[Hiding Bear]

Welcome to B4 the Bell!

Bears on the retreat yesterday, as market risk indicators continued their decent towards zero. Credit risk also heads towards zero:

Asset-Backed Securities Gain Favor
DOW JONES NEWSWIRES
May 25, 2004; Page C5

NEW YORK -- As political tensions, oil prices and interest rates climb, investors have been moving money out of stocks and bonds. But it isn't lying idle. Many investors are parking cash in highly-rated, mostly floating-rate instruments such as asset-backed securities.

There has been no shortage of supply to meet the demand. On Monday, Countrywide Financial Corp.'s mortgage unit sold a $4.2 billion home-equity loan securitization, one of the largest asset-backed deals to date.

The jitters affecting the stock market and increasing risk premiums in corporate bonds haven't been felt in the asset-backed market. That is because Wall Street structures the vast maturity of asset-backed debt to carry a triple-A rating, which tells investors that these bonds aren't much riskier than Treasurys.

Still, the extent to which risk-averse money flows into consumer lending unnerves some analysts. "There are all these different instruments perceived to be money, and they can turn on a dime to meet investor need," said Doug Noland, credit strategist with David Tice & Associates, a Dallas fund manager.

Mr. Noland worries that excessive issuance of securities that act as a substitute for "money" -- with the perception of zero credit risk, zero interest-rate risk and zero liquidity risk -- may create problems down the road. He added that it is simply impossible to sustain such massive overissuance of any monetary instrument without severely compromising the risk profile of "money."


http://online.wsj.com/article/0,,SB1085411...ticle%2Dbody%29

Risks, what risks?

U.S. Warns Of Al Qaeda Threat This Summer
Agents in Country Said To Be Planning Attack
By Susan Schmidt and Dana Priest
Washington Post Staff Writers
Wednesday, May 26, 2004; Page A01

Federal officials have information suggesting that al Qaeda has people in the United States preparing to mount a large-scale terrorist attack this summer, sources familiar with the information said yesterday.

http://www.washingto...-2004May25.html

[DrStool]

Good morning. FYI, Geocities, Tripod, and other free webhosts do not allow hotlinking to image and sound files. The same is true for most WAV file sites. Links to those will not work. You can download the files to your machine, and upload them with your post if they are less than the 75kb limit.

[DrStool]

Steady As She Goes!

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[Hiding Bear]

DrStool, on May 26 2004, 07:44 AM, said:

Steady As She Goes!

Your Golden Stool, including short and long term updated charts and price targets, is loaded. Even if you are not a goldbug, you should check out the Golden Stool. It's in your Anals daily. Take a subscribatory and download the Golden Stool RIGHT NOW!

Gold cmaps creeping up, now that's good news.

Interesting editorial:

John Kenneth Galbraith's greatest contribution to economics is the concept of the bezzle - the increment to wealth that occurs during the magic interval when a confidence trickster knows he has the money he has appropriated but the victim does not understand that he has lost it. The gross national bezzle has never been larger than in the past decade.

What cannot continue must end, though not necessarily quickly. Since there is no policy to reduce deficits, the market will eventually do the job. Revived inflation would reduce the value of domestic savings, domestic indebtedness, and the dollar assets of foreigners. Or the unwillingness of those foreigners to accumulate such assets in ever larger quantities might lead to a plunge in the value of the dollar. Or the collapse of financial institutions might provoke a revival of domestic spending.

http://news.ft.com/s...p=1012571727088

[DrStool]

MoGauge Down Again, Condition Critical

Refi's Steadily Disappearing

Once a week Doc fills you in on the all important MoGauge , straight from the MoGauge Bankers Ass. The MoGauge reflects a major source of liquidity in the financial bubble world and is an important indicator of future market behavior, often forecasting broad market movements months in advance. Take a subscribatory and download your MoGauge RIGHT NOW!


30 Day Intro Subscribatory. Just $16.99! Get In RIGHT NOW!

[Lock Limit Down]

Well look at that
Bond being repaired
Durable goods number bond friendly
They are attempting to hold the spoos after only a mild 3am pump

Wont be saying much from now on in
I feel much better now having pretty much withdrawn from this corrupt evil operation. Subsidizing those criminals didn't sit well.

I have never been so disgusted with the market and the lies it thrives on.

Good luck stoolies. I am hoping for you...

[Hiding Bear]

On Boomberg Radio just a moment ago, the chairman of Hovnanian said that higher mortgage rates had "no effect" on home buyers but went on to say that the buyers will just get a "3200 square foot home now instead of a 3500 one".

Well buying a smaller home is a little different than "no effect", but the mighty MoGauge is saying even worse things are happening.

Even a bigger problem to the Fed is : what new credit bubble will generate new credit to keep the entire bubble economy inflated? If they don't come up with an answer to that, the deflationist argument wins. I'm still betting on inflation in the short term, as the lag effect of prior monetary expansion.

[wndysrf]

Lock Limit Down, on May 26 2004, 08:47 AM, said:

Well look at that
Bond being repaired
Durable goods number bond friendly
They are attempting to hold the spoos after only a mild 3am pump

Wont be saying much from now on in
I feel much better now having pretty much withdrawn from this corrupt evil operation. Subsidizing those criminals didn't sit well.

I have never been so disgusted with the market and the lies it thrives on.

Good luck stoolies. I am hoping for you...

LLD:

Stick around.

I doubt this fake rally will last.

Notice how last month's durable goods was revised upward by 2%??

I mean, how reliable is this stuff anyway, when these numbers are being pushed around like that???

[wndysrf]

LLD:

One more thing.

Notice how gold keeps creeping up.

Gold is the temperature gauge inside the Derivatives Tower.

There's a fire going on.

We just can't see it yet......

[Sudaca]

Today's issues:

- Terrorism fears

- Lower Than Expected Durable Goods Orders


4 p.m. Financial Report:

"Stocks ended up again today as investors shrugged off fresh terrorism fears as they focused instead on how that would lower rates and provide fresh speculative betting fuel. Also, in other news, the lower than expected durable goods order was cast in a positive light as it too would lower rates and provide fresh speculative betting fuel. 'It's all about fuel deez daze', said some log neck trader from an obscure bucket shop...."