Latvian Hookers Signal No Recovery for Economy

Bronte Capital was the first place I saw this indicator, I'll post some of his links below this Bloomberg commentary from Matthew Lynn:

When the economy starts to lift itself out of this recession, what will be the leading indicator that tells us we have turned the corner?

Some people track the price of shipping to gauge the health of global trade. Others look at the supply of freshly minted money pouring out of central banks. A few will say that signs of life in the housing markets are evidence of a recovery.

Forget them all. The one lesson we can draw from the global credit crisis is that all the traditional ways of measuring the state of the economy are about as useful as a bottle of suntan lotion in a snowstorm.

So here are two benchmarks we should all be monitoring more closely: extramarital affairs and the price of Latvian hookers. Both are telling us that there is still plenty of trouble ahead.

These two measures were proposed recently as reliable economic barometers, and they warrant consideration. Economists often say “animal spirits” play a role in keeping the wheels of the business cycle turning. They have given little advice on how we should measure those spirits. Now we may have the answer.

In the U.K., a Web site called www.illicitencounters.co.uk allows married people who are planning to play a few matches away from home to meet up with each other. It has at least 300,000 members, indicating that the British have more on their minds than just the work expenses of politicians and the threat of unemployment.

Bull-Market Affairs

The Web site crunched its traffic and membership numbers and found that there was a big increase in both when there was a turning point in the FTSE-100 index, which measures the leading companies listed in London. When the market collapses, people plot affairs. And when the bulls rage, the same thing happens. When it is trading sideways, they stick with their partners.

“It has to do with people’s confidence levels,” says Rosie Freeman-Jones, a spokeswoman for the site. “When the markets are up, they think they can have an affair because they feel they can get away with anything. When the market hits the bottom, they are looking for a way to relieve the pressure.”

In a similar vein, John Hempton, who runs the financial blog Bronte Capital, has monitored the health of the Baltic economies based on the price of Latvian sex workers -- currently about 30 lati ($60) for the standard service.

“The contractual terms of prostitution are short (an hour, a night) and entry to the industry is unconstrained,” he says. “That means that the prices are very flexible.”

Price Collapse

True enough. His argument is that since the prices have collapsed by about two-thirds in a year, Latvia and the other Baltic states are still in big trouble with deflation lurking.

This benchmark may well be a valid way to get a snapshot of the economy. If prostitution was legal in all countries, it would probably make a good index for central banks to track. There could be few better ways of checking when we will flip from inflation to deflation and vice versa...MORE

So to speak.

If you like your vice versa.

And have a plan to deal with deflation. Again, so to speak.

Here's Bronte Capital:

Hookers that cost too much, flash German cars and insolvent banks: an introduction to Swedbank’s Baltic homeland

Hookers that still cost too much – some comments on the IMF and Latvia

Polish hookers don’t cost too much

The hookers no longer cost too much: geopolitics and the price of prostitutes in the Baltic States

Marc Faber: Hyperinflation coming to the USA

From FT Alphaville:

Wa-oah. Marc Faber has a reputation as a bit of a doom-monger, but he has really surpassed himself with this one. From Bloomberg (emphasis ours):

May 27 (Bloomberg) — The U.S. economy will enter “hyperinflation” approaching the levels in Zimbabwe because the Federal Reserve will be reluctant to raise interest rates, investor Marc Faber said....

Alphaville continues:

Now, there is certainly an inflationary risk to the massive expansion of the Fed’s balance sheet, and exiting quantitative easing and the extremely low interest rate environment will be tricky for the central bank — but we’re still very far from the kind of hyper-inflation described by Faber....MORE

One of these days I'll get around to writing about the best investments during the Wiemer hyperinflation. There were some interesting plays.

Zeitgeist: Mafia Cash Increases Grip on Sinking Italy Defying Berlusconi

This goes in the zeitgeist file because we are going to see more and more reports along these lines and not limited to Italy. Some of our previous mobonomics posts:

Mafia crime is 7% of GDP in Italy, group reports

I am unsure whether these gentlemen participate in the EU's Emissions Trading Scheme.
The easy joke, of course, is that they set it up....

