MacroTwits Transcript: Sunday May 24, 2009

StockTwits: May. 24 at 10:05 PM
Thanks Gregor and everyone.
BAbnkr: May. 24 at 10:05 PM
Personally – I’ve been looking for a house recently and the good ones who have been listed for over 3 mo – finally getting snapped up
aiki14: May. 24 at 10:03 PM
@GregorMacdonald Great as always G, keeps my brain in the game
bweikulrich: May. 24 at 10:03 PM
@GregorMacdonald Soros and you seem to be on the same page. Thx for the chat, great conversation this evening
pdenlinger: May. 24 at 10:03 PM
RT @peterschloss: Chinese investment group to buy stake in NBA’s Cleveland Cavaliers – http://twurl.nl/l3fw5v
BAbnkr: May. 24 at 10:02 PM
someone needs to reign this Dallas fed prez in http://tr.im/midf
GregorMacdonald: May. 24 at 10:02 PM
Thankyou all for a great session. Let’s see how the market greets big US Treasury supply this week. Best, G.
GregorMacdonald: May. 24 at 10:01 PM
@bweikulrich It’s such a hard question to answer. I do see “moderate” protection in foreign resource stocks, if you are USD based.
bweikulrich: May. 24 at 10:00 PM
@GregorMacdonald As bond markets start to fall apart and cash looks scary to hold, gold to volatile. Do you see an equity bull?
FinanceTrends: May. 24 at 9:59 PM
@infovestment Thanks for the USD/UST answer, didn’t see your response till now in my @replies window!
sayemislam: May. 24 at 9:59 PM
RT: @avinashkaushik: Missed this recent note: $AMZN now accounts for 1/3 of all US e-commerce transactions. (!!) http://tr.im/mi3Y
Ticker: AMZN
mryakman: May. 24 at 9:59 PM
Has anyone reviewed the untapped fields of the coast of Cali? Geo fiends refer to untapped B class fields, due to off shore drilling
GregorMacdonald: May. 24 at 9:58 PM
@robertfreedland I don’t believe we are experiencing inflation either. Tonight. I just see decade as an inflationary recession in US.
robertfreedland: May. 24 at 9:58 PM
I still see real estate prices dropping, unemployment growing, and commodity prices in the basement.
avcacio: May. 24 at 9:58 PM
@pdenlinger – OK, thanks for that – makes sense
robertfreedland: May. 24 at 9:57 PM
@GregorMacdonald $$I still am not convinced that we are in an inflationary environment. Is this agreed upon by economists?
pdenlinger: May. 24 at 9:56 PM
@avcacio Chinese know they are losing on Treasuries; no way to avoid it. Just choosing less dramatic slow-drop over dramatic collapse
mojakus: May. 24 at 9:56 PM
@InEgoVeritas you’re referring to Paulson’s new RE venture? He’s planning on back-bidding to bottom-barrel levels
aiki14: May. 24 at 9:56 PM
@GregorMacdonald LOL, I hope you do my friend, we need em in a big way. I’m thinking “Childhoods End” scenarios
SellPuts: May. 24 at 9:56 PM
@UrbaneGorilla $TSO is a volitile name. I used to play that & $CHK during weekly inventory reports.
Ticker: CHK TSO
aiki14: May. 24 at 9:55 PM
@InEgoVeritas The ties are too tight with the G20,USD collapse make it the G5, and they will prop the USD at all cost, they have to
avcacio: May. 24 at 9:54 PM
@pdenlinger @infovestment – re: CN – and as the $ drops, are they loosing more $ on thier “holdings” of treasuries?
beanieville: May. 24 at 9:54 PM
Not to worry, bulls. I see a White Swan coming this year.
GregorMacdonald: May. 24 at 9:54 PM
Great sessions tonight. Good to see the newcomers, as always. We finish up in about 5 minutes.
FinanceTrends: May. 24 at 9:54 PM
Good one @GregorMacdonald! Yes, I think I’ve heard Jim Rogers talk about this in recent times, would be interesting to see
rcline_jr: May. 24 at 9:53 PM
@GregorMacdonald As US companies issue stock to cover their capital needs foreign holders of USD can “buy America” cheap to unwind.
