Solarbird (solarbird) wrote,
Solarbird
solarbird

  • Mood:

No theme, and no clarity

Stocks through the floor (three-digit/9-handle S&P500 ftl; Dow swing today of 687 points from high to low, 680 points from high to close), a selloff in Treasuries. Dollar's basically flat (despite the possible CDS effect?), and the Yen's through the ceiling. Are Japanese investors fleeing? I dunno. It's certainly not going to the Nikkei, and it has a whiff of capital flight to it.

Here, this won't help: The Dow and S&P500 decline this year make it the worst year for stocks since 1937. Yeeeeeeeee-haw! Todd Harrison had wondered whether Monday's selloff was a short-term low, but I guess not. I'm also hearing comments that there are just no real buyers. This is where you get snapback rallies; this is also where you get crashes.

The Fed made the de facto rate cute I've been talking about semi-official, with a rules change that lets them pretend that they're still at 2% while actually going down to 1.25%. Ironically, Monday night was only the second time they hit their 2% overnight target in the last few weeks. I remind readers that opacity, fraud, and accounting bullshit are what got us here. More is not going to get us out.

TED spread bounced down to 3.29 before starting back up to 3.56 as of right now. Banks are continuing to hoard cash. If that insure-interbank-lending thing doesn't kick in soon it's not going to matter much. Instead, we have the Fed deciding to lend money unsecured on commercial notes. This is so far out there I don't have any analysis because I just don't fuckin' know.

Iceland is going to Russia for help. They need to do something since they have a nasty set of bank failures, affecting account-holders all over Europe.

Finally, consumer borrowing dropped in August for the first time since 1998. In the long run, that's good. In the short term, well, that's already fucked, so hey.
Tags: economics
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