Why the Mafia Loves Garbage
Mafia link to Sicily wind farms probed
So a Sicilian mafioso walks into HSBC…

Here's the headline story, from Bloomberg:

In the southern Italian port city of Palermo, home to bustling outdoor markets and Arab-influenced architecture, prosecutor Roberto Scarpinato has hunted Mafia money for two decades.

Now, as the rest of the world tightens its belt in the global recession, he’s tracking how the mob is profiting by lending and investing what’s become a scarce commodity these days: a growing hoard of cash.

Scarpinato points to the 2.7 billion euros ($3.8 billion) of assets he’s seized on the island of Sicily, where Palermo is located, since the start of 2008. In one haul, he confiscated 12 businesses, 220 buildings, 33 plots of land and a 25-meter (82- foot) yacht from grocery-chain owner Giuseppe Grigoli.

Known as Sicily’s king of supermarkets, Grigoli, 59, is on trial in Marsala for running the food stores and other enterprises at the behest of the Sicilian Mafia. He denies the criminal charge of being a member of an organized crime group.

Unlike overleveraged companies burned in the credit crisis, the Mafia and its cash-based, debt-free business model are breezing through economic hard times. With young, savvy leaders at the helm, organized crime is poised to expand as legitimate companies founder....MORE

Canadian Solar Inc. Sparks a Short-Squeeze Rally (CSIQ)

Update below.
Original post:
I didn't mention CSIQ this morning for two reasons:
1) It is so darn tiny I almost don't follow it.
2) A few sources I looked at had takes on the earnings that were nearly opposite each other, which to go with? Neither.
From Tech Trader Daily:
Canadian Solar Slashes ‘09 Forecast; Shrs Set To Slide
From the Wall Street Journal:
Canadian Solar Swings To 1Q Loss As Revenue Plummets
From Reuters:
UPDATE 3-Canadian Solar posts narrower-than-expected Q1 loss
In fairness, TTD and the Journal wrote their pieces before the market opened.

Here's the headline story from Schaeffer's:

Canadian Solar Inc. (CSIQ) is up more than 10% on the heels of its latest quarterly report. The solar issue confessed to a first-quarter loss of just 13 cents per share, compared to analysts' expectations for a loss of 25 cents per share....

...The equity plunged 12% right out of the gate this morning on the heels of this downbeat forecast, and the drop was likely more than sufficient to prompt a wave of short-covering activity. Short sellers have amassed a sizable bearish position on CSIQ, with nearly 11% of its float dedicated to short interest....MORE

Update: So what did Oppenheimer's Sam Dubinsky know?
He upgraded the stock on Thursday afternoon before the long weekend and preceeding the earnings release.
That's about as gutsy (or crazy) a timing scenario as I can imagine.
From Reuters:
Oppenheimer ups Canadian Solar to outperform, shares up

Markets: Back to the Future, 1938-1942

Barron's has a very nice reproduction of one of Louise Yamada's charts. Go to Up and Down Wall Street for the verbiage.

...From there comes the hard part. Starting in November 1938, there was a 22% drop, qualifying for the 20% rule-of-thumb definition of a bear market; then a rally of 26%, fitting the definition of a bull market, into the fateful month of September 1939, the start of World War II.

Then came a series of bull and bear trades -- down 28%, up 23%, down 16%, up 13%, and the final decline into 1942 of 29%. After this nauseating roller-coaster ride, the market was down 41% from the 1938 highs (analogous to where we are now) to the 1942 lows....

That '42 low occurred on April 28 for the DJIA at 92.92. Since the previous December 7th, there had been nothing but bad news on the war fronts: Wake Island, Hong Kong, Manila, Kuala Lumpur and Singapore captured by the Japanese. The Prince of Wales sunk, the Normandie burns and turns turtle in New York. In March of '42 Roosevelt ordered all Japanese-Americans rounded up. On the East coast the German U-boat commanders were having what they called the (second) Happy Time, sinking some six hundred ships, virtually at will.

