Wednesday, June 8, 2011

Morning Update/ Market Thread 6/8 - You Really Got Me Edition...

Good Morning,

Equity futures are solidly lower this morning following yesterday’s speech by Bernanke that failed to mention more QE is on the way, and thus we are to experience a wave of deflation until we cry “Uncle” and then accept more devaluing of our money which will surely come later, if not sooner (not that I believe they will really stop, their QE actions will just go underground). The dollar is higher as a result, bonds are also higher, oil is lower, silver & gold are lower, and food commodities are mixed.

The still worthless, conflicted, and hypocritical Mortgage Banker’s Association released Purchase Applications for the prior week… down again, this time by a supposed 4.4%, but Refinancing activity supposedly rose by 1.3%. Here’s Econohope:
The volume of mortgage applications to purchase a home fell 4.4 percent in the June 3 week, a week that closes out a flat month of May and starts June off on a weak note. Purchase volumes aren't going to be boosting expectations for home sales. Unlike purchase volumes, applications for refinancing have been on the climb and relative to purchase volumes are at their highest point since the beginning of the year. The refinance index rose 1.3 percent in the week and is getting a solid boost from low mortgage rates, at 4.54 percent for 30-year loans for the lowest level since November.

Remember, there are a huge number of Option-Arm loans resetting and that number increases throughout the year. The real problem is that most of those mortgage holders are underwater and therefore cannot refinance.

The “Fed’s” Beige Book comes out this afternoon to baffle us with more of their economic disinformation. But that comes after the petroleum report which I’m sure will show even more demand destruction and record oil inventories.

Now that the players are getting the idea that QE3 is not on the way immediately, the drug addicts are melting down. Here’s one now, crying for “reform,” which to him means more, more, and still more:
Jamie Dimon gripes to Bernanke

NEW YORK (CNNMoney) -- JPMorgan Chase CEO Jamie Dimon is still griping about financial reform, and this time, he took his complaints straight to the top official at the Federal Reserve.

"I don't personally buy the argument that because it was a financial crisis it has to take a long time coming out," Dimon said in a Q&A session following a speech by Ben Bernanke at the International Monetary Conference in Atlanta Tuesday.

Dimon blames financial reform for stifling growth. He gave the Fed Chairman a laundry list of ways regulators have already cracked down on the banking system, after the Dodd-Frank financial reforms were passed last year.

"Most of the bad actors are gone," "off-balance-sheet businesses are virtually obliterated," "money market funds are far more transparent" and "most very exotic derivatives are gone," he said.

Bernanke: Jobs still weak
Dimon, who is known for his vocal opposition of many of the Dodd-Frank reforms, said he fears those reforms may be hindering, rather than helping, the recovery.

"Has anyone bothered to study the cumulative effect of all these things?" he asked Bernanke. "Is this holding us back at this point?"

Gee Jamie, have you bothered to think about the cumulative effects of permeating the world with your money from nothing debt? This whining comes from a drug addict who belongs in jail - definitely the narcissist of the decade.

Below Arnie Gunderson hits the nail on the head regarding the revolving door between industry (special interest) and regulators and how that helped lead to disaster at Fukushima. He also points out that there is nowhere to run, and that “Hot radioactive particles in Seattle are at 50 percent of levels seen in Tokyo,” and that those particles are charged and therefore “Latch onto lung tissue.”

So, how are you feeling now about the way your government, and the government of Japan have reacted to this crisis?