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Japan’s Shiseido Eyes 20% Growth In China

China Retail News — Thu, 19 Nov 2009 19:30:23 +0000

Japanese cosmetics company Shiseido has announced plans to introduce a new brand into China with the aim of gaining 20% growth in this market. According to Yasuhiko Harada, the chief financial officer of Shiseido, the company made revenues of JPY690 billion last year. Of the total revenue, 10% was from the Chinese market. Shiseido says that due [...]

Zacks Analyst Blog Highlights: Citigroup Inc., Liberty Global Inc., Comcast Corp., Deutsche Telekom AG and Vodafone Plc – Press Releases

Zacks Market Commentaries — Tue, 17 Nov 2009 12:00:07 +0000

For Immediate Release

Chicago, IL – November 17, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Citigroup Inc. (C), Liberty Global Inc. (LBTYA), Comcast Corp. (CMCSA), Deutsche Telekom AG (DT) and Vodafone Plc (VOD).

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Here are highlights from Monday’s Analyst Blog:

Citi to Sell Stake in Bellsystem24

Citigroup Inc. (C) announced that it will sell stake in Bellsystem24 to U.S. private equity firm, Bain Capital Partners, in a deal that values the Japanese call center operator at $1.1 billion.

The company announced on Sunday that it will sell its 93.5% controlling stake in Bellsystem24 − which it held through its Citigroup Capital Partners Japan Ltd. − to Bain Capital Partners through a tender offer. The tender offer is expected to start on or before Nov 20 and be completed on Dec 30, 2009. Under the terms of the deal, Citi will receive 93.5 billion of yen ($1 billion) in cash.

Following the completion of the deal, Citi Holdings’ assets will be reduced by $1.2 billion. However, Citi’s net income and capital ratios will not be significantly impacted by this stake sale, the company said.

Liberty to Acquire Unitymedia

Liberty Global Inc. (LBTYA) announced it will acquire all of the issued and outstanding capital stock of Unitymedia GmbH, the second largest cable TV operator in Germany. The total consideration will be approximately $5.2 billion. Liberty Global will acquire 100% of the shares of Unitymedia for an equity purchase price of around $3 billion and will also assume around $2.2 billion of net outstanding debt of Unitymedia. The deal is expected to be completed by the first half of 2010 subject to regulatory clearance.

Liberty Global is the second largest cable TV operator in the world. However, it is the largest international cable TV operator since Comcast Corp. (CMCSA), the largest cable MSO in the world does not have any operation outside the U.S. As of now, the company has approximately 16.6 million customers in 14 nations, most of which are in Europe. On the other hand, Unitymedia has approximately 6.4 million RGUs (revenue generating units); including 4.5 million analog and digital basic cable subscribers and 1.9 million new service RGUs (digital TV Pay, retail broadband internet, wholesale MMA internet, and telephony).

Germany is one of the lucrative markets in Europe. In 2002, Liberty Global has failed in its attempt to acquire the cable TV business of Deutsche Telekom AG (DT). Unitymedia has the highest uptake of digital TV and highest RGU per household in Germany. Integration of Unitymedia’s operations with Liberty Global will create a formidable cable TV player in Germany to compete with Kabel Deutschland (the largest cable TV operator in Germany), Deutsche Telekom and Vodafone Plc (VOD).

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Japan’s Economic Growth Accelerates, but Deficit Raises Concerns

Money Morning — Mon, 16 Nov 2009 21:30:31 +0000

By Bob Blandeburgo Associate Editor Money Morning Stimulus measures in Japan helped the world’s second-largest economy grow at its fastest pace in more than two years, but it’s unlikely policymakers will reduce spending despite the nation’s rapidly growing debt. Gross domestic product (GDP) in Japan grew at 4.8% annual rate in the third quarter, surpassing all the [...]

Citi to Sell Stake in Bellsystem24 – Analyst Blog

Zacks Market Commentaries — Mon, 16 Nov 2009 19:03:15 +0000

Citigroup Inc. (C) announced that it will sell stake in Bellsystem24 to U.S. private equity firm, Bain Capital Partners, in a deal that values the Japanese call center operator at $1.1 billion.

The company announced on Sunday that it will sell its 93.5% controlling stake in Bellsystem24 − which it held through its Citigroup Capital Partners Japan Ltd. − to Bain Capital Partners through a tender offer. The tender offer is expected to start on or before Nov 20 and be completed on Dec 30, 2009. Under the terms of the deal, Citi will receive 93.5 billion of yen ($1 billion) in cash.

Following the completion of the deal, Citi Holdings’ assets will be reduced by $1.2 billion. However, Citi’s net income and capital ratios will not be significantly impacted by this stake sale, the company said.

Citigroup, once the largest U.S. bank by assets, fell behind last year after a series of acquisitions by rivals. Citi has been among the banks hardest hit by the credit crisis and the recession. The bank has been severely hurt by billions in losses and write-downs of problem loans and toxic assets. 

The U.S. government injected $45 billion in bailout funds into the bank and currently has a 34% equity ownership stake. Citigroup has been selling its assets as part of its restructuring efforts. In October, the company completed the sale of its Japanese brokerage business to Sumitomo Mitsui Banking for $8.7 billion.

We expect Citigroup to incur higher credit losses in the upcoming quarters as its restructuring process continues. However, such strategic sell-out bodes well for the company.

Read the full analyst report on "C"
Zacks Investment Research

Panasonic Starts Tender for Sanyo – Analyst Blog

Zacks Market Commentaries — Thu, 05 Nov 2009 15:48:41 +0000

Panasonic Corp. (PC) provided another update on the acquisition of SANYO Electric Co Ltd. (SANYY) at its Board Meeting held on Nov 4, 2009. The company announced the start of its tender offer to acquire 3.1 billion shares of SANYO (or more than 50% of the company’s total shares) for approximately $4.4 billion (403 billion yen).

Earlier, Panasonic had planned to take over all of Sanyo's shares. Panasonic had entered into a capital and business alliance agreement with SANYO in Dec 2008. The latter is a leading company in the rechargeable battery business focused on lithium-ion rechargeable batteries. Panasonic is one of the leading manufacturers of electronic and electrical products, systems and components.

The tender offer is planned for Nov 5 through Dec 7 at a price of $1.4 or 131 yen per share. Goldman Sachs, Daiwa Securities SMBC and Sumitomo Mitsui Banking Corp. (Sanyo's three major shareholders) holding approximately 70% of total shares have agreed to sell at least a combined 3.07 billion shares to Panasonic.

The Panasonic deal with SANYO is pending regulatory approval but the company said earlier that most of the regulatory hurdles have been taken care of in some countries. Panasonic has so far received the approval of seven regulatory bodies for its proposed acquisition of Sanyo Electric but is still waiting for regulatory approval from the United States Federal Trade Commission, the Ministry of Commerce and the European Commission.

The regulatory bodies were concerned on the growing combined market share of Panasonic and SANYO (approximately 90%) in nickel-metal hydride batteries and cylindrical primary lithium batteries, which will pose a threat to other manufacturers.

To deal with this, Panasonic said that it will transfer to FDK Corporation all the shares of SANYO Energy Twicell Co. Ltd., which conducts the business of rechargeable portable nickel metal-hydride batteries. The share transfer is expected to take place on Dec 21, 2009.

The energy business of SANYO will be added as Energy Solutions to Panasonic’s business, which will further expand its HIT (crystalline silicon) solar photovoltaic cells and modules (batteries) business and accelerate the development and commercialization of next-generation solar cells. By taking over SANYO, Panasonic plans to double production capacity of lithium ion batteries to around 1 million units a year by the middle of 2010.

Panasonic expects the alliance to result in a net profit growth of 80 billion yen in fiscal 2013. Panasonic and SANYO will also set up a ‘Collaboration Committee’, in which Panasonic will invest around 100 billion yen in order to achieve the synergy of both companies. 

Management said that Sanyo is expected to become Panasonic's subsidiary by mid-December, bringing greater expertise in two areas – batteries and solar panels.

This acquisition will enable Panasonic to more aggressively compete with market leaders such as Sony (SNE) and Hitachi (HIT) amid growing demand for the rechargeable power source commonly used in mobile phones, laptop PCs and digital cameras. Moreover, it will help Panasonic become Japan’s largest electronics maker.
Read the full analyst report on "PC"
Read the full analyst report on "SANYY"
Read the full analyst report on "SNE"
Read the full analyst report on "HIT"
Zacks Investment Research

Restructuring at Panasonic – Analyst Blog

Zacks Market Commentaries — Tue, 03 Nov 2009 16:30:24 +0000

Panasonic Corp. (PC) plans to restructure its division, Motor Company in April 2010 to enhance growth potential and strengthen its management structure. Upon completion of the restructuring, the motor company will be dissolved.

Panasonic will reorganize and integrate its Home Appliance, Automotive Motor and Industrial Motor Businesses to form the Home Appliances Company (HA) and transfer the Information Equipment Motor Business to Minebea Motor Manufacturing Corporation.

The company will liquidate Panasonic Motor Matsusaka Co., Ltd., which is Panasonic's subsidiary company, for accelerating manufacturing at other optimal locations after transferring compact AC geared motors and industrial brushless motors to Panasonic Motor (Zhuhai).

Panasonic’s organizational restructuring and its ability to target resources to growth areas have enabled the company to withstand the weak economy. The company aims to strengthen both finished product manufacture and device businesses through company-wide cost reduction efforts, including material costs and fixed costs.

The company has experienced losses in 2009 due to the global economic slowdown, weak consumer spending and slump in electronics sales. To cope with the global slowdown, Panasonic plans to close and integrate 27 manufacturing sites, including 13 in Japan and 14 overseas as part of its restructuring plan. The company also plans to retrench 15,000 employees in Japan , by the end of March 2010.

The tough business environment, global recession and shrinking demand triggered by the financial crisis and changes in market structure have led the company to come out with various restructuring plans.

In fiscal 2010, the company plans to further strengthen its earnings in growing businesses, reform or withdraw its unprofitable businesses, expand its lines of business and accelerate new restructuring initiatives. As a result, the company expects 100.0 billion yen in cost reductions in fiscal 2010.

Panasonic is a leading manufacturer of electronic and electrical products, systems and components for a wide range of consumer, business and industrial uses. Yet, the company faces competition from other large players such as Sony Corp. (SNE) and Hitachi (HIT). Competition also emanates from large international companies such as those in South Korea.

We have a Neutral rating on the stock.
Read the full analyst report on "PC"
Read the full analyst report on "SNE"
Read the full analyst report on "HIT"
Zacks Investment Research

The Three Roadblocks to Sony’s Turnaround

Contrarian Profits — Thu, 08 Oct 2009 11:57:21 +0000

pSony Corp. (NYSE ADR: a href="http://www.google.com/finance?q=NYSE:SNE"SNE/a) is facing the first consecutive annual loss of its 63-year history./p pThe Tokyo-based company lost $1.1 billion (98.9 billion yen) last year, and it expects to lose another $1.4 billion (120 billion yen) in its fiscal year ending March 31. That would be Sony’s first back-to-back annual loss since the company went public in 1958./p pAnd despite renewed optimism within its ranks, Sony still faces a plethora of challenges, including a questionable direction, cost-conscious consumers and a strengthening yen./p pThe onetime bellwether of the electronics industry has seen its market share crumble in almost every category: Nintendo Co. Ltd.’s (OTC ADR: a href="http://www.google.com/finance?q=OTC:NTDOY"NTDOY/a) Wii game console has supplanted Sony’s PlayStation brand, Sony has given up its lead in portable#8230;/p

RBA Raises Rates!

Contrarian Profits — Tue, 06 Oct 2009 18:33:59 +0000

pPandora#8217;s Box of rate hikes is opened! Is the dollar being removed from oil trades? Deficits do matter, eh? Gold heads toward its all-time high#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! A Tuesday morning that is seeing a HUGE currency rally VS the dollar on the news that the Reserve Bank of Australia (RBA) opted to go ahead and hike rates now, and not wait for November#8217;s meeting, as I had thought they would do! WOW!/p pThe first hike#8230; It has opened Pandora#8217;s Box of interest rate hikes around the world#8230; For, if the RBA went this soon, then we can expect Norway#8217;s Norges Bank to push their rate hike earlier on the calendar, maybe even later#8230;/p

A Jobs Jamboree Friday!

Contrarian Profits — Fri, 02 Oct 2009 18:31:22 +0000

p The dollar remains well bid#8230;G-7 to hand currencies off to G-20? Car Sales collapse#8230;Auditing the Lehman cash movements#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! Yesterday, I welcomed you to October. I had been prepared to tell you about a famous radio station here in St. Louis, that has long called October#8230; Rocktober#8230; But forgot, as usual! But anyway#8230; It#8217;s the first Fantastico Friday of Rocktober!/p pToday is a Jobs Jamboree Friday too! And#8230; I#8217;m not getting a good feeling about today#8217;s labor report at the Jobs Jamboree. The forecast is for jobs losses to fall from -216,000 to -175,000, but the unemployment rate to tick up to 9.8% from 9.7%#8230; I got the feeling, baby,#8230;/p

Whiplash Wednesday!