It was a very rough 20 weeks. I can't imagine having to go through something similar to see the bottom of the market.

On the other hand, I wonder what the equivalent of the Battle of Midway (June 4-7, '42) would be.

Gold in Kansas!!!

If you follow the action on a state by state basis, Kansas makes for an interesting case study.
A slightly right of center political base (yet the home of populism).
The state with the third best wind resource (they argue about coal).

Folks are talking about using the state as a transmission corridor.
Before that it was I-70 and I-35.
Before that, well it seemed like folks were just passing through (cover via Kansas State Historical Society):

If you remember your history, Kansas territory extended west to the peaks of the Rockies. Here's a NYT headline from 1859:

The Gold Excitement in Kansas.

It was a major, 1100 word story. Here's another, 1243 words:

THE KANSAS GOLD MINES.; How to Get to Pike's Peak, and What You Will Find on Getting There.

"History Doesn't Repeat Itself, But It Rhymes"
-attributed to Mark Twain

From Kansas' own Climate + Energy Project blog:

KCStar: “Renewable energy brings modern-day gold rush”

Renewable development, manufacturing – and now, research. Some Midwestern entities, such as MRI in Kansas City, are looking at the renewables research example of NREL, in Colorado. From the Star, by Jason Gertzen:

GOLDEN, Colo. | Dreams of renewable energy riches have set off a scramble not seen since miners rushed into these surrounding hills in search of shiny nuggets.

“This is like a land rush with a whole bunch of people running side by side,” said David Christensen, one of the gurus of new electricity technology at the National Renewable Energy Laboratory in the Colorado foothills.

The winners, he said, will find “huge pots of gold at the end.”

Publish Post

Kansas and Missouri leaders are joining many other states scurrying to stake claims in the energy gold rush....MORE

First Solar: Downgraded to Underperform at FBR Capital (FSLR)

The stock is down 5% at $182. Between the officer and Walton insider sales and the big push on Solyndra, another Walton/Goldman production, Now With Fed Loan Guarantees!, FSLR, as king of the hill, is a target.
From Notable Calls:

FBR Capital is out with a stingy call on First Solar (NASDAQ:FSLR) downgrading their rating to Underperform from Market Perfrom ($100 tgt).

Polysilicon prices taking a nose dive. Checks over the past week suggest (quality) spot poly prices have declined to $65/kg, down 35% year to date, driven by: 1) weak end-market demand for si-based modules, and 2) an aggressive attempt by industry leaders like Hemlock, MEMC, and Wacker (all enjoying average fully loaded cost of $40/kg) to further increase their lead over the new entrants (which are estimated to have $80-plus/kg cost structure).

- From inexpensive but “quality” poly to inexpensive but “quality” si-based modules. Checks also suggest six inch solar wafer prices (in the spot market) have declined to US$3.50/piece, implying that finished solar wafers are now US$1/watt. Assuming US$0.80/watt for turning wafers into modules, we estimate $65/kg poly to yield modules at a cost of US$1.60-US$1.80/watt. And even a rather aggressive GM of 20% implies si-based manufacturers could sell modules at US$2.10 (or EUR€1.62, assuming 1.3 F/X) and compete head-to-head with FSLR....MORE

SHOW ME THE MONEY!: A Guide to Sources of Funding through the American Recovery and Reinvestment Act

From Stoel Rives LLP:

The American Recovery and Reinvestment Act (ARRA) provides almost $94 billion dollars in direct and indirect spending, through tax incentives, grants and loan guarantees to clean energy companies and projects. While financing challenges continue to hold back many worthy companies and projects, we believe that the ARRA funding will provide an important and significant boost to the clean energy industry over the next eighteen months.

We recognize that the funding opportunities presented by ARRA do not apply uniformly to all sectors of the clean energy industry, and that the opportunities that may apply to a particular company or project are often buried in the legislation, with the result that the applicability and application processes are often difficult to discern. Accordingly, we created this guide to separately identify the programs and the potential sources of funding under ARRA based on the type of company or project rather than the typical approach of describing the tax incentives, grants or loan guarantees generally for all types of clean energy companies and projects.

