7-11 Jan Economic Calendar: 1st Rule of Fight Club Meets Real Economy
The first rule of Fight Club is, you never ever tell anyone about the Fight Club. Which is why no one will be talking near term about the looming gridlock over spending cuts coming in March. We'll be too busy in that most terrifying realm, the real results of last quarter's business activity which should be trundling along. Right now, it looks like the second highest expenditure for families, autos, is carrying the economy. Which makes Obama look right, and Mitt Robme look wrong, on bailing out Detroit. Bankruptcy might have taken a source of recovery and brought it to its knees.
Mortgage refi's took a dip in December. I'm having to jump through hoops refiing with a 780 FICA score.--how many more of "me" are there out there? Pinching off low irates before 2018 would be madness. That means print more money, for debt payment, through bond sales to ourselves.
The recession in Europe and the devaluation of the yen push the dollar higher as cream of the #$%$ currencies, but the next five to ten yen to the whopping 95 yen to the dollar set up, is the set u for the mother of all dollar sell offs. I'm nibbling SLV/SLW in anticipation of the rancor due late February, caused by this year's dysfunctional Congress.
Whoops, there I go talking about Fight Club.
Jan 8 3:00 PM Consumer Credit Nov - $8.0B $10.6B $14.2B -
Jan 9 7:00 AM MBA Mortgage Index 01/05 - NA NA NA -
Jan 9 10:30 AM Crude Inventories 01/05 - NA NA -11.1M -
Jan 10 8:30 AM Initial Claims 01/05 - 365K 366K 372K -
Jan 10 8:30 AM Continuing Claims 12/29 - 3200K 3200K 3245K -
Jan 10 10:00 AM Wholesale Inventories Nov - 0.2% 0.1% 0.6% -
Jan 10 10:30 AM Natural Gas Inventories 01/05 - NA NA -135BCF -
Jan 11 8:30 AM Trade Balance Nov - -$45.0B -$41.8B -$42.2B -
Jan 11 8:30 AM Export Prices ex-ag. Dec - NA NA -0.7% -
Jan 11 8:30 AM Import Prices ex-oil Dec - NA NA -0.2% -
Jan 11 2:00 PM Treasury Budget Dec - NA NA -$86.0B -
Old big mouth is back. The most conservative Fed argues if you keep irates low, it complicates making them high again. (Kills real estate recovery, etc) and he's worried about the fact that the fiscal problems of the country haven't been solved yet. Uh, well, YEAH! Where you been Putzer. And yes, the prospect of 1/4 point taking what, $10G's off the top of your home values, at 4% overnight rate taking $150K off the top bothersome? Yup, well, best look hard because that is where it goes whenever Bernankie's replacement hits the fan, Jan 2014. Nobody has even looked at the radar of who that might be, and when. What's new Jack Lew doesn't have to be the crisis manager his predecessor was, but isn't the expansionist on his side the governmental aisle either. Silver sold off a bunch.
The market is being reminded by old rubberlips the March deadlines for the debt and the cliff are just a scant six weeks away right on the cusp of yesterday's highs for the last zillion depression years, so folks are taking a lot off the table. Shed a tear for daytraders going long yesterday.
Let's see who starts the reverse, the buy cycle today and when. It's coming.
The bigger number of jobless had an impact in yesterday's events in the general market, but the big elephant in the room was the 1.3 TRILLION dollar stimulus package coming from turtle Japan. The currency wars are on, and the winners are holders of gold and silver.
Ignoring a pop in initial claims and concentrating on AA results and China pop? Don't believe it, it is the increased claims that tells the Fed pedal to the metal in spite of improvements, so it is off to the races for everyone this morning.
Barrick lost a battle on an obscure copper and gold mining right issue in a Pakistani court, but you could tell by the selloff in SLW somebody thought SLW might be involved. It's a stretch, but if the issues about Pascuatootiefrutie and Barrick's lack of legal interest were vaguely true, every back up or new Barrick facility would be hard pressed to make up the difference promised by a possible defunct Pascuatootiefrutie. Are you following my paranoia? It's tough to lose a backup facility, even a fictitious one. It's a stretch, but there you go--any blood being lost from ABX's turnip is not good for SLW.
With the rockbottom mortgage interest, today's MBA number has some traction, I know Dec was disappointing for refi's. Nobody has to move in winter to refi a loan. We're running out of highly qualified owners. I have a 780 score and I got an awful bodily cavity search for a loan--if it were a car, it would have been a few scratches on a sheet of paper, and that car is a traditionally declining asset. Same with leasing a car, less hassle than buying chewing gum.
Claims the end of the week is where eyes are focused, and goldilocks is required. I suspect we get numbers that imply we have retained any of the alleged XMAS hire-and that takes some interpolation because of the holidays-we're stuck with the end of stimulatum making the headlines, and the looming fiscal cuts, which really, once we got our semi Bush tax rates, are in the who cares camp from a market persective (unless you're a Defense Industry).
Which by the way got the go ahead to plan for sequestration, over 9 months not 12, a larger impact. Remember I said--if it wasn't in the planning, it should be, and last week it wasn't.
Ooops. What WILL the impact of "government refuses to borrow and spend" after "government refused to tax and spend" be?
Silver up 1/2%PM for absolutely no reason whatsoever. Earnings start this evening with AA, that albatross around the market's neck. Unless auto sales start to reflect the aluminum content, the market will flounder. Already the next new thing seems to be steel reinforced carbon fiber, dropping in cost 60%. Like Gilda Radner wrote "There's always something".
It's far from around the corner however.
An article I read perversely notes higher taxes has accompanied steller market growth almost as a mantra, except for key years in Bernankie;s favorite Depression. The article cites people look "harder" for money making investments. No, they just throw money at the market hoping it sticks, and if in enough quantities, it's self fulfilling.
The article ignores paper currency devaluation masquerading as "growth", and the fledgling corporations protecting profit by investing in the only cash cow in the real world, deductable salaried employees.
Our payroll tax is deductible? Obamacare a deduction? Some.