Oct 7.

Oct 7.  Gold exploded to a new high, as a report that oil producers want to price oil in a basket of currencies (and gold) gained credence.  The UN also called for an alternative reserve currency.

–Yields rose slightly, but bonds are surprisingly resilient in the face of supply, a weaker dollar, and stronger stocks.  There is an item this morning that Black Rock looks for a wealth “shift” as baby boomers move from accumulation to “de-cumulation”.  In the late 1990’s the boomers were supposedly a huge wind at the back of the equity market as they invested for retirement.  Though I never really accepted that argument, one might consider the reverse case today: an overhang of supply as people sell assets to pay for retirement. 

–Ten year note auction today.  Consumer credit this afternoon. This report isn’t normally considered to be a big release, but the whopping $21B decline in July has given it a bit more focus (article in WSJ).  It is expected -8.5B for August.  In any event, it highlights a shift away from consumption and toward saving in the US economy.

–A speech by NY Fed Bill Dudley outlines three major factors that might restrain the economic recovery. 1) Household net worth “shock” which causes increased saving.  2) Fiscal stimulus measures that are running down and 3) A retrenching banking system, hesitant to provide small business and commercial real estate credit.


Posted on October 11, 2009 at 6:34 pm by alexmanzara · Permalink
In: Eurodollar Options

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