Tuesday, December 9, 2014

Tuesday noontime news

Still awaiting today's anti-gold commentary from Barry Ritholtz.

In the meantime, here's the news:

Brett Steenbarger - is the market getting weaker? Quote:
Trending markets generally cut across sectors. When sectors are doing very different things, that smacks more of rotation than outright trend--and that keeps me nimble.
Again, the lack of collapse in semis and financials means this is just a rotation. It just happens to be going on in December, because I guess hedge fund clowns are always late to the party.

WSJ - Greek stocks and bonds tumble. Personally, I think the best thing for Greece would be Syriza in power. They can destroy the old kleptocrats, will have no compunction with putting all the Greek Nazis in prison for life, and will take pride in standing up to the Germans. But I'm also putting GREK and NBG on my trading radar for when Tsipras comes to power and turns out to be good for the economy.

FT beyond brics - what if the conventional wisdom on China is wrong? Hoo boy, don't let Billy Bishop see this. His reply will be "It is. Surprised?" As for Andy Rothman, I think he just made a friend in Jim O'Neill:
Let’s start with the consensus that China’s residential property market is about to replicate the U.S. housing crisis. But China has avoided most of the U.S. traps. For example, homeowner leverage is far lower in China than it was in the U.S. during the run-up to the crisis. By 2006, the National Association of Realtors reported that the median cash down payment for first-time homebuyers in the U.S. was only 2 per cent of the purchase price. In China, the minimum down payment is 30 per cent.

Another consensus holds that Chinese banks are on the verge of their own “Lehman moment.” But the products that broke Lehman Brothers—and caused havoc through the U.S. financial system—do not exist in China. There are no subprime mortgages and there are very few mortgage-backed securities. There is no secondary securitisation, so no collateralised debt or loan obligations (CDOs and CLOs). And China’s banks are very liquid, with deposits equal to 140 per cent of GDP, compared to 55 per cent in the U.S. Moreover, all Chinese banks are government banks, and there is no doubt that the Communist Party stands behind them.

Then there is the outdated view that China’s economy is dominated by stagnant state-owned enterprises. That was true 30 years ago, when I first worked in China, but today, small, privately owned companies account for 80 per cent of urban employment and more than 70 per cent of investment and industrial sales. In a relatively brief period of time, China has become very entrepreneurial.
You can listen to baseless assertions, or you can listen to the guy with hard data. Be warned that empiricism beats bald assertion every time.

Mining.com - gold fanatic Chinese officer made $5 billion from bribes. And that is where your Chinese gold demand was coming from, guys.

io9 - the best-ranked crop circles of 2014. They should really have an awards ceremony or something.

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