Continue reading Closing Bell: Slight Climb Throughout the Day (GE)

Closing Bell: Slight Climb Throughout the Day (GE) originally appeared on BloggingStocks on Fri, 23 Jul 2010 17:00:00 EST. Please see our terms for use of feeds.

Continue reading James Altucher: Stocks Heading to New Highs

James Altucher: Stocks Heading to New Highs originally appeared on BloggingStocks on Tue, 06 Jul 2010 14:40:00 EST. Please see our terms for use of feeds.

Continue reading Closing Bell: Technical Relief On Groundhog Day (GE, JPM, F, AMTD, RPRX, LXK)

Closing Bell: Technical Relief On Groundhog Day (GE, JPM, F, AMTD, RPRX, LXK) originally appeared on BloggingStocks on Tue, 02 Feb 2010 16:00:00 EST. Please see our terms for use of feeds.

Continue reading Market ends the day lower, but up for the month

Market ends the day lower, but up for the month originally appeared on BloggingStocks on Wed, 30 Sep 2009 18:20:00 EST. Please see our terms for use of feeds.

A little more good news for the struggling housing market Tuesday, as a closely watched home price index showed increases in prices for the third straight month in July.

The news comes from the Standard & Poor's/Case-Shiller home price index, which shows that home prices rose by 1.2% from June to July.

Continue reading Home prices move a bit higher

Home prices move a bit higher originally appeared on BloggingStocks on Tue, 29 Sep 2009 11:40:00 EST. Please see our terms for use of feeds.

Continue reading S&P 500 option traders still bullish

S&P 500 option traders still bullish originally appeared on BloggingStocks on Fri, 28 Aug 2009 14:45:00 EST. Please see our terms for use of feeds.

• Despite the deleveraging process many companies have undertaken, on an EBITDA/Debt ratio junk rated companies are as leveraged as they have ever been thanks to the "complete trashing" of cash flows. MS expects leverage ratios to rise even further and, therefore, from a "leverage-risk to yield" basis, junk spreads are way too tight to reward buyers for the underlying default risk.
• In the residential Option ARMs market, delinquency rates as a percentage of original balances are running higher than they were in subprime. On the other side of the ledger - and confirming what is intuitively logical - recoveries as a percentage of balances are significantly lower and falling, which will continue to put heavy pressure on home values. In the Alt-A market things are not going that well either.
• In the Commercial Mortgage Backed Securities (CMBS) world, Standard & Poor recently implemented new tests to determine the downgrade of various CMBS vintages. The test for the 2004 issues was relaxed, which is likely to spare from downgrade 65% of AAA rated CMBS which had been put on negative watch. Under the prior, stricter test, 80% of the watch list issues were in danger of downgrades. Are we really to believe that the relaxation of the testing standards for issues that are coming up for refi between now and the next two years are just a coincidence?
• What caritas the S & P showed toward the 2004 CMBS it apparently took it out on the mezzanine CMBS of 2006 and later. Most AAA mezz tranches are or will be downgraded to A/BBB- grades, while all junior AAAs tranches have gone straight to junk.

Corporate bond market rally originally appeared on BloggingStocks on Mon, 13 Jul 2009 14:40:00 EST. Please see our terms for use of feeds.

On Friday June 5, the U.S. Labor Department will release the unemployment numbers for May. Here are some guesstimates from leading economists:

• The median of 59 estimates will show that unemployment is at 9.2%, the highest since 1983.
• The jobless rate may reach 10% by the end of the year.
• Estimates are that payrolls fell by 521,000 in May after declining by 539,000 in April.
• The median of 60 estimates showed the job losses peaked at 741,000 in January.
• The economy has lost 5.7 million jobs since December 2007.

Continue reading What are the guesstimates for Friday's unemployment report?

What are the guesstimates for Friday's unemployment report? originally appeared on BloggingStocks on Mon, 01 Jun 2009 17:40:00 EST. Please see our terms for use of feeds.

Continue reading The stakes are high for US government bonds

The stakes are high for US government bonds originally appeared on BloggingStocks on Thu, 28 May 2009 14:30:00 EST. Please see our terms for use of feeds.

Can you imagine this! The outlook in the UK has been downgraded by Standard & Poor's to negative from stable. To underscore the dire economic circumstances in the UK, Standard & Poor's David Beers said: "We have revised the outlook on the UK to negative due to our view that even assuming additional fiscal tightening, the net general government debt burden could approach 100% of GDP and remain near that level in the medium term." Yet the Agency did maintain the UK's long term sovereign credit rating at AAA.

The report triggered a drop of 1.2% in the pound to $1.5529 to the dollar and 1.4% against the euro to .8866 pounds.

Continue reading UK's government debt burden may reach 100% of GDP

UK's government debt burden may reach 100% of GDP originally appeared on BloggingStocks on Thu, 21 May 2009 15:00:00 EST. Please see our terms for use of feeds.

