Media Appearance: Kudlow & Company (7/26/07)

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Its the regular 5 pm appearance on Kudlow tonite on CNBC:

The discussion will cover today’s market schmeissing, the oil trade, and yield collapse.  Other things worth noting:

– Financials — 22% of the S&P500 — have been getting just crushed.

– Goldman Sachs (GS) is down ~20% from its peak last month

– Defensive rotation to big caps is well underway.

– NYSE Up Down volume earlier today was 1.9 Billion (down) to 55 million (up)

The Dow is off 4.6% from its recent high last week, while the S&P and the Nasdaq are off 5.6% — but the Russell 2000 is off ~9% – a huge differential.

To say the least, it should be interesting.

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What's been said:

Discussions found on the web:
  1. hue commented on Jul 26

    Barry, have you talked again with that hedgie who asked on July 12th if that was a bullshit rally?

  2. dave commented on Jul 26

    clever how kudlow stacked the deck with bulls and put so many people on in one segment you didn’t get to say much

  3. Greg0658 commented on Jul 26

    LBO’s is a growth story???

    and then layoffs … squeeze every drop out of a business for profitability

    then what of that unemployed familyman …
    euthanize him and his family???

    then what do you do with his debt obligations? write them off.

    USA needs standard of living wage jobs.

  4. Rob Dawg commented on Jul 26

    Kudlow will be lucky (or have to grovel) to get Shiller back after that treatment. “Strangely quiet about [Shiller’s] housing predictions” indeed.

  5. Short Man commented on Jul 26

    “LBO’s is a growth story???

    and then layoffs … squeeze every drop out of a business for profitability

    then what of that unemployed familyman …
    euthanize him and his family???”

    Exactly. Although, why do you think the payroll/unemployment reports have been so strong? It’s because a) most of the lost construction jobs were illegals b) anyone who does get laid off has to pick up a McJob in the service economy to keep on top on the mortgage obligation on the 3,000 square foot house they can’t afford.

    Was surprised at the weakness in the American Express earnings report. The deterioration in credit quality on what is undoubtedly the last, last, last source of credit for some distressed consumers shows just how bad a shape they are in. If they are willing to put money on Amex that they know they can’t pay off in 45 days and face those kinds of steep penalties, that is a sign of desperation to keep the lights on at home.

  6. Chief Tomahawk commented on Jul 26

    Pretty entertaining BR. Looked like you were assuming the crash position after Jerry’s “profits drive credit” answer as the show went to the first break. But “That’s wrong on so many levels got through”.

  7. Rusty commented on Jul 26

    I missed it, but please tell me that Kudlow used “the pause that refreshes” line he put out on National Review. Good times….good times.

  8. Rich commented on Jul 26
  9. Stuart commented on Jul 26

    As much as I value the input of BR on his media appearances, I absolutely cannot stand the shill screeching Kudlow and his stacked deck shows bullying and cutting off dissenting opinions. I just cannot watch them anymore they are sssssoooooooooooooo bad. He’s the store front of shillism supreme-and that’s being polite. It’s like cerebral acid. Apologies in advance. Today was enough forever of Kudlow.

  10. heather commented on Jul 26

    I don’t usually catch your tv spots because the post alert doesn’t come up in time. It’s nice to see someone calm and classy discussing the markets, but I’m not sure I can stomach that biiii… er, Liz. Anyways good job.

  11. Frankie commented on Jul 26

    Glad to hear you fessed up to owning equities Barry.

    The bear cubs here should follow your lead..but I know they won’t.

  12. Stuart commented on Jul 26

    Speaking of Media appearances, the entire gang is assembled tomorrow morning. Leazer, Portman, Gutierrez and of coarse, Paulson. Hmmm….do you think they’re going to preach their book? I wonder what would’ve happened if CNBC declined the invitation to interview them. These 4 clowns are going to get out there and say jack of any value. Does anyone with half a neuron actually believe they will admit that containment has been broken, that they’ve underestimated the affect of mortgage resets, that they were asleep at the wheel while credit was been thrown around like a financial orgy of greed, that regulators are negligent.

    Write this down as this will summarize tomorrow morning which btw is at 9:45 am the interview.

    1. Paulson supports a strong dollar but the markets are what have to move currency markets.
    2. Subprime is still in their opinion contained and not spreading to other sectors, particularly not spreading to consumer spending. They will cite strong employment figures to support this…which we all know is BS given the birth death model, but they will still cite the strong employment.
    3. GDP growth, which will be out by then, will show a marked rebound from Q1. Lots of cheerleading about that as sign the economy has bottomed in Q1 and further evidence of no contagion.
    4. Any credit squeeze is temporary
    5. Any credit squeeze is very specific and localized on specific companies, specific transactions.
    6. China must move faster on reforms
    7. The US has is in GREAT fiscal shape evidenced by its improving budget deficit. Forget the fact they leave out anything that will worsen it and dump in hundreds of billions of OAS and Medicare collections.
    8. The US still have the best and most liquid markets so great place to invest
    9. The TIC report showed foreigners still want US assets, so no worries about a weakening dollar.
    10. Not concerned about anything.
    11. Did I say not concerned about anything.
    12. Go out and buy something,it’s good for the economy and America.
    13. Trade deficits don’t matter.
    14. Deficits in general don’t matter as the world still views America as a strong place to invest.
    15. Did I say not concerned about anything.
    16. Raspberry kool aid is the best.

