Monday, November 21, 2011

An optimist (and cynic) would say that a member of the super committee could conceivably trade on inside information regarding its progress.

Wouldn’t it be funny if they bought SPY today?

Well, it wouldn’t be that funny!

Congress and insider trading -- you simply can’t make these things up.

We could be closer to the end than the beginning of the eurozone sovereign debt concerns and poor sentiment that it brings to our markets.

The Wall Street Journal just introduced a column on the cover of the online edition that shows the 10-year yields, the spread against German bunds and the basis-point change during the day on Italian, French, Portuguese and Spanish debt.

The contrarian in me says this could mean we are closer to the end than the beginning of the eurozone sovereign debt concerns and poor sentiment that it brings to our markets.

Interesting comments by Miller Tabak's Peter Boockvar on ECB sovereign bond purchases last week:

Capturing a more aggressive ECB on Nov 10 and Nov 11, the ECB said it settled sovereign bond purchases of 7.99 billion euros for last week, up from 4.48 billion euros in the week before and vs. 9.52 billion euros in the week prior to that. They now have a total of 194.5 billion euros to sterilize with the latest purchases continuing to be Spanish and Italian debt. To measure the effectiveness or lack thereof of the buying of Italian bonds, today's 10-year yield is at 6.68% vs. 6.09% the close before the buying started Aug. 8 and the Spanish 10-year is at 6.57% vs. 6.04% right before. The Italian two-year yield is at 6.38% vs. 4.52% on Aug. 5, and the Spanish two-year yield is at 5.57% vs. 4.35% on Aug 5.

1. Establish term limits for all our representatives.
2. Limit government spending. Set a specific limitation on the annual gains in spending to be less than the increase in consumer price index.
3. Develop a comprehensive jobs plan.
4. Fix housing. Over 15 million homeowners are underwater with their mortgages, the shadow inventory of unsold homes is a drag on a housing recovery, and we must find a way to find a way to reemploy over 2 million former housing-related workers. We need a Marshall Plan for housing. I would suggest that the Obama administration reach out to the two most knowledgeable and smartest guys in the residential real estate markets, Eli Broad and Bob Toll. I would have them all meet in a locked room with Fed Chairman Ben Bernanke, Treasury Secretary Geithner and President Obama (and his economic team).
5. Raise taxes on the rich. Put a three-year income tax surcharge (of 10% to 15%) on incomes above $500,000.
6. Create a health care czar and tackle our health care industry's delivery and costs.
7. Mean test entitlements, freeze entitlement payouts and gradually increase the social security retirement age to 70 years old.
8. Build infrastructure. Set up an infrastructure bank, and place the money saved on defense into a massive build-out and improvement of the U.S. infrastructure base.
9. Create energy self-sufficiency. Develop a comprehensive plan designed to rapidly develop all of our energy resources.