Author: admin

The technology sector has been one of the hottest plays for
investors in 2013, and right now there is one tech firm that has the market’s
full attention.

 

Over the last 12 months Yahoo! Inc. (ticker: YHOO) has seen
tremendous growth increasing 135% in value from its $17.00 low, surging to a
high of $40.00 per share. Many analysts are saying that the company is still
cheap and expecting a continuation of this rally in price. Plausible? <<Get My YHOO Trade setup FREE>> 

 

It all comes back to revenue and YHOO is certainly headed in the
right direction. The company has been making significant adjustments in its core
business model which is very “ad driven”. As a result they are seeing higher
click through rates, which translates into revenue.

 

Additionally, YHOO is one of the most trafficked sites on the
web and owns a number of highly trafficked websites such as Flicker, and has
acquired a stake in Alibaba.com (IPO expected 2014)…. All of this has had a
direct impact on the bottom line leading to increased profitability.
Expectations for Alibaba’s IPO looks quite bullish, which could lead to another
bullish pop for YHOO if all goes according to plan. Many are anticipating that
Alibaba’s IPO results will be similar to that of Facebook’s IPO.

 

The fundamentals for YHOO look great, but that is only part of
the story. Now lets take a look at the technical, which are just as impressive.
YHOO has is obviously in a strong uptrend, and the “intelligent investor’s”
will be looking to join the rally by buying into the pullbacks into support.  

 

The Trade Set Up

The key when trading is to allow the trade to come to us rather
than chasing after it. There is an area of support that has my eye, but it will
require a little bit of a wait to get the price I want.

 

I am looking at a long as price retests support at $39.08, with
a stop at 38.74 and an initial target of $40.00 where I plan on shaving half of
the position. The purpose of this initial move is to eliminate trade risk and
then the second half of the position will be used to milk profit out of the
trade.

 

Here is a quick look at the chart:

 

For those of you looking to play YHOO, keep in mind that the
company will be releasing earnings sometime during the last week of January
2014. That to say, it is always prudent to use those protective stops just to
prevent any trade from getting away from us around those “big news” events.

 

Have a great Christmas and a happy new year!

 

Your top-down market strategist,

 

Justin Burkhardt | TradeTrends.com

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/S6Bj_pmngGc/story01.htm Burkhardt

“The new year should be very exciting for EURUSD bears,” BofAML’s Macneil Curry explains. Historically, January is the worst month of the year for the currency pair. Since 1971 (interpolated data pre-1999) it has averaged a return of -1.27% (excluding carry) and fallen 62% of the time. With EURUSD having just confirmed a top and bearish turn in trend, this January should be no exception to the historical norm. EURUSD bears should be salivating for the start of the new year.

 

 

Source: BofAML

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/PNIuXfcAJFI/story01.htm Tyler Durden

Submitted by Simon Black of Sovereign Man blog,

Here’s a question– if you’re in the Land of the Free, do you think those green pieces of paper in your wallet are dollars?

They’re not. A US dollar was defined by the Coinage Act of 1792 as 416 grains of standard silver.

No, those green pieces of paper are Federal Reserve notes. “Notes” in this case meaning liabilities to the central bank of the United States.

That makes you, me, and anyone else holding those green pieces of paper essentially creditors of the Federal Reserve, whether we signed up for it or not.

The Fed is theoretically like any other business. On one side of its balance sheet, it has assets. On the other side, it has liabilities.

The Fed is unique, though, in that its liabilities– namely Federal Reserve Notes– are passed off as money in the Land of the Free.

And they have a legal monopoly in this money business. Just ask Bernard von NotHaus, the founder of Liberty Dollar who was labeled a domestic terrorist and convicted for minting silver coins to be used as a competing money.

Moreover, the Fed has the ability to increase its liabilities at will. Mr. Bernanke can conjure additional Federal Reserve notes out of thin air and pump them into the system.

And at this point, thanks to a long-standing policy of wanton money printing, the Fed has more liabilities than ever before in its history. By an enormous margin.