Download Show Me The Money: The Law of the Stimulus Package (53 page PDF)

HT: GreenBiz

Hottest Oil Options Indicate 16% Drop as Demand Falls

From Bloomberg:

After oil passed $60 a barrel for the first time in six months, the New York Mercantile Exchange’s fastest-growing options trade in July is for a 16 percent drop.

The number of options to sell oil at $50 a barrel for July settlement rose 22 percent last week to 24,948. Traders expect prices to fall because U.S. crude inventories are 1.8 percent below the highest in two decades, and the International Energy Agency says demand is falling the most since 1981. There’s enough unsold crude stored in offshore tankers to supply the U.S. for a week, and oil fell below $60 today in New York.

Crude jumped as high as $62.26 a barrel on May 20 on optimism that the worst of the global recession and the Organization of Petroleum Exporting Countries agreed to cut supplies by the most on record. Now, economic reports are increasing speculation that the world economy will continue to sputter, and OPEC, which meets May 28 in Vienna, has yet to complete the supply curbs it promised in December.

“Oil prices are rising way ahead of reality, way ahead of fundamentals,” said Eugen Weinberg, a senior commodity analyst at Commerzbank AG in Frankfurt. “It would be more reasonable for prices to drop a little and correct to $50 or below.”>>>MORE

The lithium boom is coming: The new bubble? (SQM)

Butch Cassidy: Kid, the next time I say, "Let's go someplace like Bolivia,"
let's go someplace like Bolivia.
- Butch Cassidy & the Sundance Kid (1969)

If you are looking for a play, start with Sociedad Quimica y Minera, the world's largest lithium miner. We have dozens of posts on lithium. I'll link to a few or you can use the search blog box.
From Reuters:

New vehicle emission standards will likely be a boon for everything from aluminum to new plastics, but the producers of lithium -- a mineral used in batteries that power new generation vehicles -- could be the big winners.

But while the few public companies that mine lithium will likely see surging revenue, they will also face the pressure that comes with all booms -- making supply meet ever-tightening availability.

Companies that mine lithium should see a long-term boost to their business, analysts said, although there are questions about whether there is enough lithium for all customers.

And some energy experts see the irony in lithium batteries replacing carbon-burning gasoline, since they believe

exploiting lithium could be just as destructive to the environment as pollution.

Lithium is generally mined from rock, but it can also be found in deposits in brine ponds. It comes mostly from one region -- the Andes mountains of Chile, Argentina and Bolivia, with some deposits in China. Chile's SQM is the world's largest producer, along with U.S. specialty chemical companies Rockwood Holdings Inc and FMC Corp.

There are enormous possibilities for profit.

"We are ready and able to expand production," said Tim McKenna, a Rockwood spokesman. "In fact, in the last 18 months, we completed capacity expansion of our Chile operations to keep pace with expected demand from the auto industry."

McKenna said the auto industry is not likely to bring lithium-powered cars to the wider market much before 2011, although the Mercedes S-class is expected to be the first lithium/hybrid car on the market late this year.

Rockwood, through its German subsidiary, Chemetall, produces lithium from brine lakes at Santiago Salar de Atacama in Chile and from a mine in Silver Peak, Nevada....MORE

Some prior posts:

Lithium-Ion Batteries and Bolivian Politics

Electric Vehicles-Lithium Supplies and Crucifixion in Bolivia

Mining lithium from geothermal 'lemonade'. And: Batteries That Don't Blow Up

Simbol Mining raises $6.7 million for "zero-waste" lithium extraction

Japanese industry set for a lithium rush (SQM)

Lithium: In Bolivia, Untapped Bounty Meets Nationalism

Can't Get Enough o' That Lithium. "Peak Lithium: Will Supply Fears Drive Alternative Batteries?"

Although Lilly introduced Prozac to the U.S. in 1988, they didn't really begin marketing it until 1991. Sales increased five-fold by 1994, the year the big bull market of the nineties kicked in.

