Posts Tagged ‘Eurodollar’

Notes From Underground: Unemployment Friday and the market has built in huge expectations

June 3, 2010

Friday brings the May unemployment report. The consensus jobs number is for 500,000-plus on the NFP, a 9.8 percent jobless rate and average hourly earnings to rise 0.1 percent. The headline number will be difficult as we will have to factor out the census hiring, but we will wait to decipher construction and manufacturing as being very important.

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Notes From Underground: Just when the market thought it was safe to rally … SAFE is rumored to signal OUT

May 26, 2010

We thought we were finally getting a little relief rally in the equities, with a thaw in the Libor/OIS and the EURO FX market attempting to hold onto its late gains of yesterday, when rumors about the Chinese State Administration of Foreign Exchange (SAFE) wanting to dump euro-denominated assets. There was no name to the spokesperson who made the statement. We are very skeptical of this rumor because if the Chinese were serious about wanting to dump euro debt, we doubt they would announce their intentions. As we mentioned yesterday, it was the Chinese deciding not to buy Greek debt that set the current debt crisis into motion. Adding to the euro’s problem was the 5 year BOBL auction in Germany that did not get the fulfillment of BIDS, thus a “failed” auction.

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Notes From Underground: With allies like these who needs dollars?

May 26, 2010

The case for a bullish DOLLAR has certainly been made in NOTES FROM UNDERGROUND during the past five months. Since the Chinese walked away from a potential bid on 25 billion of euro-denominated Greek debt, the pressure on the European debt markets has led to a reduction in EURO-based assets by large private investors, pension funds and even some central banks. The overall effect has been a further deleveraging of the global financial system and thus the increased fears of global deflation taking firm control of the credit markets.

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Notes From Underground: “We hear but we don’t listen”

May 6, 2010

In 2001 when the European Union was in a recession, financial analysts were pressing the ECB president,Wim Duisenberg, to cut interest rates. In attempting to gain credibility as a tough, hard-money institution, Duisenberg responded, “We hear but we do not listen.” Well, we would say to his successor, Jean-Claude Trichet, it is time to start listening.

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