This precarious balance sheet is dangerous, because if the Fed goes bust, everyone loses.

Is it even possible for a central bank to go bust? Definitely. Zimbabwe and Tajikistan are infamous examples.

And most recently it happened in Iceland. The banking system there collapsed from being so highly leveraged, and Iceland’s central bank suffered tremendous losses.

The end result was insolvency, and the central bank’s liabilities, i.e. the Icelandic kronor, went into freefall, losing 60% against the dollar and euro in a matter of days.

So yes, it does happen. And the consequences are devastating.

But how likely is it that the Fed could go bust?

In its most recently published balance sheet, the Fed listed assets valued at $3.5 trillion.

Most of this is US Treasuries and ‘agency’ debt securities. You probably remember those– the toxic mortgage debt that blew up a few years ago like Fannie Mae and Freddie Mac. Not exactly low risk.

Meanwhile, the Fed has become one of the biggest creditors of the United States government… which has managed to accumulate more debt than any government in the history of the world.

Of course, the only way the US government can pay interest to the Fed is by going into even more debt (which the Fed then has to buy).

Every time this happens, the Fed’s already razor-thin capital gets smaller and smaller, and the Fed’s balance sheet becomes riskier and riskier.

In fact, the Fed’s capital ratio (1.53%) is lower than Lehman Brothers when they went bankrupt in 2008.

But what happens if the Fed becomes insolvent?

In the case of Iceland, the government bailed out its central bank.

Iceland’s government went from being essentially debt free to having debts in excess of 100% of the country’s GDP, just to bail out the bank.

But the US, Japan, and Europe are already too indebted to bail out their central banks. An insolvent government cannot bail out an insolvent central bank.

The IMF is not an option either. The US, EU, Japan, etc. make up roughly half of the IMF capital quota– these are the countries who fund the IMF, not the other way around.

There really is no backstop for the Fed. The buck, so to speak, stops here. And with a capital ratio of just 1.53%, the Fed’s balance sheet is already in precarious financial condition.

Given that the Fed’s assets are so closely tied to the finances of the US government, the outlook should concern independent, thinking people.

If they go bust, the value of Federal Reserve notes (i.e. ‘dollars’) is going to plummet… along with the paper wealth of anyone holding them.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/mKbcQL2TLEU/story01.htm Tyler Durden

New 52-week highs reached 2-month highs (and lows at 1-month lows) as stocks ruged to new record-er highs once again today. Aided by AAPL, the NASDAQ outperformed but the ridiculousness was not limited as TWTR continues its exponential rise (up over 59% in the last 2 weeks). Today's range was small in stocks (except for a strange – likely rebalancing related – 6% rise in the Russell at the open) and volume barely above the lowest of the year. Bonds sold off modestly with 7s and 10s worse at +3.5bps following ths morning's un-fat-finger idiocy in Treasury Futures markets. VIX was banged lower (with a late flourish) to 1-month lows. The USD slipped modestly lower on the day but rallied from the US open but correlations to JPY crossesd were not great for stocks once again. Commodities were quiet with Silver up and gold down (back under $1200).

 

Russell's open confused a lot of people…

 

But The Taper continues to be great news for US equities….

 

As TWTR just goes bull retard…

 

Bonds "broke" higher in price (lower in yield) overnight but  sold off from that point on (as the 2s10s30s butterfly supported stocks today).

 

Commodities were relatively flat… (week after POMO started)

Oh – and we heard numerous times today how the market is now priced on fundamentals as the Fed starts to Taper… hhmm seems like the "market" is still "correlated" to the flow of liquidity and JPY crosses when it wants to be…

 

And finally – the credit market's melt-up as once again it proved "too" anxious and explodes to new cycle lows as hedges are lifted…

 

Charts: Bloomberg

 

Bonus Chart: Will The Nikkei overtake the Dow once again tonight…?

