The Big Picture

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• First and Goal for Risk
• Last few TBP Conference tickets left…
• The Most Disruptive Companies in Tech
• Awesome, Time Lapse Landscapes
• ‘About as Bad an Expansion as I’ve Ever Seen
• Huge Employment Chart Roundup
• Does Banning Short Sellers Work?
• Take a Strategist to Lunch: Felix Zulauf
• Why Americans Should Care About Dexia
• 10 Monday AM Reads, Bailout Continent Edition

First and Goal for Risk Posted: 10 Oct 2011 10:00 PM PDT We asked last week if the S&P500 (our proxy for risk markets) was capable of clearing the "red zone",  the zone of resistance between 1175-1195, which included the 50-day moving average.  The market's answer?  Like a hot knife through butter! Interestingly, the S&P500 closed at its high of the day at?  1194.91!   Not a sold out crowd today as the volume was super light.  Nevertheless,  impressive.   The bears need to take a goal line stance right here and push back the momentum or the next stop is S&P500 1230, the top of the recent trading range which began with the August collapse. We have posted several pieces on the three macro bears that have been weighing on equities:  1)  Europe's sovereign debt and banking crisis;  2)  The slowing of the U.S. economy and employment problem; and 3) China hard landing concerns.   We're not sure — and have our doubts — all three bears have gone into hibernation for the winter, but they do appear to be, at least, napping. Today's intervention to support the banking system by the Chinese government was a big, yet under appreciated, catalyst for the rally, in our opinion.   The FT writes, Central Huijin, the domestic arm of China's sovereign wealth fund, will purchase shares in Agricultural Bank of China, Bank of China, China Construction Bank and Industrial and Commercial Bank of China, the official Xinhua news agency announced on Monday. Xinhua added that the purchases by Huijin – its first such public intervention since a similar decision at the onset of the financial crisis three years ago – would "support the healthy operations and development of key state-owned financial institutions and stabilise the share prices of state-owned commercial banks". The announcement came too late for the Chinese stock market, which had closed at a 30-month low, but had an immediate effect on late trading in Hong Kong. ICBC's Hong Kong-listed shares, which had been down 3 per cent, rallied to close up 1 per cent. The U.S. economic data looks to be improving and Europe has a plan to have a plan to recapitalize the banks and fire break the contagion of a Greek default. We're always flying blind with China due the country's lack of transparency, but the equity markets have been hammered over there and should rebound on the intervention news providing more confidence for the global markets.  The announcement of intervention came after the market closed but Asian ETFs were up big in New York trading. The U.S. data, including Friday's employment number, are not great, but beating to the upside.  The key now is for earnings to confirm the U.S. economy is not sliding into recession.  Company outlooks are more important in this season than almost any we can recall. We're most worried about Europe.  There is more time for the markets to continue to hope as the E.U. summit meeting has been postponed to October 23rd to give policymakers more time to hammer out the details.  They really need to get this right. A big commitment by a national government to backstop its banking system could have adverse consequences for the sovereign's credit rating, which negates the positive contribution of the recapitalization.  This destablizing feedback took down Ireland and the worries seem to be the biggest point of disagreement between Merkel and Sarkozy. The markets aren't focused on these concerns and want to believe the three bears are hibernating for winter. They want to rebound from the August collapse like a beach ball held underwater.   And that they are.    Stay tuned.

Last few TBP Conference tickets left… Posted: 10 Oct 2011 02:30 PM PDT > You can grab the last few tickets here.

The Most Disruptive Companies in Tech Posted: 10 Oct 2011 11:30 AM PDT Click for ginormous graphic: Source: The Most Disruptive Companies in Tech by Focus

