Dangerous Times

I had my teeth cleaned today which is always fun. Little did I know things would get worse in the afternoon.

It is Friday night tomorrow, but I do not know how much fun we can have with all the news coming down (covered below). Requests always welcomed though.

Short post as there is too much going on and I want to follow things this evening.

On Japan
I have no special understanding of the issues involved at the troubled nuclear plant. My feeling is that if something was going to happen, and I mean worse than what already has, it would have happened by now. Let's hope the new power line can be in place so that the material can be controlled.

What about the earthquake and tsunami damage? While all the talk has been about how Japan will rebuild and how they will pay for it (No one wondered about Haiti for some reason..) not much sympathy has been shown for the stoic Japanese people. I cannot fathom what it feels like. One minute you live on the sea and all is well and the next the earth moves and the ocean becomes an enraged force that sweeps your town, your friends, your family out to sea, never to be seen again. Find words for that.

No Fly Zone Resolution
Tonight the UN which usually cannot authorize stopping genocide (Rwanda has no oil I guess) somehow found a way to pass a resolution authorizing a "No Fly Zone" over Libya.

It is not clear as yet who will be doing the enforcing, this Wall Street Journal article was thin on details (understandable) but there was this section which is a little strange for a No Fly Zone:

Options included using cruise missiles to take out fixed Libyan military sites and air-defense systems, according to these officials. Manned and unmanned aircraft could also be used against Col. Gadhafi's tanks, personnel carriers and infantry positions, with sorties being flown out of U.S. and North Atlantic Treaty Organization bases in the southern Mediterranean.

Did not know tanks could fly.

Conflict is always dangerous for the known and unknown. I have mixed feelings on this. I would like to see Gadhafi go, but where does it end? I would like to see more British and French forces in on this and not just a US show. We shall see what happens but this is very serious and deserves your attention.

Right now the Japan disaster is consuming the news speak and headlines, and rightly so. Libya will now command attention when bombs start dropping. Ok. It is at times like this that sneaky, nasty players like Russia, China, and especially Iran like to make some kind of major move, going quiet and unnoticed. These are dangerous times.

Saint Patrick's Day
Just load it and go:


Have a good night.

What a Mess

As if every day since last Friday was not enough, more and more issues are surfacing every hour. I will do the best I can to hit what I think is important, but no one writer can cover all the moving parts.

Japan Nuclear Reactor News
I really cannot comment much here. The news items are all over the place and it is hard to know what to make of the news that does come out. I suggest checking in at major news sites and following the more headline centered financial blogs for the latest news.

What is troubling is how sketchy the real hard information is and why nobody seems to be able to really explain what the scenarios are. It is either "Total Meltdown Catastrophe" or "Troubling, but With Limited Large Scale Impact". Seems a wide divide.

Yen Carry Trade
Wonderful, yet another market that I do not have a firm grasp of!

I understand the Yen carry as a vehicle for cheap liquidity for speculation. The Wiki entry for this in regards to Carry:

By early year 2007, it was estimated that some US$1 trillion may have been staked on the yen carry trade. Since the mid-90's, the Bank of Japan has set Japanese interest rates at very low levels making it profitable to borrow Japanese yen to fund activities in other currencies. These activities include subprime lending in the USA, and funding of emerging markets, especially BRIC countries and resource rich countries. The trade largely collapsed in 2008 particularly in regards to the yen.

I have no idea how much it collapsed then or if it was reborn after.

Some items worth a look (via Zero Hedge):
The Day the Yen carry Trade Died
I would expect intervention on this, but how much can Japan do at this point?

Josh Brown, The Reformed Broker, has a great list that will get longer during the evening:
Yen Linkfest

Video Recap a Must See
iBankCoin write chessNwine does not post much free content anymore (and he should not, it's too good) but here is a great video recap not only of just today, but a long stretch where being cautious and on the sidelines would have been a very good thing to do:
Video Market Recap 3-16-2011
I of course was not listening too much but I did scale way down my position sizes while I played a few ideas the past few weeks. Thanks Chess!

Just How Important are Stock Indices to Policy Makers?
Grabbed a headline this morning off Yahoo because something about it just pissed me off royally for some reason. Here it is:

You can click for a larger view but it reads:
Stocks Hit by Japan Fears Despite Nikkei Rally

After a 20% drop, Japan's Nikkei rose 6% today. Somehow the stock market moving up failed to calm anyone. How much Japan blew buying stocks instead of saving to either rebuild the country or defend their currency is open for debate.

This kind of thing pisses me off because it is a waste. When markets are ready to rise, they will rise. They will not need help. All the money funneled here to the banks via POMO to raise the stock market was done to provide a "Look, SHINY Object" kind of distraction against serious issues. All that money and all that work gets erased pretty quick.

It should be totally clear by now that all things cannot be controlled at all times. Pretending otherwise is foolish and silly.

There are many big picture things to consider tonight, but I am out of time.

Have a good night.