Feb. 10 (Bloomberg) -- Pacific Investment Management Co.’s Bill Gross increased his holdings of Treasuries to the highest level since July 2010, while billionaire investor Warren Buffett called them “dangerous.” Gross boosted U.S. government and Treasury debt to 38 percent of assets in Pimco’s $250.5 billion Total Return Fund, the world’s biggest bond fund. The position in January climbed from 30 percent in December, according to a report on the company’s website yesterday.
Thursday, February 9, 2012
Gross Buys Treasuries; In Your Face Warren!
CFTC considering new rules for high-frequency traders
Mutual Funds With Commodities Required To Register By CFTC
The U.S. Commodity Futures Trading Commission adopted rules requiring registration by mutual funds when they have investments in commodities. The five-member commission voted 4-1 to approve the rule in a private voting process, the agency said today. “This rule enhances transparency in a number of ways and increases customer protections,” CFTC Chairman Gary Gensler said in a statement.
Currency Intervetion Anyone?
Feb. 9 (Bloomberg) -- The U.S. didn’t buy or sell dollars to affect foreign-exchange rates in the fourth quarter, the Federal Reserve Bank of New York said in a report to Congress. The New York Fed, which acts for the U.S. Treasury and the Federal Reserve in the $4 trillion daily currency market, intervened in the currency market during the first quarter for the first time since 2000. The Fed bought $1 billion of the U.S. currency on March 18, when Group of Seven nations sought to halt the surge in the yen after Japan was struck by the nation’s worst earthquake on record.
The Libyan Crude Oil Market - Time For A Change
Libya is an OPEC member and holds the largest proven oil reserves in Africa (followed by Nigeria and Algeria), 41.5 Gbbl (6.60×109 m3) as of January 2007, up from 39.1 Gbbl (6.22×109 m3) in 2006. About 80% of Libya’s proven oil reserves are located in the Sirte Basin, which is responsible for 90% of the country’s oil output.[3] The state-owned National Oil Corporation (NOC) dominates Libya's oil industry, along with smaller subsidiaries, which combined account for around 50% of the country's oil output. Among NOC's subsidiaries, the largest oil producer is the Waha Oil Company (WOC), followed by the Agoco, Zueitina Oil Company (ZOC), and Sirte Oil Company (SOC). Oil resources, which account for approximately 95% of export earnings, 75% of government receipts, and over 50% of GDP. Oil revenues constitute the principal foreign exchange source. Reflecting the heritage of the command economy, three quarters of employment is in the public sector, and private investment remains small at around 2% of GDP.
Low natural gas prices result in capital spending cuts
CALGARY - Progress Energy Resources Corp. (TSX:PRQ), citing continuing low prices for natural gas in North America, is reducing its planned 2012 capital program by $100 million to $365 million. Calgary-based Progress said Tuesday that it will also take steps to shut-in approximately 10 per cent of total natural gas production by April as it takes steps to "prudently manage its assets and balance sheet" in light of the current price environment.
5-10 percent corn yield jump using erosion-slowing cover crops shown in new study
The results are the best yet in the ongoing research, according to Ken Moore, Distinguished Professor of agronomy and primary investigator on the project, who plans to carry on the trials for at least one more growing season. Planting living mulch – or ground cover – between rows of corn is intended to perform several functions – maintain soil moisture, slow soil erosion, and sequester carbon. There were factors in last year's weather that made the higher yields possible, according to Moore.
"Battered" casino chain is surprisingly making investors very happy.
Caesars Shares Jump on Debut
Caesars Entertainment’s first day of public trading is paying off for investors willing to gamble on the battered casino chain.Shares of the company, which were priced at $9 on Tuesday, nearly doubled on Wednesday as the company, which was taken private in a 2008 leveraged buyout and subsequently lost billions of dollars in value, re-entered the market in an initial public offering
More women needed in Britain's boardrooms
Britain's economic recovery is being held back by a lack of women in the boardroom, David Cameron has warned. The prime minister said on Thursday there was clear evidence that ending Britain's male-dominated business culture would improve performance.
