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Friday, December 12, 2008


News driver of the moment is the Senate defeat of the auto company rescue package and markets are plunging this morning. Stock futures are down 300 dow points as of this posting so we are getting a test of this rally phase rather quickly in here. I like sharply down opens as they can be catharic and if there is enough volume...a climax can be achieved. Energy markets are sharply lower this morning to start. Its a test there too as crude probes around this bottoming area.

By the way getting less play but huge is the Bernie Madoff ponzi scheme story which could be another massive deleveraging mess. Watch this one carefully.

News headlines today could swing markets in either direction so keep dramamine handy. And MLPS which have no news drivers today on the corporate side will be be moving with everything else. Here we should watch for relative outperformance.

So here comes another day of hand holding.


Anonymous said...

Should be an interesting day, for sure. But I still firmly believe the Senate will ultimately have to pass the auto bailout. They're politicians and as unpopular as this package is, if the public understood how close we are to the abyss it would be the most popular measure in history. Not passing it is just too risky for our noble leaders. But at the end of the day, it won't matter. Like the guy who tells a lie about a small matter and has to keep lying to cover his thread of previous lies until the whole thing comes unraveled, our public officials are in a similar quagmire now thanks to their non-stop decade-long interventionist free market tinkering. The damage was done a long time ago ensuring the implosion that will inevitably come. All they can do now is pick when and even that will soon no longer be an option.

As crappy as things are, I’m not predicting Armageddon. In fact, I believe there must be a pony in here somewhere. Keep the faith, MLPers! But stap yourself in today - a football helmut and shoulderpads wouldn't be a bad idea either.


Unknown said...

It's interesting how this has become a protect the UAW destroy / the UAW vote in the Senate.

The Republicans want to destroy the UAW and the Democrats are willing to let the Automakers fail if the UAW is destroyed by the legislation.

I guess the Democrats haven't figured out that the UAW will be destroyed if the Automakers fail.

I too believe in Free markets, but with reasonable rules to prevent systemic risk.

What we got was the worst of both worlds, less than Free markets with systemic risk.

In the Goldman Sachs ( Remember their March 2008 $200 a barrel price prediction )being the root of all evil dept.

GS Lowers West Tezas Intermediate
crude target to $30.00 a barrel.

NEW YORK (MarketWatch) -- Goldman Sachs on Friday cut its 2009 outlook for oil prices to $45 a barrel from $80 a barrel in the face of the global economic slowdown, while raising the possibility that crude could dip below $40 a barrel shortly. "The global credit threatens to push oil prices below $40 a barrel in the near term as the impact of the global economic recession has swung the oil market from pricing demand destruction in 2008 to pricing supply destruction in 2009," Goldman said in a note to clients. Goldman lowered its three-month West Texas Intermediate crude target to $30 a barrel. In electronic trades on Friday, oil prices fell $3.30 to $44.68 a barrel.

In the Obama advisers are out of their mind dept ( considering the state of the economy ).

Obama's energy team expected to push for CO2 cuts

NEW YORK (MarketWatch) -- With President-Elect Barack Obama expected to name Clinton-era Environmental Protection Agency chief Carol Browning as energy Czar, it's likely the U.S. will move ahead more quickly with legislation to cut greenhouse gases, Houston-based energy research firm Tudor Pickering Holt said Friday. Nobel Prize physicist Stephen Chu is expected to head the Department of Energy. It's a "strong duo...big brained research guy with Washington insider," Tudor Pickering Holt said in a note to clients. "Buckle-up energy guys...Change, for example, carbon legislation!"


Bruce said...

Chu has said repeatedly that he "hates" coal. Unfortunately, that's where we get most of our electricity. Browner is a hard-core lefty and, in her stint as EPA head, never showed one ounce of common-sense or practicality when dealing with the economic consequences of her positions.

Someone better reign these two in.