Contrarian Profits — Wed, 30 Sep 2009 19:07:48 +0000

pCurrencies rebound VS the dollar#8230;Aussie and kiwi lead the currencies higher#8230;Data and Central Bank speeches today#8230;Gold rebounds back to $1,000! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you#8230; Instead of a #8220;turn around Tuesday#8221;, we#8217;re seeing a whiplash Wednesday! And for once in a month of Sundays, the Big Dog, euro didn#8217;t lead the other little dogs (currencies) off the porch to chase the dollar down the street!/p pNo#8230; This time it was the currencies of Australia and New Zealand that led the charge VS the dollar#8230; The euro has taken up the charge since opening the doors to a new day of trading in Europe, so#8230; It looks like it#8217;s a #8220;take the dollar to the woodshed#8230;/p

Stop The Presses!

Contrarian Profits — Tue, 29 Sep 2009 18:04:00 +0000

p A bias to buy dollars remains#8230;Looks like coordinated jawboning#8230;Fujii now talks about intervening! Gold remains below $1,000#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! Well#8230; Stop the presses#8230; You know the presses that are talking about the countries that are on the docket to begin a rate hike cycle, because#8230; Russia has thrown a cat among the pigeons this morning with a rate CUT#8230; Let me tell you why this is a big deal#8230;/p pWell, when everyone is thinking that the G0-GO countries of Norway, Australia, and Brazil will probably begin their rate hike cycles this year, and other won#8217;t be far behind#8230; While the U.S. drags its feet and wallows in the zero rate mud#8230; The thinking#8230;/p

European Stocks Down, German Election Boosts Utilities

Contrarian Profits — Mon, 28 Sep 2009 15:20:48 +0000

pWorld stocks hit a 12-day low on Monday, depressed by recent weak U.S. economic data and failing to find support from the G20 summit, while the yen attracted fresh flows to hit an eight-month high against the dollar./p pWeaker-than-expected U.S. housing sales and durable goods orders on Friday drove U.S. stocks lower, and world and European stocks followed that trend on Monday./p pLeaders of the Group of 20 rich and developing nations pledged on Friday to bring the global economy back into balance but their statement contained few surprises and investors are already looking ahead to U.S. employment data at the end of this week./p pGlobal equities and other higher risk assets have risen sharply in the last six months on growing optimism#8230;/p

G-20 Heats Up…

Contrarian Profits — Fri, 25 Sep 2009 19:07:47 +0000

p Dollar#8217;s rally is cut short#8230;Major problems for loans still exist#8230;Yen rallies on exporter repatriation#8230;Kiwi gets whacked! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! It#8217;s still raining here in St. Louis this morning, but I won#8217;t that get me down, as it is a Friday! G-20 has gotten a bit ugly, folks#8230; Seems everyone just can#8217;t seem to get along! Imagine that! 20 different countries, and now they want to be able to watch another country#8217;s finances and comment on them! Oh, I can see that working out real well! NOT!/p pSo#8230; Yesterday, we had the dollar gaining back the ground that it had lost the previous day, but at the end of the day, we#8217;re#8230;/p

Chunghwa Looks Beyond Taiwan – Analyst Blog

Zacks Market Commentaries — Thu, 24 Sep 2009 19:42:19 +0000

Taiwan’s largest integrated telecom operator Chunghwa Telecom Co. Ltd. (CHT) recently adopted a series of measures to expand its presence outside the country. The Taiwanese telecom market is quickly approaching maturity and has become extremely competitive following telecom regulatory changes.

The market size is comparably smaller than other regional country markets, with approximately 23 million potential customers. Therefore, geographical expansion is critical for Chunghwa’s operations to retain a leading edge.

The company formed a joint venture with Singapore Telecommunications Ltd. to build ST-2 telecommunications satellite network. Mitsubishi Electric Corp. and Integral Systems Inc. (ISYS) will install satellite ground system for the ST-2 program.

Chunghwa signed a memorandum of understanding with China Telecom Corp. Ltd. (CHA) to set up a joint venture to develop information and communications technologies in China.

As part of its next-generation network implementation program, the company is deploying Cisco System Inc.’s (CSCO) optical network solution to expand coverage from 6 to 12 cities in different countries of Asia, Europe and the U.S. Successful deployment of an all IP-based converged network will generate considerable international revenue (currently just 4% of total sales) as many Taiwanese firms have regional branches in several foreign countries.

Chunghwa has also entered into a joint venture with Viettel Corp to provide Internet Data Center services in Vietnam.

So-net Entertainment Corp of Japan formed an operational venture with Chunghwa to expand its Internet services. The company will acquire 30% stake of So-net for total consideration of Japanese Yen 170 million.

Chunghwa, China Unicom Ltd. (CHU) and Japan’s KDDI Corp. have decided to jointly build an undersea cable network called APCN3 for a total consideration of $ 500 million.

Along with these initiatives, Chunghwa has taken lot of other measures to improve sales. The company has started selling Apple Inc.’s (AAPL) 3G iPhone in Taiwan and entered an agreement with Warner Music Taiwan to pursue opportunities in the digital music market.

Going forward, we expect fierce competition as Chinese giant China Mobile Ltd. (CHL) has acquired a 12% stake in Chunghwa’s prime rival Far EasTone Telecommunications. In view of these competitive pressures, we believe geographical expansion and product innovation initiatives were crucial steps taken by Chunghwa’s management.

Read the full analyst report on "CHT"
Read the full analyst report on "ISYS"
Read the full analyst report on "CHA"
Read the full analyst report on "CSCO"
Read the full analyst report on "CHU"
Read the full analyst report on "AAPL"
Read the full analyst report on "CHL"
Zacks Investment Research

Oops, Did I Say That Out Loud?

Contrarian Profits — Thu, 24 Sep 2009 17:31:51 +0000

pA Wild and Wacky Wednesday#8230;FOMC leave stimulus and QE in place#8230;Will G-20 try to throw cold water on commodities? GATA receives a letter from the Fed#8230;And Now#8230; Today#8217;s Pfennig/p pGood day#8230; And a Thunderin#8217; Thursday to you! It#8217;s Thundering and raining here, so I felt that naming today a #8220;Thunderin#8217; Thursday#8221; was bang on! We had a wild and wacky Wednesday yesterday, with the Fed Heads playing the part of the court jester#8230; And#8230; I want to know, right here, right now, why the media isn#8217;t blasting Fed Head Honcho Big Ben Bernanke! I#8217;ll tell you why they should be, in a minute#8230;/p pOK#8230; As I said, we had a wild and wacky Wednesday yesterday, as the non-dollar currencies went for a#8230;/p

Catching Up With Richard Duncan…

Contrarian Profits — Wed, 23 Sep 2009 19:03:06 +0000

pNon-dollar currencies give back very little#8230;The Unemployed are remaining unemployed#8230; FOMC puts away the board games today#8230; China invokes a #8220;Public Morals#8221; defense#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! Well, the Fed Head put away the board games today, and make an announcement this afternoon#8230; Yawn#8230; Norway#8217;s Norges Bank will also make an announcement with theirs coming this morning. I still contend that the Norges Bank will keep rates unchanged and give a hint as to when their rate hike cycle will begin. If that were to happen as I think, then it would be very bullish for the krone#8230;/p pWell! The non-dollar currencies held ground gained yesterday, giving back, oh-so-little to the profit taking. The#8230;/p

US Dollar Sags Under Weight of Global Imbalances Pre-G20

Contrarian Profits — Tue, 22 Sep 2009 14:00:46 +0000

pThe U.S. dollar slid to a 1-year low against the euro on Tuesday near $1.48 as deteriorating sentiment on the U.S. currency encouraged selling ahead of a Federal Reserve meeting and Group of 20 summit this week./p pTraders took advantage of a dollar rally in the prior session to sell on views the Fed will signal plans to maintain loose monetary policy well into 2010./p pCurrency investors are also bracing for G20 leaders to discuss rebalancing the global economy this week, a process that would almost certainly require a weaker dollar./p pA document obtained by Reuters showed how Washington would urge G20 leaders to launch a new push this year to get debtor nations like the United States to save more and exporters#8230;/p

FOMC Week…

Contrarian Profits — Mon, 21 Sep 2009 19:07:01 +0000

p The dollar pushes back! FOMC plays battleship? Norges Bank meets this week#8230;Precious metals give back too#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! Here we go#8230; Starting a new week all over again#8230; I have a blank page to start each day, and then 2 hours later#8230; The Fabulous Pfennig! A work of art, I must say! HAHAHAHAHAHAHAHA!/p pWell#8230; Recall on Friday, I said that the non-dollar currencies would probably just follow whatever the stocks did, since the data cupboard was empty? Well, the non-dollar currencies didn#8217;t even follow that theme, as stocks pretty much wallowed around in the mud all day#8230; The dollar began to push back at the gains the other currencies had made during the#8230;/p

Global Stocks Retreat

Contrarian Profits — Mon, 21 Sep 2009 17:30:55 +0000

pWorld stocks retreated further from last week#8217;s 11-month high on Monday as lower energy and commodity prices and caution ahead of a Federal Reserve meeting and G20 summit prompted investors to trim risky trades./p pLeaders of the Group of 20 meet on Thursday and Friday in Pittsburgh and U.S. President Barack Obama said on Sunday he would push world leaders for a reshaping of the global economy in response to the crisis./p pWorld stocks, measured by MSCI have risen over 26 percent this year, recouping more than half of last year#8217;s losses, underpinned by repeated pledges by G20 policymakers to keep emergency support for the economy in place./p p#8220;The market might look slightly overbought near term, but the economy is definitely improving, corporate#8230;/p

Dollar Rises vs Yen, Boosted by Short Covering

Contrarian Profits — Mon, 21 Sep 2009 16:30:37 +0000

pThe dollar rose broadly on Monday, hitting a near two-week high against the yen, as traders trimmed short positions in the U.S. currency following broad losses so far this month./p pAgainst the yen, the dollar rose more than a full percent, after speculative flows pushed it higher in quiet trade in Asia, where markets in Japan, Singapore and other centres were closed for holidays./p pIn the absence of economic events or data, traders took profits on currencies which have rallied against the dollar, including the euro, up more than 2 percent so far this month./p pAnalysts said some investors were becoming concerned that short dollar positions were overstretched, suggesting that a near-term correction may be in store./p p#8220;There#8217;s already a lot of long euro/dollar#8230;/p

Retail Sales Soar!

Contrarian Profits — Wed, 16 Sep 2009 19:50:44 +0000

pCurrencies rally on Retail Sales! China likes investments in Canada#8230;Big Ben the #8220;inflation fighter#8221;#8230;Gold climbs to $1,018! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! Good news for me this morning, the pain in my left knee has subsided#8230; Now, If I could just get that swelling to go down, I#8217;d be in tall cotton! This has been quite the ordeal on the old Pfennig writer, and one that I will be glad to put in the rear view mirror!/p pWell#8230; When I turned on the currency screens this morning, the euro was trading with a 1.47 handle! WOW! It just skipped to my Lou right through the 1.46 handle, eh? It began yesterday afternoon, the dollar was#8230;/p

Protectionism Wars, Here We Come!

Contrarian Profits — Mon, 14 Sep 2009 19:06:26 +0000

pCurrencies back off gains#8230;Administration slaps tariff on China#8230;And Yen rallies#8230;Quotes from Davos#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! I hope your weekend was grand#8230; I was supposed to be traveling back from Williamsburg today, so this is a bonus day for you all! HA! On Friday morning, I told the early arrivers that the currencies were strong, Gold was strong, it was all good, and we needed to close up shop and go home, because it wasn#8217;t going to get an better than that, and that the rest of the day had nothing but disappointment risk! Boy did I nail that one on the head! Let#8217;s get to the goings on./p pThe currencies added to their gains#8230;/p

Patriot Day

Contrarian Profits — Fri, 11 Sep 2009 20:30:42 +0000

pCurrencies have strong rally! Trade Deficit jumps 16.3% in July! HR 1207 Gets a hearing! Gold gets back to $1,000!br / And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! Today is Patriot Day in the U.S. and a day that brings back memories of cowardly attacks on our country 8 years ago. I remember the shock and horror on everyone#8217;s faces, and that image will remain with me to the grave. I also remember trying to write the Pfennig the #8220;day after#8221;#8230; It just didn#8217;t seem that important of a thing to do, but a reader told me that to keep things as #8220;normal#8221; as possible was the best thing I could do#8230; So#8230; I wrote#8230;/p pOK#8230; The currencies, and this#8230;/p

Yen Rises Broadly, U.S. Dollar Index Falls

Contrarian Profits — Fri, 11 Sep 2009 18:00:26 +0000

pThe yen rose across the board on Friday as a pullback in Wall Street shares and a drop in oil prices negated upbeat U.S. consumer sentiment, rekindling safe-haven demand for the Japanese currency./p pThe dollar slipped against a basket of currencies, touching a nearly one-year low earlier, as the sell-off continued, on track for its worst weekly performance in more than three months. The greenback also fell to a fresh 2009 low versus the euro, but it recouped most of its losses./p pThe prospects for economic recovery and low U.S. borrowing rates continued to encourage investors to move cash out of the dollar into riskier assets in other currencies./p p#8220;Today we#8217;re getting a little bit more action versus the yen and weaker U.S.#8230;/p

Cautiously Positive?