GregorMacdonald: May. 24 at 9:53 PM
@aiki14 I’ll see your Black Swan and raise you two White Swans: Er, as soon as I think of them. :-)
FinanceTrends: May. 24 at 9:53 PM
Re: good news for future. I think there could be an explosion in collaboration (artistic, new business ventures) thanks to Web 2.0+
InEgoVeritas: May. 24 at 9:53 PM
@aiki14 Strings such as a diminished international role for the USD as it would then be “too big to fail”. Leave the details to G20…
sufrj: May. 24 at 9:53 PM
Looks like a good day tommorrow. Asian markets and futures are up
pdenlinger: May. 24 at 9:51 PM
@GregorMacdonald Your white swan would scare many South Koreans to death! They saw what happened to German economy post-reunification.
mryakman: May. 24 at 9:51 PM
War & Peace, Yin & Yang, Capitalism & Socialism, is there really a difference in meaning? US Vs China
Blacksoth: May. 24 at 9:51 PM
A war would deal with unemployment. :P
InEgoVeritas: May. 24 at 9:51 PM
@mojakus If US/CA real estates headed for a second leg down, How to explain John Paulson’s bulllishness then?
mojakus: May. 24 at 9:50 PM
China’s got it’s own issues to deal with on it’s way out of USD. my bud mike on this in the FT: http://bit.ly/144PsT @InEgoVeritas
aiki14: May. 24 at 9:50 PM
@InEgoVeritas What strings? We still have the biggest dick..er…stick, and as Greg said, it’s wartime then
GregorMacdonald: May. 24 at 9:50 PM
@FinanceTrends Would you like to hear my White Swan? Sudden, unexpected re-unification of Korean Pen, on death of the Nutburger.
adamsussman: May. 24 at 9:49 PM
@GregorMacdonald looks like I’m underweight gold. I thought I could pull a Hugh Hendry and get a 5 handle on it before I loaded up
pdenlinger: May. 24 at 9:49 PM
@avcacio CN is playing for time to de-hoard their US$ and delay the final reckoning as long as possible.
FinanceTrends: May. 24 at 9:48 PM
Question for all: what surprise positive longer-term trends do you have your eye on? Key overlooked/little discussed good news.
GregorMacdonald: May. 24 at 9:48 PM
Great discussion tonight of the Yuan, USD, Bonds and the next potential crisis. This is the Top Agenda my friends!
Blacksoth: May. 24 at 9:47 PM
Anyone here look at the CFTC C.O.T. report every week?
InEgoVeritas: May. 24 at 9:47 PM
@aiki14 No one in his right mind wants a $USD collapse. Big econs would support it but with strings attached.
Ticker: USD
avcacio: May. 24 at 9:47 PM
@infovestment – what i don’t understand is “why” CN is still buying treasuries
aiki14: May. 24 at 9:47 PM
@GregorMacdonald Bingo, hard standard if fiat really dying, or everything goes down together, that’ll be the last defense
Blacksoth: May. 24 at 9:46 PM
Testing.
GregorMacdonald: May. 24 at 9:45 PM
De-coupling is for financial-peacetime. What we’ve seen is in Financial Wartime, you get monolithic trend of everything going down.
aiki14: May. 24 at 9:45 PM
If things get too dicey for USD the big econs will circle the wagons and defend it, nobody trusts the chinese, for good reason
UrbaneGorilla: May. 24 at 9:44 PM
@SellPuts I do understand the diff between sweet crude and the Saudi gunk.$TSO is a the refiner of choice as they are set to refine heavy.
Ticker: TSO
InEgoVeritas: May. 24 at 9:44 PM
@aiki14 Depends how severe the USD crush. Think the basket is next step on the way to a floating yuan
GregorMacdonald: May. 24 at 9:44 PM
@aiki14 Yes that’s my suspicion. The Fannie-Lehman-AIG month proved entire world tightly coupled. Maybe only gold works in USD crisis.
ichimokucharts: May. 24 at 9:43 PM
Nikkei gains 1.6 pc http://bit.ly/10uY4C
pdenlinger: May. 24 at 9:43 PM
@GregorMacdonald Don’t think Chinese want yuan to become global reserve currency in same way as US$ Too much downside.
adamsussman: May. 24 at 9:43 PM
@infovestment I hope ur right, but that is a lot of USD (2trillion) to get rid of in what I think is a short (7years or less) time
InEgoVeritas: May. 24 at 9:42 PM
As China becomes less dependent on US consumers, the $USD peg will become less important. EU already China’s biggest trading partner.
Ticker: USD
aiki14: May. 24 at 9:42 PM
@InEgoVeritas What basket? USD gets crushed no currency is unhit, and many will go down with it, any basket would be unstable
FinanceTrends: May. 24 at 9:42 PM
Listening to Bill Powers (see prev. tweet) talk about nat. gas $UNG prices and conventional wisdom on LNG imports/glut fear
pdenlinger: May. 24 at 9:42 PM
@GregorMacdonald I think Chinese really want to make SK, JP and CN-based Asian central bank strong. Strong commitment from all parties.
