Royal Bank Of Scotland Share Discussion Threads

[ramco] 21/11/2013 15:25

look at the internals of that...;

[ramco] 21/11/2013 15:24

Treasurys back from brink after weak Philly Fed
A far weaker-than-expected read from the Philadelphia Fed - for the moment - is bailing the Treasury market out of what was shaping up to be an ugly day.
Following estimate-beating prints on jobless claims and flash PMI, the 10-year yield had shot higher by 6 basis points to 2.85%, but the weak Philly read has it back to 2.82%.
New Orders fell to 11.8 from 27.5. Shipments 5.6 vs. 20.4. Unfilled orders of -4.2 vs. 9.1. Employees 1.1 vs. 15.4. The future general activity index dives to 45.8 from 63.8.

[dope007] 21/11/2013 15:24

Philly FED collapses. Great news +300 today

[ramco] 21/11/2013 15:23

Nov Philly Fed Business Outlook
Nov Philly Fed Business Outlook: +6.5 vs. +15.5 expected, +19.8 previous.

[ramco] 21/11/2013 15:23

Consumer comfort index erases shutdown dip
The Bloomberg Consumer Comfort Index slips just a hair to -34.6 from last week's -33.9, but remains sharply higher since the government got back to work. 37% say the economy is getting worse vs. 23% who say it's improving - not very impressive unless compared against a 47%-16% split in the midst of the October shutdown.

[dope007] 21/11/2013 14:35

At the open. The nuthouse continues unabated

[ramco] 21/11/2013 14:34

At the open
Dow +0.29% to 15948. S&P +0.24% to 1786. Nasdaq +0.49% to 3940.
Treasurys: 30-year -0.21%. 10-yr -0.21%. 5-yr -0.07%.
Commodities: Crude +0.75% to $94.55. Gold -1.41% to $1240.3.
Currencies: Euro +0.12% vs. dollar. Yen +0.95%. Pound -0.04%.

[ramco] 21/11/2013 14:33

Stocks set to open higher as jobless claims at lowest since September
Stock futures pointed to modest opening gains, with the S&P +0.3% and Nasdaq +0.4%, after better than expected data on weekly jobless claims.
traders appear to have shrugged off yesterday's FOMC minutes, which indicated the Fed may begin to taper "in coming months," suggesting the news was merely an excuse to sell; the minutes contained no real surprises and said nothing that wasn't already known.
Focus will center on the retail space after Dollar Tree (-6%) and Target (-3%) reported disappointing Q3 results.
Asian markets mostly fell on weak Chinese manufacturing data (the Nikkei, +1.9%, is a notable exception), while European bourses are mixed.
Still ahead: Philly Fed, EIA natural gas.

Add: For today I would like most days place more trust in what Leeds says i.e. its just volatility for now as the algos (in heaven environment) push and pull markets around...;

[ramco] 21/11/2013 14:28

With all this taper on Taper off would offer this as to what the BOE thinks QE effects are:
The United Kingdom's quantitative easing policy: design, operation and impact



"Specifically, the BOE believes that the primary impact of QE in the short term is to cause holders of QE eligible securities - primarily non-bank financial institutions such as insurance companies and pensions - to surrender these securities to central banks in exchange for newly printed money."

"In the adjustment phase, rising consumer and asset prices raise the demand for money balances and the supply of long-term assets. So the prior imbalance in money and asset markets shrinks, and real asset prices begin to fall back. The boost to demand therefore diminishes and the price level [inflation] continues to increase but by smaller amounts. The whole process continues until the price level has risen sufficiently to restore real money balances, real asset prices and real output to their equilibrium levels."


The language in the paper is predictably benign, so as not to alarm readers about the implications. But the benign language is misleading, especially with respect to the impact of attenuating QE on real asset prices like stocks, bonds and real estate. Essentially, portfolio balance effects are driven by the flow of newly printed money which is used to purchase government bonds primarily from insurance companies, wealth funds and pensions. While bond purchases - QE - continues to take place, these institutions are continually faced with holding newly minted low-yielding cash assets, which they then roll out the risk curve in search for higher yields. As assets are priced 'at the margin', these marginal dollars serve to continually apply upward pressure to prices. No doubt this engenders other feedback mechanisms related to (over)confidence, leverage effects, and momentum which carries markets far beyond equilibrium. However, when this positive feedback mechanism ends, "real asset prices begin to fall back". Let's see what that looks like according to the Bank of England...


that the Bank of England believes the mechanism of action for QE to result in massive short-term asset price inflation during the 'Impact Phase' of Quantitative Easing. However, when asset purchases slow or stop during the 'Adjustment Phase', they fully anticipate real asset prices to revert to prior equilibrium valuations. If we apply this concept to equity markets, we would expect markets to revert to long-term average valuations which, depending on the valuation method implies a real price drop of between 50% and 80%...

Further, markets rarely just revert to 'equilibrium'; just as markets clearly overshoot to the upside from leverage effects, herding and other feedback mechanisms, they are equally likely to overshoot to the downside. Indeed, in order to preserve a stable equilibrium, market must by definition trace out the same magnitude of time and value below equilibrium as they do above it...;

[ramco] 21/11/2013 14:04

On the hour

S&P +0.19%.
10-yr -0.19%.
Euro +0.15% vs. dollar.
Crude +0.42% to $94.24.
Gold -1.41% to $1240.2.