The joke on trading desks was that this was the Prozac market, sort of the "What me worry?" approach to equities (which may explain the Nasdaq at 5048 in March, 2000).*

This excursion down SSRI lane was triggered by the thought "If we run out of lithium, what will the bi-polars do?"....

...*Cramer had similar thoughts, relayed in this NYT article from 2002:

...''My own view is that one reason the investor class, including me, missed the downside was serotonin,'' James J. Cramer, a former hedge fund manager and author of ''Confessions of a Street Addict'' (Simon & Schuster, 2002), said, referring to a substance in the brain that antidepression drugs augment.

''Prozac and all those other drugs banish the 'this is the end of the world' thoughts,'' Mr. Cramer explained. ''Which means you are not as anxious as you should be about an obvious down side.''...

Memorial Day, 2009

Remember the Fallen

from TheWorldAccordingtoCarl

The National Anthem:

Try JibJab Sendables® eCards today!

from JibJab

America's second National Anthem:

Here's the third verse that Mr. Charles begins with:

O beautiful, for heroes proved
In liberating strife,
Who more than self their country loved
And mercy more than life!
America! America! May God thy gold refine,
‘Til all success be nobleness, and ev’ry gain divine!

Have a safe and wonderful holiday.
I'm going long hot dogs and hamburgers.

Cape Wind crosses major Mass. regulatory hurdle

You probably saw this story yesterday, if not, here's the AP version the Boston Herald carried.
More importantly, here's a superb video of the controversy:

The Daily Show With Jon Stewart	M - Th 11p / 10c
Jason Jones 180 - Nantucket
thedailyshow.com
Daily Show Full Episodes Economic Crisis Political Humor

HT: Mark Gongloff at the then WSJ Energy Roundup.
(now Environmental Capital)
Here's the eco-friendly Kennedy family's Compound, from the water:

So a Sicilian mafioso walks into HSBC…

From FT Alphaville:

Cracking story on Bloomberg, straight out of the annals of couldn’t make it up if you tried, and involving the Sicilian Mafia, Venezuelan bonds and a host of global banks (emphasis ours):
May 22 (Bloomberg) — Italian prosecutors today broke up an international ring led by the Sicilian Mafia that tried to use fake Venezuelan bonds to obtain credit lines totaling $2.2 billion from HSBC Holdings Plc, Bank of America Corp. and unidentified British banks, according to an arrest warrant.

“This was a colossal operation,” Marcello Viola, one of the lead prosecutors, said in a telephone interview from Palermo, Sicily. Some of the Mafia-linked people involved “were experts in finance who traveled the world,” he said....

...False Venezuelan bonds were authenticated by corrupt officials within the South American nation’s central bank, prosecutors said. The bonds were used to ask for credit lines of $500 million each from HSBC in London and Bank of America in Baltimore in 2003 and 2004. U.K. authorities and the U.S. Secret Service broke up both the deals before either bank provided financing, Viola said....MORE

In a less sophisticated move, I once had a slightly deranged money guy insist that his $1 Billion of Japanese government bonds were good collateral. Here's one of the issues he proffered, image via Scripophily.com:

Here's a close-up of the engraving:

Certificate Vignette
For the longest time Carl Marks & Co. (or was it Herzog?) made markets in defaulted bonds, for some reason I remember the Kingdom of Serbs, Croats and Slovenes 8's of 1922.
It may have been a different S,C&S issue, I can't find any record of the paper. Off to Zagreb?
[try 'off too, Zagreb' -ed.]
Here's a quick story about this odd corner of the market, from Time Magazine, Aug 8, 1983:

...Foreign bonds are riskier because it is difficult to force payment or arrange settlements. The Wall Street firm Carl Marks & Co. is still fighting a class-action suit against the People's Republic of China to recover losses from Hukuang Railroad bonds issued by the imperial Chinese government in 1911. Last year a U.S. district court in Alabama ordered China to cough up to U.S. bondholders the unpaid principal plus the interest that has been mounting at 5% annually, a total of $41.3 million. Marks also has two suits against the Soviet Union involving $75 million in dollar-denominated bonds issued by the imperial Russian government. The bonds, held by U.S. investors, were repudiated by Moscow after the 1917 revolution. Daniel Collier, a Marks vice president, is not holding his breath. In his firm's offices, one of the Russian bonds is mounted, with a small hammer beside it, along with the words: IN CASE OF SETTLEMENT, BREAK GLASS.

