Stocks and Trading Thread - Channeling your inner Mono

[MadImmortalMan]

Metals hitting the roof thanks to the bernank. Silver more than gold though. Doing well, and probably will until the next Eurozone country throws us under the bus. Maybe I'll start a pool to guess which one it will be.

And the winner is...

Fitch Ratings-London-13 July 2011: Fitch Ratings has downgraded Greece's Long-term foreign and local currency Issuer Default Ratings (IDRs) to 'CCC' from 'B+. The Short-term foreign currency IDR is also downgraded to 'C' from 'B' and the Rating Watch Negative (RWN) on all three ratings has been removed. The agency has affirmed the euro area Country Ceiling at 'AAA', which is applicable to all euro area member states, including Greece.

The downgrade follows the assigning of a RWN on Greece's ratings on 20 May. At that time, Fitch stated that it would resolve the RWN in light of the conclusion of the fourth review of Greece's economic programme by the IMF and that in the absence of a fully-funded and credible EU-IMF programme, Greece's sovereign ratings would likely be lowered to 'CCC'. Moreover, Fitch's previous rating of 'B+' was premised on the judgement that provision of new money would not be conditional on private sector participation in any new and enhanced EU-IMF programme that would potentially result in a default event.

Today's rating downgrade reflects the absence of a new, fully-funded and credible EU-IMF programme for Greece, coupled with heightened uncertainty surrounding the role of private creditors in any future funding, as well as Greece's weakening macroeconomic outlook.

New money is required to address Greece's fiscal funding shortfall that would otherwise emerge in 2012 - a key weakness of the current EU-IMF programme highlighted by Fitch at the turn of the year. Fitch had expected the uncertainty surrounding new money, along with the role of private creditors, to be resolved with the completion of the fourth review of the current EU-IMF programme earlier this month. The agency notes that while the main parameters of a new multi-annual adjustment programme were discussed at an Ecofin meeting on 11-12 July, no further clarity on the volume and the terms of new money or the nature of private sector participation was forthcoming.

Fitch remains of the opinion that any additional financial support for Greece will only be credible in providing a path to fiscal solvency if it is fully funded beyond the end of the current programme in mid-2013. New European Commission estimates of gross fiscal financing needs of EUR172bn up to mid-2014 imply substantial additional EU-IMF financial support over and above the EUR110bn already committed. However, the agency is concerned that reliance on privatisation receipts of EUR30bn and largely unquantifiable private sector participation to supplement official new money would leave a new programme vulnerable to future funding shortfalls, subjecting Greece to continuing uncertainty. While asset sales of EUR5bn look attainable in 2011, the privatisation programme will become increasingly challenging.

Fitch believes any new programme must be backed by credible policy targets. The successful passage through parliament of the Medium Term Fiscal Strategy at the end of June sent a strong message that the Greek authorities remain fully committed to the EU-IMF programme. However, official new data for the first six months of 2011 point to expenditure overruns and revenue shortfalls, highlighting the urgent need for recently legislated new measures for 2011, while there are growing doubts about the capacity of the Greek economy to withstand further fiscal consolidation in a climate of continuing economic and financial uncertainty. Thus, a further contraction in economic activity of some 4% of GDP now looks likely in 2011, followed by a weak recovery in 2012.

Fitch's 'CCC' rating encapsulates substantial credit risk and acknowledges that default is a real possibility. As previously stated by Fitch, private sector involvement would likely be viewed as a sign of sovereign credit impairment and could trigger a rating default event.

lulz


Market's drifting slowly down from this morning's bump.

[Richard Hakluyt]

So Greece isn't doing too well financially? I bet nobody saw that coming, good job eagle-eyed Fitch spotted it!

[Admiral Yi]

So Greece isn't doing too well financially? I bet nobody saw that coming, good job eagle-eyed Fitch spotted it!

It hasn't dawned on the EU, the ECB, and the IMF yet.

What did Bernanke do MIM?

[MadImmortalMan]

What did Bernanke do MIM?

Hinted that more QE-type activities were being considered.