Contrarian Profits — Thu, 10 Sep 2009 19:07:59 +0000

pEuro #38; yen add to gains#8230;RBNZ disappoints#8230;Foreclosures continue to stack up! BOE #38; BOC meet today#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Thrillin#8217; Thursday to you! Ahhh! A change! Just thought that with the thrilling victories my beloved Cardinals have been accumulating, that Thrillin#8217; would be a nice change to our Thursday lineup!/p pFront and Center this morning#8230; The currencies added to their gains this week yesterday, albeit small gains, but gains nonetheless. The Fed#8217;s Beige Book was #8220;cautiously positive#8221;#8230; And#8230; Overnight, the Reserve Bank of New Zealand met, and left rates unchanged as suspected#8230; This and more as we begin our Thrillin#8217; Thursday!/p pThe Big Dog euro has been off the porch chasing the dollar down the street for a week#8230;/p

US Dollar Slide Slows Still Seen Vulnerable

Contrarian Profits — Thu, 10 Sep 2009 16:00:58 +0000

pThe U.S. dollar steadied on Thursday after sliding to its lowest in almost a year against major currencies this week, but is seen vulnerable to further selling./p pThe dollar initially fell versus the euro after a better-than-expected reading on U.S. weekly jobless claims but recovered a little groun das U.S. and European stocks failed to extend earlier gains./p pThe U.S. currency has suffered recently as investors bet on an economic recovery through commodity-linked and higher-yielding currencies, which rallied earlier this week./p p#8220;Some caution has returned to the foreign exchange markets today, and the dollar is mixed,#8221; said Nick Bennenbroek, head of currency strategy at Wells Fargo Bank in New York. Still, Bennenbroek warned that Thursday#8217;s rebound in the U.S. currency may be short-lived./p p#8220;Dollar#8230;/p

Currencies Hold Their Gains…

Contrarian Profits — Wed, 09 Sep 2009 19:32:44 +0000

p Consumer Borrowing Collapses#8230;What#8217;s up with sterling? Option ARMs get ready to reset#8230;Gold falls back to below $1,000#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! Well#8230; The currencies, for the most part, kept the heat on the dollar throughout the day and in the overnight markets. The euro, did rise to 1.45 and change yesterday, while it is hovering right at that figure this morning, so it did give a little bit back./p pThere were no big announcements last night like we saw on Monday, so the currencies didn#8217;t have anything to push them further. In fact, there may be a #8220;letting the dust settle#8221; period of time, with the Big Dog, euro, before we see any further advancement,#8230;/p

Toshiba to Outsource Chip Making – Analyst Blog

Zacks Market Commentaries — Tue, 08 Sep 2009 18:40:40 +0000

The technology leader in high definition products and the world's no. 2 manufacturer of NAND flash memory chips, Toshiba Corp., plans to outsource a part of the production of its next-generation 28-nanometer (nm) system chips.

According to industry sources, the chips will be used in a wide range of electronics such as game consoles, digital cameras, flat panel TVs and other electronic gadgets starting in April 2010. To meet demand by that period, Toshiba will have to ramp up production. Its customers include IT giants like Apple (AAPL), which has already purchased $500 million worth flash memory chips from Toshiba.

Toshiba currently manufactures chips at its plant in Oita, southern Japan and plans to outsource to expand its production if capacity is insufficient.

According to sources, Toshiba is holding discussion with Singapore’s Chartered Semiconductor Manufacturing Ltd. (CHRT) and Advanced Micro Devices (AMD) to spin off Globalfoundries Inc. and proceed with its outsourcing plan. This will help the company to reduce costs and fulfill customer supply orders.

Last year, Toshiba formed a joint venture with Sony (SNE) and SCEI (Toshiba owned 60% while Sony and SCEI owned 20% each) for the production of high-performance semiconductors, which include the Cell/B.E. processor, the RSX graphics engine and SoCs (System-on-Chip) for applications in digital consumer products. Moreover, to ramp up chip production, it bought Sony’s SoC line for about 90 billion yen ($968 million).

Toshiba competes with International Business Machines (IBM), which has technology alliances with Chartered Semiconductor, Globalfoundries, Infineon Technologies, Samsung Electronics, NEC Electronics and STMicroelectronics (STM) for developing 28 nm chips. In addition, NVIDIA (NVDA) plans to boost its 40nm technology, that is likely to improve margins and help the company take market share from Toshiba.

Toshiba is looking to bid for French nuclear group Areva's power transmission and distribution unit. This new line will help the company enter into a new line of power business for stable revenue and growth that will facilitate cost reduction at its loss-making chip division that has been under pressure due to economic recession.

Shares of Toshiba were up 3.2% to 481 yen outperforming a 1% rise in the benchmark Nikkei average.

Read the full analyst report on "AAPL"
Read the full analyst report on "CHRT"
Read the full analyst report on "AMD"
Read the full analyst report on "SNE"
Read the full analyst report on "IBM"
Read the full analyst report on "STM"
Read the full analyst report on "NVDA"
Zacks Investment Research

A Rout On The Dollar!

Contrarian Profits — Tue, 08 Sep 2009 18:21:50 +0000

pCurrencies rally strong! China is upset with printing of dollars#8230;The UN talks of a new currency#8230;Unemployment rate rises to 9.7% And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! A long Holiday Weekend, that was quite good for yours truly! A great tailgate, a great Missouri Tigers victory, 3 of 4 for the Cardinals, a great end of summer bar-b-que at the Butler House, and a day to recharge the batteries#8230; Really couldn#8217;t ask for much more#8230; Yes, the weather could have cooperated a bit better, but, hey, that#8217;s nitpicking!/p pWell#8230; Last night I was checking the markets to see what was going on, since I had walked away from the desk on Friday afternoon#8230; And much to my#8230;/p

A Jobs Jamboree Friday!

Contrarian Profits — Fri, 04 Sep 2009 18:15:49 +0000

pCurrencies trade in a tight range#8230; G-20 to shun an exit from stimulus? Gold and Silver and Oil#8230; A new trend? Loonies follow the commodities higher#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Happy Friday to one and all! Well#8230; Once again, my day didn#8217;t turn out exactly as planned, but as they say#8230; A bad day at the ballpark is better than a good day and then you plug in the place#8230; It could be work#8230; It could be cutting the grass#8230; Etc../p pOK#8230; I heard a great song on the radio this morning on my way to work#8230; And I said to myself#8230; Chuck, now that#8217;s a great song to start a day with, that everyone should hear each day! It#8217;s a song#8230;/p

Corporate Capex in Japan (Q2-2009) – So, is This What a Recovery Looks Like?

Claus Vistesen — Fri, 04 Sep 2009 11:06:34 +0000

Much pomp and circumstance was certainly made in relation to the fact that Japan actually grew in the second quarter at a full annualized 3.7 percent in the second quarter of 2009. Yet, the underlying numbers to suggest a recovery are still sorely missing. Deflation now seem to have taken hold, unemployment is rising fast and although the recent manufacturing PMI provided us with an upbeat signal, the underlying trend still is still that of a very tepid recover, if at all, or just a plain slump.

(quote Bloomberg)

Japanese businesses cut spending for a ninth quarter as the global recession squeezed profits, underscoring the challenge for the incoming government to sustain a recovery from the country’s worst postwar slump. Capital spending excluding software fell 22.2 percent in the three months ended June 30 from a year earlier, after dropping a record 25.4 percent in the previous quarter, the Finance Ministry said today in Tokyo. Profits slid 53 percent.

Sales fell 17 percent, the second-biggest drop on record, indicating global demand hasn’t recovered enough to encourage companies to buy more plant and equipment. Sanyo Electric Co. and Seven & I Holdings Co. are among businesses scaling back. “Companies have too many resources, and until that situation changes, they won’t have to invest in more equipment and they won’t need to hire more people,” said Seiji Shiraishi, chief economist at HSBC Securities Japan Ltd. in Tokyo.

(click on graphs for better viewing)

On a y-o-y and q-o-q basis, the sales of Japanese companies fell 17% and 4.5% respectively. Especially, manufacturing in general and machinery and equipment producers saw a rapid decline in sales. Investment in plants and equipment fell back sharply on an annual as well as a quarterly basis at 21.7% and a full 39.1% respectively. The pronounced fall in Q2 investment owes itself to an abnormally large outlay in Q1 2009 which has consequently been paired in the period just ended. As can be seen in the graphs to the right, the manufacturing sector has been hit much harder than the non-manufacturing sector which is not difficult to understand if you think about the fact that it is this sector of the Japanese economy which is most exposed to the external environment. This is to say, that the manufacturing sector's top line is very sensitive to external conditions on the margin. Between Q4-08 and Q2-09 the cumulative drop in Japanese manufacturers sales was a whopping 35% almost double that of the non-manufacturing sector's corresponding toll of a drop of 18%.

With respect to investment in plants and equipment (corporate capex) the picture is, interestingly, the reverse with the investment by the non-manufacturing sector falling much more sharply during the present turmoil. On a four quarter moving average basis, the change in investment in plants and equipment for of the non-manufacturing sector has been falling ever since the first quarter of 2006 with a cumulative drop of 37%. The corresponding number for the manufacturing sector shows that the investment of plants and equipments have been falling since the third quarter of 2007 with a cumulative drop of 19%.

Finally, in the context of operating profits (that is, profits derived soled from the company's primary operations), the non manufacturing sector is still well in the black whereas the manufacturing sector has moved from a figure much below average in Q4-2008 to outright red figures in Q1-09 and Q2-09. Between Q1 2000 and Q3 2009 the average quarterly profit (nominal) for Japanese manufacturers was a little over 4 billion Yen.

In Q4 2008, the consolidated profit read 761 million yen and in Q1-09 and Q2-09 the numbers had turned into an outright decline with negative profit of 3.5 billion and 645 million respectively. Conversely, the non-manufacturing sector was, albeit still below average, performing much more strongly with solid black numbers throughout the crisis.

No Recovery Here

While there certainly may be places the newly elected party to rule Japan can look for green shoots and evidence of an impending recovery in Japan, corporate capex and profit numbers are not one them. Neither are, of course, the labour market, the deflation debacle, as well as the household sector which leaves us with the obvious question of where then? Second quarter clocked in better than most had expected and ironically, despite the analysis fielded above, upbeat signals from industrial production and the manufacturing sector in general are cited as the main reason. I will let my readers judge for themselves by perusing the graphs above and then also note the following crucial point made by Soc Gen's Gleen B. Maquire in one of their recent economic outlook reports (my emphasis);

The bulk of the contribution to growth came from net exports. Exports increased by 6.3% qoq while imports declined by 5.1% qoq. Overall, net exports contributed 1.6ppt to Q2 growth. The recovery in the Japanese economy is starting to look eerily similar to the 2001-03 recovery when Japan emerged ahead of Europe and the US. This is largely a China dynamic with Japan’s exports to China (and indirectly to the rest of Asia) recovering in step with China’s stimulus measures coming on line.

(...)

Industrial production is responding to robust demand from China for capital equipment and
industrial goods as well as tentative signs of a recovery in the durable goods cycle within Asia and globally.

So, this appears to be an export story in which case positive news from Japan should not surprise us at all. Macquire goes on to argue that since Q2 did not see a bounce back in inventories from the sharp de-stocking of Q4-08 and Q1-09 this, expected, bounce in inventories. I remain skeptical of this claim since I don't necessarily believe that the new level of growth will necessarily support any rapid re-stocking of inventories, but time will of course tell very soon.

Finally and specifically in relation to the analysis above, it is also interesting to ponder the discrepancy between the manufacturing and non-manufacturing sector in relation to the idea of Japan being dependent on exports to grow. Clearly, the manufacturing sector's higher sensivity with respect to the financial crisis and its top line makes sense since external conditions deteriorated very rapidly. Conversely, the domestic economy of Japan was not struck by a major, and relatively large, credit crunch. Hence, we see the top line of non-manufacturers relying more on domestic demand decline less. On the other hand, in relation to corporate capex the manufactures' slump in investment is very exclusively tied to the financial crisis while that of the non-manufacturers seem much more broad based. Once again can we rationalize this through the idea that the manufacturers remain tied to external conditions while that of the non-manufacturers is increasingly tied to the domestic market.

