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2013/10/22: Commentary: QE-Infinity. Good for what ails you…

October 22, 2013 Leave a comment

© 2013 ROHR International, Inc. All International rights reserved.

COMMENTARY: Tuesday, October 22, 2013.

QE-Infinity.  Good for what ails you…

 CNBCsquawkEVANSintvwLIESMAN-131021

 …unless you’re the US dollar.

The current situation is easy to assess, even if there are seeming inconsistencies with the classical intermarket influences. And it all boils down to the Fed’s seemingly endless commitment to QE… as in QE-Infinity. It shows up in the multi-asset class response to the quite a bit weaker than expected US Employment report today.

 

And that is all laid out quite clearly by one of the dominant doves (or is that a contradiction in terms?) Chicago Fed President Charles Evens was interviewed by Steve Liesman on CNBC early Monday, and we had already incorporated his views in the top of the week Trendview Video analysis from yesterday morning. He seems to clearly articulate what all of the doves (and those who are neither expecting nor necessarily want any reform in Washington DC) have already implied:

Quantitative Easing to a maximum degree that many joked was Buzz Lightyear Bernanke’s plan to take QE to ‘infinity and beyond” is indeed edging toward ‘QE-Infinity’. While the near-term influences driving that indeed seem rational, where in the world (or more appropriately the whole universe) does the Fed find the rationale to stop?

Two questions came up in the interview that are not part of the concise video synopsis. The first is whether the Fed will actually still be able to stop QE altogether by mid-2014 as it seemed to imply previous, and many expect. That was merely dodged.

Yet more important was Liesman’s pointed question on whether there is a practical limit to the size of the Fed’s balance sheet? It was especially telling in that he even cited levels like $5 trillion? $12 trillion? The almost incredible answer…

[The Weekly Report & Event Calendar is available via the link in the right-hand sidebar.]

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2013/10/09: Commentary: NFIB still weak and ‘Shutdown vs. Miley’!!

October 9, 2013 Leave a comment

© 2013 ROHR International, Inc. All International rights reserved.

COMMENTARY: Wednesday, October 9, 2013.

CNBC-NFIBdunkelbergOPTdown-131008 Holding steady is NOT success on the National Federation of Independent Business Small Business Optimism Survey. This was brought home in Tuesday morning’s CNBC discussion with respected NFIB Chief Economist William Dunkelberg.

With business conditions declining by eight points and earnings trends down, there is only marginal evidence for any improvement in the components that of held up. When asked what he thought of all this, Dunkelberg was very clear on the cyclical disconnect. He noted, “Well, we’re still in the trading range so to speak. We haven’t been able to breakout of the 95 area (on the Small Business Confidence) Index…” (more from Dunkelberg and the ‘Shutdown vs. Miley’ observation below.)

The Weekly Report & Event Summary Perspective is available via the link in the right-hand sidebar.

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2013/10/04: Commentary: Your Government at Work… or NOT!!

October 4, 2013 Leave a comment

© 2013 ROHR International, Inc. All International rights reserved.

COMMENTARY: Friday, October 4, 2013.

CNBCemplRPTnotPEARSON-131004CNBC – Hampton Pearson with the September US Employment Report (which everyone knew was not going to be released due to the government shutdown) from the US Labor Department

And the number is… ??????? 

Can’t tell ya. Don’t know.

What a way to run a railroad. And here are the wizards in Congress at the switches again, hoping they can time the shift into continuing operations timely… as in before the US government train heads off the cliff again.

And as we noted yesterday, while we hope and expect Congress will find a way to pass not just a Continuing Resolution on spending but also the far more critical Debt Ceiling increase timely to avoid an October 17th US government default, with these folks you never know. And the ‘failure is not an option’ crowd is back out in full flower. But as we noted on Tuesday, they also held that view right up to the actual failure back in August 2011. So no real cause for comfort there.

The Current Rohr Technical ProjectionsKey Levels & Select Comments are also already available via the link in the right-hand column. [Please note we did not post a TrendView Video analysis from yesterday afternoon because it was obvious the S&P 500 and other markets were slipping into a quiet finish for the week. That is consistent with our Global analysis from yesterday morning. Our full Global analysis based on today’s Close will be available over the weekend.]

As a bonus today, there is more Commentary video on the degree to which the US budget gridlock can be readily solved if…

 

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2013/01/24: Technicals and Best Davos Insight

January 24, 2013 Leave a comment

© 2013 ROHR International, Inc. All International rights reserved.

A fresh set of Technical Projections and Select Comments are already available via the link in the right hand column, current through Wednesday’s US Close. And those are now very relevant to the near term price activity in equities that are done standing still since the end of last week. Other asset classes that have also had some reasonably strong swings.

