Bobbys Corner-Open Market-March.27.2012

Good Morning:

Lots of activity in the overnight session-but not a lot of price movement.
The USD took a slight hit after comments from Fed Chairman Bernanke that he plans on keeping the monetary policy “highly accommodative” for the foreseeable future.

In the Euro Zone-the Portuguese/German government bond yield spreads have narrowed to under 1000 bps-this is the first time since September that the spread has been below 1000.

Crude oil is again trading around the $107/bbl level.  Today the API (American Petroleum Institute), will announce their weekly inventory report, and it is expected to show inventory at 2.75 million barrels-which may damper the run up by the oil bulls.
With crude hitting record highs against the GBP and Euro-there is concern that this could cause a Europe wide recession.

Gold and Silver are higher at this time.  Oil is steady-just below $107/bbl

Asian equity markets were mixed-Europe is higher-US Futures are lower.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-March.22.2012

Good Morning:

A messy overnight session-that saw the “risk” switch shut off very quickly after China posted lower than expected PMI (purchasing manager index) data.  The data printed below the key 50 level at 48.1.  This data surely shows that China’s manufacturing sector is slowing, and this comes just days after BHP Billiton commented that iron ore demand is dwindling.
The PMI data in Europe was not much better-as both the manufacturing and service sectors in the EU saw a drop.
UK Retail Sales also disappointed-.8% vs. an expected -.5%.

Asian equity markets were all higher-after a 45 point decline in yesterday’s Dow.
The negative data had all European markets lower-along with oil, gold, and silver.

Today we have data on jobless claims, house price index and Fed Chairman Bernanke will be speaking again today.
Nothing that should rattle the markets-but you just never know.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-March.1.2012

Good Morning:

Yesterday’s comments from Fed Chairman Bernanke took the steam out of any additional Fed stimulus in the short end.  The marketplace still seems to feel that the Fed will eventually do a 3rd round of their QE program-but no indication was given of when any additional QE would take place.  As the jobs markets tries to do a little better-the  Fed will monitor the situation, and act accordingly.

In other news-The Bank of England’s Miles sees  the UK QE program as very worthwhile.  The QE helped keep Gilt yields lower, along with the UK’s safe haven status, kept the nation’s economy from teetering.

Asian equity markets were lower, while European equity markets are higher-along with US Futures.

Oil is higher-over $107/bbl.  Gold is also inching up.

HAVE A GREAT DAY & GOOD LUCK

anBernanke Sees Signs Economy is Improving and Fiscal Policy Risks

• Large and increasing level of government debt runs risk of serious economic consequences
• Long way before labor market can be said to be operating normally
• Fed will continue to monitor situation in Europe closely, and take every available step to protect US financial system and economy
• There are concerns that have been weighing on US business investment
• Inflation has declined and Fed expects it to remain subdued
• Signs economy has declined and Fed expects it to remain subdued

Bobbys Corner-Open Market-January.26.2012

Good Morning:

With the ongoing sage between the Greek government and private investors continuing-there have been reports of the private sector accepting a interest rate of less than 4%.  This is a major barrier that will now allow Grrece to seriously revamp their debt.  Greece has a 14 billion euro payment due in March-and without the help of the IMF or ECB-they will not be able to meet this deadline.
This news pushed the EUR/USD pair into the mid 1.31 handle (1.3173).
Italy sold 4.5 billion euro worth of 3 year notes-with the lowest yield since last August.  The yield was 3.763% versus 4.853 on the last 3 year note auction.

Yesterday’s press conference by Fed Chairman Bernanke brought the possibility of a third round of QE to the markets if unemoloyment remains high-so I guess we will see more QE by the 3rd quarter of this year.
He also talked about keeping interest rates low through 2014.

Gold, Silver and Oil are all higher-as are equities and futures.

HAVE A GREAT DAY & GOOD LUCK

Fed Chairman Ben Bernanke Press Conference

http://www.federalreserve.gov/newsevents/press/monetary/formcprojtabl20120125.pdf

• Fed is not changing the way it conducts monetary policy
• Fed aims to support a stronger recovery, and reiterates the highly accomodative stance
• Reiterates late 2014 interest rate language
• Clarity of policy direction is objective
• Higher Inflation would reduce ability on decisions
• maximum employment on equal footing with stale prices
• not feasible for any central bank to fix long run goal for employment
• Maximum employment level is not ‘immutable’
• Economy is expanding moderately with some slowing in global growth
• Jobless rate is elevated
• Further improvements in labor market
• Private sector effort must be significant
• Oil and commodities prices have flattened, turned to the downside
• CPI has been subdued, inflation should be at, or below, FOMC mandate
• Policy assessments should not be viewed as unconditional pledges

Fed Chairman Bernanke Speaks From Washington

Says:

• Sees more accomodative financial conditions
• Fed ‘prepared to adjust’ holdings
• Longer-Run estimates inherently uncertain
• Mandate consistent inflation is 2% or ‘bit less’
• Oil down from peaks
• FOMC expects only ‘moderate pace’ of growth
• Jobless rate to gradually decline in coming quarters
• FOMC expects unemployment to fall only gradually
• ‘Pace of progress is likely to be frustratingly slow’
• Will monitor Europe closely
• Europe debt crisis may harm, confidence, growth
• ‘Inflation appears to have  moderated’
• Fed seeks to enhance communication clarity
• FOMC did not make decision on communications

Fed Chairman Bernanke Speaks at Conference In Boston

Says:

• Flexible inflation goal not enough to ensure stability
• Fed is more transparent on outlook, policy
• Crisis to have profound, lasting economic impact
• Applying lessons of crisis to ‘take some time’
• Does not discuss economic outlook
• Fed to increasingly use communication ‘tools’
• Fed seeks to increase clarity about policy goals

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