So, does this last niggle make sense? I am not sure, but it would be an interesting thing to check.

Time to Remove Stimulus?

Contrarian Profits — Thu, 03 Sep 2009 19:34:38 +0000

pChinese stocks rise 5%! Risk Assets follow! OECD forecasts faster global rowth#8230;Gold #38; Silver kicking sand again! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Tub Thumpin#8217; Thursday to you! Let#8217;s hope it remains a Tub Thumpin#8217; Thursday later today, as I head downtown to watch my beloved Cardinals play a day game! For those of you who are baseball fans, you know what I mean when I carry on about how baseball should only be played during the day!/p pOK#8230; Before I get to the currencies, economies and the dolts in the world, I wanted to briefly talk about the SEC, who made an announcement yesterday that they had done an investigation of the Madoff audits, and did not find any#8230;/p

Zacks Analyst Blog Highlights: Panasonic Corp., SANYO Electric Co Ltd., Sony, Hitachi and Toyota Motor Corp. – Press Releases

Zacks Market Commentaries — Thu, 03 Sep 2009 13:40:40 +0000

For Immediate Release

Chicago, IL – September 3, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Panasonic Corp. (PC), SANYO Electric Co Ltd. (SANYY), Sony (SNE), Hitachi (HIT) and Toyota Motor Corp. (TM).

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Here are highlights from Wednesday’s Analyst Blog:

Panasonic Still Awaits Approval

Panasonic Corp. (PC), one of the leading manufacturers of electronic and electrical products, systems and components, recently said that it is still waiting for regulatory approval for acquiring SANYO Electric Co Ltd. (SANYY).

Panasonic entered into a capital and business alliance agreement with SANYO in December 2008 and offered to pay $4.3 billion (400 billion yen) to acquire it. The latter is a leading company in the rechargeable battery business focused on lithium-ion rechargeable batteries.

The energy business of SANYO will be added as Energy Solutions to Panasonic’s business, which will further expand its HIT (crystalline silicon) solar photovoltaic cells and modules (batteries) business and accelerate the development and commercialization of next-generation solar cells. By taking over SANYO, Panasonic plans to double production capacity of lithium ion batteries to around 1 million units a year by the middle of 2010.

Panasonic expects a growth in profit by 80 billion yen in fiscal 2013 from the alliance. Also, Panasonic and SANYO will set up a ‘Collaboration Committee’ and Panasonic will invest around 100 billion yen in order to achieve the synergy of both companies.

This acquisition will enable Panasonic to more aggressively compete with market leaders such as Sony (SNE) and Hitachi (HIT) amid growing demand for the rechargeable power source commonly used in mobile phones, laptop PCs, and digital cameras. Moreover, it will help Panasonic become Japan’s largest electronics maker.

Panasonic EV Energy Co., a joint venture with Toyota Motor Corp. (TM) is currently the only supplier of nickel-metal hydride batteries. The regulatory bodies were concerned on the growing combined market share of Panasonic and SANYO (approximately 90%) in nickel-metal hydride batteries, which will pose a threat to other manufacturers.

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Yen and Dollar Rise as Investors Remain Cautious

Contrarian Profits — Tue, 01 Sep 2009 18:30:36 +0000

pThe yen and dollar rose on Tuesday as fears of further U.S. bank failures overshadowed unexpectedly strong U.S. manufacturing data, boosting the two currencies#8217; safe-haven appeal./p pMajor U.S. stock indexes #60;.DJI#62; #60;.SPX#62; #60;.IXIC#62; were down nearly 2 percent in afternoon U.S. trading as investors fretted that chatter from hedge funds on a bank failure could prove accurate./p pThe decline came despite upbeat economic news from the United States and euro zone as well as a stabilization in Chinese shares after a rout on Monday./p pThe hedge fund talk #8220;is a huge driver#8221; of currency markets, said Dan Cook, senior market analyst at IG Markets Inc in Chicago. #8220;When you have data like we had but the Dow drops, people are running for that#8230;/p

More Baby Steps For A German Economic Recovery

Contrarian Profits — Tue, 01 Sep 2009 16:00:46 +0000

pGerman unemployment falls! RBA disappoints the markets#8230; China to buy Canadian company#8230; ISM to print positive? And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Terrific Tuesday to you! And Welcome to September! Well#8230; Here#8217;s a thought to get our engines started this morning#8230; a href="http://www.contrarianprofits.com/articles/author/bill-bonner/" class="alinks_links"Bill Bonner/a of the a href="http://www.dailyreckoning.com" class="alinks_links"Daily Reckoning/a ( www.dailyreckoning.com )had this to add to my ranting about our National Debt going to over $20 Trillion in the next 10 years, due to deficit spending#8230;/p p#8220;The Obama administration, for example, expects to run $9 trillion in deficits over the next 10 years – and that number is based on a recovery! Imagine what will happen if the economy doesn’t recover?#8221;/p pNow, that#8217;s a nice comforting thought to start our day right? NOT! WAKE UP! Morning has broken, and#8230;/p

Renminbi To Become An International Currency?

Contrarian Profits — Mon, 31 Aug 2009 17:01:00 +0000

pCurrencies give back ground overnight#8230; Don#8217;t look too closely at U.S. data#8230; India posts strong GDP#8230; Lots O#8217;-data this week! And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Marvelous Monday to you! A Wonderful Weekend was enjoyed by your Pfennig writer, with good friends, and Chamber of Commerce weather, on a beautiful lake! It#8217;s back to work today though. I don#8217;t understand why I didn#8217;t plan on taking today and staying an additional day at that beautiful lake! Oh well#8230; Time to go to work!/p pWhen I signed off on Friday morning, the currencies were enjoying a very nice rally, which remained in place the rest of the day. The Consumer Income and Spending data was very much as I describe it would be, and so#8230;/p

Nokia Innovates Mobile Money – Analyst Blog

Zacks Market Commentaries — Thu, 27 Aug 2009 16:15:48 +0000

Nokia Corp. (NOK) recently introduced an innovative wireless financial service called “Nokia Money" to help consumers access basic financial services using their mobile handset.

“Nokia Money" is a 24-hour service that will enable any mobile phone user to transfer money from his bank account to another account dialing the latter’s mobile phone number. This can be done either through SMS or a call. Nokia is likely to launch this service commercially from early 2010 in select European markets.

The major innovation of this service is that it will be available across various wireless networks from any mobile phone and not necessarily a Nokia handset. This user friendly, fully secured digital financial service can be used for remitting money, pay bills for goods and services, utility bills or top-up prepaid connections. Rural consumers, who do not have access to online services, will particularly benefit from this service.

Mobile financial service has high growth potential. Industry researches estimate that currently there are approximately 4 billion mobile phone users in the world but out of these, only 1.6 billion have individual bank accounts. This indicates that a large population of mobile phone users does not have access to basic financial services.

“Nokia Money" aims to narrow this gap by combining wireless handsets and secured financial services. The company has established an alliance with Obopay, a global leader for developing mobile payment solutions, to commercialize this service. We consider Nokia’s entry into mobile financial service at this stage as a right move as the market is gradually getting crowded.

NTT DoCoMo (DCM) plans to launch an innovative online money transfer service in Japan, where it is the largest wireless service provider. Customers of DoCoMo’s i-mode mobile internet service using the 3G FOMA network will be able to remit up to 20,000 Yen per transaction subject to a monthly limit of 200,000 Yen.

Motorola Inc. (MOT) has also developed a new mobile phone SIM (Subscriber Identity Module) card called “I-SIM NFC Lite" card that can be used for mobile money transfer. The company is currently testing this m-wallet card in Taiwan and plans to launch it in the world’s largest mobile subscriber market of China in the near future.

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German Business Confidence Continues to Surprise!

Contrarian Profits — Wed, 26 Aug 2009 20:03:06 +0000

pCurrencies rally in early morning Tuesday. But see profit taking later in the day#8230; Looking for yield? China expected to get back to 10% growth! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! When I signed off yesterday morning, I told you that I was watching a mini-rally in the currencies. Well, that mini-rally turned into a real rally as the morning went along. Especially, after the risk assets got a boost from the Consumer Confidence revival. Yes, Brother Love#8217;s traveling salvation show revival, a.k.a. Consumer Confidence was much stronger than forecast, and the risk assets took off!/p pBy mid-afternoon, the euro was pushing 1.4350, and all the #8220;little dogs#8221; were following along with their own version of#8230;/p

Dollar Gains as Risk Trade Takes a Pause

Contrarian Profits — Wed, 26 Aug 2009 19:30:21 +0000

pThe U.S. dollar rose on Wednesday as news that China would act to restrict redundant investments underscored concerns about a global recovery and tempered the positive impact of data showing a jump in new U.S. home sales./p pReports that China intends to curb excessive investment in a range of industries #8220;hurts the strong global growth outlook and is one of the things moving the dollar today,#8221; said Chuck Butler, president of a href="http://www.everbank.com" class="alinks_links"Everbank/a World Markets in St. Louis./p pInvestors tend to buy the dollar and yen as safe havens or unwind trades in higher-yielding assets financed with the U.S. and Japanese currencies when recovery optimism fades./p pTwo reports offered some encouragement about the health of the U.S. economy. A rise of 9.6 percent in new#8230;/p

Making The Fed Reserve Accountable!

Contrarian Profits — Tue, 25 Aug 2009 15:46:11 +0000

pCurrencies sold overnight#8230; But rebound in early morning trading#8230; China throws cold water on stock values#8230; German exports rival the Big Kahuna! And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Terrific Tuesday to you! I returned home from San Francisco last night, and am back in the saddle today! Not the way I like to travel, where I get a day when returning home to recharge the batteries, but it is what it is#8230; I did an interview with MarketWatch yesterday morning, talking about#8230; Well, what else? The deficits, and diversification! My presentations in S.F. were well attended#8230; On Saturday, my power point froze up, but I carried on in spite of the technical difficulties!/p pYou know#8230; I really, heard a lot of people talking#8230;/p

Dollar Edges Up vs Euro ahead of U.S. Consumer Data

Contrarian Profits — Mon, 24 Aug 2009 17:00:07 +0000

pThe dollar edged up against the euro and yen on Monday in extremely thin trade as Wall Street surrendered earlier gains and traders repositioned themselves ahead of U.S. consumer and housing data due this week./p pSolid U.S. and euro zone data and an upbeat assessment on the economy from Federal Reserve Chairman Ben Bernanke over the weekend earlier pushed investors to take on riskier investments at the expense of the the low-yielding yen and dollar./p p#8220;Conventional wisdom suggests that major currencies should trade within their recent ranges until liquidity improves after the Labor Day holiday,#8221; said Wells Fargo currency strategist Vassili Serebriakov. #8220;However, there is plenty of data in the U.S. and elsewhere to change that this week, with consumer-related numbers likely#8230;/p

European Orders Support the Euro

Contrarian Profits — Mon, 24 Aug 2009 14:34:01 +0000

pEuropean orders increase more than expected#8230; Was Cash for Clunkers necessary?#8230; Roubini sees a #8216;W#8217; not a #8216;V#8217;#8230;br / Lessons from Mary Poppins#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And welcome to another week, the last one in August! The weather here in St. Louis has shifted toward fall, which is my favorite season. Chuck is flying back home from San Francisco today and will be back in the saddle tomorrow. Both he and the big boss, Frank Trotter, sent me some great Pfennig pfodder over the weekend so lets get right to it./p pThe dollar continued to drift lower throughout the trading day on Friday, with the commodity currencies of Australia, South Africa, and New Zealand leading the way. Confidence is returning to the markets, and#8230;/p

Mortgage Delinquencies Move Higher…

Contrarian Profits — Fri, 21 Aug 2009 19:03:35 +0000

pMortgage delinquencies move higher#8230;Euro pushed higher by European data#8230;Economist predicts Norway will be first to raise#8230;Mexico to leave rates unchanged#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And happy Friday! The data released yesterday morning was a mixed bag, as the leading indicators climbed for a fourth straight month and the Philadelphia fed reported a big jump in their gauge of activity, but the initial jobless claims unexpectedly rose. Unemployment in the US will continue to be a drag on the economy, slowing any recovery and possibly pushing the US back into recession (or as some predict a depression). Today we will get some news on the housing market, and while the media will pump up the fact that month on month sales#8230;/p

Stocks Push the Currencies Higher…

Contrarian Profits — Thu, 20 Aug 2009 19:34:35 +0000

pStocks push the currencies higher#8230;Norway pulls out of recession#8230;Jackson Hole boondoggle#8230;Oil helps rally commodity currencies#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; We had more rain here last night, but the storms have cooled things off and it is starting to feel a bit like fall around here. Chuck flies off to San Francisco today to speak at the Money Show, so I will be bringing you the Pfennig for the next few days. The dollar has rallied just a bit overnight, clawing back some of the losses which occurred mid morning yesterday./p pAnd what, you might asked, caused the dollar to rally yesterday? You can re-read a bit of yesterday#8217;s Pfennig for the answer: #8220;The data cupboard has been emptied out and is#8230;/p

A Gusher of Federal Money…

Contrarian Profits — Wed, 19 Aug 2009 19:05:39 +0000

pNo currency movement to speak of#8230; Buffett calls out the deficits#8230; PIMCO does too! SNB selling francs to stem gains#8230; nd Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! Another day with the medicine in my knee and it feels better yet today#8230; I did have to ice it last night though, I guess I#8217;m still not out of the woods here, but I can see the exit!/p pThere was very little in the way of movement in the currencies yesterday. The euro moved to 1.4150, but was brought back down to the 1.41 handle overnight. Stocks rebounded yesterday, which gave a few risk takers the intestinal fortitude to dip their toes back into the risk assets water#8230; But#8230;/p

German Investor Confidence Soars!

