Against the Grain

It appears the Chinese State Reserve Bureau has become little more than a market support mechanism we got the following comment from the natural rubber market that the SRB had bought rubber from Chinese producers as prices above the world spot price and like al on Fri the action had trigger a sell off. The feeling being the market must be bad shape if the government has to pay over the world price to subsidies Chinese producers. A once revered secret state reserve system has become a political last resort buffer stock manager.

The metals in Asian time got a boost, one gets the feeling more because there was no big government meeting that offered dull platitudes and there wasn’t a bank failure or any other such news. A mixed batch of LME stock data al and ni continued to pour in while cu had a small decline and zn registered a good fall in Asian stock (Sing 2715 & Johore 1875) and Sing cancelled warrants rose 4300. Every so often a really good article appears and if you have time read the attached “Why the experts missed the crash” an interview with Philip Tetlock in money magazine.

Very little data around in the US the Chicago Fed National Activity Index improved to -3.45 after Dec was revised lower to -3.65 from -3.26. The three month moving average data was -3.41 from -2.70. After 14:30 everything followed the DJI from new highs on the trail lower. The Feb Dallas business activity index dropped to -57.3 (Jan -50.5) the worst reading since ’75 with the manufacturing production index was -36.1 (-15.4). The recent manufacturing numbers from the US and Europe has been poor and suggests activity remains weak. Gold had volatile afternoon selling off from 987 to 775 as the DJI opened up the recovering to 995 as the DJI hit 100 down. The ongoing buzz conversation amongst the talking heads is should US banks be nationalised, specifically Citi and BoA.

This entry was posted on Monday, February 23rd, 2009 at 6:34 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.