Even if the court actions fail, some of the paper still has value. A Hukuang Railroad bond for 20 gold pounds ($96) that is in good condition is worth from $50 to $100 as a collector's item....

Indonesia to use climate loans to cover state budget deficit

From the Jakarta Post:

The government has continued to raise foreign loans, citing climate change as the cause, but said Thursday the loans would be used to service the budget deficit.

The move immediately sparked criticism from environmental activists who said it was the responsibility of rich nations to help both developing and poor nations finance climate change mitigation.

“The government needs to find alternative channels of finance, including grants or carbon trading. Foreign loans should be used as the last resort to fund climate change reduction policies,” WWF-Indonesia climate change program director Fitrian Ardiansyah said Thursday.

The National Development Planning Board (Bappenas) said the French and Japanese governments have expressed commitment to increasing their climate change loans to Indonesia this year.

“We are still discussing the amount, but both France and Japan have agreed to provide US$100 million toward climate change reduction measures this year,” Bappenas director of forestry and water resource conservation Basah Hernowo told The Jakarta Post.

“The government will use the money to cover the budget deficit,” Basah said....MORE

Today's word is "Fungible".

Deutsche Bank Transfers Tech Team to Renewables

From the Wall Street Journal:

Deutsche Bank AG has transferred its European technology-coverage team into a new, broader renewable-energy unit in the latest example of banks in Europe basing their business on the biggest, most lucrative sectors in response to the downturn.

Charles Bryant, previously a managing director in the technology group, has taken the new title of global head of renewable energy, a Deutsche spokeswoman confirmed. The new renewables team will cover the previous technology group's clients, as well as other companies across the renewable energy sector such as solar energy companies, many of which rely heavily on technology....MORE

U.S. panel OKs CFTC to regulate carbon derivatives

There was a method to yesterday's posting madness! I sometimes use the blog as a bookmarker, what with Google's fancy 'Search Blog' feature, it is a simple way to file information. The posts:
Carbon Trading: Senate Confirms Goldman Alum to Head CFTC and Meet The Energy and Environmental Markets Advisory Committee (EEMAC) are backround for what's coming.
Here's another piece of the puzzle, from Reuters:

A U.S. House committee on Thursday agreed to give the U.S. regulator that oversees futures markets, such as the New York Mercantile, jurisdiction over the trading of new derivative contracts based on carbon emissions.

The proposal was included in legislation to cap and reduce U.S. greenhouse gas emissions that is expected to clear the House Energy and Commerce Committee. Utilities, oil refineries and other companies would have to buy and sell permits issued by the government to spew their emissions.

The proposal would also close loopholes in federal regulations that have allowed speculators to manipulate energy markets and inflate fuel prices, said Representative Bart Stupak, who sponsored the plan.

Democratic leaders want to bring the bill up for a full House vote by August. It would then be sent to the U.S. Senate, where there is much stronger opposition.

"Tight regulation of not only the existing energy markets but also the carbon derivatives market created by (the climate change bill) is a vital consumer protection," Stupak said.

Under his plan, the Commodity Futures Trading Commission would have the authority to regulate carbon derivatives as an energy commodity....

...Stupak's carbon and energy market protections included in the climate change bill would:

* Give CFTC the authority to regulate all over-the-counter (OTC) trades that are currently not regulated.

* Regulate foreign boards of trades with energy transactions traded for delivery in the United States or on a computer terminal located in the United States.

* Close the swaps loophole, no longer allowing energy transactions to be excluded from the requirements of the Commodity Exchange Act.