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/fSLo-JwthJA/story01.htm Tyler Durden

New 52-week highs reached 2-month highs (and lows at 1-month lows) as stocks ruged to new record-er highs once again today. Aided by AAPL, the NASDAQ outperformed but the ridiculousness was not limited as TWTR continues its exponential rise (up over 59% in the last 2 weeks). Today's range was small in stocks (except for a strange – likely rebalancing related – 6% rise in the Russell at the open) and volume barely above the lowest of the year. Bonds sold off modestly with 7s and 10s worse at +3.5bps following ths morning's un-fat-finger idiocy in Treasury Futures markets. VIX was banged lower (with a late flourish) to 1-month lows. The USD slipped modestly lower on the day but rallied from the US open but correlations to JPY crossesd were not great for stocks once again. Commodities were quiet with Silver up and gold down (back under $1200).

 

Russell's open confused a lot of people…

 

But The Taper continues to be great news for US equities….

 

As TWTR just goes bull retard…

 

Bonds "broke" higher in price (lower in yield) overnight but  sold off from that point on (as the 2s10s30s butterfly supported stocks today).

 

Commodities were relatively flat… (week after POMO started)

Oh – and we heard numerous times today how the market is now priced on fundamentals as the Fed starts to Taper… hhmm seems like the "market" is still "correlated" to the flow of liquidity and JPY crosses when it wants to be…

 

And finally – the credit market's melt-up as once again it proved "too" anxious and explodes to new cycle lows as hedges are lifted…

 

Charts: Bloomberg

 

Bonus Chart: Will The Nikkei overtake the Dow once again tonight…?

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/fSLo-JwthJA/story01.htm Tyler Durden

Back in 2011 and 2012 we profiled the one organization that was among the key support pillars not only under Canada’s housing market (and according to many, bubble), but also the entity that by providing tens of billions in cash and loan support to Canada’s banks, served to rescue the financial sector from rather unpleasant consequences: the Canadian mortgage insurer Canada Mortgage & Housing Corporation (CMHC) also known as “Canada’s Mortgage Monster.”

Recall from a 2012 report by the Canadian Center for Policy Alternatives:

The official story of the 2008 financial crisis goes like this: American and international banks got caught placing bad bets on U.S. mortgages and had to be bailed out. But not in Canada. Through the financial crisis, Canadian banks were touted by the federal government and the banks themselves as being much more stable than other countries’ big banks. Canadian banks, we were assured, needed no such bailout.

 

However, in contrast to the official story Canada’s banks received $114 billion in cash and loan support between September 2008 and August 2010. They were double-dipping in not only two but three separate support programs, one of them American. They continued receiving this support for a protracted period while at the same time reaping considerable profits and providing raises to their CEOs, who were already among Canada’s highest paid. In fact, several banks drew government support whose value exceeded the bank’s actual value. Canadian banks were in hot water during the crisis and the Canadian government has remained resolutely secretive about the details.

 

It should be noted that the “Extraordinary Financing Framework” was prepared to spend up to $200 billion to aid the banks and other industries. In other words, while the sums reported in this report  are enormous, there were even more funds to be disbursed if the banks needed them.

…

It was the collapse of Lehman Brothers that started the massive support for Canadian banks from both American and Canadian governments, as shown in Figure 1. Massive loans from the liquidity programs of the U.S. Federal Reserve and the Bank of Canada provided the bulk of the initial support for the big Canadian banks.

 

However, it was the third support from CMHC’s Insured Mortgage Purchase Program (IMPP) that did the heaviest lifting. In contrast to the loans of the first two programs, CMHC was providing direct cash infusions to Canada’s banks, although it took longer to ramp up. The program provided its first cash to the banks in October 2008.

 

Within four  months’ time, Canada’s big banks requested and received a whopping $50 billion in cash in exchange for mortgage-backed securities. By March 2009, government supports to Canada’s banks peaked at $114 billion. At this point, support for Canadian banks was equivalent to 7% of Canada’s 2009 GDP. That support represents a subsidy worth about $3,400 for every man, woman and child in Canada.

