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IDS World Markets Thurs 16th August 07


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t?s=%5EAORD

 

 

I thought we might see some stabilization today but no dice so far. All Ords -1.8% and Utilities is out in front, -2.9% closely followed by Energy and Healthcare both -2.8%. IT is the only green sector, +0.2% with Property Trusts flat.

 

Less selling on the big two: BHP -2%, RIO -0.2% but gold miner Newcrest not having such a good day, -3.6%. Newmont -0.2%.

 

Energy stocks getting their usual hammering: Woodside -2.8% and Santos -3.3%.

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Rams Home Loans Fails to Refinance Debt; Shares Slump

 

Aug. 16 (Bloomberg) -- Rams Home Loans Group Ltd., an Australian lender that went public last month, failed to refinance short-term debt as buyers shun credit markets on concern that subprime losses will deepen.

 

Rams slumped as much as 41 percent on the Australian Stock Exchange. The shares fell to 83 cents at 11:19 a.m. in Sydney, compared with A$2.50 paid by investors before the stock listed on July 27.

 

The Sydney-based lender cited the ``tightening of the global credit markets'' for being unable to sell A$6.17 billion ($5 billion) of so-called extendable commercial paper, the company's largest source of funding for its loans, it said in a statement today.

 

Rams has 180 days to find buyers for the debt, who will get a rate that yields 25 basis points more than the London interbank offered rate, or libor, the company said. This debt yielded less than libor about two weeks ago.

 

The lender has been given temporary funding of A$1 billion by two of its providers, Rams said in the statement.

 

 

Got cash?

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How are those day-trading Japanese housewives doing now?

 

Japanese housewife nets ?1.7m betting on currency markets, April 13, 2007

 

"anal cysts said the $3 trillion (?1.52 trillion) of annual currency trading by retail investors in Japan may be the main reason for the persistent weakness of the yen ? a boon to Japan?s exporters in recent months."

 

http://business.timesonline.co.uk/tol/busi...icle1647243.ece

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Hey Lee W.

 

Tanks for the Anal-cyst on "the steels" in M-2-M......I'm watching these monkeys, but no more buying for me until the wheels completely fall off.

 

My efforts for the next several days will be spent battening down the hatches. Moving money from all MMF's and into multiple local bank CD's and T-bills......keeping the powder SAFE & dry for the next few to several months. :blink:

 

tinfoil-hat.jpg

 

Until the smoke clears.........NOT!!!...........there's hardly any smoke much less FIRE. This mutha' ain't even on the dance floor yet.

 

However, any FED intervention will spike this thing like a rocket -- but only temporarily.

 

FWIW:

 

The thing that scarred the sh!t out of me were the stories about the CP market starting to seize. I traded CP for my former employer when I was a young buck in the Treasury Dept. of the firm for a few years. Every day, $500M here, $3.5 billion there....boom, boom, boom. There's nothing like moving a market with a $1 billion trade using someone elses money. :D So I have, well let's say, an intimate "working knowledge" of that market.

 

The fact that the CP market is showing even a few cracks is a, well, ummm, A MAJOR wingohockingmoyamensingIN PROBLEM!!!!

 

Therefore, and for the near to medium term, all CASH assests are going into CD's ($25,000 limit per institution - local banks and some big name banks, diversification is KEY), and T-bills......it's gonna be a pain in the ass and take until next week to get it all done......but dat's OKeeee.....Dokeeeeee

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Hello Girls & Boyz,

 

Watch what happens to the markets when we get the first MMF that "breaks the buck."

 

brokendollar.jpg

 

When that happens it will instantly become the new media catch phrase and " liquidity" will go out the window.

 

Then the fun will start. And based on the amont of ABSCP (asset backed securitized commercial paper) held in MANY MMF's, it ain't gonna be long.

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w?s=%5EAORD

 

 

Whoa what was that all about? One minute All Ords -5%, next minute a dramatic v-bottom (and interestingly the latter happened just before the futures market reopened after the lunch break). The index ended down a relatively modest -1.5%, Utilities retained the downside lead, -3.2% followed by Telecomms -1.9% and Financials -1.5%. IT was the only green, +1.8%.

 

Miners ended up well off their lows: BHP -0.6% and RIO -0.5%. In the golds, Newmont did well considering, +2.1% and Newcrest finished -2.4%.

 

Oils were caught up in the intraday bounce: Woodside -0.9% and Santos -0.7%.

 

Carnage in Asia: Sth Korea -6.9%, Taiwan -4.6%, Honkers -3.7%, India -3.6%.

 

Over to UK/Europe:

 

t?s=%5EFTSE

 

t?s=^GDAXI

 

t?s=^FCHI

 

http://finance.yahoo.com/intlindices?e=europe

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New Zealand and Australian Dollars Slump

 

Aug. 16 (Bloomberg) -- The New Zealand dollar plunged, heading for its biggest weekly loss since the 1987 stock market crash, as investors slashed holdings of high-yield assets funded by loans in yen.

 

Australia's dollar tumbled, extending its five-day loss to the most since May 2004, as a drop in Asian stocks encouraged investors to reduce so-called carry trades. Both currencies fell to their lowest in about five months against the dollar and yen as short-term interest rates in Australia and New Zealand surged on concerns losses related to subprime mortgages are deepening.

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New Zealand and Australian Dollars Slump

 

Aug. 16 (Bloomberg) -- The New Zealand dollar plunged, heading for its biggest weekly loss since the 1987 stock market crash, as investors slashed holdings of high-yield assets funded by loans in yen.

 

Australia's dollar tumbled, extending its five-day loss to the most since May 2004, as a drop in Asian stocks encouraged investors to reduce so-called carry trades. Both currencies fell to their lowest in about five months against the dollar and yen as short-term interest rates in Australia and New Zealand surged on concerns losses related to subprime mortgages are deepening.

600132[/snapback]

 

Don't have the links handy, but about 70% of the Aussie stock market is owned by Foreigners and about 70-80% of the domestic home mortgage funding comes from the AUD/Yen carry trade money with lots of the rest coming from the USA.

 

Aussie dollar weakness is one of the canaries in the coal mine for Yen carry trade unwinding.

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Paulson - "I took my short positions to Tokyo with me.."

Paulson also said the repricing of risk in markets should not surprise anyone and was inevitable, and that nothing should be done to guarantee market players against losses or restrain them from taking risks

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