Currencies

Yen Tanks, While Japan Buys Bonds

twocents@thestreet.com (Debra Borchardt ) — Fri, 10 May 2013 12:20 GMT

The Yen continues to hit new lows as Japanese keep buying foreign bonds. Priceline and ArcelorMittal are both selling in pre-market trading.

Aussie Dollar: Must-See Charts

twocents@thestreet.com (Matt Zeman) — Thu, 09 May 2013 20:37 GMT

NEW YORK (TheStreet) -- The Aussie dollar is threatening a downside breakout from a nearly one-year trading range. The Royal Bank of Australia recently cut its key interest rate to 2.75 % and cited slowing growth and inflation levels running under target levels.

In my opinion, this is demonstrative of the deflation that the global economy is currently experiencing. In addition to the rate cut, rumors continue to abound of George Soros having a large short position in the currency.

RBA governor Glenn Stevens commented that the Aussie's strength "is unusual, given the decline in export prices and interest rates." It would seem to me that the RBA would like to see the Aussie lower, and I believe the possibility of lower prices is certainly in the cards....

Ponsi: A Game Plan for the Aussie Dollar

twocents@thestreet.com (Ed Ponsi) — Tue, 07 May 2013 20:00 GMT

This article originally appeared on Real Money Pro at 2:30 p.m. EDT on May 7.

NEW YORK (Real Money Pro) -- If trading stresses you out, maybe it's a sign you need to plan your trades more carefully. Easier said than done, right? People get stressed because they're not exactly sure of their next move. Is it possible to plan all of your moves in advance?

Monday, I wrote a column called "Aussie Going Down Under" where I explained why I believe the Australian dollar is likely to move lower. Less than a day later, the currency is down sharply and testing the support level I mentioned. Now that the currency has reached support, we face one question: Should we buy in anticipation of a bounce, or short in anticipation of a break in support? ...

China Puts Gold Where Its Money Is

twocents@thestreet.com (Jeff Nielson) — Fri, 03 May 2013 19:33 GMT

VANCOUVER, Canada (Bullions Bull Canada) -- Since the Crash of 2008 exposed the global financial system as simply one big Ponzi scheme ticking down to implosion, one of the most public and emphatic economic policies of China's government has been the rapid/relentless accumulation of more gold reserves to "back" its own monetary system.

This economic priority has become an even greater imperative as China steadily replaces the U.S. dollar with the renminbi as the world's new reserve currency. Stage I of that process has seen trillions of dollars in bilateral trade agreements and currency-swaps.

Stage II was the establishment of a "renminbi trading bloc among seven of 10 of Asia's most prosperous economies, where the renminbi is now the reserve currency for these nations. ...

Don't Look at Technology for Leadership

twocents@thestreet.com (Andrew Sachais) — Tue, 23 Apr 2013 11:42 GMT

NEW YORK (TheStreet) -- Monday's trading session saw a bounce in risk-assets after heavy volatility and weakness last week. A number of announcements coming from technology companies helped lift markets, but technology leadership has, as of late, had no correlation with long term strength in risk assets. Evidence for this argument is presented later in the article.

This weekend Federal Reserve Chairman Ben Bernanke stated spikes in inflation were not a threat to our economy over the near term. This is another way of saying that tepid growth will continue to be the norm. With GDP readings coming out this Friday, it does not seem like there is much of a chance that the reading surprises to the upside.

Lastly, companies have continued to come out this earnings season with downgraded outlooks and more cautious speculation for future performance. Equity has been driven by corporate profitability as of late, so weak outlooks for the rest of 2013 could give reason for an equity pullback soon. ...

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Trade Pacts With Europe and Japan Will Boost Unemployment

twocents@thestreet.com (Peter Morici) — Mon, 15 Apr 2013 11:30 GMT

NEW YORK (TheStreet) -- President Obama is betting a lot on free trade. Recently, he has agreed to open talks for mega trade deals with the European Union and Japan in hopes of jump-starting growth in both places and boosting U.S. exports and jobs. However, far from an elixir, free trade has been a rock on the back of the U.S. economy and American workers, and the Obama strategy will only make things worse.

