Bill Gross thinks conditions are ripe for a liquidity crisis, and he points a finger at his old firm for its potential to be at the center of the storm.» Read More
Black Gold's run has been a wild one for investors, sparking oil analysts to recently raise their forecasts. While the U.S. economy and demand are not the drivers behind this rush, the momentum is there (for example as a currency hedge).
The next level everyone is watching is when crude breaks through $100 and many expect it will. I decided to talk to Kevin Book, Managing Director of Research at ClearView Energy Partners about his crude expectations.
Duh, Money never sleeps. So, neither do I. I mean, someone's gotta run this graveyard. Since I've been up \(way\) longer than you, here's what you missed, sleepyhead.
Portuguese Bond Yields Spike (CNBC via Reuters) "Portugal paid almost twice as much to sell 500 million euros ($660 million) of six-month paper on Wednesday as it did in September, keeping the country at the sharp end of persistent market concerns about euro zone debt. The yield rose to 3.686 percent from 2.045 percent in the previous auction. The auction produced a bid to cover ratio of 2.6, compared with 2.4 previously."
Treasury Prices Up As Fed Prepares to Buy \(Bloomberg\) "Treasuries rose as the Federal Reserve prepared to buy long-term debt today after saying improvements in the economy fell short of what's needed to scale back its bond-purchase program. Ten-year yields approached a two-week low after Vincent Reinhart, who was the Fed's chief monetary-policy strategist from 2001 until September 2007, said unemployment may lead the central bank to extend its purchases beyond the current plan to scoop up $600 billion of debt. A report today is forecast to show that private employment rose by the most since November 2007 last month. The notes also rose as the MSCI World Index of stocks fell for the first time in four days."
Sometimes It's Hard to Count Your Billions \(New York Times\) It's really tough to be in private equity when you don't know your own net worth: "It is the brass-tacks question every stock investor asks: What is this company really worth? But in the rarefied realm of private equity investing, the answer to that question is often hard to find, if it can be found at all. After so many public companies passed into private hands during the boom years, buyout specialists who defined that era of Wall Street wealth are seemingly at odds over how their investments are — or are not — panning out. Freescale Semiconductor, for instance, was taken over by a pack of private investment companies in 2006 for $17.6 billion, of which $7 billion came from the firms. That $7 billion is now said to be worth $3.15 billion. Or $2.45 billion. Or $1.75 billion. The owners — the Blackstone Group, the Carlyle Group, Permira Advisers and TPG Capital — disagree on its value."
Stocks Trend up after Fed Minutes (Wall Street Journal) "Blue-chip stocks tacked on a second straight session of gains this year, boosted by encouraging economic data and relief over a quiet set of minutes from the Federal Reserve's last meeting. The Dow Jones Industrial Average gained 20.43 points, or 0.2%, to 11691.1, extending the gains from its surge on Monday, the first trading session of the year.
Other benchmark indexes closed with modest losses. The Nasdaq Composite fell 10.27, or 0.4% to 2681.25. The Standard & Poor's 500-stock index shed 1.69, or 0.1%, to 1270.20."
Here is the lead sentence from the FOMC press release of the December 14, 2010 meeting minutes: "Information received since the Federal Open Market Committee met in November confirms that the economic recovery is continuing, though at a rate that has been insufficient to bring down unemployment."
The first paragraph also contains this gem: "Employers remain reluctant to add to payrolls. The housing sector continues to be depressed."
Once again: You could hear a similar summary—phrased in saltier language—at your neighborhood tavern.
The annualized rate of inflation in the Eurozone for December came in today at 2.2 percent.
That number is slightly ahead of estimates—expectations were 2.1 percent—and also slightly higher than the previous annualized rate for November, which was 1.9 percent.
Izabella Kaminska, of the Financial Times blog Alphaville, takes up the story . As she points out:
The year 2010 was not a stellar year for job creation, and while the United States is back on the road to recovery, a big question mark hangs over the jobs market.
Since May of 2009, unemployment has been above 9 percent — and, by some estimates, the actual unemployment rate has been nearly fifty percent higher.
To get a pulse check on job creation, I decided to ask Gary Burnison, CEO of Korn/Ferry the world's largest executive recruiting firm, if 2011 will be the year for jobs.
There's nothing like buyer's remorse when it comes to stocks.
Retail stocks appeared to be a screaming "Buy" leading up to the holiday shopping season—but now analysts are downgrading some of the best-known names.
"There are unknowns regarding cotton costs and labor costs, and on the food/mass [production]/drug side, there's a threat coming from three dollar per gallon gas. With these in place, how could anybody get cozy with rosy," said Richard Hastings, Global Hunter Securities Macro and Consumer Strategist.
Nobel Prize-winning economist Robert Shiller says that his key valuation indicator is flashing warning signs.
The Fed is in the early stages of an analysis on changes in bond market liquidity, amid signs that liquidity may be less resilient than in past.
Janus Capital acquired a majority interest in Kapstream Capital and said Kapstream's Palghat will support Bill Gross as co-portfolio manager of the Janus Global Unconstrained Bond strategy.