TCM Notes : 4/30/09

• FOMC came and went, and all I got was no interest on my cash! We are still quantitative easing to the tune of 1.25 Trillion for agency mbs paper, 200b for agency debt by the end of the year, and 300b for treasury securities by autumn. By them not expanding the amount for Treasury paper TLT broke down, and TBT shot up. Clearly breaking out of their ranges. Traders are calling the bluff of the Fed as they doubt that the Fed can monetize all that paper the Treasury is pumping out. However, with 30yr fixed rates at 4.8%, any pressure on that to the upside could evoke the Fed into an expansion of their Treasury securities purchases. The saga continues.. http://www.federalreserve.gov/newsevents/press/monetary/20090429a.htm
• Ken Lewis lost the chairman's role at BAC. At least he still has his job......for now. From banker of the year to sacrificial goat. Way to go there Kenny boy!
• DNDN : Keeping with this gunslinger stock it reopened today near 27 and faded into the 22s. Up 94%. Those lucky bastards that bought that 40 second free fall Tuesday before the halt.......kudos. The casino is open!
• Copper < $2lb again. Leading many to blame the "flu pig" and claim the move seen in base metals recently was nothing more than a bear market bounce.
• Chemicals industry is starting to rebound.
• MGM : "waiver of financial covenant requirements and leverage restrictions on its $7 billion senior credit line has been extended to June 30. The previous temporary waiver was set to expire on May 15." Article is in the shared items section. Bankruptcy has been avoided for the moment, so they got that going for them.
• GDP contracted 6.1% is a number I had thrown out 6 months ago. I think Jamie Dimon is where I got that from and it seems to have been spot on. The other thing that accompanied that prediction was that it would be the trough of the cycle. Things are stabilizing somewhat so we'll see if this is the case.
• Remember when we were oversold and it stayed that way for an agonizing amount of time? Well markets can remain overbought for similar periods. And the futures are indicating now that the target of 88.40 for SPY will be realized today.
• Still following ideas mentioned in previous notes.
• Oh, and Chrysler may file for bankruptcy today. 40+ hedge funds would not budge on their debt they hold. Word is Obama is ready with two speeches.......just in case.