FAQ  |  Search  |  Memberlist  |  Usergroups   |  Register  |  Profile  |  Log in to check your private messages  |  Log in 

 Merrill economist prediciting a FEB intermeeting rate cut View next topic
View previous topic



Post new topicReply to topic
Author Message
bdc63
Schumpeter Reincarnate


Joined: 16 Feb 2007
Posts: 4392
Location: Maryland

Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Tue Feb 05, 2008 8:03 pm Reply with quoteBack to top

Citing today's disasterous ISM index, and troubling credit conditions in yesterday's Fed loan survey, Merrill Lynch is predicting a negative GDP for Q1, and ANOTHER intermeeting rate cut by the FED in February (next scheduled meeting is in March).

My guess is that Bernanke gave Merrill a call and told them to spread the rumor to see if they could get a bounce in the stock market. No such luck.

http://www.thomsonfxhub.com/fx.....%20Merrill

Too funny. Cramer was kissing Barnanke's a$$ after the 1.25 cut in January, and I bet you anything he will be using his "they know nothing!" button tonight.

These are historic times. The wheels are coming off the bus and we have front row seats!
View user's profileSend private message
WFExec123
Nitroglycerin


Joined: 12 Aug 2007
Posts: 722

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 5:49 am Reply with quoteBack to top

I think i know your position based upon your posts, but what about all these people trying to call a bottom? Will the dollar fall now, or will it hold or rise as other countries start cutting rates? Is gold going to run from here? I am only hearing more and more bad news, but people are trying to say we are past a bottom in financials, i just don't get it. Cramer, touting to buy financials and builders recently, what the h**l?
View user's profileSend private message
bdc63
Schumpeter Reincarnate


Joined: 16 Feb 2007
Posts: 4392
Location: Maryland

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 12:21 pm Reply with quoteBack to top

WFExec123 wrote:
I think i know your position based upon your posts, but what about all these people trying to call a bottom? Will the dollar fall now, or will it hold or rise as other countries start cutting rates? Is gold going to run from here? I am only hearing more and more bad news, but people are trying to say we are past a bottom in financials, i just don't get it. Cramer, touting to buy financials and builders recently, what the h**l?


Mainstream media is doing a great job at finding the 10 people willing to give an interview and say that everything is coming up daisys. Don't confuse that with what "most people" are saying or believe.

The first bad piece of economic news came out in July of 2006. I was neive to think that this would unfold faster than it has. The bad news continued to trickle out until August of 2007 when it become a steady stream. Now its a waterfall, where almost every piece of economic data dissappoints. I suspect it will feel like a tsunami once the mass bankruptcies start in the banks, hedge funds, and other housing related businesses (not to mention the law suits).

As far as what is going to happen to the stock market, gold, and the dollar -- expect a lot of volitility. I think that we are headed into a strange period of both deflation and inflation. Deflation of all the assets that were in bubbles (like housing), but inflation (due to Ben and the boyz running the printing presses flat out, as well as all the foreign held dollars coming back home) will hit all inports and food.

I think initially the stock market will go down -- the S&P possibly as low as 750, which is a major technical level that it should certainly hold. Then it will ride the coat tails of inflation up, put inflation adjusted it will be flat.

I think that gold goes up because of a loss of confidence in the US dollar. If the dollar loses reserve status and foreign countries lose their appetite for buying up our debt, then gold soars. Inflation adjusted right now, the all time high for gold is $2500. That would be a slam dunk in an environment where inflation continues to grow.

The US dollar, again, will be very volitile. The dollar and our treasuries are going to continue to be looked at as "save havens" for some time yet as the US spreads the flu around the world. But if foreign countries start to shun the dollar, dump their holdings, and look for yield and safety somewhere else, the dollar index falls like a rock.

As far as Cramer calling the "all clear" on Friday -- I saw that too. My thought at the time was "I wonder how long before he pretends like he never said that" ... turns out it was Monday.
View user's profileSend private message
Rotag
Wrecking crew


Joined: 01 Nov 2007
Posts: 1722

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 1:09 pm Reply with quoteBack to top

I saw Cramer last night. He was basically saying this volatility and weakness will continue until the house prices bottom. I had to laugh because just the week before he was tauting home builders. How the h**l can you say/think that housing is falling and recommend home builders at the same time?


