Wednesday, 27 April 2011

Quiet markets

Last couple of days has been very quiet , low volume pushing up stocks as we still in holiday mode. With the 4 day weekend just gone, and another 4 day weekend coming up (if you live in the UK) it is unlikely that we really will get some real direction backed up by volume until may.
Gilts and short sterling fell today as we didn't disappointing on UK GDP, which showed a bounce back from the negative growth we had in the previous quarter. In tern spreads rose as longer dated short sterling contracts fell harder.
As far as stocks go, the portfolio at the moment is ticking along nicely, its easy to be sucked in to buying more but personally don't like the risk/reward around these levels, and am waiting for a better opportunity to present itself. Until then I'll stay on the side lines and watch.
Enjoy the royal wedding for those who are going to watch. Hopefully will see some real volatility in may!

Wednesday, 20 April 2011

Is online poker legal in the US?

(Taken from church of Texas hold em)
It's a question that crops up time and again on the poker forums. The short answer is YES! There’s no such thing as a ban on online gambling. The bottom line is that Online Poker, which in 49 of 50 States of the USA was legal before Bush signed, is still legal in those states today.
Is online poker legal in the USA? Yes! Join a LEGAL USA-friendly poker site today!
There’s a big over-reaction and unnecessary panic out there. We’re here to guide you through the storm.
The poker companies, some of whom also seemed to have trouble answering the question "Is online poker legal in the USA?" and then rushed to leave the market in a panic have been the biggest losers, with their market share gobbled up by the brave sites that stayed.
So what's the REAL story? The full name of the law Bush signed is the Unlawful Internet Gambling Enforcement Act.
You should not worry about playing internet poker, as the Unlawful Internet Gambling Enforcement Act makes NO CHANGES TO US LAW.
What was legal before it was signed is still legal today. So is online poker legal in the USA? Absolutely.
No stormtroopers in jackboots are going to bust down your door and haul your ass off to Guantanamo Bay for playing a few hours of Texas holdem.
Join a LEGAL USA-friendly poker site today!
What about the companies who left the US market?
I am as baffled as everybody else by the sudden response from companies to the Is online poker legal USA question. They must have had very poor legal advice, as there seems no basis for their pullout.
There's a Dr. Jekyll and Mr. Hyde type reaction in the market, with several sites pulling out, while others offer special enticements to the US players left high and dry by their site of choice.
It is a shame that rational business people have been panicked in this way, to the extent of losing their most lucrative market. Let’s look at the facts of the case and see what your prospects are, if you live in the USA and want to play online poker.
Is online poker legal in the USA? Yes! Join a LEGAL USA-friendly poker site today!
Does the "Online Gambling Ban" mean it’s illegal to play poker online?
No. What the US government is trying to do is prevent poker players from sending and receiving money using online payment systems, such as Neteller (which pulled out of the US market -- and then CANADA?! -- with no apparent need). They are NOT after players, they are targeting the organisations which support the players by moving their money back and forth.
They’re expecting the banks to co-operate with the FBI to prevent transactions to and from gambling sites.
This has already been described as virtually impossible. Imagine asking the USPS to open all the mail, in case somebody is sending cash... It’s about the same scale, only ten times worse because there are many times as many electronic transactions as there are letters.
There’s absolutely nothing to prevent US players from sending and receiving checks and money orders. Yes, it’s more difficult and time-consuming, so the chances are that the net result of the Online Gambling Ban will be to drive out the casual players.
The very people the American lawmakers claim to be protecting – gambling addicts – will of course find a way to fund their addiction.
Is online poker legal in the USA? Yes! Join a LEGAL USA-friendly poker site today!
What has changed since the Act passed?
Surprisingly little, unless you played at the sites which pulled out of the market very early, or had significant money invested in the shares of the companies which decided to withdraw from the US market.
Most of the companies based in the Caribbean continue to accept US players. It’s doubtful whether FBI action could prevent Americans from accessing these poker sites.
The smart money is on the American government finding a way to legalise online gambling and thus claim a huge slice of tax revenue. Once it does, those companies who left the market because they were unsure about is poker legal USA will come back to beg for their customers to rejoin.
Is online poker legal in the USA? Yes! Join a LEGAL USA-friendly poker site today!
Will I lose my money if the site I played at has left the US market?
Almost certainly not, if your previous site was a big player with no risk of bankruptcy. Party Poker has paid out all its US players, including their share of promotions like the Monster series of tournaments.
Some of the smaller companies might struggle to pay all their customers, but we’ve not heard of any problems so far.

Tuesday, 19 April 2011

Full tilt Poker, PokerStars, Ultimate Bet and Absolute Poker Shut Down!

