Quotable Quotes and Notable Notes - 8/13/2012August 13, 2012 @ 8:28 AM EST
The market more or less decided to take the week off, or at least it felt that way, with lazy low volume days which drifted higher into the daily closes.
So we are sort of taking the week off also to a degree and will keep this very brief this week.
The storyline of the week continued to be the “hope trade”, as economic data out of China, Japan and Europe was far from encouraging, and in fact downright bad. We receive a weekly recap of global economic reports and there were an awful lot of red arrows compared to forecasts.
But a big news item was a lower than forecast inflation rate in China, which warmed the hearts of bulls looking for further easing actions out of the Chinese government.
On the week the SPX put in a quiet but impressive gain of +1.1%, the Dow +0.9%, and the Nasdaq Comp +1.8%. That marks again around the highest closes since early May and five straight weekly gains. Despite the ultimate weekly gain, the SPY traded between 139.85 and 140.60 for the better part of the week.
Another major story broke over the weekend with the Romney campaign’s VP selection of Rep. Paul Ryan of Wisconsin, which was not a huge surprise but an interesting choice. It seems to carve an even clearer ideological distinction for the Romney campaign vs. Pres. Obama, although some are questioning Ryan’s qualifications, but not his intellect. In fact some Republican strategists expressed a concern that he might do a better job than Romney in articulating the campaign’s platform (Sarah Palin he is not).
So what were they saying?
“The cult of equities is dead.” --PIMCO’s founder and co-head Bill Gross in a very much publicized comment, which was somewhat widely misinterpreted. Gross and his whole PIMCO team were all over the airwaves talking up their “New Normal” theories and the headwinds which face asset growth over the long haul. (Coincidence that PIMCO recently launched a long/short fund to much fanfare?)
“I am a legend.” --Jamaican sprinter Usain Bolt after winning three gold medals and completing a “double triple” of winning the same three events in two consecutive Olympics. The head of the IOC, Jacques Rogge, rained on Bolt’s parade a bit, calling him an icon but not yet a legend, which he said “takes at least three to four Olympic games and being on top for maybe twenty years.” (Hmm, Rogge himself was a sailor for Belgium who competed in three games).
"You f---ing Americans. Who are you to tell us, the rest of the world that we're not going to deal with Iranians?" --a quote Reuters attributes to an unnamed Standard Chartered executor director in 2006, which has been denied by the current CEO. Further from Reuters on the entire issue, “The New York State banking regulator, Benjamin Lawsky, called Standard Chartered a rogue institution and accused the bank of hiding 60,000 secret transactions worth $250 billion over nearly a decade. The transactions generated hundreds of millions of dollars in fees.”
“Curiosity landed on Mars. I tell my golf-obsessed friends that what JPL (and NASA) accomplished is like teeing off at Saint Andrews and making a hole in one at Pebble Beach -- with the same ball.” --Huffington Post quoting Dr. Philip Neches
“I want to congratulate Mr. Ryan. I know him, I welcome him to the race. He is a decent man, he is a family man, he is an articulate spokesman for Gov. Romney’s vision, but it is a vision that I fundamentally disagree with.” --Pres. Obama, also calling Ryan “the ideological leader of Republicans in Congress”.
“My veins run with cheese, bratwurst, and a little Spotted Cow and some Millers," Rep.Ryan said at a rally, his voice cracking with emotion, according to Yahoo Political Ticker. "I even think ice fishing is interesting."
"I've been working on the trading desk at Schaeffer's for about six years and this goes in as one of the top five most boring weeks I've experienced.” --Schaeffer's Senior Equities Analyst Joe Bell
Well, that about sums it up better than we could. There was a dearth of market-moving U.S. economic data last week and many commented on vacation time for European politicians as being a major blessing for the quiet markets. This week promises to be a bit more interesting with a much fuller plate of U.S. data, the ramp up into the Fed at Jackson Hole and August options expiration.
(The Olympics closed down today and we must say we thoroughly enjoyed them, time delay and knowing results in advance be damned. The final medal count was in and came in right on pre-Olympic projections, with the U.S. coming out on top, followed by China, Russian and Great Britain.
Britain’s tally of 29 golds and 65 overall medals far surpassed totals in recent Olympics, but that is just about always the case with studies showing the host country winning anywhere from 25-60% more medals than it usually does. And we continue to ponder what an incredible fact that is and why exactly it should be so?)
David W. (aka The Underground Trader)