World economy talk

[tidus1203]

I am gassing up by Sunday, di ko na paabutin yan ng Monday. Of course the gas companies won't be able to raise prices this lenten season...

I am watching for oil momentum now. We are closing in that upward pressure point. I have some cash on stand-by just in case!

[uls]

nonfarm payrolls and unemployment rate will be out tonight

US stock and commodities markets will be closed

bond and futures markets will be open

this time, we could see a positive number

a positive number is inflationary

the 10 year treasury yield could hit 4%

the Fed will have to raise rates soon

[tidus1203]

Very critical jobs number, if it dissapoints again USD drops and that could be the catalyst for oil...

But Fed raising rates? Definitely not this year even if there is positive jobs numbers...

[tidus1203]

WASHINGTON (Reuters) - U.S. non-farm payrolls, a key measure of the economy's health, rose in March for only the third time since recession struck in late 2007 as the private sector stepped up hiring at the fastest pace in almost three years.
Employers added 162,000 jobs last month, the Labor Department said on Friday, leaving the unemployment rate steady at 9.7 percent for the third straight month.

http://finance.yahoo.com/news/March-...&asset=&ccode=

[uls]

not immediately after this positive number (though lower than expected)

it will take consecutive positive jobs numbers to make the Fed raise rates

but i think the Fed will to tighten soon

i'm basing that on treasury yields which are rising across the curve

[tidus1203]

Remember how I always bash Bernanke and co. like a year ago? Me thinks he and his co. will screw up and raise rates too late cause these guys always lagged anyway... My bet is walang rate rise this year...

[uls]

yes they'll be late

bond traders are always ahead of the Fed

[Monseratto]

Is the euro down again? Also the Peso has "improved" against the greenback, it's above 45.

[uls]

yep

the euro fell

more like the USD strengthened coz of the jobs data

check out USD/JPY

[tidus1203]

Is the euro down again? Also the Peso has "improved" against the greenback, it's above 45.

More like the USD is getting killed with NORMAL ASIAN CURRENCIES (cause JPY ain't normal)... PHP is not alone, even SGD, MYR, THB, IDR, INR are up against the USD...

[uls]

dollars are flowing into emerging markets driving up EM currencies

risk appetite is strong

[uls]

Oil stockpile on tankers shrinks
http://online.wsj.com/article/SB3000...795631300.html

The huge floating stockpile of crude oil kept on tankers amid a global supply glut is showing signs of shrinking, as traders struggle to make profits from the once highly lucrative storage play.

The volume being stored at sea has nearly halved from a peak of about 90 million barrels in April last year, according to ship broker ICAP. The total is expected to fall even further.

Some analysts have seized on the contraction as evidence that world oil balances are tightening and the surplus that built up during the recession, when energy demand in industrialized countries plummeted, is eroding.

^^

in 2009, speculators rented supertankers to store oil at sea coz on-land storage was full due to low oil demand

it wasnt profitable to sell the oil immediately coz oil price was very low ($30+/barrel in March 2009)

so they stored the oil in supertankers to sell in the future

oil was held in floating storage for several months

Q1 2010 -- the amount of oil in floating storage has fallen

since oil price has risen a lot from the 2009 lows, speculators unloaded and took profits

that excess oil supply stored at sea is a gauge of oil demand

now that the floating storage is being depleted, it's a sign of increased demand

[Monseratto]

Oil inching painfully higher.

Last time crude was this high, the local exchange rate was around P40 vs the greenback...



Better head for the gas pumps...

EUR/USD 1.3483
USD/JPY 94.3250

[uls]

nag full tank na ako last week pa hehe

check out the gas stations, looks like nag price hike na

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aside from last friday's nonfarm employment report,

the ISM services index last night showed US services sector grew in March

the positive news sent oil price beyond $86

oil price hit an intraday high of $86.90

the 10 yr US treasury yield hit 4%

[tidus1203]

Time to buy oil and ride the momentum!!!

[uls]

a report came out saying Greece wanted to change the IMF-EU rescue plan

the Greece problem is far from over

euro down

[safeorigin]

another episode of crosstalk about IMF
[ame="http://www.youtube.com/watch?v=QghkTSwtvdM"]YouTube- CrossTalk on IMF: To be or not to be...[/ame]

[uls]

Gold passes $1,150



technical strength

increased physical buying

sovereign credit risk

Fed to maintain ultra low rates

[uls]

bank depositor runs reported in Greece and foreign banks are pulling liquidity out of Greece banks

not good

check out Greece govt debt yields

the yield curve has flattened

it is supposed to be sloping upward



look at the 6 month yield

bond investors now think Greece will default within 6 months

[uls]

uh oh

Fitch Downgrades Greece
http://online.wsj.com/article/SB1000...393050242.html

Fitch Ratings cut its rating for Greece to the lowest investment-grade rating and said the outlook remained negative, adding to the woes facing the country.

Yields on Greek debt have soared this week as worries have grown about the country's ability to finance its heavy debt load, with some analysts saying the likelihood of the country needing to accept aid from the European Union and International Monetary Fund is growing.

The downgrade comes days ahead of an auction that will test investors' willingness to buy some of the country's fastest-maturing debt. On Tuesday, Greece is to auction a combined €1.2 billion ($1.6 billion) of 26-week and 52-week Treasury bills.

Fitch cited the recent jump in Greek debt yields in its downgrade of the country by two notches to triple-B-minus, from triple-B-plus.

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15:29 09Apr10 RTRS-FITCH CUTS GREECE’s FOREIGN LONG-TERM ISSUER RATING TO ‘BBB-’ FROM ‘BBB+’

15:30 09Apr10 RTRS-FITCH SAYS GREECE’S OUTLOOK IS NEGATIVE

15:32 09Apr10 RTRS-FITCH SAYS GREECE’S TWO-NOTCH DOWNGRADE REFLECTS INCREASED INTEREST COSTS, WORSENING ECONOMIC PROSPECTS

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Greece bank runs continue

ECB will have emergency meeting