The Big Picture |
- Bill Gates: On Taxes, Gov’t Aid, Steve Jobs
- S&P 500 Technical Snapshot
- Monday PM Trick or Treat Reads
- Cartman Is the 1%
- Back of the envelope on Italy
- Navigating Volatile Markets
- The World At Seven Billion
- The October Rally Everyone Hates
- Regulatory Issues Raised by the Impact of Technological Changes on Market Integrity and Efficiency
- Has America Become an Oligarchy?
| Bill Gates: On Taxes, Gov’t Aid, Steve Jobs Posted: 01 Nov 2011 01:00 AM PDT
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| Posted: 31 Oct 2011 10:30 PM PDT
As seen in the chart above the S&P 500 is stalling and reversing off a resistance zone in the 1,298 to the 1,293 level (red lines). This follows the recent breakout and base completion above the 1,257 level (upper green dotted line). That said we would expect to see the S&P 500 hold pullbacks toward this 1,257 area (upper and dotted green line). This area also coincides with a minor uptrend line near the 1,253 area (black line). If this first support level does not hold, secondary and more firm support lies in the 1,230 area (lower green line). Our opinion is the bottoming formation that took place over the last three months looks to be real. However if this is the case then these supports should hold. Thus we are watching, very closely as to how the market trades in and around these support levels. Holding and reversing back up would suggest the recent bottoming action was real. Conversely breaking those supports would suggest this recent action was nothing more than a very aggressive oversold bounce. Stay tuned … Source: |
| Monday PM Trick or Treat Reads Posted: 31 Oct 2011 01:30 PM PDT Here is today’s train reading home for Trick or Treat:
What are you reading? > |
| Posted: 31 Oct 2011 12:49 PM PDT Wall Street fat cats and Eric Cartman are already pretty similar. They’re greedy and gluttonous, and they’ve probably all killed and served a nemesis’s parents for dinner at least once or twice. And on this Wednesday’s all-new South Park, they’ll have one more thing in common when Cartman is criticized for being the 1% at South Park Elementary that’s bringing down the phys-ed scores of the rest of the school. 1% |
| Posted: 31 Oct 2011 12:33 PM PDT REVISED: Here’s a back of the envelope calculation on Italy, highlighting the impact that a rise in financing costs coupled with a lack of growth can have on their finances. Italy needs to refinance about 310b euros of debt in 2012. I estimate the average interest rate they are paying on this maturing debt is 2.7% (short term rates collapsed in ’09-’10). With an average debt maturity of 7 years, Italy may be paying 6%+ on the refinancing. Assuming a 350 bps additional cost times the 310b euros of maturing debt, this adds 10.9b euros of interest expense to the 54b euros of interest payments scheduled to be made in 2012. At the same time, Italy’s 2T economy is expected to grow REAL GDP.1% in 2012 and nominal around 3%. Thus, nominally 60b euros will be added to their economy with all of the incremental gain thus going to service interest expense. This also doesn’t take into account any new debt Italy has to take on over and above what is maturing. Over time, just to tread water, any country needs to generate nominal GDP growth equal to its financing costs. In the 10 years prior to the sharp ’08-’09 economic contraction, Italy saw nominal GDP growth of 3.7% (REAL averaged 1.3%), near its financing costs over that time period. A continuation of nominal GDP growth of 3.5-4% (now mostly consisting of inflation) will no longer cut it for Italy with funding costs at current levels. |
| Posted: 31 Oct 2011 12:30 PM PDT Stanley Crouch, Aegis Capital, and Josh Brown, Fusion Analytics, discuss how to navigate confusing markets
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| Posted: 31 Oct 2011 11:30 AM PDT The world’s population is expected to hit seven billion in the next few weeks. After growing very slowly for most of human history, the number of people on Earth has more than doubled in the last 50 years. Click below to find out where you fit into this story of human life?
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| The October Rally Everyone Hates Posted: 31 Oct 2011 10:30 AM PDT Source: |
| Regulatory Issues Raised by the Impact of Technological Changes on Market Integrity and Efficiency Posted: 31 Oct 2011 10:00 AM PDT |
| Has America Become an Oligarchy? Posted: 31 Oct 2011 09:30 AM PDT |
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