Fw: Weekend Snippets [C]
[{"sender": "Vinit Sahni", "recipients": ["Vinit Sahni"], "timestamp": "10/20/2013 07:05 PM GDT", "subject": "Weekend Snippets (internal only) [TI]", "body": "Here we are -> record highs for the S&P 500, the S&P 400 Midcaps, and small cap Russell 2000. Should we be asking ourselves if\nthis is the Terminal Phase or will this continue ?\n\nIn these snippets here is a quick mark to market on where we are and some of the trades below. The theme of the trades below is very\nclear, carry outperformance and lower vol. Vol has broken down and we are on the leg down to 2009 levels (includes FX vol, rates\nvol, commodity vol etc) -> this has prompted additional risk taking and technicians for example are calling for 1775 levels in the S&P\n-> sharpe ratios of high carry trades looks very compelling here\n\nMark to Market:\n\nWith the US government reopened / debt ceiling raised, Obama stated -> there were “no winners.” It’s been only about 3 weeks, but\nthe fourth quarter has already shown itself worthy of the history books. If the spec community can hold gains through year-end (the\nvol markets are alluding to) -> the ranks of billionaires will surely inflate further. No winners, right ?\n\nThis week saw the S&P500, the S&P 400 Mid-Cap Index and the small cap Russell 2000 all trade to record highs. The week’s 2.8%\nadvance increased the small caps’ year-to-date gain to 31.3%. Google added about 140 points and $38.5bn of market cap this week (to\n$338bn) to reach an all-time high (up 43% y-t-d). The more speculative “beta” stocks continue to outperform. The NASDAQ 100 (up\n3.7% this week), Morgan Stanley High Tech Index (up 2.6%) and The Interactive Week Internet Index (3.4%) all traded to the highest\nlevels since 2000. Treasury, MBS, and corporate debt prices were higher as well. It all adds up.\n\nThe QE-enhanced 2013 version of “how crazy do things get?” is outshining even the 1999 speculative melee, yeah!!. The (post-\nLTCM bailout) year 1999 saw the small cap Russell 2000 Index jump from 422 to 505 (19.7%). This year, it has already run from 849\nto 1,114 (up 31.3%). The S&P400 Midcap Index jumped from 392 to 445 in 1999 (13.5%). With more than two months to go, so far\nit’s 1,020 to 1,290 for the midcaps (up 26.5%).\n\nWhy stop just at the US. Germany’s DAX equities index added 1.6% this week to a new all-time high (up 16.5% y-t-d). Italian stocks\njumped 2.1% (up 18.4% y-t-d) and Spanish stocks surged 3.5% (up 22.5%), both to more than two-year highs. Australian stocks\ngained 1.7% (up 14.5% y-t-d). Despite major economic issues, India’s stock market jumped 1.7% this week to within a couple percent\nof new highs. Stocks jumped 4.2% in Brazil and 4.3% in Argentina. Indonesian stocks rallied 4.5%. Around the globe, most equities\nmarkets pushed higher. Fueled by huge ETF flows, total equity mutual fund inflows this past week jumped to a whopping $12.7bn.\n\nYou may want to see this -> On a weekly basis, global central bank International Reserve Assets (data from Bloomberg). This data\nprovide a decent proxy for global financial flows, especially to the emerging markets (EM). From $6.63 TN back in April of 2009\nInternational Reserves surged this week to a record $11.415 TN. Reserves have inflated 330% in ten years.\n\nLets focus on some trades here:\n\n1) This environment is supportive for carry trades, which has been reflected in the outperformance of high yielders following the\nannouncement of the US debt deal.\n\nLong AUD/USD: Longer term investors remain relatively short AUD, which suggests that AUDUSD strength has further to run. A"}, {"sender": "Paul Morris", "recipients": ["Jeffrey Epstein [jeevacation@gmail.com]"], "timestamp": "10/21/2013 12:44:26 AM", "subject": "Fw: Weekend Snippets [C]", "body": "Vinit is working with me on some large clients now, good resource, I will introduce you to him and few other sr. folks before year end\neither in NYC or in europe, just some directional thoughts/observations not necessarily for you,\n\nVinit Sahni"}]