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Santa Arrives on Wall Street but Elves Join Occupy Movement
By: Kenneth Polcari, Expert Contributor
"Europe's Leaders Pursue New Pact"
WSJ 11/28/2011
Santa Claus is coming to town.....
WSJ 11/28/2011
Santa Claus is coming to town.....
Risk on!! Deal would bring closer fiscal ties. Germany & France are once again trying to come up with a solution, radical solutions to fix the problems. Recognizing the need to “act quickly” - 
aware that any real drastic change to the EU Treaty will be a heavy lift.
The mkts are demanding more immediate action: Two Tiered Europe, Euro zone bonds (no longer being ruled out), fiscal unity and a stronger ECB may be the only ways to arrest the deterioration. Plans for an agreement due by Dec 9th – which is the date for the final EU summit to be held in Brussels seems now to be the focus, so the drama and uncertainty continues. Yet, world mkts are loving the headline.
Remember - this is a headline driven rally - there is no concrete plan yet in place.
S&P futures are exploding to the upside - currently +31 pts trading at 1184, breaking thru the short term resistance. Will it hold? 1200 is the next level to watch.
Mkts around the world are screaming higher also as the optimism clearly trumps any sense at all of negativtiy. Bargain hunters and short covering becomes the mantra for today: Japan +1.5%, China +0.1%, Hong Kong +1.9%, Australia +1.8%.
In Europe the moves are even more dramatic as investors are anticipating positive news about the crisis in Europe ahead of the Dec 9th Eurozone summit. So far - FTSE +2.1%, DAX +3.2%, CAC40 +3.7%, Eurostoxx +3.7% Keep in mind that these countries have gotten clobbered this year and over the past 3 weeks, so keep this move in perspective.
Most European and Asian mkts are down between 15% - 22% ytd....(by contrast US mkts are down 7.5% ytd)
At the same time - the WSJ notes that brokers that provide the networks for the $4 tril / day foreign exchange mkts are back to testing systems that could handle the former currencies in the event of a break up. The Drachma, The Lira, The Deutsche Mark, The French Franc...etc.
On Sunday - ICAP - which operates the biggest currency trading network confirmed that they are "prepping electronic trading systems for a possible exit by Greece from the Euro zone..." All this suggests - real concern that there is an increasing likelihood of some sort of Euro Zone breakup.
And a note on Black Friday - Again the WSJ reports that retailers "enjoyed" a strong start to the holiday season...sales +6.6% vs. last year.
Don’t you love how the world is collapsing – Europe in Crisis as sovereign yields explode to the upside, Greece 20 days away from bankruptcy, the Euro collapses, Italian T-bill auction yields shoot higher, yields in Spain and France followed suit, a failed German bond auction fuels the fire – that even the zone’s strongest members are not immune from this crisis.
Asian economies beginning to slow, Chinese PMI contracting, and Brazilian GDP is a scant 0.3%. Political dysfunction and complete lack of leadership in Washington DC, Congressional paralysis and posturing, a Republican field of candidates that seem to blow themselves up at each new debate, Unemployment at 9+%, Non-Farm Payroll report expected to be weak, US macro data in neutral, housing still in free fall!!
Women pepper spraying each other in lines at Wal-Mart on Black Friday and the talk is all about how this “good start” to the holiday shopping season will provide a boost to sentiment – Is it me? Am I missing something? I mean in the bigger picture - Does this statistic really mean anything at all?
Is it time to get in? Citibank’s Tobias Levkovich notes that in the US “the current level may be an attractive entry point barring any exogenous shocks.”
Exogenous shocks? Hello??? By definition – exogenous means - barring any change that comes from “outside” the model and is unexplainable by the model… Hmmmmm change from outside the model?
Hey Toby – Have you noticed that the EU is in crisis? Do you think that is an exogenous event? Can the model explain it? Is your model taking into account a complete implosion of the Eurozone? Remember who you are - if you are in for the long term - 5+ yrs then it is probably a good entry point and with the proper research there appear to be plenty of bargains...be prepared though for shorter term volatility.
