Another currency rally….  Bank of Canada cuts 75 BPS!…  A Santa rally?… What Asia thinks… And Now… Today’s Pfennig! OK… Another day of “healing” for the currencies, as the 1.29 handle was achieved and held on to in the overnight markets. Slowly… Like sand through the hourglass, these are the days of currency healing! HA! That show, Days of our Lives, was burned into my brain as a kid, as it was my mother’s fave soap.

The single unit was higher within the 1.29 handle overnight than it is right now, as it has given back a bit of ground on the news that a European Union Commissioner, Buti, said that, “economic indicators point

...

Another currency rally….  Bank of Canada cuts 75 BPS!…  A Santa rally?… What Asia thinks… And Now… Today’s Pfennig! OK… Another day of “healing” for the currencies, as the 1.29 handle was achieved and held on to in the overnight markets. Slowly… Like sand through the hourglass, these are the days of currency healing! HA! That show, Days of our Lives, was burned into my brain as a kid, as it was my mother’s fave soap.

The single unit was higher within the 1.29 handle overnight than it is right now, as it has given back a bit of ground on the news that a European Union Commissioner, Buti, said that, “economic indicators point

...

One of the few investment writers whose books I revisit frequently is Nassim Taleb, and I recommend 'Fooled by Randomness' as an accessible and amusing explanation of the misunderstood role of probability and randomness in markets and life in general. I first heard of him when he was profiled in a magazine as this oddball trader who was happy to continuously lose small amounts of money by placing out of the money puts on the markets, in expectation of periodic huge gains that would deliver profits by the dumper truck load. I immediately admired his tenacity and sheer self-confidence. When his first book, 'Black Swans' came out, I rushed to buy it. His strategy is one I have followed for much of this year and indeed last, very profitably. Taleb's crucial insight was that the market systematically underestimated the probabilities of large negative price movements (so called 'six ...

One of the few investment writers whose books I revisit frequently is Nassim Taleb, and I recommend 'Fooled by Randomness' as an accessible and amusing explanation of the misunderstood role of probability and randomness in markets and life in general. I first heard of him when he was profiled in a magazine as this oddball trader who was happy to continuously lose small amounts of money by placing out of the money puts on the markets, in expectation of periodic huge gains that would deliver profits by the dumper truck load. I immediately admired his tenacity and sheer self-confidence. When his first book, 'Black Swans' came out, I rushed to buy it. His strategy is one I have followed for much of this year and indeed last, very profitably. Taleb's crucial insight was that the market systematically underestimated the probabilities of large negative price movements (so called 'six ...

Welcome to the Fantasyland issue of The 5…“Shouldn’t worry about the deficit,” assures Barack Obama… “yes we can” keep spending. Can’t balance the budget of your dreams? Call the Treasury… Atlanta’s doing it. Gold still suffering… Ed Bugos’ future fantasies for precious metals stocks. Plus, no one immune to the great housing illusion… the infamous Neverland Ranch shuts its doors.

“We shouldn’t worry about the deficit next year or even the year after,” the U.S. president-elect Barack Obama said on 60 Minutes over the weekend.

We were afraid that Barack’s message of “change you can believe in” was going to make it harder to take issue with politics as usual in Washington. But now we see he already drank the Kool-Aid and we had nothing to fear but fear itself.

“The consensus is this, that we have to do

...

I just can’t make up my mind:  Is Hank Paulson committing premeditated murder of the U.S. economy, or merely negligent homicide?

Constant readers know I’ve gone back and forth on this:  In September I figured the bailout bill smacked of making things up as he went along.  But on Monday I took note of the phone conversation he had two months before Washington Mutual collapsed, in which Paulson told WaMu’s CEO he ought to sell out to JPMorgan Chase (NYSE:JPM) because his company was in big trouble.

I guess it’s possible Paulson knew bad things were going down, but he still didn’t know what to do about it.  And this morning, the making-things-up-as-he’s-going-along thesis seems inescapable.  I mean, really: The bailout bill was predicated on buying up toxic, er, um “troubled” assets.  Then in the middle of the game it became a hybrid of buying up “troubled” assets

...

Foreclosures continue to plague the U.S. housing market, but government agencies are working to develop a plan to aid struggling homeowners, and in turn, strengthen the U.S. economy.

Foreclosure activity saw a huge spike in the third quarter, as one in every 475 U.S. homes either received a default or auction sale notice, or was repossessed by a bank, according a report released yesterday (Thursday) by industry group RealtyTrac. It was a 71% jump over third quarter foreclosure activity in 2007 and a 3% increase from the second quarter of this year.

Foreclosure filings actually decreased 12% in September from August, but not due to an improving housing market.

“Much of the 12% decrease in September can be attributed to changes in state laws that have at least temporarily slowed down the pace at which lenders are moving forward with foreclosures,” said James J. Saccacio, chief executive officer of

...

U.S. stocks yesterday (Monday) staged their biggest rally since the Great Depression – with the Dow Jones Industrial Average soaring an all-time record 936 points – on a Federal Reserve-led push to flood the ailing global financial system with dollars and on a U.S. government plan to buy stakes in banks.

[This is the eighth installment of an ongoing series in which Shah Gilani breaks down the credit crisis for readers.] In the mid-80s, I ran a private partnership – call it a hedge fund – from the floor of the Chicago Board of Options Exchange Inc. (CBOE). I was an independent market maker, meaning I could walk into any trading pit on the floor and trade any options and any stocks. More often than not, one of my principal trading plans was to play the crowd. My approach was to walk into the pit and chat up the crowd. My intention was to gauge whether the other market makers and locals were net long (bullish) or net short (bearish). Most of the locals are independents and not extremely well capitalized. But I was. If I gauged the locals to be bullish, ...

U.S. stocks yesterday (Monday) staged their biggest rally since the Great Depression – with the Dow Jones Industrial Average soaring an all-time record 936 points – on a Federal Reserve-led push to flood the ailing global financial system with dollars and on a U.S. government plan to buy stakes in banks. The rally was sparked by commitments from the major financial nations to cooperate in getting the credit markets functioning again, and by news that U.S. officials were putting the finishing touches on Washington’s version of a rescue plan under which the U.S. Treasury Department will invest an estimated $125 billion in nine major U.S. banks, and another $125 billion in smaller financial institutions, Bloomberg News reported early this morning (Tuesday). The White House announced that U.S. President George W. Bush would meet at 7:30 a.m. EDT today with members ...