Wednesday, January 26, 2011

Macro (big) Gorillas in the Room

Here's my checklist of Gorilla in the room:
1.  Over $14 Trillion in US National Debt (and growing)...finance charge is $4 billion per day
2. near 0% Interest Rates for a long period of time...everyone will freak out when the rate rises
3. 17% National Underemployment (or 9.4% unemployment)...this number doesn't include all the illegal immigrants who have moved to Brazil or Mexico
4. Fannie Mae...look at their Balance Sheet (it's no longer valid for a reason)
5. Freddie Mac...look at their Balance Sheet (won't play the same trick on you twice)
6. Social Security...no one under 30 years should be relying on this
7. Medicare/Medicaid...see #6
8. Shadow Inventory in housing vs. published Foreclosures...getting better
9. Addiction to POMO...the FED owns 25% of American debt (or America, depending how you see this)
10. Emerging markets having AND USING vital natural resources...remember when they just mined it and shipped it to us?
11. Addition to the BRIC engine...high inflation is not sustainable (Unfed Poverty = Revolt)
12. Suez Canal and Oil Prices...notice which country is at the bottom
13. State and City CDS rates and/or budget issues
14. Too BIG(ger) to fail...the (failed) banking industry is the mascot (no sweat FDIC)
15. HFT are robots controlled by humans...or the other way around?
16. All the wonderful unintended consequences from all our tinkering, bailing out, TARP-ing, taxing, etc.
17. Ignoring everything above for another few years.

The Questions I have are...
HOW BIG IS THIS ZOO?!?!?
HOW GOOD IS THE ZOO KEEPER?

Sunday, January 2, 2011

R.I.P. 2010

2010 saw the (temporary) passing of some key attributes in the stock market.  Here's my R.I.P. list...feel free to add your own.

R.I.P. Bad News...always seems to overshadowed or understated by media lately
R.I.P. Free Market...thank you POMO
R.I.P. Fear...anyone owns puts anymore?
R.I.P. Gulf Coast...or not according to BP
R.I.P. Blockbuster Video...muuuuust buuuuuy mooooore Netflix
R.I.P. some banks...still?
R.I.P. Too Big To Fail...cross that potential issue off the list
R.I.P. Market Ceiling...all-time highs are us
R.I.P. Pullback, Correction, Pause...
R.I.P. Sovereign Crisis...PIIGS, Belgium, Dubai fakeout?
R.I.P. 10% Unemployment...c'mon it's still below 10%
R.I.P. Interest Income...0.3% if you're lucky
R.I.P. Great Recession...clearly we're out of the woods
R.I.P. a bunch of small companies that will never grab a headline...tick tick boom
R.I.P. Unknown Unknowns...in helicopters we trust
R.I.P. Deflation...I can't wait for $4 gasoline, rising food prices, etc.
R.I.P. Mother Nature...everyone is magically hedged against earthquakes, volcanoes, monsoons
R.I.P. Home-ownership...life is a rental