Good Morning All,
Markets are soaring around the world this morning due in part to the massive stimulus package in China. This is an across the board advance that includes everything but G.M., which has been downgraded to a target price of zero by one analyst. I say in part, because nothing on a global basis ever happens in a vacuum. My personal bias suggests that this is more a combination of the passage of time that has allowed for the massive liquidity injection to begin to work, the oversold condition of stock and commodity prices and the general uplift in confidence (read hope or relief) that has followed the election of Barack Obama. Never sell confidence short for it is the backbone of all economic progress, be it in currency, in lending or in the general condition of humankind; and such confidence is born of strong leadership and respectful international relationships.
The Premier of Quebec has followed on the heels of his Ottawa counterpart by calling an unnecessary election likely based on the party's fear of an economic meltdown. This is probably bullish news because even though Harper and Charest may be privy to inside economic information, I doubt their ability to call either market performance with any degree of agility. Contrarian that I am, I will take this as a good market indicator. Thankfully too, this election will be over in less than 30 days and it does not appear that the Quebecois are likely to vote against their own self interest in these times of trouble. As I have often said, governing Canada with its vast resources and underpopulated expanses is not a difficult task, except during those times when we have been threatened by separatism and internal mayhem. I do not believe that we are entering one of those.
It is no secret that there are a number of policy issues facing the Barack administration and for want of other subject matter I will attempt to humbly cite my view of the particulars over the coming days. The first and foremost issue at hand is the assemblage of today's team of the "best and brightest" and great promise has so far been shown in this regard. Remember it is all about judgement and I don't see a chance of there being any Sarah Palins in Obamalot.
Note, Stem cell stocks are soaring again on rumours of government support for research. Democrats equal small and mid cap stocks; R&D that means tech, alternative energy , bio science and infrastructure.
Monday, November 10, 2008
Friday, November 7, 2008
November 7th Edition
Good Morning All,
I'll betcha a couple of hundred of them EEElectoral votes that I can name the capital of Africa and don't you worry China, your place in the North American Free Trade Agreement is secure. I wish this were an exaggeration and it may well be because one of Sarah's aides has assured everyone that McCain's campaign advisors are lying and that the Nieman Marcus dressed barracuda really does know that Africa is a continent and that South Africa is not just a region. I guess this brings new meaning to the "dumbing of America" syndrome of which we have each grown tired these past eight years. I would also hazard the thought that "executive experience" does not include the disciplines of high school geography, basic economics or current affairs. Sadly this probably means that we won't have Sarah to kick around anymore..... unless she gets the chance to appoint herself to the Senate or the Republican base is really stupid enough to entertain the prospect of her as a future leader. These revelations also tell us something about McCain's judgement and the blessing that a Barack victory has been to us all.
The Obama machine appears oiled and ready to go starting with the appointment of Rahm Emanuel as his Chief of Staff. A press conference today and news over the weekend to come will reveal more good stuff as we head into the all important G 20 meetings on the economy November 15th. We can rest assured that Obama's economic team will be in place by that time and that the likes of Paul Volker, Larry Summers and maybe Tim Geithner will be in attendance. It is not difficult to figure out that the light of interest will be shining on the incoming presence and not the outgoing dimness as the world convenes what is being referred to as Bretton Woods ll. I was going to do a piece on the history that surrounds this important subject area but "like" Iraq it will have to wait for time and space next week.
Employment numbers this morning are disastrous as were the revisions of the pre election data which makes you wonder what hanky panky might have been at work in this regard. Auto numbers and other earnings have also been frightening but remember that this is present and backward looking news, I am even willing to concede that not much is about to change for the better in the coming quarter but after that we may look ahead to much better news and goodness knows that stocks are a better buy now than they were last year when indexes were 6000 points higher and George Bush still had a year left to go in power.
I'll betcha a couple of hundred of them EEElectoral votes that I can name the capital of Africa and don't you worry China, your place in the North American Free Trade Agreement is secure. I wish this were an exaggeration and it may well be because one of Sarah's aides has assured everyone that McCain's campaign advisors are lying and that the Nieman Marcus dressed barracuda really does know that Africa is a continent and that South Africa is not just a region. I guess this brings new meaning to the "dumbing of America" syndrome of which we have each grown tired these past eight years. I would also hazard the thought that "executive experience" does not include the disciplines of high school geography, basic economics or current affairs. Sadly this probably means that we won't have Sarah to kick around anymore..... unless she gets the chance to appoint herself to the Senate or the Republican base is really stupid enough to entertain the prospect of her as a future leader. These revelations also tell us something about McCain's judgement and the blessing that a Barack victory has been to us all.
