Saturday, February 02, 2008

The Mets get Johan Santana........

The Met's yesterday signed Johan Santana, arguably the finest pitcher in baseball to a 6 year extention, onto his original contract. This comes after a long winter of waiting for the Met's to do something to improve their team. I for one am very glad that this has happened. The Met's need to win now. The team has been built to win NOW and they are ready. What they were missing was the number one Pitcher and now I think they are in a real position for Johan to lead us to a World Series like he did with Minnesota.

I think this relates a little to what is going on in the markets. Fan's feeling's for the Met's have brightened based on what they have done (signed Johan).Similarly, the markets may be (I repeat MAY BE) starting to believe that the Fed is on the correct path. Cutting rates aggressively (ready to do more) a stimulus package in the works and banks working on a program to keep Bond insurers solvent. Yesterday's employment number's were very poor. Even with revisions few could agrue that things are starting to look better. Trader's however, are quite often forward looking. If they percieve the things in the works will turn around (or at least stop the fall) the economy they will eliminate the bad and look for the good. Do I think we are totally there yet, No. But we should be getting closer.

The ECB did an interesting thing on Friday. They announced that they would not be participating in the auction in February to add liquidity to the markets. They feel that the liguidity situation is improved and that there is no need to do it this time around. I personally feel this is very short sighted. In late trading on Friday cash desks saw large European banks paying up for deposits.

I think this shows that the ECB are truly individual thinkers and that rate cuts are probably a while off. I think this could also cause liquidity problems to linger longer then necessary and a harder landing for their economy to come in the future.

I am currently....

Short Euro/Usd
Short Usd/Mxn
Short Usd/Krw
Long Usd/Twd
Short Usd/Ars

Good Luck and Good Forex Trading.....



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