Awesome, Time Lapse Landscapes Posted: 10 Oct 2011 10:21 AM PDT Inspiring, awesome landscapes — be sure to watch full screen: Landscapes: Volume Two from Dustin Farrell on Vimeo. Follow us on Twitter: twitter.com/​dustin_farrell twitter.com/​crewwest website: crewwestinc.com/​ from Vimeo: PLEASE WATCH IN HD FULL SCREEN w/SOUND. It is a much better viewing experience. Hopefully you have a 1080P monitor and good connection. If not, bug a friend or colleague that does. It is worth it. Landscapes: Volume 2 is the second of a three part series (probably). Every frame of this video is a raw still from a Canon 5D2 DSLR and processed with Adobe software. In Volume 2 I again show off my beautiful home state of Arizona and I also made several trips to Utah. This video has some iconic landmarks that we have seen before. I felt that showing them again with motion controlled HDR and/or night timelapse would be a new way to see old landmarks. Sales Pitch: I would now have to say that my timelapse skill set is very complete. The amount of knowledge I have gained through research, testing, and shooting experience is astounding. From moon phases to high dynamic range to motion control rigs to noise reduction, you would have a tough time finding someone with more overall knowledge of timelapse. If you need help with your next timelapse project you can reach me at 888-444-2739 or DustinF@crewwestinc.com Most of the motion control for this video was done with the Stage Zero Dolly by Dynamic Perception. Once I got comfortable using the DP dolly I fell in love. I can set up shots now in much shorter times. More importantly for me, it is much smaller and much more portable than my homemade motion control. Without it, shots like the Delicate Arch shot in Utah would be nearly impossible due to the length of the hike. Buy the Stage Zero Dolly if you are looking for quality, inexpensive, easy-to-use motion control. dynamicperception.com/​ In addition to the Stage Zero, I also used a three axis motion controlled CamTram. The CamTram is the most versatile dolly I have ever used. Its applications are only limited by your creativity. The CamTram has virtually no weight limit. I was able to achieve shots that dolly-in with the camera just over the ground because of the CamTram’s ability to hold heavy counter weights. Here is their motorized options link: camtramsystem.com/​motorized_info.html and the motorized options video: camtramsystem.com/​motorized_video.html The amazing graphic work at the beginning and end was done by Chris Pettit of Digital Skye Media Development. Check out Chris’ other work here: vimeo.com/​user8750744 Music is “Sunshine (Adagio In D Minor)” by John Murphy. #15 here: itunes.apple.com/​us/​album/​sunshine-music-from-motion/​id297702863 Thank you to the Lowell Observatory in Flagstaff for allowing me to shoot there. They were very friendly and helpful. lowell.edu/​

‘About as Bad an Expansion as I’ve Ever Seen Posted: 10 Oct 2011 10:00 AM PDT ~~~ Source: Feldstein: 'About as Bad an Expansion as I've Ever Seen' Real Time Economics, October 10, 2011 http://blogs.wsj.com/economics/2011/10/10/feldstein-about-as-bad-an-expansion-as-ive-ever-seen/

Huge Employment Chart Roundup Posted: 10 Oct 2011 09:15 AM PDT Ron Griess of the Chart Store goes mad with this enormous collection of employment related chartage: > ˜˜˜ ~~~ ~~~ ˜˜˜ ~~~ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜ ˜˜˜

Does Banning Short Sellers Work? Posted: 10 Oct 2011 08:00 AM PDT Market Declines: Is Banning Short Selling the Solution? Robert Battalio Hamid Mehran Paul Schultz Abstract In response to the sharp decline in prices of financial stocks in the fall of 2008, regulators in a number of countries banned short selling of particular stocks and industries. Evidence suggests that these bans did little to stop the slide in stock prices, but significantly increased costs of liquidity. In August 2011, the U.S. market experienced a large decline when Standard and Poor's announced a downgrade of U.S. debt. Our cross-sectional tests suggest that the decline in stock prices was not significantly driven or amplified by short selling. Short selling does not appear to be the root cause of recent stock market declines. Furthermore, banning short selling does not appear to prevent stock prices from falling when firm-specific or economy-wide economic fundamentals are weak, and may impose high costs on market participants. Hat tip FT Alphaville Market Declines: Is Banning Short Selling the Solution?

Take a Strategist to Lunch: Felix Zulauf Posted: 10 Oct 2011 07:30 AM PDT Pretty cool opportunity to break bread with famed strategist Felix Zulauf: > Click to bid on Ebay for lunch with Felix Zaulauf Previously: The Big Picture Interview: Felix Zulauf (August 2nd, 2010) Transcript

Why Americans Should Care About Dexia Posted: 10 Oct 2011 06:37 AM PDT Source: Why Americans Should Care About Failing European Bank Dexia Jeff Macke Yahoo Breakout Oct 7, 2011 http://finance.yahoo.com/blogs/breakout/why-americans-care-failing-european-bank-dexia-165732982.html

10 Monday AM Reads, Bailout Continent Edition Posted: 10 Oct 2011 06:30 AM PDT Here are the most interesting items I happened across this Monday morning: • Europe Updates: …..-Merkel, Sarkozy Pledge Bank Recapitalization (Bloomberg) …..-Spain and Italy Hit by Downgrades (WSJ) …..-How Greece Could Escape the Euro (NYT) • Sargent, Sims Win Economics Nobel (Real Time Economics) • An Ugly Forecast That's Been Right Before (NYT) • Good at Chess? A Hedge Fund May Want to Hire You (DealBook) • Short Selling Rises Most Since 2006 (Bloomberg) • What is the relationship between Wall Street and Silicon Valley? (The Baseline Scenario) • AT&T Preorders for Apple iPhone 4S Broke Sales Records (Bloomberg) • Clamping Down on Rapid Trades in Stock Market (NYT) • What Romney Gets Right (FrumForum) see also 2012 elections portend even greater turmoil and instability (FT.com) • Your Brain on Politics: The Cognitive Neuroscience of Liberals and Conservatives (Discover Magazine) What are you reading? > via NYT: Recession Officially Over, U.S. Incomes Kept Falling

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