Edit: To include Toll brothers outlook. Please read my underlined quoute



Toll Brothers issues dim forecast
Toll Brothers (TOL) continues to suffer along with the slumping housing market. The Horsham, Pa., luxury homebuilder said Wednesday that fiscal first-quarter homebuilding revenue fell 22% from a year ago to $843 million, as net signed contracts dropped 50% from a year ago in dollar terms. Toll Brothers said it remains focused on reducing its land holdings but expects to take an additional $150 million to $300 million in writedowns when it reports full first-quarter numbers at the end of the month. Weak traffic and deposit trends left CEO Bob Toll uncharacteristically glum, saying, “we are not yet seeing much light at the end of the tunnel.” But Toll, who has previously blamed media negativity for the decline of the housing market, is hoping a turning point may be near. “For the first time in recent memory, the New York Times suggests that now might be a good time to buy a home,” he said in Wednesday’s press release. “Perhaps this signals the beginning of a change in public sentiment in recognition of significantly improved housing affordability, low mortgage rates and a supply imbalance making it a buyer’s market.” Given the slowing economy and high energy prices, however, it’s a good bet that a housing recovery remains far off.

_________________
I hear nothing. I see nothing. I know nothing.

Agent Smith: You hear that Mr. Anderson?... That is the sound of inevitability
View user's profileSend private message
WFExec123
Nitroglycerin


Joined: 12 Aug 2007
Posts: 722

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 3:07 pm Reply with quoteBack to top

Another CNBC pumper just interviewed saying we are in the bottom.
View user's profileSend private message
dreamer
Demolition Man


Joined: 09 Aug 2007
Posts: 2101
Location: Northern California

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 3:15 pm Reply with quoteBack to top

They must do something as the situation is getting dicey for the dollar and the US. What you see happening is the crumbling of an empire. Things will accelerate going forward. Behind the scenes things are desperate for the US. We are boxed in and the only way out is war. It is the only card left and is the only thing we have. The war card has always been played by nations when they were up against the wall.

The US dollar is the world reserve currency and we have arrogantly squandered it. Nations are beginning to pull away from it and nations that have hoards of it are getting close to dumping it. The tipping point is approaching and will happen very quickly once a push occurs such as the Middle East countries abandoning the peg or the petro dollar system.

I hope y'all have been watching the unfolding actions by the players behind the scenes. For example; Who has been cutting all the undersea electronic cables going into the Middle East? Why? Read below.

From http://www.rense.com/general80/cable.htm

"It is little known by the American people, but nevertheless true, that Iran intends to open its own Oil Bourse this month (February 2008) that will trade in "non-dollar currencies".(16) This has massive geo-political-economic implications for the United States and the American economy, since the American dollar is at present still (if not for much longer) the dominant reserve currency internationally, particularly for petroleum transactions. However, due to the mind-boggling scale of the structural weaknesses in the American economy, which have been well discussed in the financial press in recent weeks and months, the American dollar is increasingly shunned by corporate, banking and governmental actors the world over. No one wants to be stuck with vaults full of rapidly depreciating dollars as the American economy hurtles towards the basement. And so an operational Iranian Oil Bourse, actively trading supertankers full of petroleum in non-dollar currencies, poses a great threat to the American dollar's continued dominance as the international reserve currency."

_________________
There isn't anything so bad that the Government can't make worse...

The 4-functions of government today are the same as a criminal enterprise: Lie, Cheat, Steal, and Kill...
View user's profileSend private message
icenvegas
Schumpeter Reincarnate


Joined: 22 Nov 2007
Posts: 3896
Location: Las Vegas

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 3:39 pm Reply with quoteBack to top

keep in mind as we keep saying the answer for the US is war. During WW2, which was "the war to end all wars", that the US was virtually bankrupt. It wasnt until the battle of Iwo Jima, and the raising of the flag at Mt. Surbinachi that Americans began buying War Bonds, and got a taste for the fight.
So, as we say, lets go to war, it boosts the economy, that the will of the American People to fight in the war is of importance as well.

Iran is in a prime position to further bankrupt the US because of its massive oil reserves. In my estimation (which doesnt mean a damn thing) when/if America becomes independant of foreign oil, we will essentially have closed our borders to the middle east.. its gonna get interesting.

_________________
I'm not smart, I just surround myself with stupid.
View user's profileSend private messageYahoo Messenger
bdc63
Schumpeter Reincarnate


Joined: 16 Feb 2007
Posts: 4392
Location: Maryland

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 4:47 pm Reply with quoteBack to top

dreamer wrote:
I hope y'all have been watching the unfolding actions by the players behind the scenes. For example; Who has been cutting all the undersea electronic cables going into the Middle East? Why? Read below.

From http://www.rense.com/general80/cable.htm


That's interesting stuff, Dreamer. I had only heard about the first cut cable, and even with that I was a bit suspicious about it being an "accident". But now its atleast 5, maybe 9 inside of a week, all in the same region of the world? Accident my a$$.

