3/15/13…grand ole expiry plus banking, budget and the CIA!

From the Friars Club Encyclopedia of Jokes: “Rothschild, the famous banker was strolling down a crowded street in Vienna when he was jostled by a pickpocket. “Watch out!” warned his companion. “That fellow’s trying to steal your silk handkerchief.” “So what? Said Rothschild with a shrug, “We all started small.”

Bloomberg Quote of the Day: “Intelligence is the ability to adapt to change.” – Stephen Hawking

Bloomberg Top Stories:

*Industrial Production in U.S. Increases by 0.7%, the Most in Three Months

*Michigan Consumer Sentiment Unexpectedly FELL to 71.8 in March from 77.6

*Stocks In U.S. Fall After S&P 500 Approached Record High Yesterday

*JPMorgan Whale Findings Pile Pressure on Dimon as Too-Big Banks Debate Revived

*Wells Fargo Joins JPMorgan in Raising Payouts Following Fed’s Stress Test – SICK!!!

*UniCredit’s Net Loss of $722.3 Million Wider Than $489.7 Billion Estimate – DUH!!!

*Market Knows Cameron Failure to Cut Debt Obscured by BOE Cash – austerity sucks!

*Boeing Sees Dreamliner Service Resuming in Weeks After Repairing Batteries

*Post-Chavez Venezuela Just as Chilly for Companies From Coca-Cola to P&G

*Kuroda Brings Oxford Mindset to Bank of Japan After Shirakawa Chicago View – better?

*Obama-Republican Budget Fight Isn’t Only About Taxes Versus Spending Cuts

Nixon-Era Law Invoked by Obama to Fight Climate Change Unsettles Industry

Finally, the talking heads at CNBC (airheads?) had something to crow about as the Dow put in its 8th straight record high and has had record high closes 9 of the last 10 sessions – not seen since 1999. The S&P 500 closed at the session high and is now just 13 points below the 10/11/07 record high…never mind what your return would have been if you bought it (the index which due to manipulation of the members is one of the great myths of finance – can you imagine a finance class where you tell the prof – breathlessly that we are almost to the record high???). Volume, rose slightly to an ‘average’ 3.43B shares. While the REAL volume on the NYSE rose slightly to 676M shares it is still pitiful! Financials rose again but the brokers, which led on Wednesday were FLAT while the Banks gained 0.9% – interesting as they await the Fed’s decision on ‘upping’ their meager dividend. Meanwhile, the VIX managed yet another decline to a new low of 11.05, lowest since 2/23/07 then closed at another new low of 11.30 – think of it, with all the internal and external problems you can buy a ‘put’ cheaper than at any time in the last six years!!! Gold continued to struggle near $1600 and Crude is now at the highest price since Feb. 25th.

TB remains attached to ‘sell in May and go away’ – IF we make it that far…when else have you been able to buy puts so cheaply??? Six years ago in a roaring economy!!! – that was soon to peak and sink into a massive decline!

Total NYSE total volume rose to 3.43B shares vs 3.03B vs 3.22B vs 2.98B vs 3.64B vs 3.62B vs 3.67B vs 3.57B vs 3.38B vs 3.76B vs 3.53B vs 2/28’s 4.2B (highest of 2013 by about 400M shares). Real NYSE volume rose but from a weak 585M shares (lowest since 2/11’s 497M shares), to 676M shares. Since 3/1 the range has been a weak 585M to743M shares. Ave 668M). The last REAL volume was 2/28’s (monthend) 1.01B shares (second only to 1/18’s 1.07B and third best to 12/21’s 12 mo. high of 1.88B shares). Note that 700M occurred just once last week while the average volume since 2/15 is a weak 740M shares!!! Ave vol. 12 mos. 744M, ytd 710M. There have been just eight 800+M shares in 2013. ALSO, the VIX which surged to 19.28 on 2/28 fell to an incredibly low 11.56 Monday – with a low of 11.50 – lowest since 3/2/07, declined again to 11.30 with a low of 11.05 – lowest since 2/23/07.

