Friday, May 8, 2009
Fear Factor
VIX is sure thing beaten hard by the bulls lately in this rally and its stretched south, But I would not trust VIX above 30, And it may quickly back fire any movement. VIX being the fear factor in the markets show no sign for run from the markets. Looks like think tanks are placing bets (look for the image below), So watch closely when it creeps back up in coming weeks and months.Will see who wins the bet.
Currency: Canadian Australian Dollars And US Bonds
Y'day during the 30 year bond auction we could clearly see there is more pressure on the longer term bonds as no one willing to get into safe bet, And at the same time they don't like to invest into the US dollars any more.
In the below chart it clearly gives the Canadian to US dollar ratio, If you see back in sept-Oct during the crisis, dollar and equivalent assest got appreciated vastly due to bet on American economy, And now advanced along with soverign countries are backing off bit if you the bond auction. Here it what i noticed that money is going out of the US to Canadian dollars, is that interesting........
Same is with Aussie dollar, money is getting out the US dollar and piling back into Australia.What does this tells us that US dollar is not the safe place to be when compared to the other less risky debt free economies.
In the below chart it clearly gives the Canadian to US dollar ratio, If you see back in sept-Oct during the crisis, dollar and equivalent assest got appreciated vastly due to bet on American economy, And now advanced along with soverign countries are backing off bit if you the bond auction. Here it what i noticed that money is going out of the US to Canadian dollars, is that interesting........
Same is with Aussie dollar, money is getting out the US dollar and piling back into Australia.What does this tells us that US dollar is not the safe place to be when compared to the other less risky debt free economies.
Housing Pain Continues......
what RBS has to say that we are not out of woods yet and more pain down the road with final sell wave this summer when option ARM's reset: Housing ARMS, So why is market discounting
Royal Bank of Scotland, the biggest British banking casualty of the financial crisis, warned on Friday it expects bad loans to mount during the rest of the year as the global economy remains mired in recession.The warning came as RBS revealed that it had a pre-tax loss of £44m for the first three months of the year as its bad loans and credit writedowns hit £4.9bn.Chief executive Stephen Hester, who was parachuted in as chief executive atthe peak of the banking crisis in the autumn, said: "We remain cautious and continue to plan and manage our businesses in the full expectation that both 2009 and 2010 will be very tough years for RBS."
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Royal Bank of Scotland, the biggest British banking casualty of the financial crisis, warned on Friday it expects bad loans to mount during the rest of the year as the global economy remains mired in recession.The warning came as RBS revealed that it had a pre-tax loss of £44m for the first three months of the year as its bad loans and credit writedowns hit £4.9bn.Chief executive Stephen Hester, who was parachuted in as chief executive atthe peak of the banking crisis in the autumn, said: "We remain cautious and continue to plan and manage our businesses in the full expectation that both 2009 and 2010 will be very tough years for RBS."
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