Back...

I’ve been a bit lax with the old posting what with the old marriage and honeymoon thing. Also, it's tough to see the wood from the trees when nothing really seems to matter as the market, in its unstoppable mass, continues the grind to infinity and beyond. Anyway, I’m looking forward to getting back into it, having dipped a toe with the admittedly rather empty, Europe in 4 lines piece, something I usually just send to clients as a midday wrap.

In typical fashion, just when everything seems to be going one way, a swift about turn comes and bites you when (and where ) you least expect it. Take the case of the previously friendless GBP for instance, you couldn’t sell it on Wednesday, then the talk of possibly ceasing QE comes up and with the if anything, opposite coming from the Fed minutes, you won’t see too many offers around.

Ditto equities, GS beat by a buck, just the old $5bn in a quarter, Google are better but the march is halted for the time being anyway by the worse figures by BAC. Worrying too, more worrying I think is the GE figures, with revenues coming in light. Given it’s a bellweather for the US economy, the lower top line doesn’t augur well. As every man, his dog and extended family will attest, we need these revenues to start picking up, because costs can't be cut forever.

Industrial production came in ahead with a nice revision too and it served to stall the slide for a while until the Michigan confidence number came in light. It always amazes me how much attention the market pays to these confidence numbers, especially one like Michigan which has such a small sample, but it is what it is I guess.

Something interesting I saw today came from Comstock funds noting the forthcoming downward revisions to BLS numbers. So we all know that seasonally adjusting numbers can massage things a little. Far be it from me to suggest the numbers we see are bent as a fiddlers elbow but well, they are malleable to say the least. In this case, the birth/death model is at fault for overestimating the jobs data. See it is based on the previous 5 years actual business birth/deaths, which clearly in a recessionary period is more weighted to the deaths than births and so flatters to deceive. Not such good news. On the positive side, the revisions won’t take place till next October by which time, the administration, with all their fingers and toes crossed, will be hoping they’ve bought enough time for stats like that not to matter.