On university blackboards where economists theorize, free trade is a compelling idea: Let each nation do more of what it does best, and international commerce will raise national productivity and incomes. But these benefits are not guaranteed if a few big nations can cheat on the rules.

The World Trade Organization has greatly reduced tariffs, export subsidies, and barriers to trade posed by domestic polices, such as biases in government procurement and discriminatory product standards. In addition, U.S. deals with Mexico, Canada, South Korea, and other small nations have reduced tariffs on bilateral trade to zero and eliminated even more nontariff barriers. ...

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U.S. Says Renminbi Is Undervalued and Cautions Japan on Yen

twocents@thestreet.com (The Associated Press) — Fri, 12 Apr 2013 23:11 GMT

By Martin Crutsinger

WASHINGTON -- The Obama administration on Friday declined to label China a currency manipulator, although it said that China's currency remains significantly undervalued.

The decision came in a twice-a-year Treasury report on whether any nations are manipulating their currencies to gain trade advantages. ...

Stocks Lower on Europe, Cliffs Natural Whipsawed

twocents@thestreet.com (David Peltier) — Wed, 27 Mar 2013 14:55 GMT

Stocks are trading lower on Wednesday, but Portfolio Manager David Peltier points out what is working this morning.

Cramer: Cyprus Is Outrageous

twocents@thestreet.com (Debra Borchardt ) — Tue, 19 Mar 2013 20:37 GMT

NEW YORK (TheStreet -- The situation unfolding in Cyprus is outrageous, according to TheStreet's Jim Cramer.

Debra Borchardt:

Over the weekend we had a raid on depositors funds in Cyprus and as a result that has sent our markets into turmoil. I'm here with Jim Cramer, so let's talk about this. It's really not so much that Cyprus is this little island off the coast of Greece and that it's not that big of a country. The issue is, if they can do it at Cyprus then they can do it to any other country in the EU, and that's a very frightening thing. ...

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Morning Movers: Merck, Costco, Oil Higher

twocents@thestreet.com (David Peltier) — Tue, 12 Mar 2013 14:44 GMT

Merck is Dow's best performer, Nasdaq and S&P slightly lower. TheStreet's David Peltier has more on the mid-morning action.

Housing Data Does Little To Comfort Trader

twocents@thestreet.com (Debra Borchardt ) — Tue, 26 Feb 2013 15:33 GMT

Cuttone's Keith Bliss remains cautious in this rally, even though the housing data continues to be strong. He tells TheStreet's Debra Borchardt that Italy remains a concern.

Market Gloom Ahead of Obama Japan Trip

twocents@thestreet.com (Debra Borchardt ) — Thu, 21 Feb 2013 21:00 GMT

TheStreet's Debra Borchardt covers Wal-Marts caution, positive housing stats and the upcoming meeting between President Obama and Japan's Prime Minister.

Japan, Obama Meeting Keeps Currency Battle Going

twocents@thestreet.com (Debra Borchardt ) — Thu, 21 Feb 2013 16:42 GMT

Trader Stephen Guilfoyle tells TheStreet's Debra Borchardt that currency watchers will be listening for any details to come from the meeting between President Obama and Japan Prime Minister Shinzo Abe.

Currency the Latest Threat to Global Economy: Q&A

twocents@thestreet.com (The Associated Press) — Sat, 16 Feb 2013 14:24 GMT

By Pan Pylas, Associated Press

LONDON -- The world economy faces a new threat. Instead of a banking collapse or too much debt, fears are growing that countries are using their currencies as an economic weapon.

History suggests that's never a good thing....

G20 Makes Promise to Play Nice

twocents@thestreet.com (The Associated Press) — Sat, 16 Feb 2013 13:48 GMT

MOSCOW -- Finance ministers and central bankers from the world's 20 leading industrial and developing countries on Saturday pledged not to target their exchange rates for competitive purposes.

