10/4/13…no payrolls today…thank the GOP – fools!

Today’s Quote from the Friars Club Encyclopedia of Jokes: “She has the reputation of being outspoken – by no one.” – Jack Paar

Bloomberg Quote of the Day: “Sublimity is the echo of a noble mind.” – Longinus

Bloomberg Top Stories:

*Swiss Regulator Probes Banks Over Possible Foreign Exchange Manipulation – note that LIBOR is a RECORD lows…don’t forget THAT conspiracy!!!

*Fink With Gross (and TB) Sees Zero Chance of Debt Default Amid Budget Standoff

*S&P 500 Index Futures Advance With Italian Bonds as U.S. Treasuries Drop

*Missing Payrolls Report Means Economists Chew on Football Instead of Data

*Twitter Files for IPO With Implied Value of $12.8 Billon as Sales Surging – get real!

*Shutdown Furloughs Feed Federal Workers’ Insecurity Amid Pay Freezes – SICK!!!

*BOJ Refrains From Adding Stimulus at Business Confidence Surges in Japan

*Icahn’s Apple Share Buyback Seen Failing by Bond Market – but of course!

*Pig Sales Fly Blind as U.S. Shutdown Cuts Data Bankers to Builders Rely On

*Hedge Funds Used Obscure Nova Scotia Bonds Bet to Win in GM Bankruptcy Case

*Boehner Says Republican Unity on Debt-Ceiling Increase Plan Amid Shutdown –fool!

*Obama Cancels APEC Trip Amid Shutdown Impasse in Setback to Pivot to Asia

*Netanyahu Would Consider Meeting With Rouhani If Opportunity Became Available

*Obamacare Window Shoppers Meeting Bottlenecks Slows Insurance Plan Sign-Up   

Volume steady at 3.25B shares for a FOURTH straight session. All indices negative with most down more than 1%! NDQ 100 and Dow Utilities tied for worst at -1.2%. Those suffering the least (?) were Dow Industrials and the S&P 500 both -0.9%. NYSE Financials closed -0.8%.

The Nasdaq 100 lost a huge 39.4 index points vs -0.2 vs +35 vs -12 vs -3.7 vs +25.5 points with TEN members moving by more than a point – all of them DOWN! Decliners ran 19:1!!! Let’s look again at the leaders and their changes over the past several sessions that they were leaders: APPL -5 vs +1.3 vs +9.1 vs +4.9 vs -2.8 vs +3.8 vs -6.1 vs -1.7 vs +19.2!!! vs -4.4 vs +6.4 vs +7.9 vs +4.2 vs -12.3 vs -6.5; GOOG -2.8 vs +2.9 vs -2.3, n/a -4.1, +1.2,-1.2, +4.2; BIIB -2.6; AMZN -2.4 vs +5.4 vs -1.4 vs +2.2 vs -2 vs +1.7, vs n/a, vs +3.2, +3.3; FB +1.4 vs +1.5 vs +1.6 vs +1.9 vs +2.5 vs +1.2 vs n/a vs +4 vs -2.8; CSCO -1.5; AMGN -1 vs -1.4; CELG/INTC/GILD -1.2. Not a leader but… MSFT +2.5 vs +2 vs +3.9 vs +2.1 vs -2.5 vs -6.9 vs +2.2 vs +3 vs +1 vs -1.4 vs +2; Advance/Declines and Breadth were very negative. New 52 week highs fell again while new lows rose moderately but remain weak. VIX had a blowout session surging to 18.71 before settling at 1.67 +1.07!!! Range since 9/18 it 12.52-18.71!!! CAUTION, especially today!

Bonds closed little changed and mixed in another narrow trading range ahead of payrolls which may or may not come or be incomplete. Crude eked out another high close since 9/20 but closed slightly lower – the new double bottom at $101.05 is now major support – lowest since 7/5! Gold also had a very narrow trading range and an inside day, closing slightly lower..

Dow 30 -0.9% vs -0.4% vs +0.4% vs -0.8% vs -0.5%; Dow Transports -1.1%! vs -0.4% vs  +1.4% vs -0.2% vs -0.6%; Russell 2000 -1.1% vs -0.5% vs +1.3% vs flat vs -0.4%; Dow Utilities -1.2% vs +0.1% vs +0.4% vs flat vs -0.7% vs -0.2%; S&P 500 -0.9% vs -0.1% vs +0.8% vs -0.6% vs -0.4%; Nasdaq Composite -1.1% vs -0.1% vs +1.2% vs -0.3% vs -0.2%; NDQ 100 -1.2% vs flat vs +1.1% vs –0.4% vs -0.1%.

