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The fun part of 2011 ended; earnest resolutions, trades of the yr, hopes and dreams for good things to come. World got back to business. US GDP was soft. Timmy G announced, “It’s not an expansion that’s going to offer a rapid decline in unemployment.” US budget deficit’s on track for $1.5trln, the $14.29trln debt ceiling approaches, Fed balance sheet’s $2.43trln (triple ’08 level), and S&P warned they’re eyeing o

In the market’s never-ending race, it’s fascinating to watch relay batons passed from one year to the next. This wk the 2010 fear that PIIGS would sink and the EU disintegrate was passed to a new concern, the threat of higher global interest rates (strong statements by Merkel, Sarkozy and Trichet, combined with confidence the EFSF will be preemptively doubled, led to an upgrade by traders/strategists for the Euro’s i

What a show! Leaders lined up with the kinda enthusiasm usually found at a Radio City Rockette audition. Germany’s Merkel, legs kickin’ high, “We support whatever is needed to support the Euro.” France’s Sarky, arm locked with Angela, “With Ms. Merkel, we will reinforce EU economic integration.” ECB’s Trichet, flashing a petticoat made from E98bln of newly purchased peripheral debt, said the stability fund should be

Politicians, central bankers, strategists and portfolio mgrs announced New Year’s resolutions. Obama resolved to end his love affair with the left and snuggle up to corporate USA. First off he Volkered Volker (Paul got booted as Chair of the Presidential Advisory Board). Wall Street strategists, pledging to grow bullish balls, rushed to upgrade GDP and S&P forecasts. Goldman raised S&P 500 yr-end target to 1,

Had an unreal Christmas & New Years, hope you did too. Couldn’t help but keep a lazy eye on mkts. NY’s blizzard sealed the few surviving bears deep in their caves, not sure they even got news that China hiked rates, then again, with GDP close to 10% and negative real rates, what’s 25bps? The US economy looked perky, Chicago PMI hit 20yr highs and unemployment claims plunged. Merkel stated, “We must strengthen the

Most things went up in a year-end shortage trade. Stocks, corn & oil hit 2yr highs, copper hit an all-time high. CDS jumped everywhere, though naturally, the real squeeze was in swine flu protection (Greek CDS surged 93bps to 10.63% – so much for that bailout). But there were ample supplies of Dollars, Euro’s and Pounds (they fell versus everything); worries over printing presses, mountains of debt and ugly

US acted decisively, EU dithered, deficits rose and canaries sang away. Obama signed tax legislation increasing deficits by $858bln, “In some ways this was easier than the tougher choices we’re going to have to make next yr.” No doubt he’s right. The EU agreed to a post-2013 “crisis tool” and made a statement that may mean something when translated to German or French, but means nothing in English: “Member States may

Just days after Obama’s debt-reduction commission unveiled our new age of austerity, Bernanke announced on “60 Minutes” he’s prepared to print more money if the latest $600bln doesn’t do the trick. Then Barry made a DC compromise (aka every politician/lobbyist gets what they want), cutting taxes and raising deficits. Ben/Barry are tag-teaming the US’s lumbering giant of an economy, force-feeding it Red Bull using eve

The boys, all dressed up like Ebenezer Scrooge, started Christmas season by cruelly punishing the impoverished Irish and their poor Southern cousins. Oh how they screamed “Bah Humbug!” selling bonds despite an enormous E85bln Irish bailout. But we know how the story goes, the Ghost of Christmas Past arrived on Wed and showed those neurotic bears how soulless they’d become. The ghost whisked ‘em to China where PMI sur

Had a couple quiet days up in Northern CA with Mara, the kiddies and some good friends and family. Sadly, the rest of the planet didn’t hit their pause buttons too. Tensions in Korea added to the panic in peripheral Europe and traders continued to liquidate risk assets and flock to the US Dollar. Weekly Close: S&P 500 -.9% and VIX +4.2 to 22.2. Nikkei +.2%, Shanghai -.6%, Euro Stoxx -1.1%, and Bovespa -3.8%. USD