  1. new 52 week highs which have ranged from 121-709, before falling to just 121, rose sharply to 652 vs 410 vs 413 vs 560 vs 630 vs 447 vs 539. New lows also rose slightly again to 50 vs 42 vs 36 vs 26 vs 24 vs 64 vs 73 vs 98.
  2. Advance/Declines were positive at +2x vs +1.3x vs -1.4x vs +1.2x vs +2x vs +1.4% on NYSE and +2.1x vs +1.3x vs -1.4x vs +1.1x vs +2.1x vs +1.6x on Nasdaq. Breadth was similar at +2.8x vs +1.2x vs -1.3x vs +1.6x vs +2x vs +1.8x on NYSE and +1.9x vs +1.1x vs -1.7x vs +2.1x vs +1.9x vs +1.9x on Nasdaq.
  3. Dow Transports rose another 0.8% vs 1.6% while the two Nasdaq indices were only up 0.3% from +0.1%/-0.1% vs -0.4% vs +0.4%.  71 advanced – led by Apple with half of the 8.6 point gain, 28 declined – led by AMZN which subtracted 3.7 points…no other significant movers! The Russell 2000 small cap remains very impressive rising 1%! vs +0.4% – that is up 4.8% in 11 sessions!
  4. NYSE Financials rose 0.9% vs +0.2% vs -0.7% vs +0.6%. NYSE Brokers FLAT? vs +1.1%. BofA still most active and +0.4% vs +1.4% to close at $12.11 vs -1.2% vs +0.7% vs +1.6% – the range is $11.11, on 12/17 to $12.42 on 2/13. Note: 11 cents is a 1% change!!!  No other financial most actives!
  5. Lastly volatility (S&P VIX) fell by .53 vs -.44 to 11.30 with a session low of 11.05, a new not seen since 2/23/09. We are either prophetic or just plain stupid!

Global equity markets weaker ex-Japan: UK -0.6% +0.4% vs -0.8% vs +0.1% vs +0.2%; France -0.9% vs +0.8% vs -0.4% vs +0.1% vs -0.3%; Germany -0.3% vs +1.1% vs -0.1% vs flat vs -0.2%; Japan +1.5%!!! vs +1.2%! vs -0.6% vs -0.3%; Hang Seng -0.4% vs -0.4% vs +0.3% vs -1.5% vs -0.9%; Kospi -0.8% vs +0.1% vs +0.3% vs -0.5% vs -0.1%; India -0.7% vs +1.1% vs -1% vs -0.4% vs -0.2%. U.S. stock futures weaker and still stuck in a narrow range. Stocks opening weak: DOW -33; SPX -3; NDQ 2.60.

Bonds got a lift yesterday and are up again overnight but remain weak: 10 yr Treasury range of from 2.06% to 1.85% last 18 sessions, now 2.02% +1/8, and the 30 yr’s 3.26% to 3.05%, now 3.23% +1/4. The long Tip is not participating 0.64% vs 0.65% and still near the high yield of 0.66%. Libor update: 0.242% 3 mos., 0.445% 6 mos. Foreign bond yields slightly lower, ex-Spain/Greece: Germany 1.46% -2; UK 1.96% -1; Italy 4.59% -5; Spain 4.87% +3; Portugal 5.80% +1; Greece 10.58% +4.

Gold closed slightly higher, but did not approach $1600, two days after the highest close since 2/27/13. It remains near support with the loss from the 1/17 high of $1699.90 at $116! It closed at $1590.70 +$2.30, down -$58 in 13 sessions but also above a week ago Thursday’s low of $1554.30 – not seen since May 2012! Overnight it is $1593.50 +$2.80. The total breakdown through the 40/50/200 day m/a’s, has major resistance $1629-1668, with first resistance at $1600, a double bottom from 8/14-15, also a psychological level. Last time it was below $1500 was Sept. 2011!!! Crude was up slightly, still trying to come off that new low of $89.33, lowest since 12/26, and way below the 40 day ($94.63), AND $94.37, the 50 day. It closed at $93.03 +.51 – an a second straight inside day!!! Overnight it is $93.66 +.63 – highest since 2/25..

Some random thoughts:

Required reading…hey, you’ve got all weekend!

For more on the banking problem…and there is LOTS more and more to come:

Simon Johnson//big-banks-have-a-big-problem

And Dean Baker who like Johnson has been doing some great THINKING:

Dean Baker/cracking down on banks

How about the Senate clearing the gun control issue through committee – along party lines natch as the GOP is being controlled by the NRA as well as Grover Norquist:

Wash Post/nra-congress/

Stop listening to Paul Ryan and his band of fearmongers…this is what our country is about – it is NOT a corporation and is expected to run deficits when we are in dire straits, something the states are prohibited from doing. How have we let a few of the wealthiest Americans shove the rest of the country towards poverty while preserving their precious tax breaks? Beats the hell out of me!

BaselineScenario/true budget deficit

Reich/the-contest-over-the-real_budget

Lastly, remember the Blackwater scandal in the Iraq war? It was more than that:

Have a terrific weekend!!!

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