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Random Thoughts: Foreign Holders of US Assets Lagging

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And you thought that holders of dollar-denominated assets took the rate cut in stride?

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  • Fleas and TIC! Expectations for net sales by foreigners of bonds & other U.S assets came in at -$165 billion vs. estimates of +65 billion. And you thought that holders of dollar-denominated assets took the rate cut in stride?

  • What are the sharp cookies saying?

    • These are lagging numbers. More than likely they picked up again in September given the market action. But it does show how quickly foreigners will abandon the U.S. when things get dicey. --Mr. Practical

    • Here's a scary thought. The DXY was only down -0.1% in August... the month in which capital outflows were -$69 bln. In the month of September, the DXY index was down - 3.8%.Wonder what that TIC report will look like! --Stephanie Pomboy.

  • Dry eyes out of this morning's gate? The semis and consumer non-durables.

  • The not-so-hot trotters? The financials (XBD and BKX were both off 1.5%), the trannies, the homies (yawn) and, surprisingly, the metals.

  • Watch XAU 172 as a near-term support for the metals, if and when, as a defined-risk bovine backstop.

  • Why do we note the dry eyes vs. the crying tries? Demand in a down opening (or supply in a higher opening) is usually a stealth wink on the daily agenda.

  • My two favorite football teams? The Raiders and anyone playing the Broncos.

  • My two favorite baseball teams? The Yankees and anyone playing the Sox. Go tribe!

  • Can you tell that I was hangry when I wrote this morning's Answers column?

  • Could it have something to do with the fact that I awoke at 2:00 AM and proceeded to send e-mails to the team on the litany of launches we've got in the pipe before heading to the gym at 6:00 AM?

  • Flea and Ticks? How 'bout Flea and VIX? The VXO is within spittin' distance of drinking age and, after holding the 200-day, is testing the breakdown level. Watch this fear proxy as we collectively find our way.

  • What's this all mean? Read Pepe's 5 Things, which I continue to maintain is the best read on the Street.

  • It's 106 miles to Chicago, we got a full tank of gas, half a pack of cigarettes, it's dark, and we're wearing sunglasses. Hit it!

  • The Following Buzz Took Place Between 10:00 AM and 11:00 AM…

    Punky Brewster!

    After yesterday's "Kick Save and a Beuat!" by Hank & the Banks, today's fray is a downside stray. While that finger in the damn may well have been a function of prevalent psychology, the simple and sad truth is that the markets are no longer free, Willy. Hey, it is what it is and at the end of the day, the onus is on us to adapt.

    Some top line vibes:

    • While BKX 111.50 remains the level of piggy lore, active types can use BKX 105.50 as tighter and more defined risk.

    • Ditto S&P 1555 and 1535. Every journey is made up of individual steps.

    • For what it's worth, Bear Stearns trades like it wants to go higher. It may not need a market rally but if the tape turns, this name will likely hop higher.

    • Tickle me Tea Leaves? Market internals are 3:1 fugly (2:1 negative on the Nazz) and the tone is dour. With that said, we should see at least one rally attempt ( it IS Tuesday) and we'll need to keep our eyes peeled for relative traction/slippage on our critter compass.

    • Walk and chew gum? Try typing, trading, managing, launching, philanthroping!

    • Speaking of that latter matter, many kind thanks to our good friends at Kaboose, Harbor Pilot Asset Management, Midtown Partners and TD-Ameritrade for stepping up to sponsor the Festivus. If you have an interest in being reflected by the company we keep, please lemme know! Either way, we hope to see you there!

    • As always, I hope this finds you well

  • Hit me Again Hank and this time put some STANK on it! Mr. Paulson steps on stage and the tape finds a bid. Go figure!

  • The semis (which were dry out of the gate) and Bear Stearns (BSC) (ditto) lifted in kind during the midday Snappage but the more interesting action was by the beta quartet of Baidu.com (BIDU), Apple (AAPL), Research in Motion (RIMM) and Google (GOOG).

  • That's leading to an "N's over S's" sorta session.

  • I was about to scribe that a strong Bonnie Tyler-style turnaround today would bode well through the end of the week but earnings and expiration combine to make no path obvious.

  • If anyone finds my sense of humor, please deliver it to MVHQ. Seriously Mav, I'm holding on too tight.

  • But that can change. And it will. It's simply a matter of time. And price. Time and price. Yeah.

  • Gotsta Hop---hope you're well Minyans. Less than 24 hours left until our weekly Hump!


R.P.

No positions in stocks mentioned.

Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at todd@minyanville.com.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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