* Ban naked credit default swaps....MORE

Companies spar over Iowa wind energy surplus (BRK.A; FPL)

Next Era is the former FPL Energy division of FPL Group. MidAmerican is a division of Berkshire Hathaway's MidAmerican Energy Holdings.
From the Chicago Tribune:

Iowa is producing so much wind energy that companies are competing to sell the surplus.

MidAmerican Energy, which has 1,300 megawatts of wind energy capacity in Iowa, has filed a request with state regulators to approve more than 1,000 megawatts of wind generation at undisclosed sites in the state.

But NextEra Energy Resources of Jupiter, Fla., has filed an objection with the Iowa Utilities Board. The company wants to add to its 600 megawatts of wind generating capacity in Iowa.

NextEra generates and sells electricity, primarily to Alliant Energy. It doesn't provide service to homes and businesses.
NextEra says in its petition that Iowa has plenty of wind power and that the company can produce much of what the state needs at a competitive price.

"We are filing an intervention in this case because we want MidAmerican's customers to have the best power at the best price, and we think we can provide it," said Steve Stengel, NextEra spokesman.

The Des Moines-based MidAmerican wants the utility board to approve its request by May 29 so it can take advantage of a suruplus of inexpensive wind turnbines. That won't happen because the utilities board has scheduled a public hearing on the proposalfor June 22.

The board must act on MidAmerican's request by January.

The dispute is over who gets to sell a growing -- and potentially profitable -- surplus of wind energy that Iowa is expected to produce in the coming decades....MORE

Here's how MidAmerican's hometown paper, the Des Moines Register, covers the utility:

When MidAmerican Energy announced it would join the Midwest Independent Transmission System Operator effective Sept. 1, the news didn't have the same impact on the public as if, say, Notre Dame had joined the Big Ten Conference.

MidAmerican's 770,000 customers in Iowa won't see a change on their bills, and the Des Moines utility promises that electric service will still be dependable.

But within the world of electric utility generators, transmission systems and wholesale power dealers, long-independent MidAmerican's move to join the Midwest transmission grid, commonly known as MISO, is a sign that utility plans to be a major force in wind energy....MORE

Potash; Mosaic; Agrium: Upgraded at Citigroup (AGU; MOS; POT)

All three stocks are up, 4 1/2 to 5%.
From Notable Calls:

Citigroup is out with a Fertilizer call upgrading Potash (NYSE:POT), Mosaic (NYSE:MOS) to Buy from Hold and Agrium (NYSE:AGU) to Hold from Sell.

Looking Past the China Contract — In recent months investors have been sharply focused on the upcoming China potash contract and the risk potash prices could fall below last year’s $575/t level. However, the bigger risk in Citigroup's view is that the Ag complex will continue to rally on stronger grain fundamentals. There are three key reasons grain prices are moving higher, thus creating an environment for multiple expansion for fertilizer stocks:

- Grain Supplies Remain Historically Tight — Last week’s USDA report indicated lean grain inventories, including significantly tighter corn stocks-to-use (16% vs. 20-year avg. of 24%). In our view grain prices don’t have a “cushion” – another major weather event or poor crop for a major producer (US, Ukraine, Argentina) could move corn prices closer to the $5.00+ range we saw last summer.

- The US Planting Season Is Seriously Behind Schedule — Wet cold weather has significantly delayed much of the US corn crop. The latest crop progress report indicates corn plantings are 62% complete, behind the 85% average rate for 2004- 2008. Soy plantings are lagging as well, at 25% vs. the 44% average rate....MORE

Paul Tudor Jones Interview at Institutional Investor

Last July we visited Mr. Jones in "Paul Tudor Jones on Oil". Here's the Alpha Magazine introduction:

Paul Tudor Jones II founded Tudor Investment Corp. in 1980 at the age of 25. Since then this extraordinary investor has never suffered a losing year. His old-school macro approach is built on what he calls tape-reading, which involves analyzing price trends and riding momentum — with an uncanny knack for balancing risk and return — rather than obsessing over the fundamentals, as less intuitive or less self-confident traders might. Jones’s core belief is that often prices move and trends unfold only because of investor behavior (in this he and George Soros are similar). Business schools, Jones laments, are sometimes too steeped in teaching economic postulates and market theory. Through his Robin Hood Foundation, he pours millions of dollars into antipoverty and education programs in New York City. The Memphis-born manager, who began his career as a cotton trader, first made a name for himself in 1987, when he called the market crash and rode a heavy short position in stock index futures to a 201 percent gain. Today he oversees more than $18 billion in assets. Tudor’s flagship BVI Global Fund has returned roughly 23 percent annually since its 1986 inception.

