Bloomberg Quote of the Day: “Never believe anything until it has been officially denied.” – Claud Cockburn …see story on Karl Rove below, and:
*What a child doesn’t receive he can seldom later give.” – P.D. James – like food?
Bloomberg Top Stories:
*Bank of England Halts Bond Buying as Policy Makers Focus on Loan Stimulus?
*ECB Keeps Benchmark Rate Unchanged as Spain Resists Asking for Bailout
*Treasuries Climb as Dollar Strengthens While European Stocks Pare Advance
*JPMorgan Reaches Agreement to Settle Claims on Mortage-Backed Securities (Oh how they want that regulation reduced…along with Citi, BofA, and Wells Fargo!
*Societe Generale Quarterly Net Falls 86% on Debt Charge, Greek Unit Sale
*Schaeuble Says Greek Aid Decision Not Certainty at Finance Minister Talks
*McDonald’s Monthly Sales Fall for First Time in Nine Years on U.S. Decline
*Commerzbank Likely to Suspend Dividend as It Frees Up Funds for Investment
*Warren’s Return to Washington Heralds Fight With Big Banks From the Senate – !!!
*Wall Street’s Young Romney Boosters Lament a Fox News Damps Vodka Soiree
*Obama Progress in Fixing Fiscal Cliff Hinges on Better Ties With Congress – Duh!
*UN Envoy Susan Rice Emerging as Top Candidate to Succeed Hillary Clinton – that’s Susan not Condoleeza.
*Hu Sets China Income Target for Xi as Communits Meet with Growth at Stake
*Iran to China Challenges a Threat to Obama’s Second-Term Domestic Promises
U.S. Weekly Jobless Claims fell by 8,000 to 355,000 last week! U.S. Trade Gap unexpected narrowed on record Exports – plus oil prices plunging, right?
Yesterday, TB wrote how insane it was to rally stocks ahead of such a closely contested election. That the only ones with an ax were the high frequency traders. Well, it appears they were just setting up the market so they could sell for effect. Interestingly, some advisors were calling for a rally into yearend because the ‘uncertainty’ was over? How could that be with the lame duck session ahead which will merely postpone the inevnitable…providing that is, they are still speaking. Other advisors this morning are saying that ‘uncertainty’ may be the new normal! TB is in the latter camp. Just don’t blame it on Obama getting re-elected…we knew it would be close so no surprise.
Stocks were slammed right out of the chute, which was set up yesterday, TB believes. Utilities slammed again for the third time in four sessions for a net loss of 5.9%! The Dow closed down 313 points after attempting a bounce from the low which produced a loss of 368 points or 2.4%! All 30 members were down. 472 members of the S&P 500 were also down! The two Nasdaq indices and the Russell 2000 were off 2.6%. The NDQ 100 had 94 stocks down, led by Apple with a loss of 21 of the 68 points, while ten others lost from 1-3+ points! NYSE Financials were off 2.7% led by BofA -6.3% and Citi -5.7% – ouch! Total NYSE volume surged to 4.32B from 3.3B shares and as usual it was on a BIG down day! Floor volume nearly tripled from a weak 673M shares to 874M, highest since 10/19!
Bond market was very strong on stock weakness 10 yr note up 1 point and the 30 year +1-7/8 at 1.64% and 2.83% respectively. Libor is steady.
Gold rallied slightly but hit $1733 intraday, highest since 10/19. Crude on the other hand swooned again with a low of $84.05, lowest since 7/11. It has lost $8 in two sessions!
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(Some friends have written to congratulate him on the outcome of the election. TB is not elated but happy that there will be some balance in government and in the Supreme Court for decades. Then in four years we will be offered TWO new choices! Nothing that is one-sided is good…unless you love plutocracy!)
…yesterday, TB asked: win, lose, or draw, can we put aside our partisan differences and support whoever the winner is, or will we still keep trying to stop Obama while our dysfunctional Congress continues its stupidity? This from FOX News election night”
“Fox News had what can only be described as an insane argument with itself over whether or not President Obama had won Ohio, and the presidency.