[ramco] 21/11/2013 13:57

There is more rhetoric to listen stateside today apart from already mentioned Bullard.... Fed Governor Powell (voter, dove) will speak at 9:45am EST on financial regulation. Richmond Fed President Lacker (non-voter, hawk) speaks on the economy at 12:30pm and St. Louis Fed President Bullard (2013 voter, dove) speaks on monetary policy at 1pm.

Add: that's in addition to the push me pull you of claims denoting improvement and PPI denoting more QE...;

[ramco] 21/11/2013 13:41

Retailers washing in red
The stories are different, but the results are the same for the group of retailers reporting results today.
Though some Q3 profit estimates are being met on the margin, the outlook for Q4 and beyond has been troubling and could bring down sentiment for the entire sector.

[ramco] 21/11/2013 13:38

Dow +60, S&P +5.25...;

[ramco] 21/11/2013 13:36

PPI slips, level with expectations
October Producer Price Index: -0.2% vs. -0.2% expected and -0.1% prior.
Core PPI +0.2% vs. +0.1% expected and +0.1% prior.

[ramco] 21/11/2013 13:35

The Shanghai Futures Exchange could price its crude oil futures contract in yuan, its chairman said on Thursday, adding that the bourse is speeding up preparatory work to secure regulatory approvals....;

[ramco] 21/11/2013 13:32

Initial Jobless claims dives 21K to 323K

Initial Jobless Claims: -21K to 323K vs. 335K consensus, 344K prior revised (339K prior week).

[ramco] 21/11/2013 13:22

Views on OECD global economic outlook report regarding the dire economic consequences to the US and the rest of the world through a protracted debt ceiling brinksmanship fest...

OECD is concerned about the negative impact on the already fragile global economy and stock markets, even for just a few weeks.

Mind you that raising the debt ceiling does not resolve the root cause of debt limit breach. To avoid the recurring debt ceiling showdown, Washington has to address how to cut federal spending and/or increase revenues. Unfortunately, any federal revenue increase, will involve some kind of tax increase mostly to the middle income class. And cutting the federal spending seems to be in the constant mode of one step forward, two steps back.

Unlike Fed's QE which benefits mostly the top rich 1% (and should be 'tapered'!), federal spending, however wasteful it may be at times, actually does get injected into the real economy. So when billions of federal spending disappears from the economy, it will translate into revenue and employment losses affecting many government contractors and the middle income America. Furthermore, whatever savings from spending cuts that may have materialized tends to get sucked away by some colossally mis-managed government program such as ObamaCare, whose bills eventually will need to be footed, again by no other than the middle income class.

While the middle income class has been a major force reshaping America since World War II, some doubt there's much juice left to help dig the country out of this debt trap. All in all, 2014 should be a year of several critical decisions for the United States on its debt limit and monetary (QE) program.

[ramco] 21/11/2013 13:12

According to a report issued today by the Congressional Budget Office (CBO), U.S. may be able to push the debt ceiling deadline to as late as June because the income tax receipts around the April 15 tax deadline may provide more cash cushion to meet scheduled obligations.

From CBO:

Overall, the federal government is expected to run a significant deficit for fiscal year 2014..... Given the volume of the government's daily cash flows and the uncertainty about the magnitude of key transactions...., the Treasury could exhaust its extraordinary measures and authority to borrow as early as March or as late as May or June.

[ramco] 21/11/2013 13:07

Bullish sentiment drops to lowest since late August
Declining 4.8 points to 34.4%, bullish sentiment in the AAII Investor Sentiment Survey is the lowest since just before when everybody knew the Fed was going to taper in September. The long-term bullish average is 39%.
At 29.5%, bearish sentiment is about inline with the long-term average of 30.5%. Neutrals at 36.1% compares to the 30.5% long-term average.

[ramco] 21/11/2013 13:06

On the hour
S&P +0.25%.
10-yr flat%.
Euro +0.17% vs. dollar.
Crude +0.26% to $94.09.
Gold -0.88% to $1246.9.

[ramco] 21/11/2013 12:59

Thursday's economic calendar
8:00 Fed's Bullard: U.S. Economic and Monetary Policy
8:30 Initial Jobless Claims
8:30 Producer Price Index
9:00 PMI Manufacturing Index Flash
9:45 Bloomberg Consumer Comfort Index
10:00 Philly Fed Business Outlook
10:30 EIA Natural Gas Inventory
4:30 PM Money Supply
4:30 PM Fed Balance Sheet

[ramco] 21/11/2013 12:05

Mario Draghi just said that negative rates were discussed in the last policy meeting and there was no news since then, that a rate cut has raised "some concerns" and that certainly one should not infer negative rates.

Cue Euro ramp....;

[ramco] 21/11/2013 11:31

Hmmm, Leeds my take is its a sop...no one is divulging the trade or more aptly trades....or what the inverse gain was...feels like a bit of kitchen sinking to me...how much coming from the FED to them 38bn - 1bn...tough life !....;

[leedskier] 21/11/2013 11:18

We could have guessed G.S. was betting on an early taper, because London had been front running it for weeks, not only in the Gilt market but in the equities space too.

This is the downside to having mathematicians rather than social scientists running the markets. They have no insight into the real world.

If it were otherwise they would not have pumped up the US housing market with derivatives.