Twenty Questions and a Box of Matches, Please

1. Where will SPX be trading when Santa comes down the chimney?

a) above1250
b)1150- 1250
c) below 1150

2. What will Europe have pulled out of the hat by December 24th?

a) A Schengen-based fiscal union around which to structure mutual support.
b) A battered can, to be place kicked into January.
c) Sorry, don't understand the question as Europe cannot currently be defined.

3. By year-end the Middle East will see (multiple answers allowed) :

a) The Syrian leadership be toppled.
b) Egypt have become the most democratic country on the planet.
c) Egypt be boiling in blood.
d) Libya be teetering on Somalian warlord rule

4. And Italy's 10 yr yields will be:

a) over 8%.
b) under 6%.
c) Unavailable due to the EU banning trading in them.

5. In 2012 China's economy will be:

a) A smouldering property market train wreck with HSCEI at 6k.
b) Moving BRICs like back in the day with 9% growth. Jim O'Neill will publish a note simply titled "Todja, didn't I?".
c) Bumbling along, 7-8.5% growth, with HSCEI no higher than 11k.
d) Revolution! All your equities belong to Great Hong, son of Holy same sex couple of Buddha and Jesus.

6. As BRICs has become an overused term which new country grouping acronym would you propose?

a) Turkey, Uzbekistan, Romania, Denmark & Sweden.
b) Chad, Romania, Afghanistan & Paraguay.
c) Brazil, Oman, Liberia, Lithuania, Oman, China, Korea & Switzerland.

7. The IPO of Facebook said to value the company at $100bn is:

a) A great opportunity to Buy (Like).
b) Groupontastic.
c) Facebook? Wasn't that soooo 2011?

8. If you are receiving fixed rates on Euro swap, what does paying 6m Euribor in EUR mean?

a) What it says on the tin.
b) 6M FIBOR in DEM.
d) Some blended rate in ECU-2.
e) Who cares, my counterparty already went bust so I'm fucked

9. Where will DEM/ITL trade post breakup?

a) 1100
b) 1400
d) Down at the Mithras
e) On an e-platform run by the Vatican.
f) On an e-platform run by the Bundeathstar.

10. Gilts are:

a) The new safe haven.
b) A great way to stuff the Japanese.
c) Something you have after forgetting your wife's birthday.
d) something that an Italian would love instead of BTPs, but as the word is unknown in his vocabulary he will never have.

11. Merv's remarks about the massive bookkeeping profits on the AFP are:

c) Asinine as it will have every part of government clamouring to spend it.
b) Solely down to his financial brilliance.
c) Solely down to his own belief in his financial brilliance.

12. Silver is:

a) Money.
b) Metal.
c) Way to fleece clients through theta.
d) The word that normally comes after "hi ho".
e) Tarnished.

13. The Sun is:

a) A shiny bright object last seen in the UK by a past generation.
b) A shiiity light objectionable publication in the UK run by a past generation.
c) The first name of your next boss.

14. The disclosure that Hank Paulson gave a bunch of ex-GS hedge fund mates the heads up on how the Fannie & Freddie bailouts were going to go down is:

a) A friendly thing to have done.
b) Yet more evidence of Crony Capitalism, likely to add fire to the OWS campaign.
c) Not a surprise.
d) Going to land at least one of those guys present in jail.
e) A lie... He would never do that.

15. How do you make a billion dollars?

a) Start with $10bn and invest in airlines.
b) Start with $10k and invest it in that nerdy kid down the hallway's thing he keeps on talking about to stalk girls on campus.
c) GoldsheepleBer-nankfiatmoneyRonPaul.
d) Apply academic theory regarding optimal currency unions to CDS trading circa January 2010.

16. Who is coming to Jim Chanos' Xmas Dinner Party?

a) Wife 1.
b) Kids.
c) 6 Czech models.
d) All of the above.
e) Client No. 9.

17. Today's BTP auction was:

a) A disaster as Italy had to pay 7.5 % for 10 yr money.
b) A great result compared to what people were dreading.
c) An excuse to further squeeze the market shorts by the knadgers.
d) Only filled thanks to a buy one get one free offer on the back of Kellogi's Corniflakies?

18. The FSA report into the RBS/ABN deal:

a) Was amazingly insightful: "FSA CALLS RBS DEAL ON ABN `RECKLESS' GAMBLE".
b) The product of 3yrs of hard investigation.
c) Another example of regulator too busy looking backwards to allocate blame rather than looking forwards to prevent it.
d) Cost 40bn quid.

19. Wiedmann is:

a) The name of the German detective in Inglorious Bastards.
b) The name of a secret plot to cause the break up of the EUR.
c) The name of the man at the Bundeathstar.
d) Not on TMMs Xmas card list.

20. The current market moves:

a) Are great, we are loving them.
b) Are a 12 yr old quant's nightmare.
c) Are an excuse to shut up shop 'til Xmas.
d) Can be explained by feeding torn up news items into a rat's cage and seeing which ones they devour and then vomit out of the cage.


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Click here for comments
November 29, 2011 at 1:55 PM ×

1-c bottom up in short term
3-dont care
4-b ECB steps in
5-c wait til 2013
6-b/a love the names
7-a good for a week, sell fast

10-b Japan is the role model right now.

13-c look over your shoulder
14-a only if I were among them
15-a Hope I have this opportunity
16-c day dreaming...
17-b That is how they are going to interpret it.

