Thanks for the ping.
“Ambac crisis” seems to be the party line today, there was a clown on CNBC even before the market opened, earnestly peddling that theory.
I wrote earlier that that’s BS — they didn’t know it was a crisis until the very day that Fitch downgraded them from the completely imaginary “AAA” rating?
PPT was definitely on the job today. Every time stuff needed a little boost to get through a trendline or a magic number (e.g. DJII 12000), a big volume and price spike appeared out of nowhere.
Until somebody leaked Apple’s earnings report just before the closing bell, that is! That’s the only thing that can explain that 100+ point DJII drop in like 15 minutes that close to the close. Apple is now down 25 points in after-hours trading and Nasdaq-100 futures are down 2+%.
So tomorrow could start out on a sour note again.
I’m wondering about the relationship between the instability with bond insurers and the bond market in general. Bond funds, like Vanguard’s VBMXF (an intermediate term bond fund) have risen noticeably in the past month. It’s made up of about 10% government bonds and the rest are “high quality” commercial bonds. I’m wondering why this fund hasn’t dropped in value. Any thoughts?
It's like the emperor's new clothes, combined with the knowledge that the emperor will have a fatal heart attack if he finds out he's been naked.
We have to break the news to him NOW...but gently.
Cheers!