Visually:

But while the full impact of CMHC on the Canadian housing and banking sector remains debatable, one thing can be said: next to the Bank of Canada, it is perhaps the most critical entity in preserving the nation’s financial stability.

And with a key player responsible for the perpetuation of the status quo having departed Canada recently, namely Goldman’s Mark Carney leaving the BOC and heading to the Bank of England, some were wondering just who would supervise thing up north if and when things turned sour.

Those questions were answered on Friday, when Canada named the next chief executive officer of the government-owned housing agency. His name is Evan Siddall, and, what we assume will came as a surprise to nobody, he was formerly a banker at, drumroll, Goldman Sachs.

From the WSJ:

Canada has tapped a veteran investment banker and special adviser to Canada’s central bank as the new chief executive of Canada Mortgage and Housing Corp., the government-owned mortgage insurer that Finance Minister Jim Flaherty recently said has become something “more grand” than originally intended.

 

Evan Siddall was named head of the agency for a five-year term. CMHC has been without a corporate leader since May. His arrival comes at the Conservative government has introduced a number of measures to bring more onerous oversight over the mortgage insurer, amid mounting concerns about overheating in segments of Canada’s housing market.

 

“Mr. Siddall brings to the position extensive leadership and senior management experience,” Canadian Employment Minister Jason Kenney said in a statement. “His proven financial and capital markets expertise will be of tremendous value to CMHC.”

 

In the same statement, Mr. Siddall said he looked forward to ensure Canadians “continue to benefit from CMHC’s key role in providing affordable and accessible housing, as well as in promoting a strong financial system.”

 

* * *

 

Mr. Siddall was most recently a special adviser to the Bank of Canada Governor, appointed in December 2011, by Mark Carney, who has since left to run the Bank of England. Both Mr. Carney and Mr. Siddall once worked at Goldman Sachs Group Inc.

 

“Evan is a calm, understated professional hand and has a terrific understanding of financial markets, and where risks wherein them lay. It is an inspired appointment,” said Finn Poschmann, vice-president of research at the C.D. Howe Institute think-tank, which has written extensively about CMHC and its role in the financial system.

Why the CMHC?

CMHC is the dominant mortgage insurer in a market that differs from its peers. Mortgage insurance is required of anyone buying a home with less than a 20% down payment. That insurance comes with 100% backing from the Canadian government, which means taxpayers, not lenders, are on the hook in the case of defaults.

Goldman will make sure of just that. And just like that, the tentacular status quo protection team has been reassembled in Canada, and no matter how bad things get for everyone else, the global banking syndicate will be sure to profit even more at the expense of taxpayers in one more country. After all, that is what Goldman’s true function in the world: to take financial crises and make them into opportunities… for some.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/k0GlZ5dbzRY/story01.htm Tyler Durden

Back in 2011 and 2012 we profiled the one organization that was among the key support pillars not only under Canada’s housing market (and according to many, bubble), but also the entity that by providing tens of billions in cash and loan support to Canada’s banks, served to rescue the financial sector from rather unpleasant consequences: the Canadian mortgage insurer Canada Mortgage & Housing Corporation (CMHC) also known as “Canada’s Mortgage Monster.”

Recall from a 2012 report by the Canadian Center for Policy Alternatives:

The official story of the 2008 financial crisis goes like this: American and international banks got caught placing bad bets on U.S. mortgages and had to be bailed out. But not in Canada. Through the financial crisis, Canadian banks were touted by the federal government and the banks themselves as being much more stable than other countries’ big banks. Canadian banks, we were assured, needed no such bailout.

 

However, in contrast to the official story Canada’s banks received $114 billion in cash and loan support between September 2008 and August 2010. They were double-dipping in not only two but three separate support programs, one of them American. They continued receiving this support for a protracted period while at the same time reaping considerable profits and providing raises to their CEOs, who were already among Canada’s highest paid. In fact, several banks drew government support whose value exceeded the bank’s actual value. Canadian banks were in hot water during the crisis and the Canadian government has remained resolutely secretive about the details.

