David's Feed
Jul 14, 2015
via Morning Bid with David Gaffen

Kick the Can

If history repeats itself, first as tragedy, next as farce, the third time is probably “Greece.” The austerity measures to be implemented and the staggering bailout sum together mark another exhibit in the long history of evidence supporting the line about insanity being the thing someone does over and over while expecting a different result. In its most ruthless terms, though, the markets liked it on Monday, the stock market was higher, the Treasury market sold off, and we’re in a kick-the-can scenario that David Kotok of Cumberland Advisors a few weeks ago said would be viewed well because markets like can-kicking. It’s possible it gives investment managers the hope that they’ve found the fountain of youth or something.

But never mind that now. Greece’s effect on U.S. markets was always thought to be limited, and besides, we’re being flung headlong into earnings season now, with a number of the major banks all out and firing reports ahead of some notable others in the next 36 hours – Blackrock, Yum Brands, Netflix, a load of regional banks, that sort of thing.

Jul 10, 2015
via Morning Bid with David Gaffen

What a Week!

The desire for the weekend would normally be among the motivating factors for hoping for a quiet day on Friday, particularly after the week the markets have endured – China continuing to melt down, Greece getting ready to go down the rabbit hole, the NYSE experiencing a three-hour halt as a result of a software update – if only the weekend didn’t pose its own special danger. And before that, Janet Yellen stands in the way too, so the relief won’t come for investors until that’s done.

China managed two days in a row of rallies, with the Shanghai Composite bouncing back again to the tune of a 4.5 percent gain. Again, it’s tempting to say things have been fixed now, but that seems reductive, and maybe it’s only just enough to hope things aren’t berserk there for much longer than anything else.

Jul 10, 2015
via Morning Bid with David Gaffen

What a Week!

The desire for the weekend would normally be among the motivating factors for hoping for a quiet day on Friday, particularly after the week the markets have endured – China continuing to melt down, Greece getting ready to go down the rabbit hole, the NYSE experiencing a three-hour halt as a result of a software update – if only the weekend didn’t pose its own special danger. And before that, Janet Yellen stands in the way too, so the relief won’t come for investors until that’s done.

China managed two days in a row of rallies, with the Shanghai Composite bouncing back again to the tune of a 4.5 percent gain. Again, it’s tempting to say things have been fixed now, but that seems reductive, and maybe it’s only just enough to hope things aren’t berserk there for much longer than anything else.

Jul 9, 2015
via Morning Bid with David Gaffen

Selloffs Can’t Happen When Markets Are Closed

One lesson the Chinese have figured out in the last few days, and the same goes for whatever squirrel chewed through the wires at the NYSE to cause a three-hour trading halt, is that markets can’t go down when they’re closed.

This of course does not suggest any real sense of confidence, of course, because the point of markets is to be, y’know, open, and the NYSE’s problems can be blamed on someone dumping coffee on a server somewhere while the Chinese have taken a more deliberate approach to heading off what’s already a massive selloff.

Jul 9, 2015
via Morning Bid with David Gaffen

Selloffs Can’t Happen When Markets Are Closed

One lesson the Chinese have figured out in the last few days, and the same goes for whatever squirrel chewed through the wires at the NYSE to cause a three-hour trading halt, is that markets can’t go down when they’re closed.

This of course does not suggest any real sense of confidence, of course, because the point of markets is to be, y’know, open, and the NYSE’s problems can be blamed on someone dumping coffee on a server somewhere while the Chinese have taken a more deliberate approach to heading off what’s already a massive selloff.

Jul 7, 2015
via Morning Bid with David Gaffen

All the Stock in China

As the overnight session reveals, the true measure of the efforts by Chinese authorities to backstop their equity market was able to be seen in the performance of U.S.-traded shares of Chinese companies, particularly the small-cap names.

Those shares evinced a real sense of worry that the world’s second largest economy is stumbling and has hit a point where it’s unclear if even the economic figures, no matter how strong, will be able to help stave off further declines in this equity market.

Jul 7, 2015
via Morning Bid with David Gaffen

All the Stock in China

As the overnight session reveals, the true measure of the efforts by Chinese authorities to backstop their equity market was able to be seen in the performance of U.S.-traded shares of Chinese companies, particularly the small-cap names.

Those shares evinced a real sense of worry that the world’s second largest economy is stumbling and has hit a point where it’s unclear if even the economic figures, no matter how strong, will be able to help stave off further declines in this equity market.

Jul 1, 2015
via Morning Bid with David Gaffen

Failure to Communicate

Dionysus the Elder, ruler of Greek city-state Syracuse in the fourth century B.C., was one of the first to devalue currency by turning one drachma into two drachmas by decree when he got into trouble through excessive spending.

He wasn’t aware, but he had set a precedent, one that has continued through the last two hundred years, as the modern Greek state defaulted on its debts in 1843, 1860 and 1893.

Jun 30, 2015
via Morning Bid with David Gaffen

Dispelling Some Myths About the Greek Situation

We’re at the point now where most bets are off the table, or the ones that at least were on the table before the Greeks and the rest of Europe saw fit to walk away from one another are feeling some pain. It’s worth looking at a few of the myths that got us to this point, particularly as, in an age of Greenspan Puts, the Bernanke Helicopter, Mario-Whatever-It-Takes, and Abenomics, the prevailing expectation for investors was that things just somehow get worked out.

And for sure, at some point, this will likely be worked out as well, one way or another. The forecast for markets certainly isn’t for a worldwide crackup, and the S&P 500 isn’t going to see a 50 percent breakdown as a result of a long-overdue crash of a housing bubble and a bunch of executives who thought the world owed them something.

Jun 30, 2015
via Morning Bid with David Gaffen

Dispelling Some Myths About the Greek Situation

We’re at the point now where most bets are off the table, or the ones that at least were on the table before the Greeks and the rest of Europe saw fit to walk away from one another are feeling some pain. It’s worth looking at a few of the myths that got us to this point, particularly as, in an age of Greenspan Puts, the Bernanke Helicopter, Mario-Whatever-It-Takes, and Abenomics, the prevailing expectation for investors was that things just somehow get worked out.

And for sure, at some point, this will likely be worked out as well, one way or another. The forecast for markets certainly isn’t for a worldwide crackup, and the S&P 500 isn’t going to see a 50 percent breakdown as a result of a long-overdue crash of a housing bubble and a bunch of executives who thought the world owed them something.

    • About David

      "David Gaffen oversees the U.S. markets team, having joined Reuters in May 2009. He spent four years at the Wall Street Journal, where he was the original writer of the web site's MarketBeat blog. He is a frequent guest on Reuters TV, and has appeared on CNN International, Fox Business, NPR, and assorted other media and is the author of the book "Never Buy Another Stock Again.""
    • Follow David