INSTITUTIONAL ADVISORS - OCTOBER 16,
Oct 19, 2007
- The Chinese market (FXI) is
generating an "Upside Exhaustion" reading on both the
daily and weekly numbers. Representing the oil play, Schlumberger
(SLB) is also registering the same highly speculative condition.
On the techs, RIMM is also at this Icarus altitude
- On the financial side, our
proprietary Bank Trading Guide has significantly deteriorated
- Today's 3% drop in base metal
prices is interesting
- Although quiet, this week's
action in the dollar index has been constructive. That is for
students of the market - for the nattering nabobs of interventionism
the worst of all worlds would be a sound dollar
- Recent work on the gold/silver
ratio suggests that rising above 56 would resume the uptrend.
The recent low with market rejuvenation was 53.8 on September
28. Today's close was 56
- As noted last week, the BBB
subprime bond is setting new lows. The old low with the initial
panic was 41.42, now it is at 33.78, and this melancholy fact
with the absence of the likely touts about "containment"
The widely discussed the $100
billion "liquidity" pool arranged by Treasury Secretary
Paulson along with Citigroup, Bank of America, J P Morgan and
others reveals a weak hand and an inadequate understanding of
the credit markets in today's condition. Moreover it will take
some 90 days to implement.
But for those who prefer the
brighter side, the bailout pool is going to be called the "Master
Liquidity Enhancement Conduit" or MLEC. Sounds like more
artificial credit to us.
Phil Mackesy's Oct 12th interview
with Bob [Hoye] can be visited at the following link:
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