There is a steady stream of economic data over the course of this week, but the important data points are all due towards the end. The ISM manufacturing survey exp of 51.5 and auto sales 13.4 mil are due on Thursday, and the monthly Non Farm Payroll report is due on Friday with exp of 120k.
Today we get: New home sales exp of 313k, Dallas Fed survey exp of 5.0.
Take good care -
KP
Considering all of the German news - I needed a German recipe so courtesy of one of my friends** – I got a German Pork Roast – This recipe uses a dark full bodied beer, (not sure that I
like that - but....) Caraway seeds onions, carrots and beef broth to make a moist, tender pork roast. Serve with roasted then pureed sweet potatoes and large mixed salad.
If you want to be more authentic – substitute the salad for sauerkraut….. ….Now although I have never had it – it does come highly recommended…but remember – there is no butter, cream or fresh grated cheese – so how good could it be???
You will need: a bone in– 4 lb pork roast, onions, carrots, caraway seeds, olive oil, s&p, beef broth, a dark beer – (you can try a lighter beer if you prefer) and cornstarch…..
Preheat oven to 350 degrees.
Begin by seasoning the roast with s&p, and caraway seeds…let rest. Heat up some olive oil in a large frying pan – now brown the roast on all sides.
While this browning – arrange the sliced carrots and onions in the roasting pan – place the browned roast in the center – fat side up.
Deglaze the frying pan with beef broth and then pour into the roasting pan. Now add ½ bottle of the beer. Cover and roast (20 min/lb) for ½ the time….Now uncover and continue to roast – adding a bit of beef broth if necessary…to prevent the bottom from dying out. When the meat thermometer registers 170 degrees then remove from the oven, cover with foil and let rest for 10 mins.
While this is happening – remove the carrots and onions and puree in food processor – add in some of the juice to thin it out. Pour the balance of the juice in a small saucepan and mix in 2 tsp of cornstarch and ½ cup of beef broth – check for seasoning….Place a scoop of the pureed vegetables on the plate and top with 2 slices of pork roast.
**Roasted/Pureed Sweet potatoes- bake in the oven until soft – remove and scoop out. Mix with butter and lite cream (can’t help myself) – blend well. Season if necessary. Serve on the side with a large mixed salad. (or the sauerkraut)
Guten Appetit!
**Always happy to feature one of your favorites recipes – send to me and I will give you a shout out in the eating section of the note.
The mkts are demanding more immediate action: Two Tiered Europe, Euro zone bonds (no longer being ruled out), fiscal unity and a stronger ECB may be the only ways to arrest the deterioration. Plans for an agreement due by Dec 9th – which is the date for the final EU summit to be held in Brussels seems now to be the focus, so the drama and uncertainty continues. Yet, world mkts are loving the headline.
Remember - this is a headline driven rally - there is no concrete plan yet in place.
S&P futures are exploding to the upside - currently +31 pts trading at 1184, breaking thru the short term resistance. Will it hold? 1200 is the next level to watch.
Mkts around the world are screaming higher also as the optimism clearly trumps any sense at all of negativtiy. Bargain hunters and short covering becomes the mantra for today: Japan +1.5%, China +0.1%, Hong Kong +1.9%, Australia +1.8%.
In Europe the moves are even more dramatic as investors are anticipating positive news about the crisis in Europe ahead of the Dec 9th Eurozone summit. So far - FTSE +2.1%, DAX +3.2%, CAC40 +3.7%, Eurostoxx +3.7% Keep in mind that these countries have gotten clobbered this year and over the past 3 weeks, so keep this move in perspective.
Most European and Asian mkts are down between 15% - 22% ytd....(by contrast US mkts are down 7.5% ytd)
At the same time - the WSJ notes that brokers that provide the networks for the $4 tril / day foreign exchange mkts are back to testing systems that could handle the former currencies in the event of a break up. The Drachma, The Lira, The Deutsche Mark, The French Franc...etc.