 

It should be noted that the “Extraordinary Financing Framework” was prepared to spend up to $200 billion to aid the banks and other industries. In other words, while the sums reported in this report  are enormous, there were even more funds to be disbursed if the banks needed them.

…

It was the collapse of Lehman Brothers that started the massive support for Canadian banks from both American and Canadian governments, as shown in Figure 1. Massive loans from the liquidity programs of the U.S. Federal Reserve and the Bank of Canada provided the bulk of the initial support for the big Canadian banks.

 

However, it was the third support from CMHC’s Insured Mortgage Purchase Program (IMPP) that did the heaviest lifting. In contrast to the loans of the first two programs, CMHC was providing direct cash infusions to Canada’s banks, although it took longer to ramp up. The program provided its first cash to the banks in October 2008.

 

Within four  months’ time, Canada’s big banks requested and received a whopping $50 billion in cash in exchange for mortgage-backed securities. By March 2009, government supports to Canada’s banks peaked at $114 billion. At this point, support for Canadian banks was equivalent to 7% of Canada’s 2009 GDP. That support represents a subsidy worth about $3,400 for every man, woman and child in Canada.

Visually:

But while the full impact of CMHC on the Canadian housing and banking sector remains debatable, one thing can be said: next to the Bank of Canada, it is perhaps the most critical entity in preserving the nation’s financial stability.

And with a key player responsible for the perpetuation of the status quo having departed Canada recently, namely Goldman’s Mark Carney leaving the BOC and heading to the Bank of England, some were wondering just who would supervise thing up north if and when things turned sour.

Those questions were answered on Friday, when Canada named the next chief executive officer of the government-owned housing agency. His name is Evan Siddall, and, what we assume will came as a surprise to nobody, he was formerly a banker at, drumroll, Goldman Sachs.

From the WSJ:

Canada has tapped a veteran investment banker and special adviser to Canada’s central bank as the new chief executive of Canada Mortgage and Housing Corp., the government-owned mortgage insurer that Finance Minister Jim Flaherty recently said has become something “more grand” than originally intended.

 

Evan Siddall was named head of the agency for a five-year term. CMHC has been without a corporate leader since May. His arrival comes at the Conservative government has introduced a number of measures to bring more onerous oversight over the mortgage insurer, amid mounting concerns about overheating in segments of Canada’s housing market.

 

“Mr. Siddall brings to the position extensive leadership and senior management experience,” Canadian Employment Minister Jason Kenney said in a statement. “His proven financial and capital markets expertise will be of tremendous value to CMHC.”

 

In the same statement, Mr. Siddall said he looked forward to ensure Canadians “continue to benefit from CMHC’s key role in providing affordable and accessible housing, as well as in promoting a strong financial system.”

 

* * *

 

Mr. Siddall was most recently a special adviser to the Bank of Canada Governor, appointed in December 2011, by Mark Carney, who has since left to run the Bank of England. Both Mr. Carney and Mr. Siddall once worked at Goldman Sachs Group Inc.

 

“Evan is a calm, understated professional hand and has a terrific understanding of financial markets, and where risks wherein them lay. It is an inspired appointment,” said Finn Poschmann, vice-president of research at the C.D. Howe Institute think-tank, which has written extensively about CMHC and its role in the financial system.

Why the CMHC?

CMHC is the dominant mortgage insurer in a market that differs from its peers. Mortgage insurance is required of anyone buying a home with less than a 20% down payment. That insurance comes with 100% backing from the Canadian government, which means taxpayers, not lenders, are on the hook in the case of defaults.

Goldman will make sure of just that. And just like that, the tentacular status quo protection team has been reassembled in Canada, and no matter how bad things get for everyone else, the global banking syndicate will be sure to profit even more at the expense of taxpayers in one more country. After all, that is what Goldman’s true function in the world: to take financial crises and make them into opportunities… for some.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/k0GlZ5dbzRY/story01.htm Tyler Durden