Although I haven't researched it, I believe he did end up breaking that "Never a losing year" string last year. He's still one of the best in the business. Here's the interview:

What’s so special about macro hedge fund managers?

I love trading macro. If trading is like chess, then macro is like three-dimensional chess. It is just hard to find a great macro trader. When trading macro, you never have a complete information set or information edge the way analysts can have when trading individual securities. It’s a hell of a lot easier to get an information edge on one stock than it is on the S&P 500. When it comes to trading macro, you cannot rely solely on fundamentals; you have to be a tape reader, which is something of a lost art form. The inability to read a tape and spot trends is also why so many in the relative-value space who rely solely on fundamentals have been annihilated in the past decade. Markets have consistently experienced “100-year events” every five years. While I spend a significant amount of my time on analytics and collecting fundamental information, at the end of the day, I am a slave to the tape and proud of it.

Is it possible to teach someone to be a tape reader — what some might call a trend follower or technical analyst?

Certain people have a greater proclivity for it because they don’t have the need to feel intellectually superior to the crowd. It’s a personality thing. But a lot of it is environmental. Many of the successful macro guys today, they’re all kind of in my age range. They came from that period of crazy volatility of the late ’70s and early ’80s, when the amount of fundamental information available on assets was so limited and the volatility so extreme that one had to be a technician. It’s very hard to find a pure fundamentalist who’s also a very successful macro trader because it is so hard to have a hit rate north of 50 percent. The exceptions are in trading the very front end of interest rate curves or in specializing in just a few commodities or assets....MUCH MORE

HT: The Pragmatic Capitalist who highlighted that first question as his teaser. PC also has a link to one of his global macro posts that is worth checking out.

The advantage and disadvantage of global macro is It Is Not Easy. You have to pay attention and you have to understand the interrelationships of many markets and politics and weather and psychology and be facile in both words and numbers and in an ego-driven business be humble enough to learn the lessons the market will teach you.

It really helps to not take yourself too seriously, both to avoid the temptation to impose your will upon the market and to maintain enough perspective to spot opportunities ahead of the crowd.
Because global macro isn't easy the rewards can be tremendous.

Barron's Tech Trader Daily on Today's Solar Earnings; Sorrow (CSIQ; ESLR; LDK; SOL; STP)

Back in November, '08 I went with the headline "Barron's Tech Trader Daily Goes to All Solar Format (AMAT; CSIQ; JASO; STP; TSL; YGE)" because:

Mr. Savitz is the top rated morning drivetime blogger in the Palo Alto (okay, Bay area) market. Now W-TTD breaks new ground with their fourth solar post of the day...

Today he hasn't exceeded that output [yet -ed] but has been busy. Here are the headlines:

Suntech Q1 Revs Miss; Sets 20 Million ADS Offering
Evergreen Solar Sells 37M Shrs At $1.80; Stock Falls
ReneSola Q1 Revs Miss; Full Year Outlook Falls Short
Canadian Solar Jumps; Canaccord, Oppenheimer Upgrade

And, as I'm typing, here's number five:

LDK Q1 Revs Top Ests; But Loss Worse Than Expected

The guy is amazing during earnings season. I saw 35 posts one day, just awesome. Here's one of our posts from February '09:
Eric Savitz , The Hardest Working Man In Show Business! And: Book-to-Bill Ratio at 0.10

As of 6:32 p.m. PST, I counted 22 posts at Tech Trader Daily timestamped "February 25, 2009..."
and I have a feeling that this time of the quarter is what Mr. Savitz lives for.
"I feel good..."

We are fans.