Diary of a Financier

Top Newsstuffs (February 17-23)

In Bookshelf on Sun 23 Feb 2014 at 05:15

Training days…

Video documentary: “25 million pounds” | Adam Curtis
The story of Barings Bank’s 1995 collapse at the hands of Nick Leeson, a rogue futures trader who lost £827mm and bankrupted the company after he hid years’ worth of accumulated, speculative, proprietary positions as client flow trades.

Rail traffic weekly: Slipping lower again | Association of American Railroads (AAR)
Weekly traffic -4.3% y/y; growth cascades into contraction -0.9pp @ -0.4% ytd.
2 of 10 carload groups posted gains: petroleum +7.9%, grain +2.5; minerals -10.6.
[Previously: “Still noise; the signal will have to come in March, when pent-up demand will have to displace these effects from winter storms.”]
#Brown noise $XLE $USO $UNG $DBA $XME

Investor sentiment survey: Exuberance moderated to normalized levels (February 12, 2014) | American Association of Individual Investors (AAII)
Surveys sentiment for equity performance over next 6 months (through 8/2014):
– Bulls +12.3pp @ 40.1% vs 39.0 historical avg & 60.6 high in January (45% considered extremely high)
– Bears -9.1pp @ 27.3 vs 30.5 historical avg & 18.5 postcrisis low in January (25% extremely low)
– Bull/Bear ratio @ 2.2x vs 4x alltime record in January
[Retail investors are so fickle; how quickly their excesses come & go!]
#Bullish #Mean reversion

US household debt & credit report (4q13): Releveraging | Federal Reserve Bank of New York (NY Fed)
Second straight quarterly increase in balances suggests private sector deleveraging is reversing:
Total consumer indebtedness +2.1% q/q @ $11.52T (+$241B in the biggest increase since 3q07) vs $12.68T record in 3q08
Mortgages +1.9% @ $8.05T (+$152B)
Delinquencies have returned to pre-crisis norms, with the exception of elevated student loan impairments, which themselves receded in Q4
[Household sector did a good job of weathering Q4’s rising rates.]
#Bullish

Reinventing education: The school that will get you a job | TIME
New Chicago charter high school, Sarah E. Goode “STEM” School (Science/Technology/Engineering/Math), is a 6-year program that takes 2 extra years for student to obtain an associate’s degree with their diploma.
In addition, a partnership with $IBM guarantees graduates employment in a $40k+ position.
#Jobs guarantee #Vocational

The American Recovery & Reinvestment Act of 2009, 5 years later | Lance Roberts (Street Talk Live)
Updates the progress of Obama’s $830B ARRA fiscal stimulus, part of $31T in total government bailouts from the crisis:
ARRA has not increased real fixed investment (-$53.5B since 1/2009) in “shovel ready infrastructure projects” as intended.
[See also: Moral hazard & the opportunity cost of doing nothing]

Short story: “Thicker than water: A Nantucket family’s trial at sea” | The New Yorker
Amazing account of the capsized Mleczko charter fishing boat off the coast of Nantucket.
[A scaled-down version of The Perfect Storm]
#Non-fiction

Picture of the week:

Photo: Ivanpah solar farm | GigaOM Known as "The Hoover Dam of solar power," these $1.6B in Google-owned solar panels are the world's largest operating project

Photo: Ivanpah solar farm (Las Vegas, NV) | GigaOM
Known as “The Hoover Dam of solar power,” these $1.6B in Google-owned solar panels are the world’s largest operating project
$TAN $GOOG $FSLR $SCTY #Alternative/renewable energy

–Romeo

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  1. […] valuations and psychological indicators have sufficiently moderated, given the interest rate environment. These recalibrations also have me […]

  2. […] Top Newsstuffs (February 17-23) […]

  3. […] underwriting, which accounted for 39% of new issuance in February.” [The deleveraged household sector now has releverage, taking the handoff from an overleveraged corporate sector.  Previously: Banks […]

  4. […] +8.8, forestry +3.8, petroleum +2.9; motor vehicles/parts -8.0, metallic ores -3.2. [Massive pent-up demand surges for the first time after tough winter weather in January/February; petroleum's picture […]

  5. […] Household releveraging (PUSH) 5 years after the credit crisis, US household deleveraging seems to have bottomed with 2 consecutive quarters of debt increases and healthy consumer balance sheets starting a releveraging trend. […]

  6. […] +16%, petroleum +10.3; chemicals -0.2 [After tough winter weather in January/February, pent-up demand surges for second straight week.] #Bullish! $DBA $XLE $USO […]

  7. […] vehicles +10.6; metals -13.7 [We have a trend!  After tough winter weather in January/February, pent-up demand pitches-in with the biggest surge in this three week rally.] #Bullish! $DBA $XLE $USO […]

  8. […] Household releveraging (PUSH) 5 years after the credit crisis, US household deleveraging seems to have bottomed with 3 consecutive quarters of debt increases and healthy consumer balance sheets starting a releveraging trend. […]

  9. […] to the contraction. For example, look at railtraffic, which was cascading lower at a -4% rate through February, but bounced back with +7% prints in May, raising ytd comps from sub-zero to +4% trend.  In […]

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