Tuesday, January 19, 2010

Whuz Up Out There?

U.S. stocks helped by health-care sector is the headline on Marketwatch. "The rally in health-care stocks came as voters headed to the ballot box in a surprisingly tight race to replace the late Edward Kennedy. Democrats would lose their filibuster-proof, 60-seat majority in the U.S. Senate if Republican candidate Scott Brown wins. That could pave the way for legislative compromises that could defer more to the private sector. Read more about the contentious race." I'm sure you all know all about that now, but it deserves to be rehashed as this is a HUGE event. The irony that the bill that Sen Kennedy wanted so bad would be destroyed from his seat. Something tells me the HC stocks will win either way as we really have not other options and this administration (nor any other) is going to do anything to curb the cost of medical care. There is simply too much money in the business and they'll keep our faithful representatives stoked with cash to ensure nothing changes. The peripherals surrounding this election are enormous and what gets slammed thru congress in the next week may have your head spinning (Bernanke re-appointment?).

Why do I believe there will be a big P3? Cause what we have sewn will come to roost and the ensuing cover-up has only made issues worse and is simply delaying the inevitable. Oh, The Truth Is The Banks Are Insolvent? (Still) from the Market Ticker states, "The bottom line?  The banks are still insolvent, Treasury is still lying, the banks are still refusing to recognize losses that have already happened as a direct consequence of their intentional and outrageous conduct and all of this together will prevent any meaningful recovery the broader economy from taking hold." I can not agree more and thus the next Japan we will be. When QE is done, the jobless rate remains constant, the consumer savings rate spikes, the accounting fraud ends, taxes are raised across the board, how the heck are we gonna recover? 

The Pragmatic Capitalist found a doozie that I liked.GURU OUTLOOK: FELIX ZULAUF & THE SECULAR BEAR MARKET it is always a pleasure when you find a "guru" that agrees with your opinion. “we are in the early stages of a deleveraging process, which is marked by a shift from maximizing profits to minimizing debt. It is a multiyear process. The U.S. consumer is in bad shape, and the U.K. consumer is even worse.”  You go Felix! 

FT has a good post on How the big banks rigged the market. "The next stage must be scrutiny of the structural distortions that allow these institutions to rack up such huge profits. Broadly speaking, the leading players in at least three areas of investment banking – wholesale markets, underwriting and mergers and acquisitions – have been operating natural oligopolies." Control, control, control OF EVERYTHING. Lehman was whacked and the smaller competition is being weeded out. I would not be surprised to see them busted up in the future (if and only if we get some sort of honest representation). Until then, I believe it has been proven beyond any doubt that they run the show. 

The Big Picture brings us The Anti-Fed Fact Sheet please read this.

A number that flew under the radar as the markets soared today was NAHB: Builder Confidence Declines in January (aside from the C report this am - how many billions did they lose?).

Look out for the banksters earnings in the am. Should be an interesting day. Before the bell we'll have BAC, MS, WFC and STT just to mention a few. Earnings calendar here.

I have no clue what happened to the font. blogger acted up the whole post and was a pain to deal with. Sorry.