GregorMacdonald: May. 24 at 9:41 PM
My view is that the USA has been in an inflationary recession since 2001. Very low quality of growth. Only winners: inflation recievers.
mojakus: May. 24 at 9:40 PM
@GregorMacdonald @InEgoVeritas CA is going to be unfortunate for banks with large prime HELOC portfolios marked close to par
aiki14: May. 24 at 9:40 PM
@GregorMacdonald It get’s killed, & they know it. They’re 2yrs at least from being in any real way detached from USD, but they’re trying
GregorMacdonald: May. 24 at 9:40 PM
@bie111 While I have no view yet what happens in 08-12, yes, I have been seeing 02-08 more like post 1930 period.
InEgoVeritas: May. 24 at 9:40 PM
@adamsussman @GregorMacdonald The Chinese will probably peg to a basket hence Yuan would rise against $USD
Ticker: USD
pdenlinger: May. 24 at 9:39 PM
@GregorMacdonald Yuan will be hit but make a recovery. Yuan outside China will be mainly held by central banks and govts so ltd. exposure
firstadopter: May. 24 at 9:39 PM
Post: Official bull/bear market sentiment poll results – 37/63. Thoughts and analysis – http://tr.im/mifY
bie111: May. 24 at 9:38 PM
$SPY so they think 08-12 would be similar to 38-42
Ticker: SPY
bie111: May. 24 at 9:37 PM
$SPY Barron’s: Dow in 02-08 was similar to 32-28: http://bit.ly/1bn7eN
Ticker: SPY
GregorMacdonald: May. 24 at 9:37 PM
@adamsussman Such a good question. What do people think happens to Yuan in a USD crisis?
bie111: May. 24 at 9:36 PM
$SPY Barron’s:
Ticker: SPY
GregorMacdonald: May. 24 at 9:35 PM
@mojakus @InEgoVeritas I think California RE has a final leg down made of 1. Sacto mess. 2. Long end going ugly. CA prime RE is next.
FinanceTrends: May. 24 at 9:35 PM
Bill Powers made some good points about US reliance on large pot. unstable oil producers in latest FSN podcast http://bit.ly/AaCf
adamsussman: May. 24 at 9:34 PM
@GregorMacdonald long yuan and $TBT but if we end up partial defaulting, I’m I right in thinking the yuan will also take hit?
Ticker: TBT
mojakus: May. 24 at 9:34 PM
In fairness one bond manager was massively short puts on the TYM9 10yrUST for Friday’s expiry, and that drove some of the action
mojakus: May. 24 at 9:34 PM
Street saw actual purchases by the Fed last week as pretty weak so now they’re now positioning for 3.65% in 10yUSTs
GregorMacdonald: May. 24 at 9:33 PM
@aiki14 Yes. In addition to spending immediate USD on spot, also locking up long-term deals. They know Tupi will look grt at oil 150.
kbunky1: May. 24 at 9:32 PM
$UNG . Chart of normal monthly Natural Gas usage. Note that May/June is normally the beginning of a run thru August. http://bit.ly/sXljm
Ticker: UNG
GregorMacdonald: May. 24 at 9:31 PM
SPX futures up +3.75. July oil firm. June Gold off 1.50. 10 and 30 yr bond futures firm. AUD/USD holding above .7800. ASX 200 futs flat.
aiki14: May. 24 at 9:30 PM
@GregorMacdonald Nobody, Long $TBT
Ticker: TBT
SellPuts: May. 24 at 9:30 PM
@UrbaneGorilla the gravity and sweetness of the texas intermediate is what makes it attractive & is 2$ more per BBL than OPEC or brent
SellPuts: May. 24 at 9:28 PM
@UrbaneGorilla its all about the price of west texas intermediate crude which makes 4 the best refining, the margins so thing n refining
GregorMacdonald: May. 24 at 9:28 PM
NG: Was studying BP Stat Review for past 10 years. USA NG demand growth pretty quiet last 10 years.
pdenlinger: May. 24 at 9:28 PM
@GregorMacdonald China’s continued purchase of UST is just a way to delay the final reckoning while it continues diversifying.
aiki14: May. 24 at 9:28 PM
@GregorMacdonald And I know you saw the Brazil deal as well
GregorMacdonald: May. 24 at 9:27 PM
@InEgoVeritas Well as we know from Setser, and also here from @mojakus CBs buying short end. So who is left to buy long end?
