Oct 5. Payroll report…

–Employment report today with Payrolls expected 115k and rate of 8.2%. Treasuries edged lower yesterday, led by longer maturities, with tens up a bit over 4 bps to 1.664 and 30’s up 6 to 2.88.
–Oil, arguably the most important commodity in the world, fell $4 on Wednesday and regained that loss yesterday. Sort of a slow-flash crash. Or maybe 4.5% moves don’t quite qualify. Gold continues to press toward $1800.
–The Fed minutes were released yesterday with members again expressing the hope that expanding policies that may ultimately lead to hyperinflation “could lift consumer and business confidence.” In related ‘news’ CNBC aired a long advertisement, oops, I mean hard hitting interviews, late yesterday with several top Blackrock executives, where they pounded home the new slogan of getting out of cash and moving into riskier assets, as short term bonds and cash provide no return…”it’s time to be an investor again.” I guess this is part of the Fed’s goal as well…push people into stocks, and hope for some sort of wealth effect that trickles into consumption. And of course money pumping certainly has that effect; I’ve seen several recent stories of companies using cheap funding to buy back their own shares and reduce float, thus supporting stocks. However, there are also respected analysts who feel that each new dollop of QE is having less of a positive effect on equity valuations. Is this where you go “all in” Larry Fink?

Posted on October 5, 2012 at 5:59 am by alexmanzara · Permalink
In: Eurodollar Options

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