Chicago Fed National Activity

Nightly Recap 3-22-2010

Posted by Investing Freak on March 22, 2010
General / Comments Off on Nightly Recap 3-22-2010

Market Summary:
DOW      +43.91 (10,785.89)
S&P        +5.91 (1,165.81)
Nasdaq  +20.99 (2,395.40)

Nightly News Links

US Economy:

Chicago Fed National Activity Declines in February (Econompic)
The 85 economic indicators that comprise the Chicago Fed’s index are drawn from four categories: production and income; employment, unemployment and hours; personal consumption and housing; and sales, orders and inventories. The three month average fell to -0.64 in February from -0.04 in January.

Tomorrow, Tim Geithner Urges End to Fannie and Freddie ‘Ambiguity’ (Bloomberg)
Tim Geithner is set to deliver unwelcome to news to those who play in the public Fannie Mae (FNM) and Freddie Mac (FRE) casino. Private gains can no longer be supported by the umbrella of public protection, capital standards must be higher and excessive risk-taking must be appropriately restrained,” Geithner said in testimony prepared for the House Financial Services Committee that was obtained today by Bloomberg News. The hearing is scheduled for tomorrow at 10 a.m. in Washington.

The Pressure on Malls: More Store Closings (Calculated Risk)
“Our outlook for retail properties as a whole is bleak … we do not foresee a recovery in the retail sector until late 2012 at the earliest.” Over the next three fiscal years, 25 percent of our store leases will reach maturity … E-commerce is 30 percent of our corporate revenue and it’s very profitable … even in this environment. The Internet and e-commerce have become the focus on our capital investment.”

World Economy:

Global Productivity and Unemployment (Econompic)
Producing more by working less is the key to rising living standards, but in the short term there is a tension between efficiency and jobs. America and Europe have managed this trade-off rather differently. America has gone on a diet: it has squeezed extra output from a smaller workforce and suffered a big rise in unemployment as a consequence. Europe, meanwhile, is hoping to burn off the calories in the future. It has opted to contain job losses at the cost of lower productivity.

The Beginning of the End of the Eurozone As We Know It? (Naked Capitalism)
The widely-extolled idea, that the EU would find a way to muddle through the Greece crisis, looks very much in doubt. The pressure has not simply put the rescue of Greece into disarray, but appears to have led to some positions being taken that, if they hold, look likely to lead to the partial dissolution of the monetary union. This development would have far-reaching ramifications which are far from well understood, to put it mildly.

Interesting Reads:

Dear Evil Speculators (The Reformed Broker)
Dear Evil Speculators,As part of our ongoing program designed to render the US stock market completely dysfunctional, we have added an additional tax to be applied toward your investment income as part of the wildly popular Health Care Bill that we recently finagled through into law: * Individuals earning more than $200,000 a year, or couples earning $250,000 or more, would be hit with a 3.8% surcharge on investment income to help pay for the bill.You see, we are fully aware that in just the past decade, you have been slammed twice – 2000-2002 and 2007-2009 – with two of the most brutal bear markets in history – but we just don’t care.

Health Care Expenses vs. Life Expectancy (The Big Picture)
A very insightful chart comparing Countries using Life expectancy and Health care spending.

Hedge Fund Ebullio Capital: Down 86.25% In One Month (Market Folly)
By now, many of you may have already heard the startling tale of Lars Steffensen’s hedge fund Ebullio Capital Management. For the month of February 2010, they were down a whopping 86.25%. That brought their year to date total return to -95.83%. Immediately, questions swirl in one’s head such as ‘How did this happen? What kind of risk management did they have in place? How will they recover?’ Remarkably, their investor letter had quite a calm tone to it.

Have a Good Night


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