The network seemed quite confident in its projections at first, but suddenly, pundit Karl Rove — who, as leader of a huge conservative Super PAC has something of an interest in the outcome of the race — began to pour cold water on the call.” (Source: Huffington Post)
This is what the GOP has to overcome. Karl Rove is incensed with power. He learned with Grover Norquist from Ralph Reed and Jack Abramoff. He must be put in his place.
Like Romney’s uninformed statement on the Libyan mission attack, Kentucky Senator Mitch McConnell who said before Obama even took over: “our goal is to make Barrack Obama a one term president,” then this year, along with House Speaker John Boehner, outlined the GOP strategy in a jointly issued paper: “early in his administration, President Obama reached out to Republicans but was rebuffed.” The problem, they say, is that “since then, he has abandoned the effort, and the partisan divide has hardened.”
If you extend your hand and get it slapped enough, do you continue doing so? If you do, that is an act of insanity and demeaning to the office of the President. How do these men pick and choose what parts of the Constitution to accept?
“The American people did two things: They gave President Obama a second chance to fix the problems that even he admits he failed to solve during his first four years in office, and they preserved Republican control of the House of Representatives,” McConnell said in a statement.
“The voters have not endorsed the failures or excesses of the president’s first term, they have simply given him more time to finish the job they asked him to do together with a Congress that restored balance to Washington after two years of one-party control.
“Now it’s time for the president to propose solutions that actually have a chance of passing the Republican-controlled House of Representatives and a closely divided Senate, step up to the plate on the challenges of the moment, and deliver in a way that he did not in his first four years in office.
“To the extent he wants to move to the political center, which is where the work gets done in a divided government, we’ll be there to meet him half way.”
That is not a voice of compromise, but defiance. McConnell thinks he knows why Obama was re-elected, then goes on to say do what the House wants and you will have no problem. Most non-ideological analysts say that Obama is a centrist, or as much as he can be within his own party while McConnell has proven himself to be on the fringes of his own right wing party. The battle continues especially by this bitter old man as he displayed with Senate Majority Leader Reid on 60 Minutes last Sunday.
To his credit, in his concession speech, Romney called for an end to ‘partisan bickering.’ If only he had done that during the campaign, he might have gotten TB’s vote…and others. Instead, he towed the party line as the GOP now expects. Birch Baye, Olympia Stowe, Bob Bennett and others – cast aside for not voting 100% along party lines. If that is the way to go, why not just eliminate the House and the Senate and let the party vote electronically?
As to the persistent GOP claim that his first four years was a failure, see how politifact views it…and remember this was with an obstructionist Congress. Obama promises
Don’t you owe it to yourself to learn the truth? Even if the election has already passed?
So both parties, acting within their own interests, will kick the ‘fiscal cliff’ can down the road into next year in this lame duck session (lame being the operative word), and the battle will resume and not for the betterment of America or the American people.
Several times over the past few months TB questioned the wisdom of the wealthiest Americans in supporting the lying, hate-spewing SuperPac’s and 501(c)(4)’s. At least they wasted their money and if Congress has any cajones they will at least pass a law requiring names and amount of donations to the latter as is the case with SuperPac’s.
But more importantly, the wealthy class historically has practice noblesse oblige to maintain the status quo while these short-sighted men (TB knows of no women involved in this insanity), are begging for a true leader and perhaps a new party to emerge on the scene. Have they considered that it might be the Latino Party? Better rethink your self-serving actions, guys.
Meanwhile, in the state of Minnesota, we defeated the GOP led Voter ID amendment to the state constitution while the poorly named and described ‘marriage’ amendment to define it as one man and one woman, led by the Christian Right with the support of the GOP again, is very close but looks like it is going down too. Interesting as Maine had a ‘gay marriage’ passed, overturning a previous voter approved law. Washington also passed a ‘same sex’ marriage law. A similar law passed in Maryland. The GOP had better wake up to reality, instead of violating separation of church and state, by insisting marriage follow the Bible…whatever that means. The Bible is not always accurate.
