Tag Archives: credit markets

Understanding the Government Manipulated Credit Market Evolution

The fall and financial destruction of 2008 launched a brand-new era for the credit markets. An era marked by government intervention and outright manipulation all committed in broad daylight under the protection of financial apocalyptic prophecies. Our self-styled financial superheroes (Treasury Secretary Geithner and Fed Chairman Ben “Helicopter” Bernanke), wield their collective financial imagination and money printing press like Thor’s […]

Liquidity Expands + Credit Markets Improve = Equity Market Rally

Stock Market Strategy: All signs point to a continuation of the current rally. We will continue to use the direction of liquidity and the behavior of the credit markets as our fundamental guides to equity investing. The primary news story making the rounds today involves the European bank stress test results. I have included the official results and accompanying statement […]

Precious Metals & Credit Report: A Refresher Course & An Update

Guest Post by Don Coxe (courtesy of Zero Hedge) Don Coxe Dissects Gold, As “The Oldest-Established Store Of Value Moves To Center Stage” …We think that future historians may well report that the moment when gold once again became a store of value was when the dollar began soaring in response to the stench of seared Greece—and gold climbed right […]

Stalking the Bear Part 5: The Final Installment

No need to stalk anymore, the Grizzly is now in plain sight and gorging itself on hapless bulls.  I started the ‘Stalking’ series on March 30th with the intention of raising the awareness of readers to the dangers lurking in the financial forest. From the April highs to the recent May low, the S&P500 dropped 14.6%, NASD Comp. 15.6% and the […]

Greece Update: Bond Vigilantes Return, Credit Markets Elsewhere Recover, California Bonds in Demand?!

Time to check in with the Greek narrative. The hysteria has quieted down as new backroom deals to avert a meltdown are reported with some regularity.  However, the attempts to sweep Greece’s problems under the proverbial rug are occasionally sidetracked by a pack of rioters, or as is the case below, by the bond vigilantes. If rates continue to creep higher […]

Lending Falls, Bad Loans Haunt Big Banks, Mass Layoffs Surge, Greece vs California

The equity markets dropped on average 1.5% Monday and this morning another 1.5% decline is underway.  I mentioned, in A Review of the RCM Investment Strategy, the defensive posture we at RCM have taken. I said, “We have deployed our assets in a manner we feel most appropriate for the environment we are experiencing.” The following news items should help illustrate what […]

Credit Markets Warning Signal, Foreign Demand for US Treasury Falls

The following story represents perhaps the largest obstacle facing equity market integrity today.  The previous statement is not hyperbole. The collapse of equity prices in 2008 was presaged by a python-like constriction of credit. If the private sector cannot access credit then business grinds to a halt and as we saw in 2008 economic cataclysm ensues…  Credit markets flash hottest […]

A Greek Tragedy of Shakespearian Proportion Continues to Unfold

After a week of credit market histrionics, Monday morning ushers in a moment of calm… Greek spreads ease; Portugal under pressure – WSJ WSJ reports European sovereign CDS spreads were generally tighter Monday, with the cost of insuring Greek and Spanish debt against default falling, although Portugal remained volatile with spreads widening. According to CMA DataVision, Greece’s five-year sovereign credit-default […]

Sovereign Debt Spreads Widen on Greece/Portugal Worries, Equity/Commodity Markets Roiled, Fed Begins to Backtrack

The equity and commodity markets get rocked as Sovereign debt woes resurface. The burning question: Will the dramatic widening of credit spreads in Sovereign debt, beginning to resemble the CDS collapse of 2008 in the private sector, lead to a revisit of a 2008 type credit crisis and all the fallout associated with it?… Greece, Portugal woes intensify – WSJ […]

Employment Report Weakness, Fed’s Pianalto & Rosengren Dovish Statements, Credit Markets Don’t Confirm Sell Off

The economic news continues to be terrible. The knee jerk reaction; sell off the equity markets run into U.S. treasuries. This type of action would only make sense to the person who ran directly from his cabin into the galley on the Titanic and felt he had gained safety. Furthermore, this fatuous trade into T-bonds has place a brainless bid […]