It just came to my attention the shutting down of some of the top poker sites by the Feds. This is caused alarm amongst the many millions of online players. Here is a take of what has gone on:

It’s being called Black Friday, the day the US Government shut down online poker for Americans and put the whole industry in jeopardy. On Friday April 15th, the DoJ seized the domain names of pokerstars, fulltiltpoker, UltimateBet and Absolute Poker, froze over 75 bank accounts and millions of dollars and issued arrest warrants for 11 individuals tied to the websites.
As you can imagine, millions of poker players across North America are outraged and upset that the US Government would go after a game they have so much passion for. They’re missing the point.
The US Governement and the DoJ has no issue with poker. The issue they have which led to the crackdown was all the crime, fraud and money laundering taking place by these companies who on the surface display a polished image yet have operations that are mired in crime and corruption. In the future Black Friday will be known as the day the online poker world got cleaned up as corporate America stepped in.
Forums and websites are full of poker players venting that the US government just wants a piece of the pie and the ability to tax this huge industry. And that may be the case. But the main issues are the staggering amount of money leaving the United States fraudulently, leaving banks to deal with fake businesses and accounts that were setup as fronts and in most cases don’t even exist.
So if you’re a poker player who sends these companies money and trusts them with thousands and in some cases millions of dollars, doesn’t this concern you? Doesn’t it concern you the risks they have chosen to take with your cash and their operations? Doesn’t it concern you that Absolute Poker has been lying to you all these years about its owner Scott Tom, who has been accused of stealing millions from his own players by cheating with super accounts?
You don’t become a legitimate company by upgrading your TV commercials and filling your website with famous poker pros. Why even spend all that money on lobbying the government to change its laws when you don’t respect and follow them in the first place? The only company that has shown true class is partypoker.com, who as a market leader back in 2006 decided to follow the law fully knowing it would cost them hundreds of millions of dollars, but that it was the only way to legitimize online poker.
Poker agent Brian Balsbaugh from Poker Royalty says:
“When Pokerstars, Full Tilt and Absolute Poker left the US market, 95 percent of the market share for US poker players absolutely disappeared and with that so did $200 million worth of marketing money and advertising money that these companies spent in order to acquire new customers. What that means is basically poker television shows like “The Big Game” on Fox and “Poker After Dark” on NBC are completely gone. So the poker landscape has changed dramatically in a very short period of time.”
The aftermath from legitimate companies with any ties to online poker was swift:
ESPN announced on Monday that they will be removing poker advertising from thier channel and website and will be restricting televised poker programming. According to an ESPN representative, the group was aware of the indictment only through what was announced publicly. “For the immediate future, we are making an effort to remove related advertising and programming pending further review.“
Wynn Casino ended their relationship with pokerstars, which was a proposed joint venture to combine the largest online poker operator with Steve Wynn to create pokerstarswynn.com
“Wynn Resorts Limited announced today that it terminated its alliance with Poker Stars, the online poker company,” read a statement by the group. “The decision was reached as a result of the indictment unsealed by the US Attorney for the Southern District of New York.”
The list of individuals the DoJ has charged and issued arrest warrants for:
ISAI SCHEINBERG – Founder and majority owner of pokerstars
RAYMOND BITAR – Co-founder and owner of FullTilt Poker
SCOTT TOM – Founder and owner of Absolute Poker who is suspected in cheating players for millions by using “super accounts”
BRENT BECKLEY
NELSON BURTNICK
PAUL TATE – Director of PokerStars
RYAN LANG
BRADLEY FRANZEN- Arrested and charged in NYC
IRA RUBIN
CHAD ELIE
JOHN CAMPOS – St George Bank Executive – Arrested and Charged
Domain Names Seized and Shut Down:
pokerstars.com
fulltiltpoker.com
absolutepoker.com
ub.com
fulltilt.com

Negative outlook for the USA

S&P downgraded the US outlook to negative yesterday prompting a sell off in the stocks and rally in bonds. It was very volatile the action, Euribor spreads were going down in the fronts, and along the whole curve.
To be honest I'm glad they had the balls to take this action cause clearly there is huge debt burden in the US and just cause of their size and status shouldn't mean that they are immune to such actions or threat of such actions if they cant control their debt. It was this type of rating threat which prompted drastic action in the UK with many tough decisions taken by the government to lower the debt, it remains to be seen whether this level of commitment to lowering debt will happen in the US.
Here is 10 things you should know according to Barclays take:

1) Yesterday, S&P put its long-term rating on U.S. sovereign debt on negative outlook. This means that it believes there is at least a 33% chance that it will lower the AAA long-term rating of the U.S. within two years.

2) Its base case remains that U.S. policymakers will agree on a deficit reduction plan with savings of $4-5trn over the next 10-12 years. But importantly, S&P emphasizes that meaningful steps to implement this must start by 2013.