19-d He could be closer than Hitler to the goal of uniting Europe/ruining Europe.
20-a time to short again

November 29, 2011 at 2:46 PM ×

4; You putting a feeler out in regard "DOUBLE NO TOUCH" bond option. know the rest.......

November 29, 2011 at 5:48 PM ×

It's a shame there are few takers on such a hilarious post - a sign in itself that most have either already shut up shop or are too unsure of themselves to put there prognostications in writing for fear of being humiliated by a market itself that doesnt seem to know where it's going.
1) Spx is closed for trading while Santa makes his rounds. That way he can take his time on the milk and cookies and not worry about having to mind his e-trade account. Spx 1150, but marginally improved us data take us to the 200dma first.
2). Vintage eurobollocks. Next unconventional monetary policy will be the beard riding around in a sleigh dropping euros instead of his normal routine of dollars from helicopters.
3. Higher oil.
4. At 8% no higher.
20. Where did you get your rats from, I'm looking for a new market timing tool?

November 29, 2011 at 6:15 PM ×

Agreed with Corey. It's quiet.

The funds who made money this year are not interested in risking it, and the people who are underperforming are eventually going to get their heads cut off again chasing rallies that are simply extended short squeezes.

Also agree that any slightly decent US jobs data will drive the market much higher than most shorts expect, at which point they will experience Cold Steel all the way to the 200 DMA. That would be a cue for bullish media noises, happy days are here again and John E Retail joining in, maybe even more attractive yields at the long end, at which point we will all sell and re-enter the fallout shelter until the European MAD nuclear exchange is complete. Rinse and repeat. Result - a range between 1075 and 1275.

Here is a post from Dean Baker that readers of MM will appreciate, since it says what we are all thinking. Certainly Polemic could have written this on one of his less sarcastic outings:

Dean Baker on ECB

We especially appreciated the understated elegance of this opening paragraph:

The European Central Bank (ECB) has been working hard to convince the world that it is not competent to act as central bank. One of the main responsibilities of a central bank is to act as the lender of last resort in a crisis. The ECB is insisting that it will not fill this role. It is arguing instead that it would sooner see the eurozone collapse than risk inflation exceeding its 2.0 percent target.

November 29, 2011 at 8:21 PM ×

Concur,after the 9th the only HARDCORE traders around may be (Mrs Watanabe) found under some Bodhi tree in Osaka...fuckme, why did I say that for, I've gone all misty eyed, moveover...

November 29, 2011 at 9:02 PM ×

Agree. markets like an old steering box. Loads of play and no feed back as to where they are going short term. Look at eurusd today 1.3300- 1.3450 range just on blx headline interpretations. So that's the sloppiness before you get to any real interests.
Got that old ignore good news feeling around at the mom .. US figs Great but not a peep on the chats. Didn't check ZH but did they manage to come up with a reason is as to why they were rubbish?
LB I read that piece on fed spraying Europe with dosh. Yes i would have liked to have written it but .. Oh too much to think about here .. maybe in a post

as for DNT's, unless you are the biggest boy in the school yard they normally do touch in my sad experience

November 29, 2011 at 9:03 PM ×

and yes .. where has everyone gone?

November 29, 2011 at 10:04 PM ×

Where has everyone gone?

a) still too hungover from black fri and cyber mon
b) too busy shorting jgbs to notice
c) over to the dark side
d) the blog that shall remain hedgeless

November 29, 2011 at 10:24 PM ×

Ah Corey, the Church of Doom is packed is it? And minimal comments here? "Hmm ..Get out the no-commentometer, Bob, do you have a reading ? In the red on the no-commentometer? " Well that's interesting ..

Could have just been a rubbish post though..

November 29, 2011 at 10:35 PM ×

Still here, just a bit lurgied.
And it hurts when I laugh too, but it was worth it ;)

Saul Bollox
November 30, 2011 at 2:47 AM ×

Hmm. Lemme see, Pol....

1) Lack of comments at MM and declining VIX - Bullish.
2) Loads of blokes writing about shorting JGBs and other odd Widowmakers - Bullish.
3) Nobody talking about the week's most important stat (US jobs) - Bullish.
4) Nobody who is out fancying the market much - Bullish.
5) Room overhead to firm resistance in DAX at 6000 - Bullish.
6) Nobody positioned for a run to SPX 1250 Bullish. 7) Loads of managers holding dry powder for the traditional Santa Claus rally - Bullish.
8) Mainstream media awash with Euro breakup stories - Bullish.
9) General assumption that Euros are incapable of booting the can for say a 30 day period - Bullish.

Get rid of all of the above and I will be back in the tank sitting in my Bear suit. Claws and all. Kevlar'd some NZT last week so keeping a close eye on Antipodean FX for now.

November 30, 2011 at 8:38 AM ×

Always lurking chaps, always lurking.

Actually, I think that coincident data is just about to turn south for the US (i.e. December, January, and February readings) and while we may certainly get a burst in Spoos towards year end, I think that LB is right about rinse and repeat.

As for general macro trends, the wall of money is coming in 2012.

Oh and the Aussie is toast, but that is old news for the gents here of course.


November 30, 2011 at 1:28 PM ×

Doh! New blog post just as I finished my answers. Well, anyway:

1 a
2 b
3 December is too short to properly start the boiling and warlording; year-end will be same as now
4 a
5 a
6 a (go Sweden! We can put the plural in any dirty acronym you like!)
7 c
8 No clue, I'm an equity monkey
9 a
10 see 8
11 a
12 e
13 a
14 c
15 See 14
17 a
18 c
19 Christmas cards? Isn't there an app for that?
20 c