Sadly, and a damnation of the gerrymandering done by the GOP, Michele Bachmann barely won re-election by outspending her opponent by 4:1. This despite the fact that she is a pariah in her own party, and has made ridiculous statements on everything from HPV injections to Muslims infiltrating the State Department which she claims she knows, but cannot go into detail on, because she is on the House Intelligence (sic) Committee.
Where are the moderates? They are the only ones who can save us from a backlash by the majority who are not getting anywhere and the more we widen the wealth gap the more apparent it is…and don’t call TB divisive as was done to Obama…it is fact. So when, and it will be when, not if, they assert themselves, we, the middle class and above will pay dearly. Is that what you want for your children?
…after the GOP extremists reaction to the win, one can now only pray! Hope is fading.
…after the GOP extremists reaction to the win, one can now only pray! Hope is fading. If you think TB is biased, go to www.nolabels.org and see what a non-partisan website is, one with some recognizable names behind it from both parties who are fed up. Aren’t you? Maybe you should be, it’s your country…what was it Mitt was ‘trying to take back?’ Gov. Christy would make an excellent candidate for the next election, don’t you think? But Bill O’Reilly and others say he went too far in praising Obama’s relief efforts. Did he? It was Romney who was going to eliminate FEMA in favor of ‘faith-based organizations and give states whatever relief there is ‘because they know best how to use it…do they? Can they organize when they are at the center of the catastrophe? None of the above has the ability to deal with a crisis of this magnitude!
That should be the end of it for TB’s election coverage. Have a great day!
TB
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Volume surged on a broad-based selloff where every index was down, including Dow Utilities have been sharply down 3 of last 4 sessions. Losses exceed 2% on all but Transports which were off 1.9%. 4.32B shares vs 3.3B vs 2.91B vs 3.2B vs 3.61B vs 3.9B vs 3.56B. On 9/1 volume hit 4.56B shares, high of the year. NYSE stocks executed without the aid of the ETN market rose to nearly 900M shares, highest since 10/19 or about 200M above the recent averages: 874M vs 673M vs +601M vs 793M vs 797M vs 853M. 9/15’s 464M shares was the lowest since 11/25/11! There have been just 12 700M+ days since 8/3. The high ytd was 9/21’s 1.8B shares – due to a quadruple witching and an S&P rebalancing. Since 6/29 just 15 sessions have surpassed 800M shares, most were on down days. The average since 8/1’s 1.03B is just 673B. The average for 2012 is just 770M shares and since 6/29 just 694M shares– WEAK!!! 109 of the last 150 sessions have been less than 800M shares (73%!). Since 2/29 there have been just 24 ‘average’ days (mostly down!), including 9/21’s high for 2012 of 1.8B (5B including ETNs) and just 20 have been above 900M – 784M is the 12 month average. Since 11/1/11 there have been just 17, 1B share days…13 in 2012! Since 2/6 there have been 65 sessions less than 700M shares. 227 of the last 245 sessions have been less than the 12 mo ave (93%)!
Advance/Declines were highly negative: +4.3x!!! vs +2.5x vs +1.1x vs -2.3x vs +3.4x on NYSE and -5.7x!!! vs +1.9x vs +1.5x vs -2.7x! vs +1.9x on Nasdaq. Breadth was worse: NYSE: -9.8x!!! vs +4x! vs +1.1x vs -2.8x vs +4x! on NYSE and -7.6x vs +1.6x vs +2.2x vs -2.8x vs +4.5x! on Nasdaq. New 52 week highs were halved to 108 vs 216 vs 113 vs 256 vs 309 vs 225 vs 117; (768 is cycle high). New lows nearly tripled to 196 vs 69 vs 97 vs 101 vs 93 vs 137 vs 99, recent low was 48. The ratio is: MINUS 1.8x!!! vs +3x vs +1.1x vs +2.5x vs +3x, recent high was +7x! The S&P VIX rose 8.4% to 19.06 vs 17.66 +1.48! The 12-month low was 13.32 on 8/17 while the 1012 high is 27.73 on June 4.