More on that below. Yet the most interesting public insight (versus any backroom conspiracies) to come out of the World Forum in Davos, Switzerland was the CNBC interview of Bridgewater Associates’ head Ray Dalio. While he revisits quite a few topics he has expounded upon previous, his review of his general approach to ‘the machine’ (which he considers the best analysis approach to both the economy and the markets) is a always a pleasure to hear…   

CNBCdavosDALIOclip-130124…and a reminder of why he is one of the most successful fund managers in history. In fact, that interview is split into two parts. The first is Dalio’s Perspective on Deleveraging, followed by Dalio on Policy & Productivity. The first part is very explicit on the importance of the various aspects and approaches to the current major deleveraging cycle. There are also discussions of how the central banks are affecting markets and economies, and a reminder that trading is a zero sum game.

 

The second section relates it all back to the current economic conditions, and even ends with a very brief individual country review. Enjoy the view. In the meantime, even though the markets took some interesting swings today, we feel the basic themes of stronger equities, challenged govvies and highly varied foreign exchange remain in place.

 

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2013/01/08: Cal-Perspective and US December strength to continue?

January 8, 2013 Leave a comment

© 2013 ROHR International, Inc. All International rights reserved.

The Weekly Report & Event Calendar is available through the link in the right hand column. This is a revised calendar with updated government bond auction details, so we suggest a read even if you saw yesterday’s edition. This week’s Summary Perspective is also now available there as well.

Yet there is also a continuing anomaly in the fundamental influences: relatively positive indications in quite a bit of the US economic data versus the additional headwinds which are so obviously going to impact the economy and markets into 2013. And one clear expression of that is in the important NFIB (National Federation of Independent Business) Small Business Confidence Survey that is very weak again this month after a disastrous November reading. The improvement to 88.00 from 87.50 masks some of the truly troubling aspects of this poll.

Still very negative after November plunge. Click to view Dunkelberg interview

Still very negative after November plunge. Click to view Dunkelberg interview

And we likely do not need to inform our readers that the Capital Spending indication is wholly inconsistent with the abysmal readings in the balance of the survey. Click on the table to see the CNBC video where Steve Leisman notes how minor this month’s improvement is compared to a November that was worse than 9/11 and almost as bad as the Lehman Brothers collapse response.

Dunkelberg was happy to share the small business owners’ primary reasons for such downbeat sentiment on the US economy and lack of any interest in hiring or expansion (in order of importance): Taxes, Weak Sales, Regulations. In other words, albeit with no mention of ‘protectionism’ this is a clear reflection of the continued drags from Taxulationism1.

1Taxulationism © 2010 Alan Rohrbach & Jack Bouroudjian. All rights reserved unless explicitly waived

Def.: Combined impact of taxation, regulation and protectionism to an oppressive degree as official policy

Yet there is even more reason to suspect the December economic indications are an anomaly on the way into weaker tendencies from a very well-informed source…

 

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2012/10/01: Quick Post: Weekly Calendar available and QE influence still a factor

October 1, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

The weekly Report & Event Calendar is available through the link in the right hand column. The Technical Projections and Select Comments from late last week are also available and still relevant. This week’s Summary Perspective on Key Influences will be posted later this evening, and we hope you find that useful as well.

As is typical of the first week of the month, it is going to be a heavy data week all week, and that began today with Global Manufacturing PMI’s. Continued disappointment with Asia (including Australia) and Europe was offset to a fairly interesting degree by the better-than-expected US ISM Manufacturing. However here as well, there was some bad news…

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2011/08/10: How We Got Here-IV: Welcome to the Island, Survivor (…we hope)

August 10, 2011 5 comments

Yep, it seems to have all turned into a big game of Survivor… And the two-way stretch from the stress factors is obvious. Getting through this is going to be a test of who can stand the huge amount of cognitive dissonance imposed from the outside. That includes the increasingly tedious and blindingly benighted machinations of the political class and alleged financial luminaries, and the radical, rabid dog reactions it foments in the markets.

It increasingly seems this is going to be a test of endurance, as Ben Bernanke was probably right to indicate that there won’t be much need to raise rates between now and mid-2013. In other words, after his previous soothing views on the economy and markets, the Fed head has thrown in the towel on expecting anything truly positive to develop in the intermediate term. And that’s not just us playing off his perceptions, as we have been great skeptics of the ability to return to an upbeat economic environment in spite of any improvement in equities and risk assets. And neither is it plain old bearish talk. Beyond the fiscal and debt ceiling dilemmas, there is good reason to believe it can’t get better this side of the next US general election.

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