Contrarian Profits — Tue, 18 Aug 2009 14:00:39 +0000

pZEW says Germany is on the mend#8230; UK inflation remains higher than expected#8230; Safe Haven, what safe haven? Housing data remains soft#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Terrific Tuesday to you! Well#8230; I received an injection of steroids into my left knee yesterday, and already today, I can tell that they are working their magic! I guess I#8217;ll have to give up my plans to try out for the Cardinals next year, now! HA! So, my knee is recovering from 3-weeks of agonizing pain and swelling#8230; I#8217;ve got that going for me!/p pAnd the currencies seem to be recovering this morning too, from the recent go around in the ring with the risk aversion campers. The currencies (except yen), were last seen yesterday#8230;/p

U. of Michigan Spoils the Party…

Contrarian Profits — Mon, 17 Aug 2009 19:00:52 +0000

pRisk Aversion comes back strong! Risk assets get sold#8230; What games will be played with TIC#8217;s? 40 years since Woodstock! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! A great weekend that was filled with watching my little buddy, Alex, play football, hosting a surprise 30th birthday party for my little girl, Dawn, and a sweep of the Padres by the Cardinals! This week gets cut short with me a the helm, as I head to San Francisco on Thursday. Chris will have the conn on the Pfennig Thursday through Monday./p pWell#8230; Who#8217;d a thunk it? Yes, who would have thought that the U. of Michigan Consumer Confidence could turn the markets upside down and spoil the party?#8230;/p

Cash for Clunkers Is a Clunker!

Contrarian Profits — Fri, 14 Aug 2009 19:04:14 +0000

p Currencies trade in a tight range again#8230;U.S. Retail Sales are a clunker! RBA#8217;s Stevens is upbeat! Thoughts on Brazil#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! The end of the week#8230; It#8217;s been a tough week for yours truly, as I#8217;ve hobble around in pain all week. But, as I recall, I promised 2 years ago that I would not complain about these things in the future#8230; So! I carry on!/p pWell#8230; Front and center this morning#8230; The currencies are trading near levels they were when I signed off yesterday morning. They did have a brief rally, after the U.S. Retail Sales data showed some real rot on the #8220;recover is here#8221; vine#8230; But that rally#8230;/p

Germany France Exit The Recession

Contrarian Profits — Thu, 13 Aug 2009 15:05:11 +0000

pCurrencies rally#8230; Eurozone growth unexpectedly stronger! FOMC extends QE#8230; Norges is the first!br / And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Tub Thumpin#8217; Thursday to you! Well#8230; Turn-around Tuesday came 24 hours later this week! HA! Yes, the currencies came back yesterday, but not with a lot of conviction#8230; You see#8230; Stocks rallied, but that doesn#8217;t mean what I talked about yesterday still won#8217;t happen#8230; Be careful there!/p pThe euro has received some additional love this morning, as the Eurozone#8217;s economic growth printed better than expected, albeit still negative#8230; But#8230; Germany and France showed growth, which I must say is very unexpected! That means that both Germany and France have exited the recession#8230; Well, that is at least for now! For those of you keeping score#8230;/p

$75 Billion in New Treasuries this Week

Contrarian Profits — Tue, 11 Aug 2009 19:00:30 +0000

pCurrencies adrift all day yesterday#8230;Data prints begin today with Productivity#8230;Stop to think! Chinese data is impressive#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! Well, no data yesterday left the markets drifting about the open waters. Stocks rebounded, which gave the risk assets a bias to be bought, but for the most part, the day was much like being a drift in the ocean, with no direction or cares!/p pThat will all change beginning today with the Nonfarm Productivity report for the 2nd QTR#8230; Long time readers know my dislike for this data, as I believe it simply shows that one person works longer hours! The Fed Heads used to be all over this data like a cheap suit,#8230;/p

A Big Jobs Surprise!

Contrarian Profits — Mon, 10 Aug 2009 19:00:22 +0000

p Low yielding currencies get sold#8230;High yielding currencies remain solid#8230;Further info on the inflation indexed bonds#8230;Stealth QE#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! A very nice, but hot weekend here#8230; But hey! It#8217;s August, it#8217;s supposed to be hot! Friday was an awful day for most of the currencies, and there was a HUGE surprise in the Jobs Jamboree (according to the BLS, of course!)#8230; And, at the end of updates, I#8217;ve got a story for you about stealth QE, you#8217;ll not want to miss a minute of that! So#8230; Let#8217;s go!/p pWell, Friday#8217;s Jobs Jamboree was quite interesting to say the least#8230; I had already told you about the forecasts for a HUGE drop in job losses#8230;/p

A Big Jobs Surprise!

Contrarian Profits — Mon, 10 Aug 2009 19:00:22 +0000

Spending More than We (the U.S.) Make…

Contrarian Profits — Thu, 06 Aug 2009 19:06:36 +0000

pCurrencies trade in a tight range#8230;Pesos, loonies and reals in the spotlight#8230;The Mogambo on a Thursday!YAHOO!#8230;Jobs reports dominate today #38; tomorrow#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Tub Thumpin#8217; Thursday to you! Once again yesterday, we traded all day in a very tight range with the currencies. The ADP/Challenger data didn#8217;t give anyone a warm and fuzzy about the labor picture, and tax receipts are in the news#8230; So, let#8217;s go to the tape!/p pOK, front and center this morning, I have to talk about this deal with tax receipts in this country. So, I#8217;ve chronicled the April and June debacles for tax receipts, but just in case someone is new to class, and missed that, let#8217;s review#8230; The U.S. used#8230;/p

GDP Does Not Compute, Will Robinson!

Contrarian Profits — Wed, 05 Aug 2009 21:30:53 +0000

pCurrencies trade in a tight range. Pound Sterling, the star performer? Something smells fishy#8230;Do you see trend with Gov. Reports? And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! We had a very tight range trading day yesterday in the currencies, which have left them trading in about the same clothes they were wearing when I signed off yesterday! We#8217;ve got that to talk about, and#8230; Another $2 Billion for the CARS program has been allocated#8230; What a crock! OK, Chuck, slow down, you don#8217;t need to get your blood boiling this quickly, this morning!/p pI#8217;m writing from home this morning, as I have a meeting close to our old office, which means its not far from where I#8230;/p

PennyOmega.com Stock Report! 8/05/09, IBM, RRST, INTC, RHT, JCI, LCC

PennyOmega.com — Wed, 05 Aug 2009 16:47:19 +0000

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U.S. Manufacturing Is Recovering…

Contrarian Profits — Tue, 04 Aug 2009 20:30:34 +0000

pA strong currency move Monday#8230; RBA leaves rates unchanged#8230;And moves bias to neutral#8230;Central Bank warnings have no teeth! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! First day back yesterday was a killer for yours truly#8230; Went home, and went to sleep#8230; But, I#8217;m back today, and feeling good. I did something to my left knee on vacation that left me hobbling, and leaning on my cane more than I usually do. But today, it seems a bit better, so I#8217;ve got that going for me!/p pYesterday, I left you with the euro popping back and forth over the 1.43 level#8230; But in a wink of an eye, the 1.43 level was gone, and the euro was trading#8230;/p

Data Cupboard Gets a Work out This Week

Contrarian Profits — Mon, 03 Aug 2009 14:01:13 +0000

pGood day#8230; And a Marvelous Monday to you! Hereeeeeee#8217;s Baaaaaacccckkkkk#8230; Oh no! Just when you thought it was safe to open the Daily Pfennig and not get lectured on deficit spending#8230; He#8217;s back! Oh well, It#8217;s been over two weeks, first to Vancouver, then on vacation./p pWe#8217;ve got a lot of catching up to do, eh? Mike and Chris did a Fantastico job of taking the conn on the Pfennig in my absence#8230; So thanks to them#8230; But it#8217;s back to me, and besides a couple of days in San Francisco later this month, I#8217;m all yours! (I bet that just makes you smile like a Cheshire Cat#8230; NOT!)/p pOK#8230; Rather than beat around the bush this morning, Chris left me this#8230;/p

GDP Report Shows Renewed Decline in Consumer Spending

Contrarian Profits — Fri, 31 Jul 2009 16:00:58 +0000

pThe dollar fell against the yen on Friday after a government report showing a slower-than-expected contraction in the U.S. economy in the second quarter was offset by a decline in consumer spending./p pThat prompted investors to shun risk and weighed on U.S. stock futures. The euro also pared gains versus the dollar after the report./p pThe U.S. economy contracted at a 1.0 percent rate in the second quarter, according to government data on Friday. Analysts polled by Reuters had forecast GDP falling at a 1.5 percent rate./p pDespite the fact GDP fell less than expected, investors focused on the consumer spending component, which showed a 1.2 percent drop after a 0.6 percent rise the previous quarter./p pConsumer spending accounts for over two-thirds of U.S.#8230;/p

Dollar Continues to Slide

Contrarian Profits — Fri, 31 Jul 2009 13:30:39 +0000

pDollar continues to slide#8230; US GDP contracts but not as fast#8230; Nordic currencies outperform#8230; Japanese yen continues to fall#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; The last day of July is upon us. Time just seems to keep moving faster as it seems summer just got started. The fall of the dollar also accelerated yesterday as investors moved back out of the #8217;safe haven#8217; of US$ and continued to shop for more yield. The greenback tried to stage a bit of a rally in early European trading, but has fallen back off again as I sit down to write the Pfennig./p pI got a call from a Reuters reporter yesterday mid morning to ask why the dollar was rallying at the same time stocks were moving#8230;/p

Dollar Rally Peters Out

Contrarian Profits — Thu, 30 Jul 2009 19:30:26 +0000

pObama defends his policies#8230;Commodity currencies should outperform#8230;Global Power Shift Index#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And happy Thursday to everyone! Hope everyone made it through the #8216;hump day#8217; with no worries. We started the morning here with rainshowers, but it ended up being a beautiful afternoon and evening. Currency markets were similar to the weather here, as most currencies started Wednesday in the loss column vs. the US$, but rallied as the day progressed. The dollar had strengthened over the past couple of days due to #8217;safe haven#8217; demand; but a surprisingly strong durable goods number (ex autos) combined with an #8216;all clear#8217; signal from President Barack Obama had investors moving back into riskier assets. The commodity based currencies also got#8230;/p

Honda Profit Plummets – Analyst Blog

Zacks Market Commentaries — Wed, 29 Jul 2009 18:48:03 +0000

Japan’s second-biggest automaker Honda (HMC) reported a sharp 95.6% fall in profit for the first quarter of its financial year ended June 30 due to a severe decline in unit sales. In absolute terms, consolidated net income reached $79 million (JPY 7.56 billion) or 4 cents (JPY 4.17) per share from $1.81 billion (JPY 173 billion) or $1.00 (JPY 95.56) per share in the prior-year quarter.

Consolidated operating income dipped 88% to $262 million (JPY 25.1 billion) due to decreased profits attributable to decreased revenue, an increase in fixed costs per unit as a result of reduced production and the unfavorable impact of currency effects caused by the appreciation of the Japanese yen.

Revenue in the quarter sunk 30% to $20.9 billion (JPY 2,002.2 billion), a result of decreased revenue in the automobile business and unfavorable currency translation effects.

In the Motorcycle segment, sales declined 17% to 2.25 million units. Unit sales in Japan shrank 22% to 45,000 units. Unit sales outside of Japan decreased 16.9% to 2.21 million units. This was due to a decrease in sales of motorcycle knocked-down parts for local production at Asian affiliates accounted for under the equity method and decreased unit sales in other regions including South America, more than offsetting increased unit sales in India and Vietnam. Revenue from sales to external customers declined 35% to $2.67 billion (JPY 256.3 billion) due to decreased unit sales and unfavorable currency translation effects.

In the Automobile segment, sales dipped 20% to 766,000 units. In Japan, unit sales amounted to 128,000 units, the same compared to the corresponding period last year. Results were due mainly to favorable sales of the Insight hybrid and FREED models despite a weak demand in the market.