Here are the results of last 5 sessions: Dow -2.4% vs +1% vs +0.2% vs -1.1% vs +1%; Dow Transports -1.9% vs +1.6% vs +0.3% vs -1.1% vs +1.6%;Dow Utilities -2.2% vs flat vs -1.6% vs -0.7% vs -1.4%; S&P 500 -2.4% vs +0.8% vs +0.2% vs -0.9% vs +1.1%; Nasdaq Composite -2.5% vs +0.4% vs +0.6% vs -0.9% vs +1.4%; Nasdaq 100 -2.6% vs +0.3% vs +0.6% vs -1.2% vs +1.5%; Russell 2000 -2.6% vs +0.7% vs +0.6% vs -1.6% vs +1.1%; NYSE Financials -2.7% vs +1% vs -0.2% vs -0.6% vs +1.3% (KBW Banks -4.6% vs +1.5% vs -0.3% vs -0.7% vs +1.7%; Nasdaq Banks -3.5% vs +1.3%! vs +0.1% vs -1.3%! vs +0.6%; NYSE Brokers -4.3% vs +0.8% vs +0.8% vs -0.4% vs +1.8%.NYSE Financial Leaders: BAC -6.3%!!! vs +2% vs -1% vs +1.1% vs +4.5%; C -5.7% vs +3% vs -0.7%. You were warned on bank stocks…dividends are way to low!
European equities better – surprising seeing troubled countries yields sharply higher, Asia weak! FTSE +0.2% vs +0.3% vs +0.5% vs -0.6% vs +0.4%; CAC 40 +0.7% vs +0.5% vs +0.3% vs -1% vs +0.6%; DAX +0.4% vs +0.4% vs +0.5% vs -0.6% vs +0.6%;Nikkei -1.5%! vs flat vs -0.4% vs -0.5% vs +1.2%; Hang Seng -2.4%!!! vs +0.7% vs -0.3% vs -0.5% vs +1.3%; Korean KOSPI -1.2%! vs +0.5% vs +1.1%!!! vs -0.6% vs +1.1%;Indian Sensex -0.3% vs +0.5% vs +0.3% vs flat vs +0.5% vs +0.3%. U.S. stock futures rallying in a see-saw session: DOW +42; SPX +4.20%; NDQ +7.75.
U.S. treasury bonds closed strong yesterday, up slightly over night except long bond: 10 yr 1.68% +1/16 – record low of 1.40%; 30 yr 2.83% -1/8. Long TIP 0.31% -1/64. 0.28% is record low!The 5 yr TIP yields -1.48%vs -1.50%; 10 yr -.84% vs 0.82%. T-Bills: 0.11% 1 month; 0.09% 3 months; 0.14% 6 months. Reverse Repo 0.24% vs 0.27%. 3 mo. Libor 0.31%; 6 mo. 0.53%. On 9/18 they were 0.38% and 0.67% respectively …with no policy change??? European problem sovereign 10 years, Germany-bench: 1.38% -1; Japan 0.74% -1; Italy 4.98% +9!; Spain 5.80% +13!; Greece 17.19% vs 16.57% -28!!!…on 9/20: 19.75%!!!; Portugal 8.41% +14; Ireland 4.66% -2.
Gold rallied to $1733, highest since 10/19 for an $18 gain then fizzled closing up about $1, closing at $1716.30 +$1.20. At the high it was near the 50 day moving average which was last visited on August 15th! It closed at $1796 on 10/4, highest since 2/29 and it has lost $80 since. 7/12’s intraday low of $1547.60 was lowest since June 1. The record high is $1923.70, a buying climax on 9/6/11. RES at $1739, the 50 day, $1748, the 40 day.MAJOR SUP at $1671, the 200 day. 5/2’s o/n low of $1526.70 was lowest since 12/29! Currently $1718 +$4. Crude closed strong at $84.62 -$4.09 – $8 in two days! with an intraday low of $84.05, lowest since 7/11 and way below the 40/50/200 day where it has resided since 9/19! RES at the 40 day (90.36), 50 day (91.48), and the 200 day (94.80), all falling again! Overnight it is $85.40 +.96. Minor support at $83.65, then $77.28, the 2012 low!!!
