Al Green on the Ropes

[wndysrf]

Looks like Leeson is finally on the ropes.

 

He's lost control of oil and gold and the U.S. Peso staged an Epic Collapse, as Bagholders are starting to run away from FRE and FNM Mortgage Exotica and start to pile in some "safe havens".......

 

We'll see what Leeson has in mind to douse the myriad fires cropping up throughout the 900 story Derivatives Colossus.

 

So far, other quadrants within the Colossus (BAC, WM, WB, etc.) remain unscathed, but the fires could spread.

 

We'll see what The Matrix can come up with next week.

 

Note how the Low Grade Screamers like MU, AMAT and BRCM gave it up today.

 

Looks like the 9000 HedgeFunds are selling those "Hail Mary" plays from last year and are now piling into new cult favorites such as SYNA or PRKR.

 

So few places left to hide.

 

Anybody got a chart of junk and corporate spreads??

 

Would be interesting to see "The Unravelling".

 

Please post them if you have them................

[Drano]

Weekend haipu:

 

 

One thing to ponder --

Energy stocks. Also thrown

with the bathwater?

 

 

 

DN Why did you sell some energy stocks, Drano?

Those who remember the past are doomed to make new mistakes.

[Guest]

So few places left to hide.

 

WHT, CDE, GG, PAL, CBJ.........

[machinehead]

FedGov William Poole spells it out, for those who aren't paying attention to Fannie Mae's headlong collapse:

 

In my speech to the OFHEO conference almost two years ago, I emphasized the risk of systemic, world-wide financial crisis should either Fannie Mae or Freddie Mac become insolvent.

 

Fannie Mae and Freddie Mac must roll over roughly 30 billion dollars of maturing short-term obligations every week. At a time of disrupted financial markets, the credit markets might refuse to accept the F-F paper. ... If Fannie Mae and Freddie Mac are unable to sell new debt, then they may also be unable to carry out sales of the ?liquid? securities from their investment portfolio.

 

I discussed liquidity risk at some length in a speech last spring. I won?t repeat that analysis, but the bottom line is simple: the Federal Reserve has adequate powers to prevent the spread of a liquidity crisis, but cannot prevent a solvency crisis should Fannie or Freddie exhaust their capital. In the event of a solvency crisis, the market would become unreceptive to Fannie and/or Freddie obligations; they would have difficulty rolling over their maturing debt. Moreover, their outstanding obligations would decline in price and their markets would become less liquid. Beyond that, it is hard to say exactly what else might happen.

 

http://stlouisfed.org/news/speeches/2005/1_13_05.html

 

"Difficulty rolling over their debt" ... "30 billion a week" ... yeah, uh-huh ...

 

"Hard to say exactly what else might happen" ... right, better to play it discreet rather than speak of burning cities on the horizon ...

 

Fannie = Enron x 10

 

SNARLING BEARISH ...

[Bearman]

way cools still no Bears only dippers

 

Crapvision line of the day

 

"Scratching their heads"

 

3 wks in a row down

 

not a bit of GMTFON........yyyyyyyyyyyyet

 

 

Tic Tok Tic Tok

 

 

 

PS trannies derailed another 42 pts

 

DOW THEORY RULES

[wndysrf]

Here's the Index Leader.

 

Still unable to take out prior lows.

 

Volume shrank to practically nothing.

 

Money Flow Index is set to turn up.

 

Still waiting for a bounce before getting aggressively short.

 

[machinehead]

PS trannies  derailed another 42 pts

 

DOW THEORY RULES

<{POST_SNAPBACK}>

Off 9.5% from their high of 3 wks ago

 

"Pathology illustrated"

[wndysrf]

1160 is where the selling should stop and a bounce will occur.

 

Huge support, right at the prior highs from the last 9 months.

 

Shorts should be ready to cover there, then wait for the bounce.

 

[wndysrf]

PS trannies  derailed another 42 pts

 

DOW THEORY RULES

<{POST_SNAPBACK}>

Off 9.5% from their high of 3 wks ago

 

"Pathology illustrated"

<{POST_SNAPBACK}>

 

 

Trannies croaked due to the XAL. The truckers and railroads are still holding up OK.

 

The airlines can't continue to go down in a straight line.

 

That's way too easy. One or two more days, and that will be it.

 

So we need to be careful on the short side........

 

[wndysrf]

Here's why so many of the banks are holding up so well........

 

[Grand Poopercycle]

FedGov William Poole spells it out, for those who aren't paying attention to Fannie Mae's headlong collapse:

 

In my speech to the OFHEO conference almost two years ago, I emphasized the risk of systemic, world-wide financial crisis should either Fannie Mae or Freddie Mac become insolvent.

 

Fannie Mae and Freddie Mac must roll over roughly 30 billion dollars of maturing short-term obligations every week. At a time of disrupted financial markets, the credit markets might refuse to accept the F-F paper. ... If Fannie Mae and Freddie Mac are unable to sell new debt, then they may also be unable to carry out sales of the ?liquid? securities from their investment portfolio.

 

I discussed liquidity risk at some length in a speech last spring. I won?t repeat that analysis, but the bottom line is simple: the Federal Reserve has adequate powers to prevent the spread of a liquidity crisis, but cannot prevent a solvency crisis should Fannie or Freddie exhaust their capital. In the event of a solvency crisis, the market would become unreceptive to Fannie and/or Freddie obligations; they would have difficulty rolling over their maturing debt. Moreover, their outstanding obligations would decline in price and their markets would become less liquid. Beyond that, it is hard to say exactly what else might happen.

 

http://stlouisfed.org/news/speeches/2005/1_13_05.html

 

"Difficulty rolling over their debt" ... "30 billion a week" ... yeah, uh-huh ...

 

"Hard to say exactly what else might happen" ... right, better to play it discreet rather than speak of burning cities on the horizon ...

 

Fannie = Enron x 10

 

SNARLING BEARISH ...

<{POST_SNAPBACK}>

 

 

 

 

I thought the official view 'round here was.....

'BURNING PITS OF DIESEL!!!'

 

Or has the 'six-to-eight'('eight-to-ten', etc., etc.) month

window finally closed on that soapbox?

[wndysrf]

And the REIT Carry Trade hasn't blown up. Not yet, at least..........

 

[Tchaikofsky]

Close: The market opened on an upbeat note, in the wake of strong quarterly earnings, only to be bullied by the bears as the indices closed at new lows for the third straight day... With regards to earnings - good, better, best was still no match for the cautious sentiment that has so firmly rooted itself in a market that has left the major averages in negative territory week after week in 2005... Not even record results from the country's largest company - General Electric (GE 35.25 -0.12) - could hold early buying interest into the close of trading...

 

The bellwether reported 18% growth in Q4 profits and revenues, beat Q4 earnings expectations by a penny on record sales of $43.7 bln and reaffirmed FY05 earnings growth of 10-15%... Other notable companies that reported better than expected earnings were UTX, AT, FO, KEY and PNC... But even though roughly 80% of the more than 100 S&P 500 components reporting earnings so far have either met or exceeded anal cysts' forecasts, the lack of follow through from buyers has remained a reality as even much of today's tenuous buying efforts were arguably prompted by short covering... Virtually every sector finished lower Friday...

[Slothrop]

They were piling into KRY just before the close.

[wndysrf]

Bankruptcy??

 

4:33 [TMTA] Transmeta had $53M cash balance at beginning of 2005

4:32 [TMTA] Transmeta Corp. shares halted in after-hours trade

4:32 [TMTA] Transmeta may begin staff reductions on March 31