Looks like I got it A-up on the Philly survey! (I think everyone did! -20.9 v market expectations of -1.0 - the largest drop in the survey since the start of 2001 if I'm not mistaken). Ouch. Throw in the housing starts and the NFP and it seems like we have a "situation" on our hands. Merrill also keen to feel like one of the boys, throwing 10 bill at Mrs & Mrs Mortgage in downtown Misouri. Ouch again.
But Benny and the lads are already mounting their respective soap boxes and it appears that "help is on the way" ("what's that Skippy? - the US economy has fallen off the cliff?"). Chances of a 50bp cut by the Fed around 60% (with the other 40% barracking for a 25bp cut - either way, the rates are coming down, no questions about that). And with an entree of fiscal stimulus, the emaciated US may start to put some meat on its ribs sometime soon; hopefully before it starts to make Kate Moss look like the new front runner for the Four Divas. Makes you wonder what Stevens will say in London tonight; and furthermore what justification (excuse) he will use if he choses to raise rates here in February ("Yes, I know the implied rates are up, but you mortgagees out there are just having too much of a good time, throwing your hard-earned money around on luxuries like petrol and bananas: some monetary restraint is definately called for"!).
Where does this leave CNP. Perhaps the answer is to nationalise it? (I mean, if Merv can bail Northern Rock out and save the average Novacastrian from having his 10 quid savings eaten up by creditors, surely Our Hon Treas can do the same for Centro?). I hear the Future Fund is looking around for its next investment, and Centro is surely the cheapest thing on the block at the moment (Ed: actually it "is" the block).
Failing that, it looks like CBA and pals may end up owning to local shopping centre; the only benefit being the ability to relocate homeowners away from their houses and provide them with a place to pan-handle.
Valuation: guesswork. Share price; guesswork. Survival; speculation. The only thing I am sure of is that "spikes" (whether they be Philly survey spikes, NFP spikes, or spikes in the Centro share price) are usually followed by some form of reversal: think I will put my money on that.
Best regards Kit
CNP Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