Unit sales outside of Japan decreased 23.5% to 638,000 units due to decreased unit sales in North America. Revenue from sales to external customers decreased 32% to $15.9 billion (JPY 1,523.4 billion) due to lower unit sales and unfavorable currency translation effects.

Revenue from customers in the Financial Services business rose 7% to $1.62 billion (JPY 155.9 billion) due to an increase in operating lease revenues.

In the Power Product business, unit sales decreased 13.5% to 1.16 million units. In Japan, unit sales fell 55% to 71,000 units. Unit sales outside of Japan dipped 8% to 1.09 million units due to a decline of unit sales in Europe. Revenue from sales to external customers declined 34% to $693 million (JPY 66.5 billion) due to decreased unit sales of power products and unfavorable currency translation effects.

For fiscal 2010, Honda projected a 17% decline in net sales and other operating revenue to $86.5 billion (JPY 8,280 billion). Profit is expected to tumble 60% to $575 million (JPY 55 billion) or 32 cents (JPY 30.31) per share.

We continue to recommend HMC as Hold with a six-month target price of $27.00.
Read the full analyst report on "HMC"
Zacks Investment Research

Toyota Expecting Profits in 2010 – Analyst Blog

Zacks Market Commentaries — Fri, 24 Jul 2009 16:09:58 +0000

Recently, North American chief of Japanese auto giant Toyota Motor (TM), Yoshimi Inaba, revealed that the company’s North American operations would possible become profitable in 2010. The forecast assumed U.S. vehicle sales to reach 10 million units this year and 12 million next. However, Inaba is dubious about returning to the 2007 level vehicle sales of 16 million units soon.

Last month, Akio Toyoda – the newly joined President and grandson of Toyota’s founder Kiichiro Toyoda – expressed views about making the company profitable. He anticipated the annual global vehicle production capacity to increase from 10 million units to 13 million units.

Toyota has been struggling hard amidst weak U.S. sales. In the first six months of the year, the company’s U.S. sales plunged 38%, higher than the overall market decline of 35%. In June, Ford (F) toppled the automaker by occupying the second position in terms of absolute sales figures.

Toyota posted its first annual loss (437 billion yen or $4.4 billion) since 1950 for the fiscal year ended March 2009. Further, management has recently projected net loss to worsen to 550 billion yen ($5.5 billion) for the fiscal year ending March 2010.

Currently, Toyota is seeking to review its U.S. manufacturing strategy. The company has 12 manufacturing facilities in the U.S. Half of these are operating under capacity and one has been idled in Mississippi. It also looks forward to close down the New United Motor Manufacturing, Inc. (NUMMI) plant in Fremont, California. NUMMI is a 50/50 joint venture between Toyota and General Motors (MTLQQ) that produces Corolla and Tacoma for the former and Pontiac Vibe for the latter.

We continue to recommend TM as Hold with a six-month target price of $75.00.
Read the full analyst report on "TM"
Read the full analyst report on "F"
Read the full analyst report on "MTLQQ"
Zacks Investment Research

Today’s Pfennig Friday, July 24, 2009

Contrarian Profits — Fri, 24 Jul 2009 14:30:07 +0000

pHome sales improve#8230; Are we there yet#8230; Intervention talks#8230; Buying on dips#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230;and a Fabulous Friday to you. As I was sitting here this morning collecting my thoughts, it just hit me like a ton of bricks that we#8217;re already towards the end of July and next weekend brings us into August#8230;where#8217;s the pause button when you need it. Anyway, yesterday started out like any other quiet morning so far this week but we did see a nice little run in the currencies only to see profit taking as we moved into the late afternoon. As I turned the computer screens on this morning, I see where the overnight markets brought us right back up to the levels we began#8230;/p

Bernanke Sticks to His Script

Contrarian Profits — Wed, 22 Jul 2009 16:00:15 +0000

pBernanke sticks to the script#8230; Pound sterling comes under pressure#8230; China starts shopping for assets#8230; BRIC MarketSafe lights up the phones#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; We had a very busy day on the desk yesterday, as our newest MarketSafe offering, based on the BRIC currencies, is making the phones ring off the hook. But while we were busy, the currency traders had another slow day as the dollar just drifted throughout the day. The return chart for the last 24 hours shows only one currency made more than a .5% move vs. the US$; and that was the South African Rand which increased .75%./p pThe markets were watching Ben Bernanke#8217;s congressional testimony through most of the day, but those waiting for a surprise were#8230;/p

Yen, Dollar Gain vs Euro on Lower Equities

Contrarian Profits — Wed, 22 Jul 2009 15:30:31 +0000

pThe yen and the dollar edged up against the euro today, Wednesday, as falls in equities and oil prices dampened investors#8217; appetite for riskier assets./p pU.S. S#38;P 500 equity futures were down 0.7 percent , which increased demand for those currencies which typically gain in times of risk aversion and weighed on higher risk currencies such as the Australian dollar./p pSterling pared earlier steep losses, however, after Bank of England minutes showed policymakers voted unanimously to maintain their quantitative easing target./p pAnalysts said Federal Reserve Chairman Ben Bernanke on Tuesday dented sentiment when he said U.S. interest rates would stay low for some time./p p#8220;The dollar has found a bit more of a stable footing, which is largely a function of what Bernanke said yesterday,#8221;#8230;/p

Risk Aversion Disappears Again

Contrarian Profits — Mon, 20 Jul 2009 14:00:35 +0000

pRisk aversion has left the building#8230; CIT survives without Fed help#8230; SNB tries to fight the markets#8230; Light week for US data#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; We had just an amazing weekend of weather here in St. Louis, and this morning is shaping up to be another beautiful day. Friday turned out to be a beautiful day for those who have taken our advice and diversified their holdings out of the dollar. Risk aversion was placed on the back burner again, and investors moved money back out of the dollar into higher yielding currencies. The dollar and yen got sold but all other currencies rallied, and investors also turned back toward gold pushing the metal above $950 for the first time in over#8230;/p

Risk Aversion Returns

Contrarian Profits — Fri, 17 Jul 2009 13:30:06 +0000

pRisk Aversion returns#8230; Money Multiplier dampens stimulus effects#8230; TIC flows show concern of foreign investors#8230; China back on growth track#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; Chuck got an early start on a two week hiatus from the desk, so you will be stuck with me writing the Pfennig for the next two weeks. But don#8217;t worry, you will still get a small dose of Chuck over the next week as he typically emails me his thoughts while on the road (I call it Pfennig Pfodder). Risk aversion dominated the currency markets overnight, as terrorists set off two separate explosions in Jakarta and investors moved money back into the #8217;safe havens#8217; of the US$ and Japanese yen./p pChuck wrote about this move yesterday, believing the bad#8230;/p

Yen, Dollar Slip as Investors Tiptoe into Risk

Contrarian Profits — Tue, 14 Jul 2009 17:30:55 +0000

pThe yen slipped on Tuesday in choppy trade while the dollar struggled against most currencies as earnings of Goldman Sachs and U.S. retail sales surpassed expectations, stoking modest hopes for an economic recovery/p pBut traders were cautious ahead of quarterly results from other U.S. banks, while lackluster data from Germany weighed on the euro and kept it rooted in a broad range against the dollar./p pThe slight rise in risk appetite also boosted higher-yielding currencies such as the Australian dollar at the expense of both the yen and U.S. dollar, which tend to see their biggest gains when investors grow anxious and buy them as safe havens./p p#8220;Retail sales were better than expected, so that#8217;s a bit of good news, but there#8217;s been#8230;/p

Blood in the Streets

Contrarian Profits — Tue, 14 Jul 2009 17:00:55 +0000

pRed ink flows#8230; Japan suggests diversification for their reserves#8230; Commodity currencies rebound#8230; Data galore for the rest of the week#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; Chuck had a late night down at the ballpark watching the home run derby, so he asked me to take the helm of the Pfennig this morning. I#8217;m going to try to get this one out a bit earlier than I did last Friday, so I#8217;ll get right to it./p pThe biggest news to hit the markets yesterday was the Treasury Department#8217;s report that the deficit in June totaled $94.3 billion. This monthly deficit pushed the deficit for the fiscal year to over $1 trillion dollars for the first time, and we still have another quarter to go until the#8230;/p

Toyota Shuttering NUMMI Plant? – Analyst Blog

Zacks Market Commentaries — Mon, 13 Jul 2009 17:18:58 +0000

Recently, Japanese auto major Toyota Motor (TM) said it would possibly close its New United Motor Manufacturing Inc. (NUMMI) plant in Fremont, California. Higher manufacturing cost in California, shortage of parts suppliers in the area (only 11% of NUMMI’s parts suppliers are within 400 miles of the plant) and unionization (the only plant of Toyota organized by UAW in the U.S.) led the company to seek a possible closure.

The NUMMI was started as a General Motors (GMGMQ) plant in 1962 but closed down in 1982 due to operational inefficiency. However, it was reopened two years later as a 50/50 joint venture between General Motors and Toyota. It was a remarkable joint venture in America’s as well as Toyota’s history.

Americans learnt of the famous Japanese ‘lean manufacturing system’ (focused on just-in-time delivery) through NUMMI and Toyota took its first step in the U.S. using GM’s supply lines. NUMMI produces Corolla and Tacoma for Toyota and Pontiac Vibe (Toyota’s version of the Vibe) for GM.

GM decided to pull out of NUMMI after declaring bankruptcy last month as it will discontinue the Pontiac brand. Last week, the ‘New GM’ emerged after the company completed its bankruptcy filing. The company will dump its NUMMI assets in ‘Old GM’ for liquidation. However, it will continue producing its Pontiac Vibe until August as the current UAW contract with NUMMI expires on August 31.

According to the East Bay Economic Development Alliance, the NUMMI closure would cost 5,400 direct jobs and 30,000 indirect jobs.

With the slump in industry sales, NUMMI has seen severe production cuts over the past six months. The assembly line manufacturing the Vibe and the Corolla has witnessed a 25% decline in production to 76,000 vehicles, while the Tacoma has seen an 83% fall in production.

Toyota has also been affected financially by the economic crisis. The company posted its first annual loss (437 billion yen or $4.4 billion) since 1950 for the fiscal year ended March 2009. Further, management has recently projected net loss to worsen to 550 billion yen ($5.5 billion) for the fiscal year ending March 2010.

Toyota has 12 manufacturing facilities in the U.S. Presently, six of them are operating under capacity and one Mississippi plant has been idled. The NUMMI closure seems likely as wages are higher at the plant (due to unionization) compared to others including plants in Canada and Mexico, which producing Corolla and Tacoma, respectively.

We reserve our opinion on Toyota as a Hold with a target price of $75.00.

Read the full analyst report on "TM"
Read the full analyst report on "GMGMQ"
Zacks Investment Research

Back To Risk Aversion!

Contrarian Profits — Mon, 13 Jul 2009 14:00:01 +0000

pEarnings reports begin this week#8230; Dollar, yen, francs get bought#8230; Medvedev shows off new coin! A busy week! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! A Home Run Derby Monday to boot! I have no Idea what#8217;s going on this morning, as I just woke up, and it#8217;s very late in the morning! I was very careful to set my alarm last night, and I#8217;ve never been one of those people that hit the snooze button when it goes off, but here I am, waking up late#8230; UGH!/p pSo#8230; I#8217;m writing from home, and then I#8217;ll shoot in to work#8230; We#8217;re short handed this week, so, I#8217;m sure everyone will be arriving to the office, not see my car, and be#8230;/p

Panasonic Eyes Emerging Markets – Analyst Blog

Zacks Market Commentaries — Fri, 10 Jul 2009 20:00:45 +0000

Based in Osaka, Japan, Panasonic Corp. (PC) is a leading manufacturer of electronic and electrical parts component. To grow market shares in emerging markets such as Brazil, Russia, India, and China (BRIC), Vietnam, Africa, and Latin America and increase customer base in these countries, Panasonic plans to develop a line of low-priced consumer-electronics products which has limited features.

In order to tap consumers in the emerging market, Panasonic will launch TVs for $50, air conditioners for $100 and washing machines for $200, which are expected to hit markets after October this year. Panasonic plans to use "lifestyle research" for the designing of these products.

We believe Panasonic’s success lies in is its ability to respond to rapid technological changes and changing consumer preferences with timely and cost-effective introductions of new low-priced products in markets, which are both price and technology conscious and are very competitive.

These low-priced products would increase sales of the consumer products division by 200 billion yen ($2 billion). In BRIC countries as well as Vietnam, the company expects to reach a sales target of 300 yen ($3 billion) and an average annual growth rate of 20%. Panasonic aims to achieve double-digit growth in overseas sales with an average annual growth rate of 13% by 2010 by focusing on emerging markets.

Panasonic aims to build relationships with retailers in the U.S. and European markets, while aiming to further increase the number of product models by 50% in the emerging markets by shifting to various low-priced products.

