G3 Recap 4-13-11

Main Items:

  • US Retail Sales ex Autos and Gas rose 0.6% MoM in March vs 0.5% expected. Last month’s print was revised higher to 0.9% from 0.6%. Base effects, however, takes the YoY rate down to 7.1%, and the CPI adjusted print down to 5%

  • JPM: 1.28 vs 1.15. Revenues were inline, beat was from IB, lower provisions that were somewhat offset by comp. Total loans, however, fell -1% QoQ and -4% YoY, driven by lower credit card loans. NPA formation fell -47% QoQ and -69% YoY, which generated at 35c card reserve release. Trading revenues were off -2% on a YoY basis.

Overseas:

  • UK ILO Employment 3ma fell to 7.8% in vs 8.0% expected and previously
  • UK Average Weekly earnings rose 2.0% annualized over the past 3 months, vs 2.6% expected and 2.3% previously.
  • South Korea UE was unchanged at 4.0% vs 3.8% expected

Commentary:

  • Too busy today to have much of a view, so here are a few interesting charts from the 2011 world bank report on Conflict, Security and Development:

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4 thoughts on “G3 Recap 4-13-11

  1. Very interesting charts ,indeed. Many thanks. Puts the Arab Spring in some perspective in that it will take at least 10 years (and probably much more) to get to the thresholds of Institutional Transformation. That means a long and volatile ride on the crude oil price curve with so much of OPEC barrels in the Middle East. The political premium currently in the Brent price is reckoned to be in order of 15-20 $/bbl , mostly driven by Libya and to smaller degree by events in Bahrain + Nigeria .

    1. Glad you found them interesting, PPK! Yes definitely puts the Arab Spring into perspective. I am curious what the real bottlenecks are. Citizen psychology? Is it a coincidence that most of the averages for the fastest 20 is ~30 years, or about half a generation?
      You’re probably right about the premium, but I’m kind of unsure myself. The oil & precious metals complex is a bit too risky for me at the moment, although the secular drivers remain clear.

  2. great site!!! nice trade ideas as well, though I wonder what will happen with the canadian dollar

    1. Thanks for visiting AC, and for your compliment.

      I think that it’s likely that CAD remains bid vs the USD until we get some sort of a macro shock. I probably didn’t make that clear in the trade ideas post. Short and intermediate term drivers both seem pretty straight forward. I think there is a lot of room for it to fall though, in the event of a US recession, given the hypothesis I proposed. As a result, I thought being short CAD via options was a good as a bit of a tail hedge.

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