Oct 14. Everything responds to falling dollar

Oct 14.  Bernanke speaks tomorrow morning; possible policy implications.  –Ten year auction was fine yesterday, and treasuries were given a bit of added juice by Fed’s POMO announcement in the afternoon.  Bond auction today…it’s a little difficult to worry about possible lack of demand when the central bank acts as a backstop. To everything.
–Commodities and gold continue to soar as the dollar crumbles.  Stocks are responding to the same dynamic, as people are more earnestly concerned about how to protect the purchasing power of dollars.  It simply doesn’t seem to be about forward looking economic growth…for example Ceridian-UCLA Pulse of Commerce Index was released yesterday…fell 0.5% in Sept after 1% in Aug…”the worst combined two-month decline since the recessionary months of January and February 2009″.  (Measures diesel fuel consumption; directly related to trucking, the backbone commerce). http://www.ceridianindex.com/news/release/pci-declines-second-consecutive-month/ Also RealtyTrac today says Q3 was record for foreclosures, but at least we know THAT data is about to show significant improvement!  Art Cashin had great piece yesterday on Weimar hyperinflation in ZeroH. http://www.zerohedge.com/article/art-cashin-coming-hyperinflation
–I think I marked data correctly, but in all events trend is certainly UP:  Ten year note to TIP spread now above 2%, at 205 bps. 
–Today’s news includes Trade Balance expected -44.3B, PPI expected +0.1% and Jobless Claims expected 443k.

Posted on October 14, 2010 at 4:35 am by alexmanzara · Permalink
In: Eurodollar Options

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