Continue reading Quick Take: Why is the market down today?

Quick Take: Why is the market down today? originally appeared on BloggingStocks on Wed, 13 May 2009 17:00:00 EST. Please see our terms for use of feeds.

Continue reading Oil hits high for the year, as S&P goes positive

Oil hits high for the year, as S&P goes positive originally appeared on BloggingStocks on Mon, 04 May 2009 18:00:00 EST. Please see our terms for use of feeds.

Continue reading Quick: the next 700 points on the S&P 500, up or down?

Quick: the next 700 points on the S&P 500, up or down? originally appeared on BloggingStocks on Mon, 02 Mar 2009 16:45:00 EST. Please see our terms for use of feeds.

Continue reading Record drop in home prices

Record drop in home prices originally appeared on BloggingStocks on Tue, 24 Feb 2009 10:50:00 EST. Please see our terms for use of feeds.

Continue reading Diamond Offshore Drilling (DO) to be added to S&P 500

Diamond Offshore Drilling (DO) to be added to S&P 500 originally appeared on BloggingStocks on Tue, 17 Feb 2009 12:05:00 EST. Please see our terms for use of feeds.

The Wall Street Journal (subscription required) has obtained a draft version of the SEC's report on bond-rating firms and their role in the credit bubble, and some of the stuff is pretty scary.

In one e-mail, a staffer at Standard & Poor's, which is own by McGraw-Hill (NYSE: MHP) told another that "we rate every deal," and that "it could be structured by cows and we would rate it."

Another wrote that "rating agencies continue to create" an "even bigger monster -- the CDO market. Let's hope we are all wealthy and retired by the time this house of cards falters. ;O)"

Yes -- complete with the smiley face. If this seems reminiscent of disgraced analyst Henry Blodget's e-mails bashing stocks he was publicly pumping during the dot-com bubble, that's because it's exactly the same. The lesson here, once again, is this: e-mails ever really get deleted permanently and, if you're being shady or doing something unethical, make a phone call, talk with the person in a dark alley, or send them a letter that they can promptly discard. Don't send an e-mail!

Of course, S&P's investment-grade ratings on CDOs stuffed with dodgy loans turned out to be wildly optimistic, and the house of cards has done more than falter -- it's brought down Bear Stearns and wreaked havoc on the economy.

S&P rated deal 'structured by cows' according to SEC report originally appeared on BloggingStocks on Sat, 02 Aug 2008 14:40:00 EST. Please see our terms for use of feeds.

Now that the SEC has had some time to sift though all the evidence of why credit rating agencies were so wrong in their view of mortgage-backed securities, the most disturbing finding is that S&P analysts thought their own conclusions about risk were often wrong.

According to The Wall Street Journal (subscription required), an S&P analytical staffer emailed another that a mortgage or structured-finance deal was "ridiculous" and that "we should not be rating it."

What should the government do now that it has the goods? It could fine S&P, and probably will. The fine could never be large enough to match the hundreds of billions of dollars lost by financial firms that put money into the securities. The SEC could bring charges against some of the analysts. As it is, some of them will probably lose their jobs.

The most sensible solution would be to bar S&P from rating derivatives at all. Would that leave a hole in the market? Probably. Other credit agencies might have been involved in similar misdeeds. That would mean they would have to exit the business as well.

The net effect of moving credit ratings out of the business of covering derivatives would almost certainly mean a huge drop-off in the market for the instruments. That might not be such a bad thing.

Douglas A. McIntyre is an editor at 247wallst.com.

A solution to the credit rating mortgage securities scandal originally appeared on BloggingStocks on Sat, 02 Aug 2008 08:40:00 EST. Please see our terms for use of feeds.

Analysts at some of the large credit ratings agencies may have had their eyes on the cash register instead of paying attention to the quality of their work. So says the SEC.

According to The Wall Street Journal, "The 10-month examination uncovered poor disclosure practices, a lack of policies and procedures guiding the analysis of mortgage-related debt, and insufficient attention paid to managing conflicts of interests."

That revelation all but buries the already damaged reputations of the ratings firms.

Making money is OK, but the practices may have lost investors billions of dollars. The big credit rating shops like Standard & Poor's have the job of evaluating the risk of products like mortgage-backed securities. Investment banks and their clients thought this paper was fairly safe. It did not turn out that way, not by a long shot.

Continue reading SEC: Ratings agencies cheated, a little

SEC: Ratings agencies cheated, a little originally appeared on BloggingStocks on Wed, 09 Jul 2008 13:36:00 EST. Please see our terms for use of feeds.

AK Steel (AKS) added to the S&P 500 originally appeared on BloggingStocks on Fri, 27 Jun 2008 15:16:00 EST. Please see our terms for use of feeds.

SEC requested to ramp up ratings regulation originally appeared on BloggingStocks on Wed, 16 Apr 2008 08:50:00 EST. Please see our terms for use of feeds.