I did a google search after I read the article to see what other sources are saying. It is being universally under-reported by the MSM, but they are confirming reports of 5 cut or damaged cables. The blogs and forums are going to town with it though.
View user's profileSend private message
dreamer
Demolition Man


Joined: 09 Aug 2007
Posts: 2101
Location: Northern California

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Wed Feb 06, 2008 7:52 pm Reply with quoteBack to top

FYI:

"The S&P 500 bottomed on 10/10/02 at 768.63. The next day the Senate approved the Iraq War resolution which gave permission for the President to disarm Saddam. The 3/03 low coincided with the actual invasion."

I guess the PTB are looking to do this again...

http://www.financialsense.com/...../0206.html

_________________
There isn't anything so bad that the Government can't make worse...

The 4-functions of government today are the same as a criminal enterprise: Lie, Cheat, Steal, and Kill...
View user's profileSend private message
sless
Flash in the pan


Joined: 19 Dec 2007
Posts: 46

Re: Merrill economist prediciting a FEB intermeeting rate cut
PostPosted: Thu Feb 07, 2008 12:05 am Reply with quoteBack to top

The financial have not come close to the bottom yet, the first quater will be brutal for them....

1) The recent 534 billion dollar rating cut by the S & P will be reflected in the first quarter...

http://www.bloomberg.com/apps/.....4dOmbQIYTk

2) On that note, as of today, from bloomberg.

[i] Page 1 of 2
BN 12:06 MBIA, Ambac Downgrades May Lead to Bank Rating Cuts, S&P Says


By Christine Richard
Feb. 5 (Bloomberg) -- Downgrades of bond insurers, including
MBIA Inc. and Ambac Financial Group Inc., may lead to cuts in
credit ratings at banks, Standard & Poor's said.
If more bond insurers lose their top credit ratings, the
markets in which they back debt, including municipal bonds and
structured finance, could slow, affecting bank profits, S&P said
in a report today. Bond insurer downgrades also could affect
banks directly by causing them to recognize more losses and
reverse gains in securities they hold guaranteed by the bond
insurers, S&P said.
``We believe that the specific, identifiable effect on banks
may be significant and, in a few cases, could lead to
downgrades,'' Tanya Azarchs, a New York-based S&P analyst wrote
in the report.
The collapse of the U.S. subprime mortgage market has led to
about $146 billion of losses and markdowns at securities firms
and banks since the beginning of 2007. They may report more
losses if the bond insurers falter because the insurers have

backed $125 billion of collateralized debt obligations tied to
loans to borrowers with poor credit, S&P said.
Those contracts are concentrated at a small number of banks,
S&P said. ``Few banks have disclosed how much that exposure is,''
the report said.
CDOs repackage assets such as mortgage bonds and buyout
loans into new securities with varying risk.

Guarantee Contracts

Banks that have disclosed how much of their CDO holdings are
offset by guarantee contracts include Citigroup Inc., which said
it has $10 billion of insurance on top-rated CDOs, and Merrill
Lynch & Co., which has nearly $20 billion of such contracts, and
Canadian Imperial Bank of Commerce, with $9.9 billion, S&P said.
Citigroup and Merrill are both based in New York and Canadian
Imperial is based in Toronto.
In addition to shielding them from losses, these contracts
with bond insurers allowed the banks to book profits in their
CDOs, S&P said. Downgrades of bond insurers could result in a
need to reverse those gains, the New York-based unit of McGraw-
Hill Cos. said.
S&P, Moody's Investors Service and Fitch Ratings are taking
another look at the bond insurers to see if they have enough
capital to protect their top ratings.
S&P has downgraded FGIC Corp.'s insurer, Financial Guaranty
Insurance Co., to AA from AAA. It's also downgraded ACA Financial
Guaranty Corp. to CCC from A. It's reviewing the AAA insurance
ratings at MBIA, Ambac, the two largest bond insurers, and

-----------------------------====================------------------------------
Copyright (c) 2008, Bloomberg, L. P.

Page 2 of 2 [/i]

Security Capital Assurance Ltd.


3) As for the dollar, as long as we maintain our key exporting product, "our financial service", the dollars fall should not be drastic. This is my 2 cents personally.

1) Trade deficit in essence is when trade between countries result in a disproportion in positions, where one consumes more than it creates. In the end no country can maintain this balance, but you would be essentially giving the labors of your production for free.

What use is money if you never use it? SO China will use the surplus of dollars it has, which resulted in more exports than imports with the united states, but the question is with what do they purchase? If they purchase our assets, whether they be actual companies, t-bonds, or expertise, the money creates value and should negate inflation.
View user's profileSend private message
Display posts from previous:      
Post new topicReply to topic


 Jump to:   


Merge topics 

View next topic
View previous topic
You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum




Powered by phpBB 2.0.22-2 (Debian) © 2001, 2002 phpBB Group :: FI Theme :: All times are GMT