*NYSE Volume was little changed for a 4th day at 3.25B shares vs 3.18B vs 3.16B vs 3.28B vs 2.96B (Record high (?) 4.82B shares on Sept. options expiry while 2.52B is 4th weakest of 20131.96B is the low). REAL NYSE Volume rose to 703M shares from 691M vs 717M vs 878M – 1st time above 800M in a week – vs 636M (2.06B shares also on Sept. expiry was 3rd highest ever (6/30/06 3.38B; 7/12/02 2.29B while 482M on 7/3 in a shortened trading session is the 2013 low). The 12-month average is 719M shares. The average since 6/28’s 1.75B share day, is just 692M shares, ranging from 482M to 2.025B shares on 9/20. There have been just EIGHT 1B+ share sessions! There have been 33 800M+ shares in 2013: 13 up, 18 down, and two mixed.

*New 52 week highs have ranged from 33-864. They dipped to 232 vs 297 vs 424 vs 181 vs 186. New lows were steady at 69 vs 64 vs 48 vs 64 vs  51 vs 44 – weak!

  1. Advance/Declines were VERY negative: -3.7x vs -1.3x vs +2.6x vs -1.5x vs -2x(recent range -17.5x to +6x) on NYSE and -2.8x vs -1.5x vs +2.6x vs -1.2x vs -1.6x vs +1.5x (recent -3.5x to +3.8x). Breadth was worse: -4x! vs +1.4x vs +3.7x vs -2.2x vs -2.7x (recent -18.6x!!! to +7.2x!!!) on NYSE and -3.6x vs +1.2x vs +3.4x vs -1.7x vs -1.2x vs +1.9x (recent -12.8x to +6.5x)  
  2. NYSE Financials fell by 0.8% vs flat vs +0.9% vs -0.7% vs -0.4x. BofA most active and barely holding $14, -0.1% vs +1.2% vs +0.7% vs -0.7% vs -1% vs -0.4%, closing at $14.04 -.02 – back from the lowest levels since 8/30! It has struggled since hitting $15.03 on 8/1 – highest since Jan. 14 and major res. Brokers -1.2% vs -1% vs +0.6% vs -0.7% vs -0.1%; KBW Banks -0.5% vs -0.5% vs +0.9% vs -0.3% vs -0.3%; Nasdaq Banks -0.5% vs -1.1% vs +1.2% vs +0.3% vs -0.3%.
  3. Volatility (S&P VIX) surged to nearly 19 closing at 17.67 +1.7 – highest close since 6/25!!! Range was at 16.84 to 18.71. A gap remains from Friday at 14.62-16.16 and now support. On 8/30 it closed at 17.01 but a week prior it was at 13.98. The recent range is now 11.83-18.71. It peaked at 22.79 on 12/28/12. It is now below the 40 day (14. 85), the 50 day (14.44) and the 200 day (14.46)…ytd the range is 11.05 (3/14) to 21.92 (6/24)!

European stocks higher, Asia weak; UK +0.1% vs -0.5% vs -0.6% vs -0.4% vs -0.8%; France +0.6% vs -0.2% vs -0.8% vs +0.6% vs -1.3%; Germany +0.1% vs -0.2% vs -0.6% vs +0.4% vs -1.1%; Japan -0.9% vs -0.1% vs -2.2% vs +0.2% vs -2.1%!!!; Hang Seng -0.3% vs +1% vs +0.6% vs closed vs -1.5%; Korea -0.1% vs flat two days vs +0.1% vs -0.7%; India +0.1% vs +2% vs closed vs +0.7% vs -1.8%. U.S. equity futures higher but still in a very narrow trading range: DOW +29; SPX +4.30; NDQ +9.50.

