Monday, December 30, 2013

Financial Sarcasm Roundup for 12/30/13

This is probably my last chance to be sarcastic before 2014 rings in a whole new year of Alfidi Capital  sarcasm.  I shall make the most of it.

US Treasury yields are on the rise again.  Lots of hedge fund managers and other assorted dummies are still buying stocks.  That's okay with me.  I'll laugh when rising yields force up the borrowing costs of those companies using stock repurchases to support their share price.  I'll laugh even harder when banks that aren't supposed to be prop trading anymore start losing on yield arbitrage trading.

Oh goody, here's another big non-surprise for everyone who isn't paying attention.  Academic researchers who bend over for Wall Street with baloney theories get financial rewards.  Remember that the next time a financial advisor tells you the efficient markets hypothesis works.  Academics' public statements aren't the only parts of their careers that face conflicts of interest.  Major funders can skew peer-reviewed research, as the Fed knows darn well.  The pointy heads in ivory towers are just now getting around to filing disclosure statements with their universities.  Contrast this with longstanding requirements for public company insiders to file Form 4 to see how far behind these so-called cutting-edge researchers are in transparency.  On the other hand, it's good work if you can get it.  I don't accept sponsored posts on either of my blogs and I don't publish sponsored work on my website.  My attitude toward disclosure is in my AL-FAQ-DI and my Legalistic Disclaimerism.

China's premier is pledging to keep the liquidity spigot open.  He can't afford not to do so in light of the Fed's continued ZIRP.  China and the US face the near-term prospect of competitive currency devaluations.  That race is a steady marathon right now but it could easily become a sprint that immediately exhausts both competitors' central banks.  The people claiming China had unofficially shifted to tighter monetary policy need to do a double-take.  The PBOC got spooked when it temporarily lost control of intraday lending rates this month and now knows it can't let that happen again.  Spiking rates would destroy that country's shadow banking system.

All right, that does it for now.  Tonight I'm going downtown to see what's going on around the shopping meccas at Market and Powell.  I'm not going anywhere tomorrow night because the drunks will be out in force.  The dumbest people in San Francisco like to run around and get blasted on New Year's Eve.  I can't relate to those idiots.  This has been a very sarcastic year.