    Yada yada…100% fluff, hot air, 0% substance…..
    Good lord, give me some Pepto just thinking about it.

  13. Stuart commented on Jul 26

    Just a thought, perhaps their round table tomorrow morning is to buffer,or attempt to control the market’s perception of a WEAKER GDP figure than expected. Just a thought, but very possible…. Kasriel may be right estimating close to 2.7%, and if so, you absolutely want to control the interpretation and market perception of that figure.

  14. LP commented on Jul 26

    I know that Kudlow is your friend but he’s still a clown. The crap that was coming out of him was freakin amazing. Pure crap. And have you noticed that Insana stopped drinking the CNBC cool aide since he started his own company. He and you were the only two people the whole day yesterday talking sense. The rest all crap, pure predictive, crystal ball, ouija board crap.

  15. Chief Tomahawk commented on Jul 26

    “Speaking of Media appearances, the entire gang is assembled tomorrow morning. Leazer, Portman, Gutierrez and of coarse, Paulson.”

    Stuart, I was wondering why there wasn’t more talk of this? It’s rare for an interviewer, in this case Dylan Ratigan, getting a one-on-one exclusive. But all four at once? Bush might not care about poll numbers but the White House sure took note of the markets and has scrambled the bogies … This must be the media branch of the Plunge Protection Team.

  16. Stuart commented on Jul 26

    that is a good question, was wondering that too. Remarkably little given the collective influence gathered in one room. Immediately totld me that there must be something to be concerned about.

  17. Stuart commented on Jul 26

    This isn’t going to help matters.

    China shying from shaky US mortgage market
    By Olivia Chung

    HONG KONG – While China is eager to invest a portion of its US$1.33 trillion foreign-exchange reserve overseas, it is unlikely to take a chance on buying additional US mortgage-backed securities (MBS) as they are now considered too risky, Chinese economists said.
    Of the approximately $7 trillion worth of US mortgage securities, subprime loans currently account for about 15%. Thirteen percent of US mortgage delinquencies in the last quarter of 2006 were from subprime loans and about 30 mortgage companies have gone under in the past few months, Yi said. “There are significant financial losses,” he said.

    Yi said some bond ratings agencies that advise investors, including Chinese, also purposely played down the MBS risk. “Some ratings agencies slapped investment-grade ratings on mortgage-backed bonds that they knew they were risky,” he charged.

    Bond-rating agencies this month finally downgraded about $12 billion worth of subprime US mortgage securities, Yi said.

    Economist Shi Weigan echoed Yi’s comments. “With a possible burst in the housing bubble in the US, it’s not the right choice for Beijing to spend foreign-exchange reserve funds on the US mortgage-backed securities,” Shi said.

    Olivia Chung is a senior Asia Times Online reporter.

    (Copyright 2007 Asia Times Online Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)
    Stuart | 07.26.07 – 10:19 pm | #

  18. Momo Fader commented on Jul 27

    Did anyone catch Art Cashin being asked about the Subprime Containment. His question to Paulson would be, “How do they know it’s contained.” It’s a good question. There was actually a break-through in the Fed/Treasury veneer today on CNBC. Cashin and some other traders were quite blunt in saying that they are rapidly losing credibility by parroting that line over and over. Nobody is buying it any more. What are they going to say different in the morning?

  19. Bob A commented on Jul 27

    LP… thanks for saying what I was thinking…

  20. DavidB commented on Jul 27

    HA!

    While China is eager to invest a portion of its US$1.33 trillion foreign-exchange reserve overseas, it is unlikely to take a chance on buying additional US mortgage-backed securities (MBS) as they are now considered too risky, Chinese economists said.

    It’s going to take a while to get my mind around that thought. US investments are too risky for China. Had you said this would happen 20 years ago they would have locked you up. My how the world changes. One day you’re a king, the next day you’re a beggar.

  21. wunsacon commented on Jul 27

    I’m going to keep my emerging markets investments. I have more faith in China’s productivity than in Generation Intelligent Design.

  22. winjr commented on Jul 27

    “Just a thought, perhaps their round table tomorrow morning is to buffer,or attempt to control the market’s perception of a WEAKER GDP figure than expected. Just a thought, but very possible…. Kasriel may be right estimating close to 2.7%, and if so, you absolutely want to control the interpretation and market perception of that figure.”

    I think that’s right, Stuart. Consensus was for 3.2%, but durable goods were weak in June, and Capex was being counted on to pick up the slack from a weakening U.S. Consumer. GDP will not only be less than expected, but when market traders look under the hood, they aren’t likely to be enamoured with what they see, either. Maybe the markets can rally around the Fed Rate Cut meme, instead?

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