Bonds closed mixed and little changed at levels near the sharp break that began on 8/30! Overnight they are weaker: 10 yr Treasury 2.62% -1/8 (recent range 2.99% to 1.63%!!!), and the 30 yr range 2.67% to 3.90%, 3.72% -1/4.. The long TIP is 1.38% -5/16. The (record?) low of 0.36% was set on 4/5. Recent high yield: 1.63%! Libor update: 0.243% 3 mos, 0.365% 6 mos.  Both at or setting new record lows: 6 mos. 3.666%, and the 3 mo. 0.243% respectively. Foreign bond yields mixed. Germany 1.83% +4; UK 2.73% +6; France 2.36% +2; Italy 4.30% -7; Spain 4.20% -3; Portugal 6.34% -15!!!; Greece 8.97% -7 vs 9.10% vs 8.98% vs 8.85%!!! -21!!! vs 9.22% vs 9.15%!!! -30!!! vs 9.48% vs 9.59 vs 9.71%  +10 vs 9.57%!!! -26!!! vs 9.79% -25 vs 10.13 Recent range: 8.04%-12.57%. Japan 0.64% +1.

Gold was little changed yesterday closing at $1317.60 -$3.10 in a very narrow inside session and remains above $1300, no mean feat a day after putting in a low of $1276.80 on 10/2 – lowest since 8/8 – then closing above $1300 at $1320.70. Overnight it is slightly weaker in a $5 trading range at $1316.70 -.90. Recent high was $1375.40 on 9/19.  6/27’s intraday low was $1179.40 – lowest since at least 2011 and critical support. $1300 remains psychological support, while the 40 day ($1353) and the 50 day ($1344) are MAJOR RESISTANCE. The 200 day is at $1466.

Crude also closed weaker making 9 of the last 10 sessions down days closing at $103.31 -.79 – but with an intraday high of $104.38, highest since 9/20. Wednesday’s intraday low was $101.06, a double bottom and thus major support – lowest since 7/5!!! 9/18’s session high was $108.49 from $104.94! Just 17 days ago it set a rally high and close of $110.70 and $110.53 respectively. It is way below the 40/50 day m/a’s ($106.16-.01), and crossed! The 200 day ($97.90) is major support!!! 4/18’s low of $85.61 was lowest since 12/11! Major Res is the high the spike to $112.24 on 8/28. That move was immediately rejected! The range is $85.61-$112.24 since March 1, 2012. Overnight it is slightly higher at $103.66 +.35.

 

Some random thoughts:

As a former GOP’er TB can say this without prejudice: a ship of fool’s which is headed to the bottom…and why? Over a law Congress passed…true, a Dem controlled Congress but are they to set a precedent to shutdown the government if something passed by a prior Congress does not suit them? But the more important question is why?

If it is flawed as they say…and it is…why not let it fall flat? In fact, the funding they are holding back does not affect the Act which is already funded…but don’t let the facts stop the right wing from spreading lies…er…misinformation an disinformation.

That still doesn’t answer the question? Dean Baker, in his weekly, summed it up this way: it is neither irrational or foolish for them to do this. The answer is they are afraid that with all its warts the people might like it…in fact, once you get past the bullshit the most likely will…then what do they do? Go into hibernation as they lose more votes (by the way it is very popular with Latino voters).

Instead of resorting to lies and fear-mongering, they could have been proposing…and PASSING…fixes to the problem…now however, thanks to the Tea Party, they are past the point of no return and their only hope is to cause Obama to back down…which he cannot do as that would set a horrible precedent as described above.

Back to the facts…it is flawed…some due to Obama caving on prescription drugs to the Pharma lobby…as Bush did during the push for Medicare Part D, enriching a Senator who headed the committee and whose staff…or more accurately the lobbyists…wrote the bill for them. For this he did not run again and instead took a $1 million plus year a job as head of the lobby. That man was slick Louisiana Sen. Billy Taussig – REPUBLICAN and as a result, Medicare, in addition to the non-funding of Medicare Part D which has huge costs, pays 30% more for drugs than Medicaid! Is this a great country or what???

But the Supreme Court and the Constitution also hamper it over the issue of state’s rights. That is why it works so well in Massachusetts. But leaving it to every state, when a key objective is worker mobility, keeps costs higher. Insurance companies have to have a subsidiary in every state they operate in and in some states only a couple of insurers want to be there. This opens the door to corruption…as California had a couple of decades ago.

It has to be a national insurance program to effectively lower costs and that is keeping the U.S. from being able to provide the services that every other industrialized nation and many others provides it citizens…in fact we already are as the uninsured flock to ER for common ailments. So combine this with negotiated drug prices and you have a winner. But it is too late for the GOP to claim it so they will continue to fight it. After all, it is never a case of right or wrong (as Prohibition proved) but what is politically expedient!

Have a relaxing, fun weekend of football, brats and beer!

TB

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