The Obama machine appears oiled and ready to go starting with the appointment of Rahm Emanuel as his Chief of Staff. A press conference today and news over the weekend to come will reveal more good stuff as we head into the all important G 20 meetings on the economy November 15th. We can rest assured that Obama's economic team will be in place by that time and that the likes of Paul Volker, Larry Summers and maybe Tim Geithner will be in attendance. It is not difficult to figure out that the light of interest will be shining on the incoming presence and not the outgoing dimness as the world convenes what is being referred to as Bretton Woods ll. I was going to do a piece on the history that surrounds this important subject area but "like" Iraq it will have to wait for time and space next week.
Employment numbers this morning are disastrous as were the revisions of the pre election data which makes you wonder what hanky panky might have been at work in this regard. Auto numbers and other earnings have also been frightening but remember that this is present and backward looking news, I am even willing to concede that not much is about to change for the better in the coming quarter but after that we may look ahead to much better news and goodness knows that stocks are a better buy now than they were last year when indexes were 6000 points higher and George Bush still had a year left to go in power.
Thursday, November 6, 2008
November 6 Edition
Good Morning All,
I am sure that many of you have either read or heard of the late David Halberstam's study of the Kennedy and Johnson Administrations entitled "The Best and the Brightest" first published in 1972. It is a book , as I remember it, that is both hopeful in its essence and tragic in its outcome, as it moves from the assembly of a very smart people team to the assassination of JFK and beyond to the devestating errors of the Vietnam War. Obama, unlike the present occupant of the WhiteHouse, is likely aware of all this important history, and through employing such knowledge as a template for his own administration it is not a stretch for us to believe that many of the mistakes made in that other time will be avoided in this one.
News on Barry's boys and girls will be forthcoming over these coming days as most stories have had Obama ahead of the curve for some time in this regard. We are dealing with a very different leader this time around, one who is in charge rather than one who has been put in place by agendized ideologues; and most importantly....one who is both lucid and informed. The Chief of Staff and Treasury Secretary appointments appear imminent, as well as a replacement at Homeland Security, Rahn Emmanuel and Timothy Geithner look set to fill the first two although there is no dearth of emminently qualified names being bandied about. What a refreshing change. Across the aisle it may be about former Republican Senators Lugar or Hegal, or even Colin Powell. Enough speculation for now however as what will be will be and it will be a vast improvement.
Markets took a much deeper breath yesterday than I had bargained for but what the hell, they were coming off an 18% pre election splurge and apullback was likely healthy. London cut rates by 150 beeps this A.M. and Europe by 50. LIBOR will tell the short term tale. We are headed for 1200 S&P soon from these 940 levels despite the bad economic news.
I am sure that many of you have either read or heard of the late David Halberstam's study of the Kennedy and Johnson Administrations entitled "The Best and the Brightest" first published in 1972. It is a book , as I remember it, that is both hopeful in its essence and tragic in its outcome, as it moves from the assembly of a very smart people team to the assassination of JFK and beyond to the devestating errors of the Vietnam War. Obama, unlike the present occupant of the WhiteHouse, is likely aware of all this important history, and through employing such knowledge as a template for his own administration it is not a stretch for us to believe that many of the mistakes made in that other time will be avoided in this one.
News on Barry's boys and girls will be forthcoming over these coming days as most stories have had Obama ahead of the curve for some time in this regard. We are dealing with a very different leader this time around, one who is in charge rather than one who has been put in place by agendized ideologues; and most importantly....one who is both lucid and informed. The Chief of Staff and Treasury Secretary appointments appear imminent, as well as a replacement at Homeland Security, Rahn Emmanuel and Timothy Geithner look set to fill the first two although there is no dearth of emminently qualified names being bandied about. What a refreshing change. Across the aisle it may be about former Republican Senators Lugar or Hegal, or even Colin Powell. Enough speculation for now however as what will be will be and it will be a vast improvement.
Markets took a much deeper breath yesterday than I had bargained for but what the hell, they were coming off an 18% pre election splurge and apullback was likely healthy. London cut rates by 150 beeps this A.M. and Europe by 50. LIBOR will tell the short term tale. We are headed for 1200 S&P soon from these 940 levels despite the bad economic news.
November 5, Edition
Welcome back America, welcome back to the world and congratulations on a job well done. November 4 2008 will prove to be one of those dates that people look back upon many years from now and remember where they were on this special day. There were a number of memorable moments last night and for channel hopping political junkies such as I the list is long so I will cite only one of the less obvious. Jim Lehrer of PBS provided a whole new perspective on the night when he said, after a particularly long set, "we are going to take a break for a moment while I get a cup of tea and....ahem, tend to some other things"
This is day one of the transition process and not the Obama Presidency, a fault in the American system that needs to be corrected forthwith. This President elect has proven over the past 20 months that he is not just a great campaigner/orator but that he is a magnificent organizer, manager, listener and delegator; skills that will serve him and the world well in these coming days and years. Getting off to a good start is immensely important and by the weekend we should have a pretty good idea on just how this is all going to work and with whom, so everybody take a deep breath and enjoy the fresh air.
