have been pulling euros out of struggling countries and depositing them in the banks of countries deemed relatively safe. Such moves indicate increasing concern that a financially strapped country might dump the euro and leave depositors holding devalued drachma, lira or pesetas.

The flows are tough to quantify, but they can be estimated by parsing the balance sheets of euro-area central banks. When money moves from one country to another, the central bank of the receiving sovereign must lend an offsetting amount to its counterpart in the source country — a mechanism that keeps the currency union’s accounts in balance. The Bank of Spain, for example, ends up owing the Bundesbank when Spanish depositors move their euros to German banks. By looking at the changes in such cross-border claims, we can figure out how much money is leaving which euro nation and where it’s going.

Capital Flight

This analysis suggests that capital flight is happening on a scale unprecedented in the euro era — mainly from Spain andItaly to Germany, the Netherlands and Luxembourg (see chart). In March alone, about 65 billion euros left Spain for other euro- zone countries. In the seven months through February, the relevant debts of the central banks of Spain and Italy increased by 155 billion euros and 180 billion euros, respectively. Over the same period, the central banks of Germany, the Netherlands and Luxembourg saw their corresponding credits to other euro- area central banks grow by about 360 billion euros….”

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Chinese GDP data has taken some risk premium out of over night trading…..

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WTI and Brent fell and then pared most of their losses. Currently WTI is down $0.24 @ $103.40

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The trick is no cash bonus’ , but rather stock options. So in the end it is all the same. 

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Spanish 10-year debt fell as the euro-region’s higher-yielding sovereign bonds underperformed German securities amid concern budget cuts and European Central Bank measures are failing to stem the financial crisis.

Ten-year German bunds advanced, pushing yields toward record lows, after government reports added to evidence the global expansion is slowing and spurred demand for the safest assets. Spain’s 10-year yield climbed toward 6 percent after data showed Spanish banks’ borrowings from the ECB jumped by almost 50 percent in March. The nation’s government will today approve measures to crack down on tax fraud.

“Spain’s significant budget measures have proved unable to convince the market that the new government has the fiscal situation fully under control,” said Norbert Aul, a fixed- income strategist at Royal Bank of Canada in London. “The market reaction to the more-or-less-expected borrowing increase only shows the nervousness in the current environment. Spain should remain under pressure and 10-year Spanish yields could move above 6 percent.”

Spain’s 10-year bond yield rose nine basis points to 5.91 percent at 11:22 a.m. London time. The 5.85 percent bond due in January 2022 slid 0.62, or 6.20 euros per 1,000-euro ($1,316) face amount, to 99.575. The rate has climbed 55 basis points over the past two weeks.

The 10-year bund yield fell four basis points, or 0.04 percentage point, to 1.75 percent. The benchmark yield slid to 1.639 percent on April 10, within a basis point of the record 1.636 percent set Sept. 23….”

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Revs up 12% and profits were up 7%

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“Ireland’s National Asset Management Agency is turning debtors into landlords as it seeks to recoup the 32 billion euros ($42 billion) it paid for commercial mortgages after the real-estate market collapsed.

The agency, created to purge banks of toxic property loans, has forced debtors to find tenants for 4,000 empty apartments, the legacy of a real-estate crash that led to the country getting a 67.5 billion-euro international bailout in 2010. NAMA, which has a goal of repaying its debts by 2020, is focused on increasing revenue from the properties while it looks for buyers. It bought the assets using November 2009 valuations and prices have fallen further since then….”

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Asia

Europe

Futures

Currencies

Commodities

LIBOR, EURIBOR, 10 year yields for Italy, Spain, France, and Germany

 

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Futs are -1 below fv after China’s GDP came in at 8.1%. The forecast was for 8.3%.

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The graph below shows changes in Envisat Northern Hemisphere sea level made this week. Previously, sea level was decreasing -0.241 mm/year, and now it is increasing by 2.37 mm/year. The most recent data magically went from lowest on record – to highest on record.

Note that the magnitude of the seasonal swings has greatly increased, and the adjustments are clearly non-linear. There is a sharp break in slope after the year 2009.

The red image was dated November 10, 2011 and the blue image is dated today. Both were taken from the same link below. The data has been overwritten in place.

MSL_Serie_EN_North_IB_RWT_NoGIA_Adjust.png (1024×680)

Individual graphs are below.

November 10, 2011 version below. No longer available on their web site. It showed the record La Nina of 2010-2011, and the transfer of seawater to soil moisture due to heavy rain.

MSL_Serie_EN_North_IB_RWT_NoGIA_Adjust.png

Below is the April, 2012 version of the same graph

MSL_Serie_EN_North_IB_RWT_NoGIA_Adjust.png

 

SOURCE

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[youtube://http://www.youtube.com/watch?v=vjZ8-xO2pMM&feature=related 450 300]

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WTF is wrong with people ?

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Not something you want to tweet…..

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