While we expect the new lower priced TVs and washing machines to increase unit sales, we remain apprehensive about the impact of these products on profitability and revenue. Additionally, low-end features could hurt Panasonic’s global brand image and premium reputation.

By cutting down features and providing just basic design and manufacturing, Panasonic plans to cut rising raw material costs and overall development costs for its digital products. Panasonic said it will need to perform a complete overhaul of how it conceives, designs and manufactures its products. On top of this, local competition from small manufacturers who can adjust their prices quickly will result in severe pricing pressure for Panasonic.

Panasonic did not provide any details of its product strategies. Panasonic said in a statement that it plans to continue with the strategy only if it can maintain profitability.

While Panasonic is the first Japanese company to launch ultra low-price products to tap customers in emerging markets, it faces competition from large international companies such as South Korean companies - Samsung Electronics and LG Electronics and other Japanese companies, such as Hitachi (HIT), Sony (SNE) and Sanyo Electric (SANYY), which already sell in the low-end market. We therefore maintain our Hold rating on Panasonic.

Read the full analyst report on "PC"
Read the full analyst report on "HIT"
Read the full analyst report on "SNE"
Read the full analyst report on "SANYY"
Zacks Investment Research

Frightened Investors Move Back into US Treasuries

Contrarian Profits — Fri, 10 Jul 2009 15:30:59 +0000

pJobs data skewed by #8217;seasonal adjustments#8217;#8230; BOE surprises the market#8230; Oil falls below $60#8230; China#8217;s reserves continue to grow#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230;Chuck has a bevy of doctor#8217;s appointments today, so he decided to let me take over the Pfennig. Unfortunately it will go out a little later than usual, as I always struggle to get all of my thoughts together so early in the morning. Its not that I come in late (I was here two hours before everyone else) but it just takes me much longer than Chuck to get it all on paper. But enough of the excuses, I#8217;ve got to get writing./p pWeekly jobless claims released in the US yesterday morning fell below 600k for the first time since January#8230;/p

Risk Returns… Slowly

Contrarian Profits — Thu, 09 Jul 2009 14:00:52 +0000

pCurrencies rebound#8230; G-8 has no fireworks#8230; Aussie / China and coal#8230; Entitlements#8230; And Now#8230; Today#8217;s Pfennig!/p p/p pGood day#8230; And a Tub Thumpin#8217; Thursday to you! I#8217;m late, I#8217;m late! I don#8217;t believe I ever heard the alarm go off this morning! I overslept by more than an hour, and will still be here more than an hour before any sign of someone else! But! That puts me behind by more than an hour today#8230; I#8217;ve got to play catch-up! So, let#8217;s get this Tub Thumpin#8217; Thursday going!/p pWell#8230; Let#8217;s see#8230; G-8 never had the opportunity to shoot fireworks because China#8217;s leader had to return home to deal with the street riots going on in his country. So#8230; The call for a replacement for the dollar#8230;/p

Back and Forth We Go!

Contrarian Profits — Wed, 08 Jul 2009 14:45:35 +0000

pBias to sell dollars fades away#8230; Trading in yesterday#8217;s clothes#8230; More thoughts on China#8230; Shadow Inventory#8230;br / And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Wonderful Wednesday to you! Tuesday ended up being a very nice day, except for the currencies. After signing off yesterday and telling you how I had watched the euro climb back to 1.4025, it just couldn#8217;t hold that figure or add to 1.4025.. And all the thoughts that had held the dollar hostage earlier that morning, being the China going to G-8, and so on, just faded like a black shirt put through 100 washes!/p pSo#8230; When I came in on Tuesday, the euro was 1.3920#8230; When I came in this morning, the euro was trading 1.3925#8230; Trading with yesterday#8217;s clothes on.#8230;/p

NTT DoCoMo Keeps Innovating – Analyst Blog

Zacks Market Commentaries — Tue, 07 Jul 2009 21:30:47 +0000

NTT DoCoMo (DCM), the largest wireless service provider in Japan, has decided to launch an innovative on-line money transfer service. Customers of DoCoMo’s i-mode mobile internet service using the 3G FOMA network will be able to remit up to 20,000 Yen per transaction, subject to a limit of 200,000 Yen every month.

The payee will have the option to either deposit the money in a domestic bank account or have the amount credited to his monthly DoCoMo phone bill. Charges per payment will be 105 Yen for the payer and 65 Yen for the payee. However, the payee will not be charged if the remittance gets deposited in a Mizuho Bank (for which DoCoMo will act as an agent) account or credited to the payee’s monthly DoCoMo phone bill.

At present, DoCoMo commands more than 50% of the Japanese wireless market. However, this market is quickly approaching maturity, is low margin and characterized as highly competitive. Smaller service providers like Softbank Corp., and KDDI Corp., have initiated severe price competition after the introduction of mobile number portability system in Japan.

DoCoMo has reinvented the i-mode service as an answer to competition. Nearly 90% of its mobile subscribers have signed up for this service, which enables internet access including e-mail and online credit card transactions.

The company has also started a new service enabling subscribers to use mobile phones as credit cards or e-wallets. For this, DoCoMo has installed a multi-service wireless mesh network spanning 100 cities, added vendors and various service providers and also offering compatibility with the Visa Card network.

Recently, DoCoMo decided to purchase 35% stake in PacketVideo Corp, a subsidiary of NextWave Wireless Inc (WAVE), for a total consideration of $45.5 million. This strategic alliance will enhance DoCoMo’s music and video services. PacketVideo’s multimedia technologies have already been incorporated in 90 handsets for DoCoMo’s 3G FOMA network service. We reiterate our Buy recommendation on NTT DoCoMo.

Read the full analyst report on "DCM"
Read the full analyst report on "WAVE"
Zacks Investment Research

Yen Gains, Dollar Edges Up as Risk Aversion Rises

Contrarian Profits — Tue, 07 Jul 2009 20:30:09 +0000

pThe yen rose today as uncertainty about the global economic outlook and forthcoming U.S. corporate earnings increased the safe-haven appeal of the Japanese currency./p pSterling fell as weak industrial output data reinforced doubts about a UK recovery. The euro dipped against the dollar, but losses were capped by a surprise increase in German factory orders that initially pushed it to a session high above $1.40./p pWhen risk aversion rises, investors often cut holdings of stocks and higher-yield currencies and buy back the yen and dollars that were used to finance the trades./p p#8220;We#8217;ve been getting very mixed signals, with some positive data and some very poor data, so it#8217;s extremely difficult to pinpoint direction,#8221; said Fabian Eliasson, vice president of currency sales at#8230;/p

$35 Billion More Treasuries To Auction

Contrarian Profits — Tue, 07 Jul 2009 14:25:59 +0000

pBias to sell dollars again#8230; More supply to choke down#8230; More thoughts on China#8230; RBA leaves rates unchanged#8230;br / And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Terrific Tuesday to you! A beautiful day and night here in St. Louis yesterday, where was that during the 4th of July weekend? Oh well, at least I got to enjoy a couple of hours of it, outside! There#8217;s more Treasury supply for the markets to choke down, and the whispering campaign regarding China is growing louder#8230; Those things and more, in this edition of A Pfennig For Your Thoughts, Tuesday, July 7, 2009#8230; And here#8217;s our host#8230;/p pHello! Everyone! How nice it is to be with you again today! We#8217;ll start out with a recap of yesterday#8230; When I#8230;/p

China Is Back On The G-9 Docket

Contrarian Profits — Mon, 06 Jul 2009 18:30:22 +0000

pRisk Aversion is strong once again#8230; Currencies get sold#8230; What#8217;s China really up to? RBA to leave rates unchanged?br / And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Marvelous Monday to you! Some people have the day off today, so we#8217;ll probably not be back in full force until tomorrow#8230; Not that we#8217;ve been in full force, as a workforce in the U.S. for some time#8230; But that#8217;s another story for another day! Today is a new day, and new week!/p pFriday#8217;s thinned out markets were not what the currencies wanted to see, as the bias to Risk Aversion was magnified in the thinned out markets, only making the selling of the currencies even worse#8230; Some #8220;levels#8221; were hit in the thinned out markets, and that caused#8230;/p

Euro Edges Up vs Dollar in Holiday-thinned Trade

Contrarian Profits — Fri, 03 Jul 2009 15:00:36 +0000

pThe euro recovered against the dollar today, Friday, as traders picked up the single European currency following its fall the previous session, when weak U.S. jobs data helped lift the dollar across the board./p pSome traders booked profits on the euro#8217;s slide on Thursday, while analysts said currency movements were aggravated due to thin volumes as U.S. markets were closed for the Independence Day holiday./p pOn Thursday, data showed U.S. employers cut a greater-than-expected 467,000 jobs in June, leading to heightened risk aversion on the back of pessimism about the recovery of the U.S. economy./p pThe bleak data pressured the euro and currencies perceived to be higher risk such as the Australian and New Zealand dollars, but the single European currency found its#8230;/p

The U.S. Treasury Moves The Goal Posts

Contrarian Profits — Wed, 01 Jul 2009 14:40:29 +0000

pA 4-day rally gets stopped at the border#8230; Home Prices fall at a -18.12% pace#8230; Alice Rivlin gives her 2-cents#8230;br / * Kiwi bond maturities galore next month#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Wonderful Wednesday to you! As tradition with the Pfennig would have it, here#8217;s my introduction to July#8230; There I was#8230; On a July morning#8230; Looking for love#8230; With the strength of a new day dawning, and#8230; The beautiful sun#8230;/p pYes, for those #8220;old rockers#8221; from the 70#8217;s like me#8230; That#8217;s Uriah Heep, at their best!/p pOK#8230; So, welcome to July! The last day of June was quite the volatile one to say the least! There we were waiting for the S#38;P/CaseShiller Home Price Index to print, and show that home prices were#8230;/p

Suning To Buy 27.36% Shares Of Japan’s Laox

China Retail News — Tue, 30 Jun 2009 19:30:39 +0000

Chinese electronics retailer Suning has confirmed that the company will buy 66.67 million shares from the Japanese electronics retailer Laox at a price of JPY12 per share. This is the first time that a Chinese company will acquire a Japanese listed company and it is the first time for a Chinese home appliances chain to enter [...]

Toyoda to Steer Toyota towards Growth – Analyst Blog

Zacks Market Commentaries — Mon, 29 Jun 2009 18:11:54 +0000

Recently, Toyota Motor (TM) announced the 53-year old Akio Toyoda as its new President. Toyoda is the grandson of Toyota's founder, Kiichiro Toyoda, and the son of Toyota's honorary Chairman, Shoichiro Toyoda. Akio Toyoda replaced his predecessor, Katsuaki Watanabe, as the 11th president in the automaker's 72-year history.

Akio Toyoda joined Toyota in 1984 and went to the U.S. for a two-year stint as head of a joint venture plant, New United Motor Manufacturing Inc. (NUMMI), in Fremont, California. The California plant was a General Motors (GMGMQ) plant that had been opened in 1962 and had become a joint venture between General Motors and Toyota in 1984.

Akio Toyoda assumes presidency right after the company posted its first annual loss (437 billion yen or $4.4 billion) since 1950 for the fiscal year ended March 2009. Further, management has recently projected net loss to worsen to 550 billion yen ($5.5 billion) for the fiscal year ending March 2010.

However, the new president is very optimistic about Toyota's as well as the auto industry's future. He looks forward to increase in annual global vehicle production capacity from 10 million units to 13 million units. His company is trying to tap government incentives in Japan, U.S., and Europe for so called 'green' cars. Consequently, Toyota would be heavily focused on hybrid cars.

Recently, the company has already shown signs of success in this effort by receiving a bumper order of 180,000 units for its third generation 4-door compact hybrid, Toyota Prius 2010, debuted in Japan on May 18, 2009. The company also foresees significant growth potential in emerging markets such as Brazil and India.

Despite his optimism, Akio Toyoda looks well aware of the present condition of his company. In light of the difficult market scenario, he has volunteered to take a 30% pay cut for one year from July. He also expects other top managers to follow suit. This portrays the new president's cautious approach to mitigate the problems in the company. We all welcome him!

We reserve our opinion on the stock as Hold with a target price of $75.00.

