The credit cycle has finally turned: one can see it everywhere – from the rapidly deteriorating corporate fundamentals, to the recent surge in defaults and downgrades, to the tightening lending standards, to the most obvious – sliding asset prices. Nowhere is the bursting of the credit bubble more obvious than in the spread between junk…
The FTSE 100 found support at 6195 and may still trade higher this afternoon given that U.S. NFP prints higher than 200k expected (Bloomberg News survey). Yesterday’s sharp drop was triggered by Mario Draghi’s announcement that the ECB would not significantly increase quantitative easing. The market was expecting the ECB to deliver strong stimulus and investors betting on that got the rug…
Christmas is usually a quiet time for the global financial markets. It’s the one time of year traders get to actually kick back and completely disengage from the markets. Trading volume – the quantity of financial assets bought and sold during a given time period – is usually much lower in December when compared with…
The only way to explain the largest swing in the euro in six years yesterday is to appreciate the disconnect between what was expected and what was delivered by the ECB. Draghi’s urgency and commitment to do “what it must” fanned expectations, and more importantly, substantial positions, in various asset classes–short euros, long European debt,…
The long-awaited Square IPO (SQ) took place last week, attracting a lot of attention from the tech and financial sectors. The company is led by Jack Dorsey, the CEO of Twitter (NYSE:TWTR). Square is a high-profile payment processing unicorn that was valuated on the private market at $6 billion. The company has faced a negative sentiment since it filed for IPO. This negative sentiment was caused by the correction in the markets…
Gold: Having halted its broader weakness on a long-tailed candle formation on Thursday, Gold looks to build up on its corrective pressure. While the commodity holds and trades above the 1046.30 level, recovery threat is expected. On the upside, resistance resides at the 1070.00 level where a break will aim at the 1080.00 level. A…
By the way, you might want to check out this post at NFTRH.com, which includes some USD and Euro talk, and a heck of a lot more talk about stock markets, policy makers, semiconductors and a little bit about gold to boot. The question I would ask here is whether or not Uncle Buck is double…
Draghi’s Limp Stimulus Drags Down Markets This evening’s comments will be brief, if any at all. Today’s market was about as irrational as it gets. This time it was not Yellen who prompted the selling, but Europe’s chief central banker himself, Mario Draghi. Apparently he did not cut rates or increase QE stimulus enough and…
Janet Yellen’s Congressional testimony today brought up an interesting line of questioning from Ted Cruz who said that the Fed was “passively tightening” policy in 2008 which contributed to the financial crisis. This is a popular line of reasoning among many economists. David Beckworth, whose work I admire greatly, posted some nice comments explaining this view. In…
Janet Yellen’s Congressional testimony today brought up an interesting line of questioning from Ted Cruz who said that the Fed was “passively tightening” policy in 2008 which contributed to the financial crisis. This is a popular line of reasoning among many economists. David Beckworth, whose work I admire greatly, posted some nice comments explaining this view. In…
