Posted on 10/22/2010 12:04:56 PM PDT by Kartographer
Fresh from Fitch Ratings — one almighty ratings watch call.
It seems the ‘Too Big To Fail’ fix announced by the Federal Deposit and Insurance Corporation last week, is too formidable to satisfy Fitch’s ratings ‘uplift’ requirements.
The agency thinks the measures will eliminate the government support currently implicit in its ratings on US financials. That, incidentally, is rather different to what rival Moody’s said on the same (support) subject earlier this week.
(Excerpt) Read more at ftalphaville.ft.com ...
PING!
It will not bother the stock market at all. Let’s see who knows why... (no prizes for guessing right, just the satisfaction of knowing that you understand what’s going on).
PPP?
Nope.
Why?
C'mon. I've only got about 15 or so minutes left. Please, please, please? I'll be wondering for the rest of the day now. My kids are about to come home from classes and they'll need the computer. Bummer!
QE2 – It's not just a cruise ship anymore, but it could certainly buy a few. It's called "Quantitative Easing", Part Deux – instant credit creation. The market is betting that it's on the way, and that's why bad news is good news.
Poof! – thanks Uncle Ben - we're rich! So… the banks get bailed out by the Federal Reserve once more. The Fed then buys more Treasuries in the open market operations trading sessions, loans money to the banks at near zero interest rates, and they in turn go out and buy more shares of Apple and Amazon.com. Everybody's happy. Yeah.
PS....
Unemployment numbers don't seem to be bothering it either. People are dropping out of jobs like flies, and....nothing. That seems odd to me.
Because the market is now largely populated by machines trading on microscopic ups and downs which have almost nothing to do with the real value of any of the companies being traded.
L
The easiest way to understand the stock market right now is to discard the notion that fundamental economic analysis means anything. It is a game, with a handful of high-stakes players gambling with borrowed money on a handful of issues with high-speed computers, all on short bets.
But, by God, the DOW is up, up and up.
I wish I could get up that easily, but that’s another story.
Because Jimmy Mcmillian is going to elected Governor of NY?
And so it begins.
“And so it begins.”
Well Fitch did downgraded Lehman in June 2008 and then Lehman died September 15, 2008.
1. earnings are positive
2. the election will dampen the liberal nonsense
My daddy use to call it betting on the come
The government and the big banks are controlling the market to prevent panic. All wise investors have left the market for commodities and bonds.
I would agree mostly EXCEPT I think that bonds are as bad off as stocks. I fear that there a “bubble” has formed in bonds and that there will be at least a major decline coming soon.
PS....
Unemployment numbers don't seem to be bothering it either. People are dropping out of jobs like flies, and....nothing. That seems odd to me.
I have seen this same thing in the early 80’s, this surprised me as well. I guess the theory was that employers were trimming up, becoming more “lean”, and wall street found this to be encouraging news.
However at this point I don't see how the same message would apply.
As one who used to play the crap tables, you have to understand the percentages and know who owns the table. In this case, earnings are subject to taxes, political influence, and inflationary depreciation, all of which reduce your “take”. The table is owned by the banks and the government. The election might change those odds, but it’s far from a certainty as long as Washington, DC runs the game.
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