Read the full analyst report on "TM"
Zacks Investment Research

Desperately Seeking Yield

Contrarian Profits — Fri, 26 Jun 2009 15:50:41 +0000

pCurrencies rally#8230; More on the BRIC#8217;s#8230; New Zealand#8217;s GDP contracts.. Bernanke gets grilled! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! The end of what seemed to be a very long week#8230; The last weekend in June, can you believe that? Next week, we#8217;ll be getting ready for the 4th of July celebrations! WOW!/p pWell#8230; What a volatile week it has been in the currencies! Up, down, all around, and settling back to levels that we saw before the Fed#8217;s FOMC meeting earlier this week. Suddenly, investors are looking for yield again#8230; Looks like they are #8220;Desperately Seeking (not Susan) Yield! And why not? The Fed, and the Bank of Canada (BOC) have come out and said that there will#8230;/p

Increasing SDR Issuance

Contrarian Profits — Thu, 25 Jun 2009 13:45:48 +0000

pFed confuses markets, risk assets get sold#8230; SNB intervenes to stop franc#8217;s rise#8230; ECB issues 12-month liquidity#8230; Bernanke to get grilled? And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Tub Thumpin#8217; Thursday to you! Yes, I know the currencies and commodities got whipsawed yesterday, and my Cardinals got spanked, but that#8217;s no reason for us to not enjoy a Tub Thumpin#8217; Thursday! Every day is a gift, and it has nothing to do with stocks, bonds, currencies, and commodities!/p pOK#8230; Not that I try to be philosophical, sometimes it just comes out that way! Besides, you don#8217;t want to think that I#8217;m just a smart *** all the time! HAHAHAHAHAHA!/p pWell, as I said in the open, the currencies and commodities got whipsawed yesterday, and the culprit#8230;/p

More Stimulus On The Way?

Contrarian Profits — Wed, 24 Jun 2009 13:45:52 +0000

pEuro leads currencies higher#8230; Commodities rally back on FOMC thoughts#8230; FOMC meeting today#8230; NZ Consumer Confidence on the rise#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Wonderful Wednesday to you! Well#8230; Yesterday, the title of The Pfennig was: So Far#8230; It#8217;s A Turn Around Tuesday! And#8230; That theme played well throughout the day, and by day#8217;s end, it had been quite the Turn Around Tuesday! Now, we have to see what#8217;s in store for us today, as the last couple of weeks have seen the Wednesday trading quite the opposite of Tuesday#8217;s trading! Strange trading pattern don#8217;t you agree?/p pOvernight, the euro climbed as high as 1.4140, only to sit at the cusp of 1.41 as I begin to write this morning. Of course 1.41#8230;/p

Suning Plans To Acquire Stake In Japan’s Laox

China Retail News — Sun, 21 Jun 2009 19:31:38 +0000

According to reports in local Japanese media, the Japanese electronics retailer Laox is in discussions with the Chinese home appliances retailer Suning and plans to sell parts of its stake to the latter. It is planned that Laox will issue shares valued at about JPY1.5 billion, which accounts for over 50% of the company's total equity. [...]

A Sustainable Economic Recovery?

Contrarian Profits — Fri, 19 Jun 2009 14:00:18 +0000

pMore range trading#8230; Eurozone doesn#8217;t need more stimulus#8230; A$#8217;s outperform on rate outlook#8230; A double whammy for the dollar#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! The end of another week#8230; I was out on Monday, and it still seems to have been another long week! UGH! Oh well#8230; It#8217;s Friday, and this weekend is Father#8217;s Day#8230; So, we#8217;ve got that going for us, eh?/p pMore range trading in the currencies yesterday, with the euro leading the currencies higher for most of the day, only to see their gains slip, sliding away by the late afternoon. In the overnight markets, the currencies, once again, have moved higher, but nothing to get all lathered up about#8230;/p pThis morning, the euro got#8230;/p

Gold Vending Machines!

Contrarian Profits — Thu, 18 Jun 2009 14:00:51 +0000

pMore range trading#8230; SNB doesn#8217;t target the franc#8230; Norges Bank cuts rate but looks forward#8230; Buy your gold and Snickers! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Tub Thumpin#8217; Thursday to you! It was 95 here yesterday, and forecast to be even warmer, or should I say hotter, today! WOW! Like overnight, it turned to summer, after the coldest, most wet, spring I can ever recall#8230; I know, I#8217;ll get 100 emails reminding me that summer doesn#8217;t officially start until next week#8230; I#8217;m just talking about the summer-like weather!/p pThe currencies remained in that range I talked about yesterday, with a slight bias to sell dollars, but not much of one. Crude Oil prices moved higher on the day and overnight, which doesn#8217;t play well#8230;/p

Stuck In A Range

Contrarian Profits — Wed, 17 Jun 2009 19:14:59 +0000

pA Turn Around Tuesday? BRIC meeting doesn#8217;t get covered by the media? Are the Bearer Bonds real or fakes? QTC#8217;s get Gov. backing! And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Wonderful Wednesday to you! Remember last week, when I said that we had a #8220;Turn Around Tuesday?#8221; I came in this morning to find a story that Chris Gaffney had printed off the Bloomie for me#8230; The writer refers to the price action yesterday as #8220;Turn Around Tuesday!#8221; OK#8230; I for one, don#8217;t even begin to believe that I was the originator of a saying like that for the currencies#8230; I just find it interesting, that a week after I make a big deal out Turn Around Tuesday that it is used in a#8230;/p

German Investor Confidence Is On The Rise…

Contrarian Profits — Tue, 16 Jun 2009 19:17:39 +0000

pCurrencies stop the dollar#8217;s run#8230;BRIC meeting could get ugly for the dollar#8230;RBA meeting notes good for Aussie dollars#8230;Depressing data / forecasts for housing#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! Thundering storms moved through here this morning, as I was preparing to leave home and drive to the office. As slow as I am with getting around these days, I got pretty wet from my car to the office building. But, I didn#8217;t melt, as most would have thought! HA! And, I#8217;ll dry out soon enough#8230; Well before anyone else comes in!/p pOK#8230; Well#8230; When I left you yesterday, the dollar was on a rampage, from the comments by the Russian Finance Minister, Kudrin#8230; Was it an overreaction,#8230;/p

German Investor Confidence Is On The Rise

Contrarian Profits — Tue, 16 Jun 2009 14:10:36 +0000

pCurrencies stop the dollar#8217;s run#8230; BRIC meeting could get ugly for the dollar#8230; RBA meeting notes good for Aussie dollars#8230; Depressing data / forecasts for housing#8230; And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! Thundering storms moved through here this morning, as I was preparing to leave home and drive to the office. As slow as I am with getting around these days, I got pretty wet from my car to the office building. But, I didn#8217;t melt, as most would have thought! HA! And, I#8217;ll dry out soon enough#8230; Well before anyone else comes in!/p pOK#8230; Well#8230; When I left you yesterday, the dollar was on a rampage, from the comments by the Russian Finance Minister, Kudrin#8230;#8230;/p

Throwing A Cat Among The Pigeons!

Contrarian Profits — Mon, 15 Jun 2009 14:50:44 +0000

pRussia#8217;s Fin Min talks up the dollar! Currencies, commodities, stocks all lose ground#8230; Who#8217;s car is uglier #8230; Gold hit a 3-week low#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Marvelous Monday to you! How about that weekend? I actually didn#8217;t get a chance to experience much of it outside, but it sure looked great! We have new champions in basketball and hockey, so congrats to the Lakers and Penguins on their Championships! Now, the housecleaning is out of the way#8230; It#8217;s time to get to the meat#8230; Where#8217;s the beef? HA!/p pOK#8230; Well, the Russian Finance Minister, Kudrin, threw a cat among the pigeons yesterday, when he stated that Russia has confidence in the U.S. currency. The markets have reacted violently to this statement, sending#8230;/p

Here We Go Again!

Contrarian Profits — Fri, 12 Jun 2009 20:14:49 +0000

pCurrency rally gets wiped out#8230;Geithner to talk about a strong dollar? Brazil cuts rates! The Fed to control everything? YIKES! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! Another seemingly long week for yours truly#8230; Where#8217;s a 3-day Holiday weekend when you need one? Have you been following the goings on with the investigation into the Bank of America (NYSE:a href="http://www.google.com/finance?q=BAC"BAC/a) purchase of Merrill Lynch? Whoa, there partner! I thought for sure this would get all swept under the rug, but it#8217;s all coming out, every dirty deed! Dirty deeds done dirt cheap!/p pBefore we get into the goings on there#8230; Let#8217;s talk about the currencies and their huge jump yesterday, only to see chicken traders come#8230;/p

Whipsawed Wednesday!

Contrarian Profits — Thu, 11 Jun 2009 19:49:18 +0000

pFed#8217;s Beige Book disappoints#8230;Dollar rebounds on the day#8230;Currencies come back on the night#8230;RBNZ leaves rates unchanged#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Thunderin#8217; Thursday to you! It#8217;s a Thunderin#8217; and lightenin#8217; here in St. Louis. It all began last night, went through the night, and still hangin#8217; round this mornin#8217;! Yes, I#8217;m into dropping #8220;g#8217;s#8221; today! HA!/p pWell#8230; We had #8220;Turn Around Tuesday#8221;, and that was fallowed by #8220;Whipsawed Wednesday#8221;! The euphoria of the dollar bears, turned quickly yesterday, with the dollar bouncing back#8230; I#8217;ll tell you this dollar has more lives than a cat! But that#8217;s OK#8230; I certainly don#8217;t want to see a dollar collapse, as some have called for#8230; I just want to see it at a #8220;fair#8221;#8230;/p

A Turn Around Tuesday

Contrarian Profits — Wed, 10 Jun 2009 15:38:01 +0000

pAnother Treasury auction today#8230; Goldman says to buy euros! Oil fuels Commodity Currencies! RBNZ to meet tonight#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Wonderful Wednesday to you! Well#8230; Yesterday was #8220;Turn Around Tuesday#8221;! Add to that, the fact that there were a number of reasons for the euro to lead the charge for currencies VS the dollar yesterday. And#8230; A word from one of the economists that I keep on my list of #8220;to read#8221;#8230; So, let#8217;s get to the tape from Turn Around Tuesday!/p pI heard yesterday someone say #8220;well, we sure turned around today in the currencies#8221;#8230; And I thought, Shoot Rudy, why not name it Turn Around Tuesday? Then I went back to the history page on my trusty Bloomberg, and#8230;/p

Rising Treasury Yields

Contrarian Profits — Tue, 09 Jun 2009 16:17:33 +0000

pAnother Treasury auction today#8230; Spending habits come back to haunt reps#8230; Some healing in the currencies#8230; 10 Banks to repay TARP today#8230; And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Terrific Tuesday to you! Well#8230; I sure stirred up the hornet#8217;s nest yesterday#8230; Some people didn#8217;t think I should express my opinion#8230; But that#8217;s OK#8230; Here#8217;s the skinny#8230; I wrote yesterday about the farce that the jobs report was, and what a feeble job the media did in reporting the #8220;real numbers#8221;#8230; I then threw something in the Pfennig that I don#8217;t normally do, just to see what was more important to people#8230; The fact that their Gov#8217;t lies to them, or the fact that they don#8217;t see eye-to-eye with me on the President#8230;/p pGiven the#8230;/p

Who’s Foolin’ Who?

Contrarian Profits — Mon, 08 Jun 2009 17:12:30 +0000

pJobs Jamboree gets a lift#8230; The real numbers#8230; The dollar comes back with vengeance! RBNZ to meet this week#8230;br / And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! You know the Jobs Jamboree data that printed on Friday, and created some HUGE euphoria among the media types that love to just #8220;read the news#8221; and not actually do the research to report it? Yes#8230; It was a very good number, on the outside#8230; Not that losing 345,000 jobs in a month is a good thing, but it is far better than the near 700,000 jobs lost a couple of months ago./p pSo#8230; I#8217;ve got that to talk about today#8230; And the rebound by the dollar that has taken the euro to the 1.38#8230;/p

A Jobs Jamboree Friday!

Contrarian Profits — Fri, 05 Jun 2009 19:49:47 +0000

p Currencies get a tourniquet#8230; BOE And ECB leave rates unchanged#8230;Political uncertainty in the U.K#8230;Aussie dollar to rally further? And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Happy Friday to one and all! A Fantastico Friday, as we all will be heading to the Ballpark tonight to watch my beloved Cardinals! This should be a fun time by all! It#8217;s also a Jobs Jamboree Friday, and we#8217;re about to witness something that hasn#8217;t been seen in 25 years#8230; A #8220;published by the BLS#8221; Unemployment Rate of 9%!/p pOK#8230; You know me#8230; I think the (Bureau of Labor Statistics) BLS should just drop the #8220;L#8221;, as they have gone whacko with the adjustments and deletions to the statistics! So#8230; For those of you keeping#8230;/p

Wild Swings!

Contrarian Profits — Wed, 03 Jun 2009 21:59:37 +0000

pEuro goes back and forth over 1.43#8230;Eurozone unemployment rises to 9.2%#8230;Australia#8217;s GDP surprises! Is it protectionism? And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Wonderful Wednesday to you! I#8217;m draggin#8217; the line today, as I was helping my oldest son, Andrew, with things in his brand, spankin#8217; new house, last night. Congrats to Andrew, for finding a great bargain, with a low, fixed, interest rate!/p pOK#8230; Whew! What a day in the currencies yesterday! Another day, and another day of wild swings.. Volatility is the name of the game these days#8230; Watching, for instance, the euro trade down to 1.4220, and then up to 1.4320 and not just on a one-way ticket! Oh No! this is a bounce here a bounce there#8230;#8230;/p