Dec 5, 2011. Send lawyers guns and money….

–Employment report showed a large drop in the rate to 8.6% though NFP up only 120k.  Though the report on its surface was heartening, internals, like the labor force participation rate, were suspect. US bonds don’t seem to buy into the economic strength story at present.  2/10 and red/gold actually closed lower than on Wednesday.  Tens fell 7 bps to 2.04 yield.  Stocks faded from a strong open to close unchanged to lower. 
–Italy pushing through a big austerity package.  I saw references this morning to slowing in Spain, China (service PMI), India, and further austerity in Ireland.  There was an item about Germany possibly nationalizing Commerz.  I have to think that the ECB is going to become the buyer of FIRST resort of all troubled debt and the IMF will get involved as well.  Might be good for risk assets in the short term and will almost certainly boost oil, which has the added kicker of increased mideast tensions as Iran said it shot down a US drone. The Fed will clearly stay easy in support of europe, though it’s unlikely that they can keep the curve as flat as it currently is.
–Today’s news includes non-mfg ISM expected 53.9 and Factory Orders +0.3%. 

–Send lawyers guns and money, the new global anthem, and here’s an interesting investment play on that theme by Cerberus:

Mystery company buying up U.S. gun manufacturers 

While at the same time…

‘President Barack Obama will travel to Osawatomie, Kansas on Tuesday to emphasize the need for Americans to pay their “fair share.” ‘

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Posted on December 5, 2011 at 7:51 am by alexmanzara · Permalink
In: Eurodollar Options

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