UrbaneGorilla: May. 24 at 9:27 PM
$UNG . Chart of normal monthly Natural Gas usage. Note that May/June is normally the beginning of a run thru August. http://bit.ly/sXljm
Ticker: UNG
aiki14: May. 24 at 9:27 PM
@GregorMacdonald I don’t see them doing it, they need to protect the short paper much more than the long, buying will be there IMO
InEgoVeritas: May. 24 at 9:26 PM
@GregorMacdonald We’ve already had the long-end blown higher by the Fed. The more they do it the less it’ll work. Nature of QE.
robertfreedland: May. 24 at 9:26 PM
A New Podcast on $PETM $$ Thanks for listening! http://bit.ly/HSYqP
Ticker: PETM
GregorMacdonald: May. 24 at 9:25 PM
I think it’s coming to light that China is buying lots more stuff than what is merely reported. It’s deals, deals, deals. Africa, for ex.
GregorMacdonald: May. 24 at 9:24 PM
China figured this one out earlier this year. De-hoard USD by buying stuff.http://bit.ly/16jJSx @pdenlinger
FinanceTrends: May. 24 at 9:23 PM
@TheStalwart Joe, here is the article I read in FT on that (good overview of reactions to rally) http://bit.ly/7Ll52
pdenlinger: May. 24 at 9:23 PM
@GregorMacdonald My guess: CN govt. buying for time and infrastructure development before the other shoe drops in US.
GregorMacdonald: May. 24 at 9:22 PM
@TheStalwart Classic US Press: largest democracy in world has blow-out turnout at polls, with huge Congress Party mandate: and “yawn.”
infovestment: May. 24 at 9:22 PM
@GregorMacdonald IF $UST‘explodes’USD wld crash to&thru 2 in a split second,not even Timmy&Ben wld be that stupid2hit this panic button MKT
Ticker: UST
upsidetrader: May. 24 at 9:20 PM
$$ subs,the weekend post will be published tomorrow
FinanceTrends: May. 24 at 9:19 PM
Speaking of sovereign default (& US), did anyone see Marc Faber’s comments in recent Howe Street interview? http://bit.ly/mXo7p
GregorMacdonald: May. 24 at 9:19 PM
Who here thinks this ends with Long Rates blowing their top w/the FED panic buying of the Long End–thus making Long End blow higher?
TheStalwart: May. 24 at 9:18 PM
@FinanceTrends @gregormacdonald Saw a bit of India talk, but seemed very superficial. Like “wowee, big move up” and then onto next story
TheStalwart: May. 24 at 9:17 PM
If a big reason for China’s voracious USD appetite is to keep the Renmimbi cheap, how much submerged upside pop waiting to be un-sprung?
rcline_jr: May. 24 at 9:17 PM
@infovestment Harder yes, but they will move their trades to London, Dubai and elsewhere.
mojakus: May. 24 at 9:17 PM
@GregorMacdonald yes! keep rolling till one finds the alternative (domestic consumption, reduction in overcapacity etc) then pull out…
GregorMacdonald: May. 24 at 9:17 PM
@markradabaugh There is also the issue that NG is trapped in North America. Not a global fuel.
ichimokucharts: May. 24 at 9:17 PM
Asian Stocks Advance, Led by BHP $$ $BHP http://bit.ly/kJNlY
Ticker: BHP
GregorMacdonald: May. 24 at 9:15 PM
@pdenlinger People still do not accept that QE is the on-ramp to sovereign default. It’s b/c we’re “the USA.”
FinanceTrends: May. 24 at 9:15 PM
@TheStalwart @GregorMacdonald The 1st mention I saw of India’s 17% rally was in Financial Times. But did see more press after that
ParrParr: May. 24 at 9:15 PM
$ES_F 890.25 short
Ticker: ES_F
infovestment: May. 24 at 9:15 PM
@rcline_jr ironic,this regulation wld make it harder for those that are supposed2actually hedge their biz risk w derivatives,i.e.airlines
FinanceTrends: May. 24 at 9:15 PM
@TheStalwar @GregorMacdonald The 1st mention I saw of India’s 17% rally was in Financial Times. But did see more press after that
markradabaugh: May. 24 at 9:13 PM
recession aside…$UNG collapse due in part to new drilling / fracing technologyhttp://bit.ly/DmvFo
Ticker: UNG
GregorMacdonald: May. 24 at 9:13 PM
@rcline_jr I knew during commodity bull market that regulation would eventually drive commodity trading more offshore. I expect it, yes.
ichimokucharts: May. 24 at 9:12 PM
FX-Euro Approaches Year’s High on Optimism German Sentiment Risinghttp://bit.ly/7t0kq
rcline_jr: May. 24 at 9:12 PM
@GregorMacdonald Derivatives regulation could affect commodity derivative trading, impacts energy co. and others. http://bit.ly/pc2Vl
GregorMacdonald: May. 24 at 9:11 PM
@mojakus If a central bank thoroughly restructures duration to short-end, then, failure to roll is a more convenient way to sell?
