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Toddo on TV: Ease Off the Gas?


Markets, movers and more.


Chief Minyan Todd Harrison proudly stands in front of his new Fox backdrop as he wonders what the Fed will do next and how people will react to it. Currently, Fed Fund Futures are pricing in a 12% shot of a 25 basis point increase this meeting, 36% in August and 57% chance in September. While Wednesday may not see a large move, ears will be tuned in for hints of the next meeting's action.

Gasoline prices are on the minds of everyone from airliners to traders to soccer moms. If hybrids and crossover vehicles are one solution to the problem, what would happen if prices retreated? Would people jump back into their SUV's? Maybe there's more at play here dragging down consumers, like declining home values, wage pressures and credit limits. As Toddo says, we could see a knee jerk rally in stocks first but the onus is on us to ask "why" rather than "what" when it arrives.

In the "What Are You Watching" column, Todd serves up a plate of BKX 60 -- a level that would mark the 10-year low in the banks -- and big beta including Google (GOOG), Baidu (BIDU), Apple (AAPL) and Amazon (AMZN). Conventional wisdom is for a quarter-end "purge and splurge", out of financials into big beta. But is that trade a little too easy?

The big news today that the Federal Trade Commission filed suit against CompuCredit (CCRT) claiming the company monitored consumer spending patterns and cut credit lines if consumers used their cards at certain places. Todd vibes that apparently credit scoring has gone beyond payment history and FICO scores. On a related note, the New York Times ran a piece noting that Washington Mutual (WM), HSBC Holdings (HBC), Target (TGT) and Wells Fargo (WFC) have collectively cut credit card lines by $15 billion over the past three months. Deleveraging continues.

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No positions in stocks mentioned.

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