Market Soapbox 08/21/08

THU, sideways & down, DJIA +13 on lower volume with poor internals. All DOWN cept DJUA, MID, XAU, XOI.

Bonds down 10 yr +3bps 3.83%. $ porked vs 1.4887€ & vs 108.485y, WTI +5% $121.23, gold +2% $838.2; TED Spread down -3bps 1.10%

SP500 1274, dive 1265, rise to 1281, fade to close 1277. NDX 1913, gap down to 1900, dip to 1886, rise back to 1913, fade to close 1906.

MON: Major concern over FHLMC & FNMA needing a near term bailout.

TUE: Talk that Lehman is planning to sell large amounts of assets could point to an extremely ugly third quarter.

WEN: Lehman failed to secure its Korean backing. Fannie & Freddie tumbled to 20 year lows... while their bonds rallied.

Keep your eyes peeled to the sky, it could be a name brand...


Today, the dollar tumbled, oil soared, commodities headed for their biggest weekly gain in 33 years...

and insolvent Merrill Lynch went panhandling to a Korean sovereign fund and Singapores Temasek (already their largest shareholder).

Cut and bailout all you want... widening (agency vs treasury) yield spreads will force home prices down further...

30 year mortgage rates climbed to their highest in 6 years while mortgage applications fell 34% to their lowest in 8 years.

New bailout dead pool: WaMu, Wachovia, Lehman Bros, Citigroup, Merrill Lynch, FHLMC & FNMA.

Often wrong, but never in doubt, this is the Nattering Naybob and you're not.

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