2/29/12…Leap Day

Bloomberg Top Stories:

 

*Banks in Europe Tap ECB for More Three-Year Cash Than Economists Estimated

*European Stocks Rise With Italian Bonds After ECB Loans Report; Oil Gains – again!

*Treasury Yield Descending Since January Seen Signaling Slowing U.S. Growth – but stocks???

*EIB Bonds Rally as Lender Said to Share Greek Writedown Exemption With ECB

*Americans Pay Price at Pump as Sanctions Boost Iran Profit – Romney take note!

*Apple Dividend Payout Seen Returning $7 Billion of $98 Billion Profit – AAPL 10% of NDQ 100

*Condo Market Bottoming With Morgan Stanley Reducing Loan Losses

*SandRidge Chief Tom Ward Shuns Shale Frenzy as Investors Pay Price

*Financials Show Growing Calm in U.S. Stocks is Deceiving – there, someone finally said it!

*Wall Street Bonus Withdrawal Means Trading Aspen for Discount Wheat Chex – poor babies!

*Pandit Fast Money With Hedge Funds Proves Citigroup Dead End With Spinoffs

*Romney’s Double Victory Sets Up Next Big Test in Super Tuesday’s 11 Races

*Obama Plan Uses Three Numbers With Four Definitions for $250,000 Tax Line

*Lehman Client Money Appeal Dismissed by U.K. Supreme Court in Loss for GLG 

Volume was steady at 3.55B shares from 3.48B. Stocks were generally higher but the Dow was

only slightly higher despite breaking 13k for a second time…this time to just 13009 and closing at 13005…this after being FLAT for a second straight session. NYSE stocks executed on the Big Board rose slightly to 755M shares from 732M shares…still about 250 million below average. Since 11/1 there have been just six 1B share days…only one in 2012! 74 of the last 80 sessions have now been less than 1B! Advance/Declines were mixed: +1.1x vs 1:1 vs +1.2x vs +2.4x vs -1.3x vs 1:1 on NYSE and -1.1x vs -1.2x vs -1.2x vs +2.6x vs -2x vs -1.6x on Nasdaq. Breadth was moderately positive: +1.3x vs +1.3x vs +1.1x vs +2.4x v -2.2x vs 1x on NYSE and +1.7x vs +1.3x vs +1.4x vs +2.5x vs -3x vs -1.6x on Nasdaq. New 52 week highs rose to 277 from 251 while new lows were steady at 26 vs 27. Watch the new highs! The ratio rose slightly to 10x positive from 9x, but it is just high frequency trading! The S&P VIX dipped to 17.96 -.23.

Here are the results of the past five sessions: Dow +0.2% vs FLAT vs FLAT vs +0.4% vs -0.2%; Transports -0.1% vs +0.6% vs -0.4% vs +0.7% vs -0.7%; Dow Utilities +0.4% vs -0.1% vs +0.6% vs -0.4% vs flat; S&P 500 +0.3% vs +0.1% vs +0.2% vs +0.4% vs -0.3%; Nasdaq Composite +0.7% vs +0.1% vs +0.2% vs +0.8% +0.5%; Nasdaq 100 +1% vs +0.1% vs +0.4% vs +0.6% vs -0.5%%; Russell 2000 DOWN 0.4% vs FLAT vs -0.3% vs +1.6% vs -0.8%; NYSE Financials +0.4% vs +0.2% vs +0.1% vs +0.9% vs -1.1%. NYSE Leaders: BAC +1% vs +2% vs -1.8% vs  +0.9% vs -3% vs +1.1%; C +1.7%; GE +0.5% vs -0.8%; JPM +0.4%. BAC has been among the

most active stocks virtually every day (usually number one) since last August!!!

