Sunday, May 23, 2010

Just another random Monday...

I'm sure you will have seen it somewhere online by now, but in case you haven't seen the BP live stream from the blowout of their well in the Gulf of Mexico you can watch a live video stream here....

There is also talk that the oil is now officially entering the loop current which means Florida will be in for some stressful weeks and months.
Finally, consider this image of the fishing ban now imposed in the Gulf.
That's about 4 times the size of the last fishing ban area that I saw posted last week.
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I love the fact that even Jim Cramer sees the lunacy of the market. "Frequently people say, "you never complain when the market's higher and you get this action". I want to make it clear to everyone that I thought the last 15 minutes up was outrageous and shows how broken everything is. Just ridiculous... And should be investigated." This was in reference to the autobots running the market up 100 pts in about 10 minutes at the end of the day on no volume. An old trader dropped into today's market wouldn't recognize the market.
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Weekly wrap-up of some old headlines from last week...
* MBA Q1 2010: Record 14.69% of Mortgage Loans Delinquent or in Foreclosure - it's hard to spin this positively.
* Housing Starts increase in April - On the surface this was a good number, but since permits fell sharply in May it suggests that this was a temporary blip.
* NAHB Builder Confidence Increases in May - I don't think the builders have a very good feel for their business anymore.
* House Prices Decline 0.3% in March - On a month-over-month basis, the national average home price index fell by 0.3 percent in March 2010 compared to February 2010
* Commercial Real Estate Prices Decline 0.5% in March - commercial real estate remains in a very ugly position.
* Architecture Billings Index shows less Contraction in April - This is a slightly confusing headline, but basically it suggests that business was weakening for commercial architects around the US, but it was getting worse at a slower pace. Given the glut of commercial real estate around the US, it's hard to see this business picking up any time soon.
Another consideration is that when business does improve many firms may not expand domestically. I've recently read where major US tech firms have sign new expanded leases in India for increased sq footage. This could signal an uptick in their business or a decision to ship more jobs overseas - it's not clear at this point - but I know of many huge blocks of commercial real estate in NY, NJ, CA that you can't fill at almost any price.
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Does anyone else get the feeling that the South Korean delegation to the UN gets their lunch money stolen by the bullies every day?
From South Korea's president Lee Myung-bak: "If our territorial waters, airspace or territory are violated, we will immediately exercise our right of self-defense."
Here's the thing: Someone already violated your territorial waters and sank your ship. Threatening self-defense at this point lacks much punch especially when dealing with a leader that makes Charlie Manson look sane... Either way, keep and eye on the Korean peninsula because a real war over there is one of those "low probability, huge impact" events that you need to watch.
Cheers!

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