The two-day meeting in Moscow ended Saturday with a joint communique that included a promise that the G20 members would "refrain from competitive devaluation" and "resist all forms of protectionism and keep our markets open."

"We reiterate that excess volatility of financial flows and disorderly movements in exchange rates have adverse implications for economic and financial stability," the statement said....

George Soros Adds Apple, Defriends Facebook

twocents@thestreet.com (Chris Ciaccia) — Thu, 14 Feb 2013 22:55 GMT

NEW YORK (TheStreet) -- While the majority of his peers were selling, legendary investor George Soros was adding to his stake in Apple during the fourth quarter.

According to his latest 13F filing, Soros owned 183,976 shares. This compares to his third-quarter filing, when he owned 84,858 shares of the technology giant.

Soros, known for his philanthropy and ideas on economics, also cut his position in other technology names, including Facebook and Amazon.com . Soros owned 300,000 shares of Facebook as of the end of the third quarter, but owned none at the end of the year. His entire stake in Amazon was sold as well, going from 260,000 shares to none. ...

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The Extreme Movers Message: Energy Gone Wild

twocents@thestreet.com (Michael Gayed) — Thu, 24 Jan 2013 19:08 GMT

Where every something, being blent together turns to a wild of nothing.

--William Shakespeare

NEW YORK (TheStreet) -- In last week's Extreme Movers Message, I noted "the areas which are rallying are those which are not highly focused on by the mainstream investor." The eclectic mix I was highlighting was somewhat all over the place on the extreme winners side, with the Yen being the top loser. ...

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QE, Japan Style

twocents@thestreet.com (Bo Peng) — Tue, 22 Jan 2013 14:40 GMT

NEW YORK (TheStreet) -- Monday morning (Tokyo time), Bank of Japan announced the universally expected Japanese version of QE-ternity. They would buy JPY13 trillion worth of sovereign debt (mostly short-dated bonds) per month. Using the approximate exchange rate of 90, that's $140 billion a month, compared to the $85 billion a month in the U.S. version. That's a darn impressive number, more so when considered relative to GDP.

But there's a big caveat. The beginning date for this all-out, nothing-held-back, do-or-die Kamikaze is January 2014. Huh? If the situation is so dire as to warrant such a dramatic action, why wait for a year?

The fact is Bank of Japan has been one of the only two major central banks (the other being Deutsche Bundesbank) that have been very prudent in monetary policy and are humble and realistic enough to recognize that monetary policy can achieve little in the face of inevitable, long-lasting structural changes such as aging baby boomers. While the effectiveness of the Fed's bold experiments into the uncharted territories is at best debatable, such actions in Japan would be suicidal for the following reasons: ...

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Stocks Are Up but Remain a Risky Asset Class in 2013

twocents@thestreet.com (Richard Suttmeier) — Fri, 11 Jan 2013 14:02 GMT

NEW YORK (TheStreet) -- The new year is off to a solid start for U.S. equities, and while this strength can continue near term, I stand by the theme I wrote on Jan 2, in The Stock Market Is a Risky Asset Class in 2013.

Next week is an important week for earnings, as 13 money center and regional banks with buy ratings report their quarterly results. I profiled them on Thursday, Jan. 10 in Buy-Rated Big-Bank Stocks to Trade Pre-Earnings. Positive results from the banking system should prolong the near term stock market rally. Otherwise, next week's closes could be disappointing as pivots from my proprietary analytics act as magnets pulling stocks back down.

As I have been reporting recently, the fundamentals for the stock market are not cheap. At www.ValuEngine.com we show that only 42.7% of all stocks are undervalued with 57.3% overvalued. In addition, all 16 sectors are overvalued with eight overvalued by double-digit percentages; consumer staples by 24.3%, construction by 20.3%, transportation by 20.0%, industrial products by 17.2%, finance by 13.4%, medical by 12.4%, computer and technology by 12.3% and retail-wholesale by 11.9%....