3) We believe this is an aggressive timetable, since it means that policymakers will have to agree on a long-term deficit reduction plan before the 2012 elections. This will be tough, given the political landscape and the structural nature of the budgetary problems.

4) According to S&P, the ratio of net general government debt/GDP would rise to 84% in the base case by 2013 (and 90% in a pessimistic scenario). Beyond the medium term, it views growth in entitlement programs to be the main source of fiscal pressure.

5) The catalyst for the negative outlook was the “increased risk” that there would be no resolution to “the medium and long-term fiscal challenges” facing the U.S. until after the 2012 elections.

6) In other words, once the two political parties put their deficit reduction plans on the table, it became obvious how far apart they were, and how difficult the road to political convergence would be. S&P noted that despite more than two years having passed since the financial crisis, there has been no agreement on steps to reverse the fiscal deterioration. It highlighted the examples of other countries such as UK, France and Germany, which have begun implementing plans to address their fiscal problems.

7) The announcement was seemingly a surprise to the bond market: 30y yields reversed their early morning rally, and the yield curve steepened immediately after the announcement. It was a surprise to us, as well. While we have always emphasized the unsustainable nature of the U.S. deficit and have outlined the likely factors that would drive a lowering of the U.S. AAA rating (see How risk-free are U.S. Treasuries? January 8, 2010), we had believed that the rating agencies would wait till after the 2012 elections before taking any action.

This announcement was not about the debt ceiling; in fact, the debt ceiling is not even mentioned in the S&P release. In sharp contrast, the reason why U.S. government ratings came under pressure in 1995-96 (Moody’s put parts of U.S. government debt on negative watch) was the debt ceiling impasse at that point. This means that even if the debt ceiling debate were to be resolved in the near term, it would not be enough to restore the outlook to stable.

9) On the other hand, the longer that debt ceiling negotiations drag on, the bigger the seeming rift between the two political parties and the greater the likelihood of a downgrade down the road. In turn, this would mean a steeper Treasury yield curve, higher yields on the long bond, narrower longer-term swap spreads, and a flatter swap spread curve.

10) The key to a stable outlook is that there be a concrete plan for deficit reduction that needs not only to be agreed upon, but also put in place by 2013. As noted earlier, this will be very challenging.

Tuesday, 12 April 2011

Stock Buy: BTU

I initiated a long position in BTU today and it has pulled back to trendline support. Although its broken through as I write, but ill give it a bit of breathing space and see how it goes. I wont be hanging around for long though if we are looking at another correction in these markets.

Entry: 64.80
Take profit: >75
Stop loss:60

A UK Rate Hike, still far away?

A much weaker CPI reading out of the UK pushed cable down 70 pips and pushed up bonds as inflation pressure is lifted, although at 4% is still high. Expectations were for a reading of 4.4% on the main headline figure.
After the ECB rate hike, I personally felt a UK rate rise is round the corner, but after this number some are saying it could be as late as November before we get a hike. However we shall see if this will be the continuing theme or will we go back up again next month.

Stocks look like they pausing around here, still looking for some pull-backs rather then buying a bunch of fly away stocks.

On a side note I will be posting video blogs in the future, which will be much more interactive. Stay tuned!

Wednesday, 6 April 2011

All eyes on ECB

Ive found the last few days very slow, not really being able to do much. Look s like most of the big players are out of the market waiting on the ECB rate decision as well as the Bank of England decision tomorrow. We have an estimate of a raise of 25bp by the ECB where as the Bank of England its still up in the air really, with worse manufacturing data but much better services data.
So not really much else to talk about till then.
The portfolio is inching up, but cant really pull the trigger as I don't see any good risk to reward opportunities right now, so I would rather stay out until better opportunities present itself.

Friday, 1 April 2011

Selling half BIDU

Sold half of my position in BIDU at the open at 138.69. My target in fact is here, but there seems to be such rampant strength in this stock I've decided to keep half on and see if it keeps going higher. Especially as the market seems hell bent on ramping higher on a daily basis and has totally discounted all Japan woes and the middle east.
It is my belief that there purely isn't much else out there to invest in with attractive yields which makes putting money into stocks the only viable option.
Non farm came in above 200k for the first time in years, to help propel this market higher, but I think this has also coincided with the first day of the month when portfolio managers are ramping up stocks with the influx of new capital.
Next week we potentially have a rate rise out of the EU, and possibly the UK, so could be very exciting.
Have a nice weekend!

Short Sterling spreads nudge higher on hawkish Fed; Walmart blowout

As most must know trading Short Sterling is a bit of a bore, and has been for a while. Having managed to get out of my 2 month hold before,...