But first, a brief dollar update; oil spiked up to US$82/barrel as the US dollar index fell briefly under 75. It has since moved back up to its recent trading range, and as I type is hovering around 75.2-75.3. (As an aside: I'm told that the traditional ratio of gold:oil price is 13:1, or gold/troy oz costing 13 times as much as a barrel of crude in New York trading. By this measure, oil is right in line with gold. I haven't run the number history tho' to see whether this ratio is valid.) Fundamentally, the DXY has engaged in a series of tests down over the last week and a half, with each test down falling slightly lower than the previous. Whether this pattern will continue, I can't say.
The US S&P 500, by the way, has seen the 20 week moving average break soundly past the 50 week moving average, and this indicator has never failed in the modern era to indicate a sustained bull market, with significant upside ahead. However... I... just cannot see how we get there with these fundamentals. It just feels all. wrong. This whole rally makes me think of the recession/inflation rally of the late 1970s, where the stock markets climbed like gangbusters while the economy tanked, and it was mostly an inflation play, with the difference being inflation was actually present.
I just don't know. I really don't. I also don't know what happened to the equities markets late in the afternoon on Wednesday. But I do know I'm not buying the MarketWatch explanation of a correction call; those have been coming for weeks. That swing down had force to it, and the only thing that stopped it was a combination of position-coverage and market close. But futures for tomorrow are flat, so.
Anyway, some tabs for you. Major banks are starting to hit careful credit card users with charges - annual fees, charges for not maintaining a balance, things like that. Cards used to have annual fees all the time, but it's been a while, and these are stupid. Karl at Market Ticker is seriously pissed off and calling for boycotts, because a lot of this is bullshit.
Naked Capitalism is calling out the mainstream financial media as propagandists, talking about the ability of the powerful to manipulate media trivially, and the lapdog role they have adopted. Sound familiar, anyone? Daniel Hoffman guest-blogging on Zero Hedge notes Treasury Department lies. Hedgie himself is content with the former SEC chair saying that anyone expecting ratings agencies or the government to do their jobs are "making a huge mistake." Buyer beware, indeed.
(Oh, and on the topic of media, keep an eye on this CanWest bankruptcy.)
Glenn Greenwald has an extensive column on the latest Goldman Sachs executive named to a key government post as GS's and other large-bank taxpayer-funded profits soar. In particular, this GS executive has been named chief of the SEC Enforcement Division. I'd laugh, or I'd cry, but either way, this is just sad. Mr. Greenwald documents how Goldman Sachs, Citigroup, and JP Morgan have more access to Treasury Secretary Geithner than anyone else with the possible exception of Chief Executive Obama. Think any of this might fuel resentment much?
Note also Paul Volcker's slow marginalization as he calls for re-separating large commercial banks from risky investment arbitrage. The major banks want to keep playing that roulette, particularly now that they know the government won't let them fail - and why wouldn't they? It's a money spigot. And they're winning; Team Obama is on their side. Oh, and we're starting to see admissions that "some" of the $700B TARP funds won't be repaid. O RLY?
Today's bear pr0n: John Mauldin talks about 'a worse crisis' coming; to counteract that, see Mary Stokes and Jelena Vukotic at RGE Monitor talking about stabilisation in Eastern Europe.
That's all for tonight. Good luck.