Markets are selling on news in Europe and futures are down in the early going in New York but don't be concerned too much by the Republican/economic numbers sell off, confidence is the foundation of stable markets and the world just received a huge injection of this magic serum. The Obama rally will continue, albeit with some abatement.
I don't know whether to write phew or WOW...so here's both
This is day one of the transition process and not the Obama Presidency, a fault in the American system that needs to be corrected forthwith. This President elect has proven over the past 20 months that he is not just a great campaigner/orator but that he is a magnificent organizer, manager, listener and delegator; skills that will serve him and the world well in these coming days and years. Getting off to a good start is immensely important and by the weekend we should have a pretty good idea on just how this is all going to work and with whom, so everybody take a deep breath and enjoy the fresh air.
Markets are selling on news in Europe and futures are down in the early going in New York but don't be concerned too much by the Republican/economic numbers sell off, confidence is the foundation of stable markets and the world just received a huge injection of this magic serum. The Obama rally will continue, albeit with some abatement.
I don't know whether to write phew or WOW...so here's both
Tuesday, November 4, 2008
November 4, 2008 Edition
History does not happen in a vacuum and certain events presage the arrival of others and influence our future course. Some of these are at the margin; think of how we each count the paths taken or not in our own lives whilst we spend our mature years wondering what might have been. Others are far more momentous in their impact on history as witnessed by the acts of individual leaders for better or worse, as well as many of the avoidable confrontations that have in their time, spun the world out of control and beyond civilized norms. Forty years ago, to employ one such example, during a time of conflagration and social evolution when most of this readership was at least alive if not in young adulthood, Bobby Kennedy and Martin Luther King Junior were assassinated thereby changing both change and the future course of history. Suffice to say that had Kennedy lived, there would have been no Watergate, no Nixon impeachment and a much earlier end to the war and the deaths in Vietnam. It is not difficult to look back and wonder about any number of such events but for the moment, live the moment for we are onlookers, some of us are even "deciders", present at this watershed occasion.
While the world is collectively holding its breath markets appear to be freshening up from east to west. We are about to enjoy the fourth movement of the first Obama symphony as indexes celebrate a new beginning. Look for a solid follow through this week despite the Republican bent of most Wall Streeters. Markets historically fare better under Democrats anyway and from these depressed levels it will be easier than usual.
One sour note this morning has the Republicans running attack ads on major networks proving once again that they just don't understand....or get it.
While the world is collectively holding its breath markets appear to be freshening up from east to west. We are about to enjoy the fourth movement of the first Obama symphony as indexes celebrate a new beginning. Look for a solid follow through this week despite the Republican bent of most Wall Streeters. Markets historically fare better under Democrats anyway and from these depressed levels it will be easier than usual.
One sour note this morning has the Republicans running attack ads on major networks proving once again that they just don't understand....or get it.
Monday, November 3, 2008
November 3 edition
Good Morning All,
World markets have been mixed overnight as they appear to be underplaying the tensions of the coming two days. LIBOR has begun this week with the same positive tone it has exhibited over the last ten settings while the U.S. dollar has continued to lose ground against the Euro and Loonie, a not so surprising occurence considering the incredible gains it had made since summer. The first and most important tenet of financial markets is to provide a stable environment for trade, commerce and the settlement of transactions. In recent months as we are now all aware, the sense of potential failure of the system as described by the daily volatility in commodity, currency, stock and bond markets was palatable. This feeling has eased somewhat in recent days and confidence is once again returning to the economic arena.
The next few months should prove to be less testing and appreciably more enjoyable than the last quarter unless something untoward happens on election night. Imagine for a moment that Obama wins the popular vote by 10 million but loses in the Electoral College.....come to think of it...don't. Believe instead that Barack wins by more than 10 million votes and seals the deal with an Electoral College vote that exceeds the 270 required majority by more than 100, say 379. The Democrats also appear to be on target for Senate and House gains that will give them total control. This will be quite different than the post 1994 situation that Clinton found himself in when the GOP was in charge and harassment topped the agenda. We could go on here about Rawanda ,the Balkans and Monica but space thankfully prohibits us from expanding such rhetoric.
The Stem Cell sector have had a good runup since Thursday (40 plus per cent), the next few days will see them run much higher, but this a trade, not a buy and hold.