[Admiral Yi]

Goddamn Jewboy.

[Ed Anger]

Metals hitting the roof thanks to the bernank.

[mongers]

What did Bernanke do MIM?

Hinted that more QE-type activities were being considered.

Will they be handing out free wheelbarrows this time ?

[Richard Hakluyt]

So Greece isn't doing too well financially? I bet nobody saw that coming, good job eagle-eyed Fitch spotted it!

It hasn't dawned on the EU, the ECB, and the IMF yet.

It is very disturbing that the policy on Greece seems to be so reactive. Everyone else seems to know that Greece will never repay the bulk of that debt. They should get ahead of the game and provide a credible solution and end this damaging uncertainty.

Meh, a pointless tautological post really, but why don't the Euro institutions see it that way?

[MadImmortalMan]

It is very disturbing that the policy on Greece seems to be so reactive. Everyone else seems to know that Greece will never repay the bulk of that debt. They should get ahead of the game and provide a credible solution and end this damaging uncertainty.

Meh, a pointless tautological post really, but why don't the Euro institutions see it that way?

Nobody cares about Greece per se. They care about Greece as the first domino.

[mongers]

It is very disturbing that the policy on Greece seems to be so reactive. Everyone else seems to know that Greece will never repay the bulk of that debt. They should get ahead of the game and provide a credible solution and end this damaging uncertainty.

Meh, a pointless tautological post really, but why don't the Euro institutions see it that way?

Nobody cares about Greece per se. They care about Greece as the first domino.

I thought that was Laos ?

[MadImmortalMan]

Well, my Alcoa options are still open and this is the last trading day before expiration. They are so far in the money at this point that they are trading above what I sold them for even on expiration day. Hopefully, they will either expire clean or drop in value at the end of the trading session so I can buy them back. Either of those means I walk with the cash and the stock. If they are called, I have to sell the stock for $13 a share. I will only make a couple hundred bucks if that happens.

[MadImmortalMan]

I've decided that once this nerve-wracking thing is over, I'm selling the lot and going long GLD. I might sell options against that.

[MadImmortalMan]

The trading day is over and my contracts are still open. They'll go dead tomorrow and I get to keep all the money. 

Beats having to sell all those shares for 13 bucks.

[Richard Hakluyt]

I'm out. Back to cash, shame there is nowhere decent to put it.

[MadImmortalMan]

What a retard.

PSA: Brokers, Don't Pump Stocks on Twitter

It's amazing that this needs to be repeated in 2011, but here goes...
BROKERS, DON'T PUMP STOCKS ON TWITTER.

Idiots, the internet is forever.  No different than the old message boards or email.  Same rules apply and nothing you delete is deleted.  And you'll look like a dirtbag anyway.

Here's DealBook on a broker who's been suspended for sending "unbalanced" tweets about stocks she owned:

    Wall Street's self regulatory organization has suspended a California-based broker for sending a series of "misrepresentative and unbalanced" messages on the microblogging site Twitter. The Financial Regulatory Authority, or Finra, also fined the broker $10,000. Her suspension will last a year...

    Finra sanctioned the California broker after she touted certain investments to her 1,400 Twitter followers without notifying her firm of the stock-picking "tweets." Some of the "overly positive" messages predicted that stocks, including Advanced Micro Devices, or AMD, would soon surge.

    On Sept. 9, 2009, she tweeted, "Keep an i on AMD ppl! Just bike abve $5 = margins & institutionals can now 'play ball!' Barclay upgraded to $7 ystrdy, but it should be $10+"

    A couple months later, she tweeted, "How accurate am I with AMD? Just check out my tweets! The future of AMD in 2010? Ummm..I would say $12 is conservative!"

By the way, what's an "institutional", lol.

We're not here to debate how stupid the people acting on her tweets are, that's a separate discussion.  If you go make investment decisions based on something you read on Twitter and do no further research, you're a schmuck and we don't feel bad for you.

But for Wall Street professionals taking advantage of social media, try to be smart about it so you don't ruin it for everyone.