Why It Pays to Own These Emerging Markets Bonds

twocents@thestreet.com (Stan Luxenberg) — Wed, 09 Jan 2013 15:36 GMT

NEW YORK (TheStreet) -- Wall Street strategists are warning investors to be wary of bond funds. When interest rates rise, bond funds tend to drop. Plenty of economists expect rates to rise soon as the economy grows.

Investors recently got a taste of the pain that could lie ahead. During the past month, interest rates on 10-year U.S. Treasury bonds rose from 1.60% to 1.93%. In response to the rate move, iShares Core Total U.S. Bond Market ETF , which tracks the Barclays aggregate bond index, lost 0.6%, according to Morningstar.

Seeing the losses, you may be tempted to dump all your bonds. But a better approach is to diversify your fixed-income portfolio, including some funds that don't necessarily move in lockstep with the rest of the bond markets. Top diversifiers include funds that hold emerging markets bonds denominated in local currencies. ...

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We Did Not Fall Off the Cliff; We Will Get Stuck on the Ceiling

twocents@thestreet.com (Bo Peng) — Mon, 07 Jan 2013 12:47 GMT

NEW YORK (TheStreet) -- As far as political melodrama is concerned, it doesn't get mellower than the cliff-hanger of a negotiation about the fiscal cliff. As a typical Hollywood blockbuster, the hero and the villain duke it out amidst fantastic noise and flashes until the very last minute and the hero has no other choice but to win and kiss the girl.

The crowd never gets tired of it. Only this way, it feels, can it get its money's worth.

We got our money's full worth in the entertainment department. But in the real-value department it's far less satisfactory. They did reach an agreement, as I cynically predicted. But they settled on the easy part, which is raising taxes, and left out the hard part, which is cutting spending. This is not what I predicted. I did expect the Republicans to give up and give in; I just didn't expect them to do it so thoroughly. ...

Jim Cramer's Best Blogs

twocents@thestreet.com (Jim Cramer) — Sat, 29 Dec 2012 14:47 GMT

NEW YORK (TheStreet) -- Jim Cramer fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he discussed: which stocks you should sell if we go over the fiscal cliff; and why gold will head higher in the coming year.

Click here for information on RealMoney, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.

A Fiscal-Cliff Strategy ...

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A Foreign Stock ETF for a Rapidly Declining Currency

twocents@thestreet.com (Gary Gordon) — Mon, 24 Dec 2012 14:51 GMT

NEW YORK (ETF Expert) -- Throughout 2012, I chose exchange-traded-fund assets that offered twice the annual cash flow of what the 10-year Treasury yielded. This meant pursuing capital appreciators and/or yield producers with a 3.0%-4.0% annualized income stream.

In the stock world, many client portfolios contained iShares MSCI Australia , WisdomTree Dividend Ex Financials , Vanguard High Dividend Yield and iShares MSCI Malaysia . Real estate investment trusts (REIT) like Plum Creek Timber and REIT ETFs like SPDR Dow Jones Global Real Estate also fit the bill.

From the land of higher-yielding income, clients benefited from funds like iShares Preferred , SPDR High Yield as well as Guggenheim Multi-Asset Income . Even investment-grade bond ETFs like PowerShares Emerging Market Sovereign and Vanguard Intermediate Corporate figured prominently. ...

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Gold a Long Term Winner as Currencies Collapse

twocents@thestreet.com (Gregg Greenberg) — Mon, 17 Dec 2012 15:05 GMT

Phil Streible, Sr. commodities broker at RJO Futures, says gold will win in the long run as central banks race to weaken their respective currencies.

Top Technical Trades: SPX, Dollar, Nat Gas

twocents@thestreet.com (Chris Vermeulen) — Thu, 13 Dec 2012 20:20 GMT

NEW YORK (www.TheGoldAndOilGuy.com) -- Wednesday's price action was bearish again and we are patiently waiting for a counter-trend pullback to happen. While there are some good-looking plays out there, I really do not want to get long until the market clears the air with a bout or three of strong selling. Remember 3:4 stocks follow the market and the odds of picking a commodity or ETF that bucks the trend is unlikely.

