FT: “Mother of All Carry Trades Faces Bust”

I consider this a must read article. It’s basically analogous to Roubini’s February 2008 article “The Twelve Steps to Financial Disaster,” which I posted back then (you can download the PDF from the first link here).

Excerpt: So the combined effect of the Fed policy of a zero Fed funds rate, quantitative easing and massive purchase of long-term debt instruments is seemingly making the world safe – for now – for the mother of all carry trades and mother of all highly leveraged global asset bubbles.

“Mother of all carry trades faces an inevitable bust”
By Nouriel Roubini
2009-11-1
Financial Times (original)

Since March there has been a massive rally in all sorts of risky assets – equities, oil, energy and commodity prices – a narrowing of high-yield and high-grade credit spreads, and an even bigger rally in emerging market asset classes (their stocks, bonds and currencies). At the same time, the dollar has weakened sharply , while government bond yields have gently increased but stayed low and stable.

Stocks notched gains Thursday, But…

Just time for a quick summary today. IBD said it best:

Volume fell significantly, making the indexes’ gains less impressive. Still, we note that Wednesday’s activity was very high, and thus a tough comparison.

Also disappointing was the rally’s depth: Gainers beat losers by 5-to-3 on the NYSE and on the Nasdaq by not quite 4-to-3.

Those results don’t paint an exciting reversal.

Follow-Up on Yesterday’s Action and Trading

Yesterday, I went fishing. We caught five fish, including Martin’s 7.6 kilo Lake Trout (shown) and my 4 kilo wild Salmon.  More pics coming soon.

While we were fishing, I got filled on a QQQQ limit order around the 52-week low ($42.10 fill). The day before (at the close) I went long the Select Sector SPDR: Financial Select Sector SPDR Fund (XLF).

When I got home from fishing at 9:40 and saw the market action I took the following actions:

Stockholm and Up North (Sweden) Pics

From July 2007:

1. A “tall ships” festival in Stockholm.
2. A great sculpture garden in Stockholm.
3. The first batch of pics from our trip up north last summer (up above the Arctic Circle in Sweden and Norway).

Click to Flickr to see the rest.

Research: ALL TALK, NO ACTION

MORGAN STANLEY RESEARCH
DOWNUNDER DAILY:
ALL TALK, NO ACTION
January 09, 2008
Gerard Minack, Morgan Stanley Australia Limited+

Despite the chatter and worry, I still think most equity investors have not made a US recession their base case, and hence markets are not priced for the downturn. So far, in other words, the recession is all talk and no action.

Roast of Doug Kass’ “20 Surprises for 2008″

From TheStreet.com, which I don’t read (I can’t stand the shouter).

Anyway, a friend emailed me this list and I couldn’t resist.

My roast is [in brackets].

New Year’s Eve Pics

Click here to see the rest of them!

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BuzzPal – The World Is Your Party

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From now on photos will be posted on Flickr and blogging will be done on WordPress.

Why am I moving? Here’s why.

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Have a great 2008!

Cheers,
chrisco

Important Announcement…

From now on photos will be posted on Flickr and blogging will be done on WordPress.

Why am I moving? Here’s why.

What are the new web addresses?

Flickr: http://www.flickr.com/photos/flickrchrisco

WordPress: http://chrisco.wordpress.com

Please update your bookmarks and/or hop on over to the links above, where you can subscribe via Email and/or RSS feed.

Have a great 2008!

Cheers,
chrisco

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Two Cows – The Silicon Valley Version

You know those funny “two cows” emails going around? Such as here and here. Well I figured I’d add one more entry to the list:

You have two cows, both of whom go to a famous and over-rated university in Cambridge. One of them creates a me-me social network, the other stumbles upon and registers a great domain name, cowbook.com.

[click through to read the rest and see here for some more]

Two Cows – The Silicon Valley Version

You know those funny “two cows” emails going around? Such as here and here. Well I figured I’d add one more entry to the list:

You have two cows, both of whom go to a famous and over-rated university in Cambridge. One of them creates a me-me social network, the other stumbles upon and registers a great domain name, cowbook.com.

[click through to read the rest and see here for some more]

Some great lines in here! Guy’s a real piece of work. The scary part is that if enough people think he looks like a president should look and sounds like a president should sound, then that’s good enough for them… they will vote for him… Just a regular ‘Merican guy.

From the September 13, 2007, New York Times:

Sleepwalking in September
By GAIL COLLINS

Fred! Fred!

He’s here. He’s tanned. He’s ready.

He looks like he needs a nap.

When it comes to overhyped underperformers, Fred Thompson’s entry into the presidential race was right up there with Britney Spears at the MTV awards.

Sicko, The Movie: American Healthcare vs. Rest of Developed World’s)

Everybody should see this movie. American, non-American, living in America, not living in America, whatever. This will really open your eyes and make you want to get involved. See Michael Moore’s website for more info, from movie trailers and fact checks to news, commentary and copies of documents, letters, etc. See this page for links and to find out what you can do, from promototing the movie to writing your representatives, making YouTube movies, etc. Please share this post or write a better one and share that. Just get it moving. Let’s see what we can do. Cheers!

This Is Going to Be Big… Sub $200 Laptops… On Linux, NOT Windows

So, I just bought an brand new Acer notebook computer for $379. First thing I’m going to do is reformat the hard drive and install Linux. That’s right, I’m throwing away Microsoft’s crap Vista, Internet Explorer, Outlook, Office, etc. You hear me, Bill? We don’t want or need Microsoft’s junk anymore. We’re sick of your prices, crashes and viruses. Linux, Firefox, Thunderbird and Open Office are all free, open-source replacements. And they are BETTER. Sorry, Bill. This IS the beginning of a trend. Buh-bye expensive proprietary junk. Hello cheap/free open-source goodness. Click through to read the article / blurb.

ETF News

State Street said Wednesday morning two new international ETFs, based on S&P/Citigroup Global Equity Indices, will begin trading Thursday April 26. SPDR S&P International Small Cap ETF includes companies with market caps under $2 billion domiciled in developed countries outside the U.S. It will trade under the ticker (GWX) and carries a 0.60% expense ratio. SPDR S&P World ex-US ETF includes more than 5,000 companies domiciled in developed countries outside the U.S. including Canada. It will trade under the ticker (GWL) and carries a 0.35% expense ratio.

Google’s New Affiliate Network (CPA) Program

(Download google-affiliate-network.jpg)

Wall Street Journal on It’s Format Change

Here’s a quote from the email I got today from the WSJ explaining how great it was that they’re reducing the size of the newspaper, but not it’s price:

“It will come to you in a slimmer, easier to handle size, with a more legible typeface.”

Translation: Not only will the paper be smaller, but it will have a bigger font size. And they say they are doing it to help their poor readers, who struggle daily with their oversized paper and undersized fonts.

This reminds me of the…