Freaky Friday Potpourri: Stress Test Stuck in Traffic!
Long awaited results are still being withheld from public.
Being late is never a good thing.
For a couple that just started dating, "I'm late" could be the scariest two words in the English dictionary.
When friends meet for dinner, "I'm sorry I'm late" doesn't change the fact that it's rude.
When an incredibly important market-shaping catalyst is postponed, it's rarely due to better-than-expected news.
The Federal Reserve announced last night that the highly anticipated stress test on the 19 biggest U.S. banks has been postponed while executives debate the preliminary findings with examiners, according to sources close to the situation. A new release date could be announced as soon as today.
As discussed yesterday on Yahoo TV, in a finance-based derivative-laced financial fabric, we're only as strong as our weakest link. We saw that in spades when Lehman Brothers collapsed and can only hope policymakers have learned that the only difference between a mistake and a lesson is an ability to learn from it.
In addition to the stress test results, the Chrysler situation warrants a mention. If bondholders are willing to roll their dice in bankruptcy court, the government will have to make a decision regarding where they draw the line of intervention and the implications could be massive. That's the other side of moral hazard-once you let the genie out of the bottle, it's tough to stuff back in.
The risk isn't simply a multitude of corporate failures-which, while unfortunate for employees, is necessary through the lens of debt destruction-it is the entirely more pervasive counter-party exposure that ties together all things finance. Despite the recent rally, the capital market construct remains fragile as we together wade through an unsure world.
Bud Fox once said, "Life comes down to a few moments and this is one of them." With the S&P tetherballing the technically significant S&P 875 level, the markets dancing on the head of a pin akin to a "W", and the whole world reactive and nervous, this is indeed a critical session for bulls and bears alike.
Keep your head up, your eyes open and your thoughts positive for if we've learned nothing together, it's that profitability begins within.
- Our job in the 'Ville is to provoke rather than shape thought. I offer that as a context when I share that the White House issued a health advisory warning for anyone who traveled with President Obama to Mexico after a member of his delegation (and now, his family) is likely inflected with the swine virus.
- As discussed in real-time on yesterday's Buzz & Banter, I faded (sold) the morning glory yesterday through purchasing the FAZ (ultra bear financial crack) and some S&P puts. I took partial profits on both into the afternoon swoon and have set my stops on the leaves at my entry levels. Should we see some slippage, I'll roll them down in kind.
- Hey, maybe I really do have a face for radio? (25th minute, for those who care.)
- Saturday Night Grateful Dead Garden Party. Because we can.
- Have you seen Hoofy and Boo's take on consumer confidence?
- While we've all got a lot on our plates and our minds, I'll take a moment to remind ye faithful that the Bennet Sedacca Memorial Drive concludes today. Once the Minyan love and respect is tallied, we'll sit down with Nan and the Clan and decide how to best honor our fallen friend.
- Has anyone noticed the three top sellers on Amazon's (AMZN) health and personal care department? Perhaps more disturbing, did you check out the mark-up? Shameful.
- A Connecticut company is working a swine flu vaccine? That's good news.
- Minyanville Underground Railroad Ambassadors of the World Unite! I've been a bit of a slacker on this front as I've been juggling cats but we'll have Freaky Friday delivery on the next Murmurs. If you would like to climb aboard The Critter Express, please click here!
- I don't know about you but I'm appreciating every little thing in life these days, from seeing old friends to meeting new ones, a good meal, the color of the sky, the purr of my cat... pretty much any and every experience at some level. Mindfulness and perspective is perhaps the only upside to the threat of a global pandemic.
- We've long said that tomorrow is promised to nobody. That remains the case, perhaps now more than ever. Enjoy your journey, Minyans, and make every moment counts.
In memory of our fallen friend and trusted colleague, Bennet Sedacca, 100% of the donations made to the RP Foundation through April will be channeled to philanthropic endeavors consistent with the RP mission, working closely with the Sedacca clan in the distribution of those funds. We thank you kindly for your support as we strive to effect positive change in the lives of children.
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 firstname.lastname@example.org.
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