>>If you are interested in powerful stocks & ETFs that buck the trend, check out my FREE Trading Ideas here. S&P 500 / Broad Stock Market We have seen a big run-up in stocks this month and things are looking a little long in the teeth. A large number of stocks are trading above their upper Bollinger bands and the broad market is testing that key resistance level also. Typically when a Bollinger band is reached, we see price reverse for a couple days, at minimum.

While the equities market is in a new uptrend, as seen by the moving averages, a pullback seems imminient. The last two days have formed reversal candles and are pointing to lower prices. ...

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Weak Dollar Signals Buy Signs For Commodities

twocents@thestreet.com (Debra Borchardt ) — Tue, 11 Dec 2012 15:32 GMT

Mark Newton, Chief Technician for Greywolf Equities points out that the weak dollar will lead to higher commodity prices.

A Tale of Two Chinas

twocents@thestreet.com (Bo Peng) — Tue, 04 Dec 2012 13:47 GMT

NEW YORK (TheStreet) -- Casual observers of Chinese stock markets tend to, naturally, focus on the widely referenced broad indices, the Shanghai Composite and the Shenzhen Composite.

And the picture is not pretty. They have been on a steady decline since early May and still show little sign of rebounding. Ironically, the Chinese media and webosphere also tend to narrowly focus on the broad indices, adding to an ever-increasingly gloomy sense of doom.

But if one looks beyond the broad indices, a very different picture emerges. The blue chips, roughly represented by the Shanghai 50 Index, have shown remarkable resilience in the last three months (see chart below). ...

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Expect an S&P Pullback: Opinion

twocents@thestreet.com (TheStreet Guest Contributor) — Wed, 28 Nov 2012 15:33 GMT

By David Banister NEW YORK (MarketTrendsForecast.com) -- The S&P 500 is likely to pullback from a 66-point rally off the 1343 pivots. Those pivots were right at a Fibonacci fractal retracement of 61.8% of the summer rally. That rally ran from 1267-1474, as we all know in hindsight, and the correction was a normal correction within a bull cycle. Near term, we had a nice run to 1409 and met resistance there. We would expect a pullback to the 1384 areas on the S&P 500, if not a bit lower in the coming days. The U.S. dollar is likely to get a bounce, which will also pull down precious metals along with stocks in the near term. We think this could be a opportunity to buy as we approach pivot pullback buy points, but of course we will monitor in the event the pullback becomes more dire than expected. Below are charts of the US dollar and the S&P 500 index and potential near-term movements to monitor. We closed out long positions in Direxion Shares Exchange Traded Fund Trust with nice gains Tuesday as well as stocks with trading profits while we watch the pullback action. ...

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Holiday Spirit Relieves QE Fatigue

twocents@thestreet.com (Richard Suttmeier) — Fri, 23 Nov 2012 12:13 GMT

NEW YORK (TheStreet) -- A week ago market sentiment turned on a dime when congressional leaders announced that they were optimistic of finding a compromise solution that prevents the economy from falling off the fiscal cliff. I for one was quick to recognize the changed environment for U.S. equities even though I remain bearish longer term.

Some key levels were penetrated to the upside on Monday setting the stage for the Thanksgiving week rally, which is building a base for a potential Santa Claus rally even with continued negative weekly chart profiles for the major equity averages. Some of the weekly chart profiles could shift to neutral as Santa and his sleigh prepare to leave the North Pole a month from now.

On Monday, I wrote, Stocks Set to Bungee from Fiscal Cliff where I described the potential key reversal for the Russell 2000, which was confirmed at Wednesday's close. I also tracked the upward trend for the S&P 500 above my annual pivot at 1363.2....

What China's Leadership Changes Mean for US Investors

twocents@thestreet.com (Nightly Business Report on TheStreet) — Fri, 16 Nov 2012 15:00 GMT

Emerging markets investment advisor, William Nobrega describes what's the world's second largest economy needs to do next.