Credit Suisse loses $698 million
Credit Suisse Reports First Quarterly Loss in 3 Years
Credit Suisse, one of Switzerland’s biggest banks, reported its first quarterly loss in three years on Thursday as its core businesses experienced a slowdown in a weak economic environment.Credit Suisse had a net loss of 637 million Swiss francs ($698 million) in the fourth quarter of 2011 compared with a profit of 841 million francs in the period a year earlier. Analysts had expected the bank to report a profit.
Credit Suisse, one of Switzerland’s biggest banks, reported its first quarterly loss in three years on Thursday as its core businesses experienced a slowdown in a weak economic environment.Credit Suisse had a net loss of 637 million Swiss francs ($698 million) in the fourth quarter of 2011 compared with a profit of 841 million francs in the period a year earlier. Analysts had expected the bank to report a profit.
Buffett says bonds are dangerous
Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc., said low interest rates and inflation should dissuade investors from buying bonds and other holdings tied to currencies. “They are among the most dangerous of assets,” Buffett said in an adaptation of his annual letter to shareholders that appeared today on Fortune magazine’s website. “Over the past century these instruments have destroyed the purchasing power of investors in many countries, even as these holders continued to receive timely payments of interest and principal.”
Refineries were "born to run".
Gasoline price spikes on refinery shutdown fears
Every day we sweat the gas price out on the streets of a runaway American dream, at night we ride through at the mercy and glory of these refining machines. Prices are rising out on highway 9, chrome wheeled, fuel injected, and prices continue to climb. Oh, baby, this gas rips the bones from your back. It's a death trap; it's a suicide rap. We gotta get out while we're young. `Cause tramps like us, refineries were born to run. 1-2-3-4! The highway's jammed with broke drivers on a last chance power drive. Everybody's out of gas tonight and there is no place left to hide. Together perhaps we can live with the gas price, before the effect on growth takes its toll. Oh, someday soon, I don't know when, we're going to get to that place where we can power our cars with the sun! But till then, tramps like us, baby, refineries were born to run.
Unregulated non-bank banks to be dragged from the shadows into the light
(Reuters) - Beyond the reach of regulators, and about half the size of the world's banking industry, a thriving breed of "shadow banks" is emerging that could trigger the next chapter in the global financial crisis. Spurred by this concern, the watchdogs are turning their attention to the fringes of the global financial system, where hedge funds and money market funds are filling the gaps left by retreating banks. "In America, increased financial activity is taking place between non-banks which are subject to little or no regulation, and Europe is catching up fast," said Godfried De Vidts, director of European Affairs a ICAP, a brokerage firm that trades only with large professional clients, such as investment banks.
CME downgraded by S&P AA-
NEW YORK (Standard & Poor's) Feb. 8, 2012--Standard & Poor's Ratings Services said today that it lowered its long-term issuer credit rating on CME Group Inc. (CME Group) to 'AA-' from 'AA' and affirmed its 'A-1+' short-term rating on the company. The outlook on the long-term rating is negative. Standard & Poor's also said that it lowered its senior unsecured debt rating on the $612.5 million 4.4% notes due 2018 issued by CME Group Index Services LLC to 'AA-' from 'AA'. CME Group guarantees the notes.
Is Bill Gross in the twilight of his career? Hardly!
(Reuters) - He is the man who made bond investing sort of sexy - and now he may pay the price. Over more than three decades, Bill Gross, co-founder of asset-management giant PIMCO, has made so much money for clients that he has become the barometer by which other bond traders are judged. His West Coast perch, prescient calls on the U.S. economy and devotion to yoga only added to the mystique. But the very recipe that enabled Gross to dominate his industry may now be conspiring against him.
How to fit bonds into your portfolio
Since the early 1980s, interest rates have been on a secular decline. Since the credit crisis, governments across the world have worked to flood global financial markets with liquidity, which includes low interest rates, to try and stoke economic growth. This has served to push most interest rates to all-time lows, be it those paid on government securities, mortgage rates or the rates that banks borrow from and lend to each other. (For related reading, see Forces Behind Interest Rates.)
