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  • jmlregoog jmlregoog Apr 6, 2007 9:29 AM Flag

    Short Squeeze

    In view of the employment data, and construction employment up 56,000 in particular, looks like shorts will get squeezed pretty hard come Monday. Any other thoughts?

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    • I meant to say NOT in residential but commercial...

      anyhow, even in residential the trend is SOUTH...

    • hey folks, the rebound was in 'residentual construction'

      Just the opposite - residential is contracting hard!

    • The 'jobs report' only validates the Feds argument to hold rates. But even at that, the quality of the jobs created would hardly create demand for new housing at todays price levels. Big Brother will never admit the latter.

      Only a collapse in oil prices and a much lower 10 year bond could help patch this bubble if money could be found to finance the buyers. But the carpet has been pulled on the demand level and only many more 'risk points' could assuage it. The 10 year bond is rising without that previously unfactored risk. Credit card issuers value it at 12-21%!

      I mentioned last December that a significant event took place in China that the press almost totally ignored.

      Since then Big Brother's 'Eco-Newspeak' has been nothing short of self-fulfilling.

      In todays economic environment the dollar should be strong. However it seems to be showing its punch against only a single major currency, the yen, which is a nightmare! The Fed has its finger in a leaking dam of monetary malfeasance.

      There will be casualties. The HBs first in line. If there is a rally in this stock, it will be short lived.

    • Bloomberg

      April 6 (Bloomberg) -- Treasuries fell, pushing 10-year note yields to the highest in eight weeks, as a more-than-forecast increase in hiring and a drop in the unemployment rate in March eased speculation the Federal Reserve will cut borrowing costs.

      Two-year notes, more sensitive than longer-maturity debt to rate changes by the Fed, fell the most since March 9, when the previous monthly employment report also was stronger than economists forecast. In interest-rate futures markets, the odds of a rate cut by mid-year fell almost to zero.

      ``It makes it very difficult to make the case the Fed may cut anytime soon, and the market is taking out those cuts that it had priced in,'' said Michael Pond, an interest-rate strategist in New York at Barclays Capital Inc., one of the 21 primary dealers that trades directly with the central bank.

      I think what has been giving hope to the HB's is that the Fed will cut soon and take pressure off the subprime crisis. So if you think about it a weak jobs report probably would have been positive for the HB's as far as a swing trade is concerned. Its interesting that the jobs picture is better than expected. Those people haven't been stepping to the plate to buy houses. The rapidly rising NOD's, foreclosures, subprime, alt-a meltdown story shows no sign of abating right now. The bubble markets are going to get clobbered now. IMHO.

    • Sorry, the link is in the next post. I think I saw it elswhere also...

    • One of the boards listed a site of a recorded news team investigation of a neighborhood that has million dollar houses. Several were abandoned by the builder. Several sit there empty, several others have had mysterious fires (no wireing or appliances to cause a fire). The people that still live there are whinning that their property values are in danger. Duh.....

      Sorry for no links and I don't remeber if its in texas or ?

      I am sure others here have seen it and can post the links if they want.

      scary stuff.

      I still think the three days between this jobs report and actual trading will have an impact on how it all trades on monday.

    • Agree...big squeeze right from the open. HBs will soar...more "employed" people can buy houses than ever before. Right back to the bull argument, millions more immigrants to provide cheap labor and housing demand, low rates, plenty of jobs, easy loans...housing has really hit bottom and will explode over the next few months. Can't be short right now...IMO.

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