RTM007: May. 24 at 9:11 PM
$ES_F looks like the first couple days(tues/wed) should have a market pop. but if 875 (close only) is crossed then target =821
Ticker: ES_F
mikestiller: May. 24 at 9:10 PM
collapses are inflationary for hard assets, what abt those comp’s that look for said asset? those stocks denom in the collapsing fx (USD)
GregorMacdonald: May. 24 at 9:09 PM
@TheStalwart I searched high and low for indications that the US press even payed much attention to India last week. Didn’t find much.
my10000dollars: May. 24 at 9:09 PM
$$ Jim Rogers – Is It Safe to Invest in China?: [There is a video that cannot be displayed in this feed. Visit.. http://tinyurl.com/qktsdg
GregorMacdonald: May. 24 at 9:09 PM
@FinanceTrends My view is Richard Russell is citing normal intermarket relationships. Have to believe RR also thinking abt non-normal.
mojakus: May. 24 at 9:09 PM
@mikestiller for now Asia isn’t yet on buying strike (TIC reports increased holdings last week), they’re just shortening duration for now
TheStalwart: May. 24 at 9:08 PM
How much did excitement about India last week (the 17% gain in stocks) contribute to the run-up in Gold?
ichimokucharts: May. 24 at 9:08 PM
FX-Dollar steady near 5-month low, US auctions eyed http://bit.ly/Vjn2R
aufaittrader: May. 24 at 9:07 PM
@GregorMacdonald The Senate, I’m certain, will destroy a portion of the Bill but perhaps the change is overdue at this point.
GregorMacdonald: May. 24 at 9:07 PM
@turbotrader The USD and the UST market are now in control. It’s now a question of which assets are unencumbered, and hedge USD exposure.
FinanceTrends: May. 24 at 9:07 PM
Was reading Richard Rusell last week, believe he noted that bond prices and USD tended to move in tandem. Historically true? Thoughts?
StockHustler: May. 24 at 9:06 PM
Im loving some Biotech plays right now
infovestment: May. 24 at 9:06 PM
@GregorMacdonald There is no question, they will contract credit lines.If the lender doesn tget paid for the risk,he wont extend credit
GregorMacdonald: May. 24 at 9:06 PM
@mikestiller Recessions are deflationary. Collapses are inflationary. That’s my shorthand.
pdenlinger: May. 24 at 9:05 PM
PetroChina buys $1B stake in oil refiner Singapore Petroleum in plan to expand refining capacity
GregorMacdonald: May. 24 at 9:04 PM
@aufaittrader One wonders the credit card bill will further contract already contracting credit conditions. Perhaps this was fate.
mikestiller: May. 24 at 9:03 PM
@mojakus @GregorMacdonald bond move more about solvency than inflation expectations?
GregorMacdonald: May. 24 at 9:03 PM
Last week, I think it ‘s fair to say, there were some observers who were interested in going long USTs as a way to play stock weakness.
aufaittrader: May. 24 at 9:03 PM
RT @aufaittrader: @infovestment Nope. Contradictory terms used together such as *legal murder* or *honest government* LOL
aufaittrader: May. 24 at 9:02 PM
@BAbnkr With the credit card reform bill, we’re going to see a lot more changes on fees. Won’t be pretty
mojakus: May. 24 at 9:02 PM
inflation and the collective conscious?: 10-year TIPS breakevens accounted for 26 bps of the 32 bps rise in nominal yields last week
infovestment: May. 24 at 9:02 PM
@bie111 $GDXMOST miners r profitable@ these gold prices&with evry$GOLDgoes up their profits rise exponentially,soGDXshld outperformGLD MKT
Ticker: GOLD
GregorMacdonald: May. 24 at 9:01 PM
MacroTwits welcomes back @mojakus A bond maven who will help us unravel, well, the unraveling of the UST market.
GregorMacdonald: May. 24 at 9:00 PM
It’s 9pm in New York. Treasury has bonds to sell. Gold has broken out. And as goes$GM, so goes…California? Welcome to MacroTwits.
Ticker: GM
infovestment: May. 24 at 8:59 PM
@bie111 $GDX is an ETF of mining stocks, GLD is a straight ownership of gold,you cant really compare one or the other as being better
Ticker: GDX
StockTwits: May. 24 at 8:59 PM
MacroTwits Hour w @GregorMacdonald on StockTwits starts now…http://bit.ly/FfK1t Bring it G!

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

Tickers:

You might be interested in:
blog comments powered by Disqus

In partnership with CNN Money Part of the CNN Network