Crude - Which way will it go?
Iranian issue, disruptions in Middle East continue to weigh on crude prices. Daniel Hynes, director-commodity research at Citi Investment Research has been relatively conservative on the outlook for oil, particularly over the first quarter. He expects it to trade in a relatively tight range. According to him, high inventories may keep WTI below USD 100 per barrel.
Dollar showing a spark of life
The greenback was firmer at the close of North American trade on Wednesday with the Dow Jones FXCM Dollar Index (Ticker: USDOLLAR) advancing 0.23% on the session. Risk appetite saw a dramatic reversal as equity markets pared early gains and the dollar found its footing. The Troika released the terms required of Greece for the debt laden country to receive the next €130 billion bailout tranche ahead of next month’s deadline when some €14 billion in bond redemptions and paybacks are due. While optimism remains that Greek officials will indeed reach a consensus on the required measures, the draft released suggest a harsh reality for the Greek people. For Greece to receive further aid the nation must pledge to cut an additional 15,000 state jobs in 2012, cut minimum wages by 20%, and accelerate labor and product market reforms among other stipulations. While the measure aim to increase the nations competitive advantage, given the current economic environment there are concerns that further austerity will weigh on growth prospects amid an expected “mild recession” in Europe. Still, markets found solace on the news with stocks managing to close in the black with the Dow, the S&P, and NASDAQ higher by 0.04%, 0.22%, and 0.41% respectively.
Hedge Funds Went Long Natural Gas Right Before Rally
Feb. 6 (Bloomberg) -- Hedge funds more than doubled bullish bets on natural gas just before government data showed record production and Exxon Mobil Corp. decided not to reduce output, cutting short the biggest rally in more than a year. The funds and other large speculators raised wagers on rising prices to a six-month high in the seven days through Jan. 31, according to data from the Commodity Futures Trading Commission's Commitments of Traders report. Gas gained 14 percent in the week ended Jan. 27 after Chesapeake Energy Corp. and ConocoPhillips said they will reduce output.
Gold, Silver, Copper and Crude Oil Trading - NASDAQ.com
Apr Gold futures finished pit trade Wednesday lower and near the daily low on profit profit-taking. The Key outside markets turned from a Bullish tone for the precious metals in early dealings Wednesday, to a Bearish posture at the close. The US Dollar index moved up off of its session low to trade near steady on the day. The Crude Oil market lost most of its early gains to trade just steady to firmer on the day. Apr Gold last traded down 13.80 at 1,734.80 oz. Spot Gold was last quoted down 12.50 at 1,733.00 oz. Mar Comex Silver last traded down 0.324 at 33.87 oz. It was a "risk on" trading day in the market early Wednesday, which was mildly Bullish for precious metals, as the European Union sovereign debt crisis was perceived by the market place to be more stabilized.
Volume unimpressive as indexes gain
Market Overview – What We Know:
- Major indexes posted small gains Wednesday and NASDAQ Composite index rallied to new high. Dow Jones Industrial Average hit new high Tuesday, but S&P 500 and Value Line index have yet to follow suit by bettering May 2011 highs.
- Trading volume in S&P 500 index rose Wednesday by nearly 14%.
- Short and Intermediate-term trends remain “Overbought.”
- Selling in S&P 500 below lower edge of 10-Day Price Channel (1310.92—Thursday) would suggest beginning of end of Minor Cycle advance underway since December 19 short-term low (1202.37—S&P 500).
- Short-term Momentum in S&P 500 remains slightly positive, but has failed to confirm any strength in index since December lows.
- Daily MAAD rallied to new high Wednesday and was last at level not seen since March 5, 2008 when S&P 500 was quoted at 1333. Weekly MAAD continues to underperform.
- Cumulative Volume (CV) in S&P 500 remains above late October resistance highs, but Emini CV remains weak.
- Daily CPFL was positive Wednesday by 2.56 to 1. Indicator is closing in on late October resistance high, but remains below last October’s short-term high and has confirmed none of strength since October lows.
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