Obama’s Super Friday
From The New Yorker;
If you think you heard a loud cheer around 8:30 E.T. this morning, you were right. It came from 1600 Pennsylvania Avenue, where Super Bowl weekend started early—at just about the moment when the Labor Department announced that the unemployment rate fell to 8.3 per cent in January.
Of course, once they had almost busted their lungs screaming “touchdown,” the President’s men tried to put a sober face on things: “Today’s employment report provides further evidence that the economy is continuing to heal from the worst economic downturn since the Great Depression,” Alan Krueger, the chairman of the Council of Economic Advisors, said in a blog post that was carefully modulated to avoid the appearance of gloating. “It is critical that we continue the economic policies that are helping us to dig our way out of the deep hole that was caused by the recession that began at the end of 2007.”
(Full article here.)
The Omaha guru on the Facebook IPO
Market is cheering the latest NFP figures and the Facebook IPO. Meanwhile Europe’s problems are still alive.
We can’t tell you everything, but at least, some words of caution on that Facebook hype, from the Omaha guru.
Facebook IPO video, courtesy NYT.
Risk on as NFP beats “everything”
NFP figures shocking many investors. Beating consensus by miles, and above the highest “predictions”, the figures are making the markets go into risk on mode. Let’s see what people figure out after digging into the numbers…(birth/death etc)
We hope to see volume come back, as this number should get people out to trade the market again.
Meanwhile some soaring charts below, at least for now.
Where is da Bull?
What a bull!? Everything is soaring higher on healthy volumes. It has been two really busy and crazy weeks! Is this really so, or are we just perceiving the bull as strong? Volumes have been dropping steadily, day by day, and we are now back to volumes that we had ten years ago. The Trader has been pointing out the declining volumes as a worrying trend that is magnified by the day.
Shorts have been abandoning their positions, bears are joining the bull camp, and we now hear of Goldilocks and other fantasy scenarios. Still, we have had a great bull over the past weeks. At least it feels so. Figures are pointing the other way actually. Both the SPX and the DOW are pretty much unchanged over the last two weeks of trading. We agree, it doesn’t feel that way, but that is the truth. Market has not moved in two weeks, and volume is still falling. Remember, volume precedes price.
Overvaluation Increases
Guest post by D Short. Here is a summary of the four market valuation indicators I updated at the beginning of the month.
| ● The Crestmont Research P/E Ratio (more)
● The cyclical P/E ratio using the trailing ● The Q Ratio, which is the total price of the ● The relationship of the S&P Composite to |
Marc Faber’s latest. “Facebook is not cheap…”
Latest from Faber on Facebook, Debt, Europe and how stocks might dissapoint after May.
News That Matters
Ft.com
Hong Kong billionaire Li Ka-shing’s Hutchison Whampoa agreed to buy Orange Austria in a deal valued at €1.3bn ($1.7bn), adding to more than $31bn of investments in overseas mobile-phone operations, http://ftalphaville.ft.com/thecut/2012/02/03/867211/hutchison-to-buy-orange-austria/
Bank of England policymaker Adam Posen looks set to vote for another cash injection for the faltering British economy next week, and expressed some confidence that other central bankers may join him, says Reuters. http://ftalphaville.ft.com/thecut/2012/02/03/867161/posen-leans-towards-75bn-extra-qe/
The economy will suffer a modest contraction this year, according to influential academic institute the National Institute for Economic and Social Research, the first to forecast a return to outright recession for the UK. http://ftalphaville.ft.com/thecut/2012/02/03/867011/uk-recession-predicted/
Trading in the most popular US exchange-traded funds fell to multiyear lows in January, threatening to increase transactions costs for retail investors. ETFs, which track the performance of a basket of securities such as an equity or bond index, http://ftalphaville.ft.com/thecut/2012/02/03/866991/etf-volumes-hit-historic-lows/
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