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russiangambit (29.21)



Today was hilarious

April 20, 2011 – Comments (11)

I am really busy at work these days; suddenly everybody wants their project done this year after not doing anything for 2 years. But I felt compelled to comment on today’s silliness in the markets.Remember Monday we were down 1%? That is what passes for a huge sell off these days. Europe is in trouble again, gas at $4, US political circus continues unabated. Suddenly everyone was concerned about US debt levels. Really? I didn’t really attribute the sell off to the S&P500 nonsense. I felt like people are looking to sell before the end of QE2.And what today?  Sky is suddenly blue again, Europe is just fine, Euro is up to more than 1.45. UNBELIVABLE. This market is so irrational, it is downright silly. Or maybe I should say that the market is rational albeit it overdoes everything since it is driven by the machines, it is market commentators who are irrational. So, today they were rejoicing at the market being up. Never mind that dollar is down something like 2%, which pushes everyone out of dollars into everything else - commodities, stocks, foreign currencies.I think we are approaching the end gamer for the FED again. They succeeded in reinflating the bubble and debasing the dollar. But in the processes they destabilized the system to a dangerous degree again. It couldn’t be otherwise because all they do is disguise, smoke and mirrors, they cannot fix the real structural problems because they require doing something real, not financial alchemy. Schizophrenic stock market is the evidence of how unstable we are becoming.There is a fundamental story  going on at the same time. Companies, especially multinationals are having a wonderful year with their profits overseas and weak dollar. It doesn’t jive at all with stagnation of the US economy. But it is what it is. Most of these companies are American in the name only. Their fortunes are now tied to the overseas markets. This is a part of today’s rump up on the earnings. On one side people are weary about the end of the QE2. On the other hand the earnings and margins are really good.So, is this it then? The USA (the country) will continue to stagnate while the stock market and those with the capital will continue doing just fine? It is hard for me to see this continuing though. In 2008 the decline in the US pulled everybody else down, the decoupling story was debunked. It is likely to end the same way now.I started closing my long positions 2 weeks ago because I am weary of the excessive bullishness lately. It will be interesting to look at this post 2 months from now and see how the things turned out.  [more]



Apropos everything - how the money REALLY works

April 07, 2011 – Comments (1)

Today there is a link to a great article on the Big Picture. Even though there is an underlying agenda to convince you own gold ( which you have to decide for youself, I sold all of mine already but I still hold on to oil for a couple of weeks) it provides enough of good  information on how the money works to be a worthwhile read.  [more]



Enough already - what to cut , the cost of wars

April 04, 2011 – Comments (12)

I read a little tidbit of information yesterday – the first 10 days of the bombing campaign in Libya cost US 500 mil dollars. Now do you honestly believe that Iraq and Afghanistan cost just 3 trillion (or whatever the official number is?) over 10 years? The real number is probably much much higher, somewhere between 20-30 trillion.   [more]



BOFA and others - a trillion loss?

March 08, 2011 – Comments (5) | RELATED TICKERS: BAC

Has anybody seen this? BOFA practically admitting that they expect a trillion loss on house morgages, 25% of it is on their balance sheet, the rest belongs to "other investors" (I am guessing MBS). This is what people talked about 2 years ago, the trillion of losses on housing. The time has come that they have to be recognized.  [more]



The FED is already behind the ball

February 07, 2011 – Comments (5)


I was listening this morning on Bloomberg radio to a conversation about revival of commercial real estate thanks to the very low interest rates, which push people to look for opportunities in commercial real estate in search or return and how the mortgage rates are so low and favorable. Even GS didn’t expect such a recovery  [more]

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