Global equity markets higher: FTSE FLAT vs -0.1% vs -1% vs -0.1% vs +0.3%; CAC40 +0.6% vs -0.2% vs -1.4% vs +0.4% vs +0.2%; DAX +0.5% vs -0.3% vs -1.5% vs +0.5% vs -0.4%; Nikkei FLAT vs +0.9% vs -0.1% vs +0.5% vs +0.4%; Hang Seng +0.5% vs +1.7% vs -0.9% vs +0.1% vs -0.8%; Korean KOSPI +1.3% vs +0.6% vs -1.4%! vs +0.6% vs -1%; Indian Sensex +0.1% vs +1.6% vs -2.7% vs -0.8% vs -0.4%. U.S. stock futures slightly higher: DOW +18; SPX +2.60; NDQ +5. Bonds slightly higher: 10’s below 2% but 30’s still above 3%: 10 yr 1.93%

+5/64. RECORD low 9/23 of 1.6855%; 30 yr 3.06% +1/4; Long TIP 0.68% +5/16; 0.57% at high. The 5 yr TIP yields MINUS 1.43%!!!; 10 yr -0.34%. Bills 0.09% 1 month; 0.10% 3 months, 6 months 0.13%….steadily climbing. Reverse Repo 0.19% vss 0.23%. 3 mo. Libor 0.48%, and 0.75%, stable.

Gold closed higher at $1788.40 +$13.50, $1792.70 intraday high, not seen since 11/16!

It is well above the 200 day ($1671), and has been above $1600 since Jan. 3. It is now $1787.90 -.50. The record high is $1923.70, a buying climax on 9/6. Sup is $1701, the 40 day, further support $1680, the 50 day m/a, both rising. Res is $1800, the 11/14 high! Crude plunged, closing at $106.55 -$2.01! It is now $107.07 +.52, with support at the 40 day (101.08), the 50 day (100.40), and major support at $94.57, the 200 day, all rising. Resistance now at $110.

…a once in four years event…just like the presidential elections (not to be confused with a leap of faith). Perhaps that explains why the Dow for the fifth time in a week broke above 13k and for the first time since 5/19/08 closed above it…but in a world dominated by flash trading, they didn’t blink…again…so a close at 13005 should be deemed a failure. Overnight however, it traded as high as 133034 in futures and now stands at 13017 just before the open…remember the volume in the overnight session is very low relative to the day session which has been running low anyway.

That is not to say that the market can’t or won’t move higher. As those who buy bonds know, people aren’t investing they are looking for a place to park their money…and like parking your car on the side of the interstate could set you up to be torpedoed by an semi!

It still bothers TB that the SEC sees nothing wrong with flash trading…wasn’t it established to provide fair markets? Wasn’t the NYSE set up to provide liquidity…and why the specialists for so long had a license to steal? Of course the SEC has been toothless since the horrific abolishment of Glass-Steagall which had established the U.S. as the most respected marketplace for stocks in the world…not anymore…you pays your money, you takes your chances…end of story.

. . .   – – –  . . . note that the same old SOS applies…perhaps more so!

Too bad it isn’t as easy to reform the tax code as to neutralize the SEC, CFTC, and other regulatory bodies…but then the money is defeating the latter…not much money available (in the form of bribes…er donations) for simplifying the tax code and eliminating loopholes since the tax industry is just a subset of the financial sector and just as determined to keep making money – at all costs to the taxpayer and the country…except the wealthiest who are doing quite well, thank you.

TB just read a story about a woman who was about to undergo back surgery when a tax lien was filed on her. It seems she had moved 11 months earlier and the IRS sent the audit notice to her old address and it wasn’t forwarded. To make matters worse her computer had been stolen so she lost all of her organized records. How did it come out? Well, one reason they audited her was she worked for a non-profit and had taken some deductions which raised red flags…in the end the IRS found it owed her about $500…she was one of the unlucky 1%…by the way the top 1% have well less than 1% of their returns audited due to the time and cost of examining them, not to mention their batteries of lawyers.

Well…so long as Romney doesn’t stub his toe before Super Tuesday, he should have a clear run at the presidency. Amazing…he opposed bailing out the auto companies, stumped to the voters about what a great state it was and how his wife drove two Cadillacs (for even and odd days?), yet under him there would have been no automobile industry recovery. Go figure. Meanwhile, Obama used it as a photo op under the pretense of being an economic speech…ya think it might have been political…just a wee bit?

These are the times that try ones souls…from The Crisis, by Thomas Paine which is a worthwhile read…one that tells of another era where service was something one did willingly for one’s country…unlike today. Now we take ‘service’ as being elected to Congress or the presidency.

One question: who among them actually believes that the country needs their guidance…and feels truly qualified to lead? Since TB, and so far no one has approached him with any names, can’t think of a true thinker in this country…sad but true. Send in your nominations….

As always, have a great day!

TB

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