Sept 27. Wild swings in metals

Dec Gold had a range of $131 yesterday.  Silver, $4.82.  Crude $4.12, Copper, 28.5 cents.  And this morning silver up $3. Wild swings.
–Markets responded to news that EFSF would be expanded and possibly levered.  According to CNBC, the EFSF would provide seed money to the Euro Investment Bank, which would then buy sovereign bonds.  On margin.  Gives me the same feeling of security as the NYPD Police Chief saying that the dept can take down a plane if it has to.  Still a German vote coming up Thursday on EFSF ratification.
–Buffet is buying back shares of Berkshire as they’re undervalued.  You’ll notice that HE isn’t buying Greek bonds.  AAPL (over 3% of SP500 weight) closed down slightly due to lower component shipments for the i-pad.  At the same time, AMZN released its new tablet features.  Foretells lower consumption or simply competition and substitution?
–Liquidation seems to be the theme in eurodollar options.  Seller of 30k E2Z 9887c from 32 to 31. Open interest (OI) declined 25k.  Also a seller of 40k EDM13 9900/9750p 1×2…exit.  Euro$ futures OI down another 46k.  In fact, through the beginning of 2011 ED OI had gained from 7.15m in Jan to 10.77m in mid-June.  Since then it has steadily dropped, now 8.37m.  Same sort of pattern in treasury interest rate futures. Any implication for stocks of financial exchanges?     
–Today’s news includes Consumer Confidence and 2 year note auction.

Posted on September 27, 2011 at 7:09 am by alexmanzara · Permalink
In: Eurodollar Options

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