On Sunday - ICAP - which operates the biggest currency trading network confirmed that they are "prepping electronic trading systems for a possible exit by Greece from the Euro zone..." All this suggests - real concern that there is an increasing likelihood of some sort of Euro Zone breakup.
Don’t you love how the world is collapsing – Europe in Crisis as sovereign yields explode to the upside, Greece 20 days away from bankruptcy, the Euro collapses, Italian T-bill auction yields shoot higher, yields in Spain and France followed suit, a failed German bond auction fuels the fire – that even the zone’s strongest members are not immune from this crisis.
Asian economies beginning to slow, Chinese PMI contracting, and Brazilian GDP is a scant 0.3%. Political dysfunction and complete lack of leadership in Washington DC, Congressional paralysis and posturing, a Republican field of candidates that seem to blow themselves up at each new debate, Unemployment at 9+%, Non-Farm Payroll report expected to be weak, US macro data in neutral, housing still in free fall!!
Women pepper spraying each other in lines at Wal-Mart on Black Friday and the talk is all about how this “good start” to the holiday shopping season will provide a boost to sentiment – Is it me? Am I missing something? I mean in the bigger picture - Does this statistic really mean anything at all?
Is it time to get in? Citibank’s Tobias Levkovich notes that in the US “the current level may be an attractive entry point barring any exogenous shocks.”
Exogenous shocks? Hello??? By definition – exogenous means - barring any change that comes from “outside” the model and is unexplainable by the model… Hmmmmm change from outside the model?
Hey Toby – Have you noticed that the EU is in crisis? Do you think that is an exogenous event? Can the model explain it? Is your model taking into account a complete implosion of the Eurozone? Remember who you are - if you are in for the long term - 5+ yrs then it is probably a good entry point and with the proper research there appear to be plenty of bargains...be prepared though for shorter term volatility.
There is a steady stream of economic data over the course of this week, but the important data points are all due towards the end. The ISM manufacturing survey exp of 51.5 and auto sales 13.4 mil are due on Thursday, and the monthly Non Farm Payroll report is due on Friday with exp of 120k.
Today we get: New home sales exp of 313k, Dallas Fed survey exp of 5.0.
Take good care -
KP
Considering all of the German news - I needed a German recipe so courtesy of one of my friends** – I got a German Pork Roast – This recipe uses a dark full bodied beer, (not sure that I
If you want to be more authentic – substitute the salad for sauerkraut….. ….Now although I have never had it – it does come highly recommended…but remember – there is no butter, cream or fresh grated cheese – so how good could it be???
You will need: a bone in– 4 lb pork roast, onions, carrots, caraway seeds, olive oil, s&p, beef broth, a dark beer – (you can try a lighter beer if you prefer) and cornstarch…..
Preheat oven to 350 degrees.
Begin by seasoning the roast with s&p, and caraway seeds…let rest. Heat up some olive oil in a large frying pan – now brown the roast on all sides.
While this browning – arrange the sliced carrots and onions in the roasting pan – place the browned roast in the center – fat side up.
Deglaze the frying pan with beef broth and then pour into the roasting pan. Now add ½ bottle of the beer. Cover and roast (20 min/lb) for ½ the time….Now uncover and continue to roast – adding a bit of beef broth if necessary…to prevent the bottom from dying out. When the meat thermometer registers 170 degrees then remove from the oven, cover with foil and let rest for 10 mins.
While this is happening – remove the carrots and onions and puree in food processor – add in some of the juice to thin it out. Pour the balance of the juice in a small saucepan and mix in 2 tsp of cornstarch and ½ cup of beef broth – check for seasoning….Place a scoop of the pureed vegetables on the plate and top with 2 slices of pork roast.
**Roasted/Pureed Sweet potatoes- bake in the oven until soft – remove and scoop out. Mix with butter and lite cream (can’t help myself) – blend well. Season if necessary. Serve on the side with a large mixed salad. (or the sauerkraut)
Guten Appetit!
**Always happy to feature one of your favorites recipes – send to me and I will give you a shout out in the eating section of the note.
