The Market Traders

News and analysis that really matters.

January 2011

The Fed and Job Creation

Mon, 01/31/2011 - 9:38pm -- editor
Topics: 
The Fed
Fed
Politics
Economic Indicators
Site Section: 
Politics
Regulation

[[wysiwyg_imageupload:1555:]]By Ron Paul

Unemployment continues to plague our economy. In spite of constant claims that we have just turned the corner into recovery, the jobs reports remain grim with no real signs of improvement. While Keynesian economists and big government apologists scratch their heads about persistent unemployment in spite of unprecedented government "investment" in the economy, free market economists understand the problem perfectly well. In short, they understand that we are looking to the Federal Reserve to solve an unemployment crisis that the Fed itself largely created.

Beware when markets enter irrational exuberance.

Mon, 01/31/2011 - 9:31pm -- editor
Topics: 
Economic Indicators
Site Section: 
Economics
Markets

By readtheticker

Thank god markets are emotional, how else would we get fantastic over bought and under bought prices. The only trick for the investor is to know when prices are considered to be within a period 'irrational exuberance'. Some use RSI and Stochastic, others use sentiment readings of confidence, option call put ratios and standard deviations from a long term moving average. Many of these tools have false readings and hence a combination is preferred when forming an opinion and unfortunately that normally end in a confused state of mind for the investor.

Guess What The "Smart Money" Is Doing Now With Muni Bonds

Andy's picture
Mon, 01/31/2011 - 4:39pm -- Andy

We've argued that the hype over the muni crisis is a gift to smart investors.  We know that old fashioned, mom and pop retail investors have been deserting their muni holdings in droves, as an endless stream of headlines warns of TRILLIONS IN BANKRUPTCIES. Conversely, other more learned investors have been drooling over the fat yields now being offered by some strong-rated munis.

Topics: 
Muni bonds

U.S. Energy Policy Is Responsible for Unrest in Egypt

Mon, 01/31/2011 - 2:52pm -- editor
Topics: 
Oil
Energy
Energy Stocks
Site Section: 
Commodities
Oil and Energy
Natural Resources

By Michael Fitzsimmons

The world continues to suffer from America's addiction to foreign oil and its inability to craft a strategic long-term comprehensive energy policy to reduce consumption of foreign oil. In the recent past the world has witnessed $148/barrel oil and an oil war in Iraq. The unrest in Egypt is the latest result of American oil dependency. Is this an absurd statement? Before you vent your disagreements in the comment section following the article, please let me explain.

Bullishness in Silver

Mon, 01/31/2011 - 2:23pm -- editor
Topics: 
Economic Indicators
Silver
Site Section: 
Commodities
Metals

[[wysiwyg_imageupload:1547:]]By Chris Marchese

COT analysis, supply & demand and backwardation

Once again to my surprise, the structural changes in the Commitment Of Traders report continue to change for the better. Despite the increased volatility the past couple of weeks, the four and eight largest commercial traders slowly continue to cover their massive net short positions, paving the way for much higher prices in the future. The total net short position of all commercial traders declined more than 2,000 contracts, including over a 300 contract reduction in the top four commercial traders and over a 1200 contract reduction among the eight largest commercial traders.

How Big Is Chinese GDP

Mon, 01/31/2011 - 2:11pm -- editor
Topics: 
Economics
China
Site Section: 
Economics
Markets

[[wysiwyg_imageupload:1546:]]By Michael Pettis

Most of this week’s newsletter was about the release last week of China’s fourth quarter GDP growth numbers by the National Bureau of Statistics (NBS).  You can find the full NBS report on their website, but here is the key paragraph:

   " According to preliminary estimation, the gross domestic product (GDP) for the year 2010 was 39,798.3 billion yuan, up by 10.3 percent at comparable prices, or 1.1 percentage points higher than that in the previous year. In terms of growth by quarters, it was up 11.9 percent for the first quarter, 10.3 percent growth for the second quarter, 9.6 percent for the third quarter and 9.8 percent for the last quarter."

Risk-off Sentiment Refocuses Attention on Bonds

Mon, 01/31/2011 - 12:10pm -- editor
Topics: 
Bonds
Site Section: 
Bonds
Treasuries

[[wysiwyg_imageupload:1542:]]By Prieur du Plessis
The significant sell-off in the long end of the U.S. bond market has at long last resulted in the price of 10-year Treasuries to correctly reflect the state of the underlying economy. Since 1999 the yield on the 10-year Note has narrowly tracked the Conference Board's Consumer Confidence Index. In the second half of last year the yield dropped significantly below the level of the confidence index. It was either due to the market expecting an imminent double-dip recession or some other forces that were at work. In fact, it was the latter as a result of the culmination of QE1 and QE2 via the repurchase of government bonds by the Fed.

Stay Focused Gold Investors

Mon, 01/31/2011 - 11:59am -- editor
Topics: 
Gold
Markets
Geo Politics
Site Section: 
Economics
Markets

[[wysiwyg_imageupload:1539:]]By Frank Holmes

Last week was an eventful week at home and abroad with several events directly showing up in the performance of global markets and the price of gold. On Friday, Egypt's mayhem in the streets caused uncertainty in the markets, but sent gold shooting up over $21 to close at $1,336.75.

On Wednesday, a continuation of the Federal Reserve's easy monetary policy pushed gold up double-digits. Earlier in the week, a small hedge fund that had overleveraged itself to gold futures blew out its position, causing the biggest ever one-day reduction in futures contracts for the Comex.

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