BEA 4th Quarter GDP 1st Estimate 0.7% Q&A: Why Did GDPNow Rise After Durable Goods? When are Construction Revisions Coming? 175K-180K looks like rather strong expectations in light of all the mass layoffs we have seen lately. Sentiment is still strong that this economy is growing nicely in spite of a huge job miss last month and wildly unexpected mass layoff announcements. If the numbers comes in weaker (which is my expectation), I would expect to see a rally in treasuries and interest rates products in general. If there is a huge downside miss (not unlikely) there will likely be a huge treasury rally. Are treasury bears feeling lucky? Unless the numbers come in really hot, I would not expect much of a treasury selloff (as strong numbers should already priced in). As for the market, which seems to rally on every bit of bad news lately, I am not sure what to expect. Eventually the cheerleaders are going to figure out that all these mass layoffs and job cuts are not really a good thing, regardless of how many jobs are created at Walmart to replace them. BTW, eventually means the middle of the next recession when they will all be chanting 'no one could possibly have seen it coming'. Thus, no matter what the numbers are, expect for a bullish spin to be put on it. On a downside miss they will be talking about the FED pausing, on an 'in the ballpark' play we will hear about the 'Goldilocks Economy' and if the numbers are hot, they will say that higher interest rates will 'not matter'. Those with idle time on their hands might wish to turn on CNBC and count how many times they say 'Goldilocks Economy'. The closer we are to a range of 150K to 190K the higher will be the Goldilocks count. The content on this site is provided as general information only and should not be taken as investment advice. All site content, including advertisements, shall not be construed as a recommendation to buy or sell any security or financial instrument, or to participate in any particular trading or investment strategy. The ideas expressed on this site are solely the opinions of the author(s) and do not necessarily represent the opinions of sponsors or firms affiliated with the author(s). The author may or may not have a position in any company or advertiser referenced above. Any action that you take as a result of information, analysis, or advertisement on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.
BEA 4th Quarter GDP 1st Estimate 0.7% Q&A: Why Did GDPNow Rise After Durable Goods? When are Construction Revisions Coming? Moody's Investors Service on Thursday placed Ambac Financial Inc (ABK), which insures more than $500 billion in bonds, on review for a possible ratings cut, an event that could trigger similar downgrades on billions of dollars of debt. A cut could mean the ratings on the bonds it insured -- which amount to $556 billion in value -- would also be lowered, forcing the owners of those bonds to mark down the value of their portfolios. Moody's announcement came after Ambac, hard hit by the turmoil in credit markets, said it was recording a $3.5 billion write-down, equivalent to nearly two-thirds of its net worth, and plans to raise $1 billion in new capital to maintain its ratings. MBIA Inc (MBI), the world's biggest bond insurer, sold $1 billion of surplus notes last week to shore up capital and preserve its crucial triple-A rating. 'The markets are...
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