World markets have been mixed overnight as they appear to be underplaying the tensions of the coming two days. LIBOR has begun this week with the same positive tone it has exhibited over the last ten settings while the U.S. dollar has continued to lose ground against the Euro and Loonie, a not so surprising occurence considering the incredible gains it had made since summer. The first and most important tenet of financial markets is to provide a stable environment for trade, commerce and the settlement of transactions. In recent months as we are now all aware, the sense of potential failure of the system as described by the daily volatility in commodity, currency, stock and bond markets was palatable. This feeling has eased somewhat in recent days and confidence is once again returning to the economic arena.
The next few months should prove to be less testing and appreciably more enjoyable than the last quarter unless something untoward happens on election night. Imagine for a moment that Obama wins the popular vote by 10 million but loses in the Electoral College.....come to think of it...don't. Believe instead that Barack wins by more than 10 million votes and seals the deal with an Electoral College vote that exceeds the 270 required majority by more than 100, say 379. The Democrats also appear to be on target for Senate and House gains that will give them total control. This will be quite different than the post 1994 situation that Clinton found himself in when the GOP was in charge and harassment topped the agenda. We could go on here about Rawanda ,the Balkans and Monica but space thankfully prohibits us from expanding such rhetoric.
The Stem Cell sector have had a good runup since Thursday (40 plus per cent), the next few days will see them run much higher, but this a trade, not a buy and hold.
October 31 Edition
Good Morning All,
It has been quite sometime since markets have enjoyed three consecutive updays so maybe we should get set for a little pullback today, at least in the morning. Japan lost 5% overnight and in years past this may have appeared to be important but considering that this decline is coming off a multi session rise of 26% we will accept it for something less so. The question now before us lies in dealing with how real the recent stabilization may be and how far the markets can progress from here.
The odds have it that the economy will likely see its worst performance in the final quarter of this year and the first of 2009. The market however is a discounting mechanism and has already begun to buy a second quarter flattening and a final half of next year recovery. It is our view that a rally through mid January will take the major indexes in Canada and the U.S. above 11,000 before giving in to fourth quarter earning news and guidance during that period. Between now and then we may also expect a slowing of the recent extreme volatility, so VIX watchers may wish to advantage themselves of this levelling out.
When it appeared that John Kerry was leading in the days running up to the 2004 election, stem cell stocks made fabulous gains until crashing with the Ohio voting machine outcome. Although this research has not been an issue in this election, I suspect that similar moves will take place this year as memories kick in. Traders and other assorted punters may wish to play the game; STEM, ASTM and GERN are three of many that soared back in the day.
Barack Obama's lead in both the overall polls and in key electoral states is large and growing, so instead of fretting all weekend over a Karl Rovian inspired result I am going to relax and accept the facts on the ground as I reassert my faith in the American people to overwhelmingly do the right thing. We will know very early just how big a sweep this can be as the results in Virginia and even little New Hampshire will presage the night's message. McCain must win both to have the barest chance of victory.
It has been quite a month and I don't know about you but I'm beat.
It has been quite sometime since markets have enjoyed three consecutive updays so maybe we should get set for a little pullback today, at least in the morning. Japan lost 5% overnight and in years past this may have appeared to be important but considering that this decline is coming off a multi session rise of 26% we will accept it for something less so. The question now before us lies in dealing with how real the recent stabilization may be and how far the markets can progress from here.
The odds have it that the economy will likely see its worst performance in the final quarter of this year and the first of 2009. The market however is a discounting mechanism and has already begun to buy a second quarter flattening and a final half of next year recovery. It is our view that a rally through mid January will take the major indexes in Canada and the U.S. above 11,000 before giving in to fourth quarter earning news and guidance during that period. Between now and then we may also expect a slowing of the recent extreme volatility, so VIX watchers may wish to advantage themselves of this levelling out.
When it appeared that John Kerry was leading in the days running up to the 2004 election, stem cell stocks made fabulous gains until crashing with the Ohio voting machine outcome. Although this research has not been an issue in this election, I suspect that similar moves will take place this year as memories kick in. Traders and other assorted punters may wish to play the game; STEM, ASTM and GERN are three of many that soared back in the day.
Barack Obama's lead in both the overall polls and in key electoral states is large and growing, so instead of fretting all weekend over a Karl Rovian inspired result I am going to relax and accept the facts on the ground as I reassert my faith in the American people to overwhelmingly do the right thing. We will know very early just how big a sweep this can be as the results in Virginia and even little New Hampshire will presage the night's message. McCain must win both to have the barest chance of victory.
It has been quite a month and I don't know about you but I'm beat.
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