Irene's eyewall collapses; further intensification UNLIKELY (ALL; TRV; CB; BRK.b)

Allstate is up 1.27% (and seems cheap at $24.74, The Travelers is up 3/4%, Chubb, with a large presence in the Northeast is up 1.64%.
From Wunderblog:

Satellite data and measurements from the Hurricane Hunters show that Irene is weakening. A 9:21 am EDT center fix by an Air Force Reserve aircraft found that Irene's eyewall had collapsed, and the central pressure had risen to 946 mb from a low of 942 mb this morning. 

The highest winds measured at their flight level of 10,000 feet were 125 mph, which would normally support classifying Irene as a Category 3 hurricane with 115 mph winds. However, these winds were not mixing down to the surface in the way we typically see with hurricanes, and the strongest surface winds seen by the aircraft with their SFMR instrument were just 90 mph in the storm's northeast eyewall. 

Assuming the aircraft missed sampling the strongest winds of the hurricane, it's a good guess that Irene is a mid-strength Category 2 hurricane with 100 mph winds. Satellite imagery shows a distinctly lopsided appearance to Irene's cloud pattern, with not much heavy thunderstorm activity on the southwest side. This is due to moderate wind shear of 10 - 20 knots due to upper-level winds out of the southwest. This shear is disrupting Irene's circulation and has cut off upper-level outflow along the south side of the hurricane. No eye is visible in satellite loops, but the storm's size is certainly impressive.
 
Long range radar out of Wlimington, North Carolina, shows that the outermost spiral bands from Irene are now beginning to come ashore along the South Carolina/North Carolina border. Winds at buoy 41004 100 miles offshore from Charleston, SC increased to 36 mph as of 10 am, with significant wave heights of 18 feet....MORE

Bernanke: No to More Cowbell Despite Pleading from Goldman and the Band

At the Jackson Hole Annual  Economic Policy Symposium.
Transcript:

Bruce Dickinson: Alright, guys, I think we're ready to lay this first track down. By the way, my name is Bruce Dickinson. Yes, the Bruce Dickinson. And I gotta tell you: fellas.. you have got what appears to be a dynamite sound!

Eric Bloom: Coming from you, Bruce, that means a lot.

Buck Dharma: Yeah. I mean, you're Bruce Dickinson!

Alan: This is incredible!

Bobby: I can't believe Bruce Dickinson digs our sound!

Bruce Dickinson: Easy, guys.. I put my pants on just like the rest of you -- one leg at a time. Except, once my pants are on, I make gold records. [ the group laughs ] Alright, here we go. "Fear... Don't Fear the Reaper" -- take one. Roll it [ he exits into the control booth ]

Eric Bloom: Alright! One, two, three, four...

[ The group starts the song: "All our times have come…Here but now they're gone..." -- Bobby slaps the drums, Eric jams his guitar, and Gene bangs on a cowbell. ]

Eric Bloom: [ distracted by Gene banging the cowbell ] Okay! Wait! Wait! Stop! [ the group cuts off their instruments ] Um, Bruce, could you come in here for a minute, please?

Bruce Dickinson: [ stepping out of the booth ] That... that was gonna be a great track. Guys, what's the deal?

Eric Bloom: Uh, are you sure that was sounding okay?

Bruce Dickinson: I'll be honest.. fellas, it was sounding great. But.. I could've used a little more cowbell. So.. let's take it again.. and, Gene?

Gene Frenkle: Yeah?

Bruce Dickinson: Really explore the studio space this time.

Gene Frenkle: You got it, Bruce.

Bruce Dickinson: I mean, really.. explore the space. I like what I'm hearing. roll it.

[ the group starts the song again, as Gene bangs more wildly onto the cowbell, gyrating his exposed belly. In the booth, Walken is smiling to keep from laughing. Before the session is interrupted, Gene misses a beat on his cowbell.]

Eric Bloom: Okay, wait! Stop! Stop! Bruce, I'm sorry, could you come back in here, please?

Bruce Dickinson: [ stepping out of the booth ] Fellas.. now, we just wasted two good tracks! This last one was even better than the first!

Eric Bloom: Well, it's just that I find Gene's cowbell playing distracting! I don't know, if I'm the only one, I'll shut up.

Buck Dharma: Nah, it was pretty rough.

Gene Frenkle: You know, I could pull it back a little, if you'd like.

Bruce Dickinson: Not too much, though! I'm telling you, fellas -- you're gonna want that cowbell on the track!

Gene Frenkle: You know what? It's fine. Let's just do the thing.

Bruce Dickinson: Okay, Roll it.

Eric Bloom: One, two, three, four...

[ the band starts the song once more, with Gene banging the cowbell right next to Eric's ear until Eric pushes him, knocking over the microphone and causing Horatio Sanz to fall ]

Eric Bloom: [ stopping the song again, fighting Gene ] COME ON, GENE!!

Gene Frenkle: NO, YOU COME ON!!

Bruce Dickinson: [ running out of the booth again ] Guys, y’ know…that…that…it doesn't work for me. I gotta have more cowbell!

...MORE

Hurricane Watch: Gas up, Grab Some Cash

Those are the tips from a buddy in Houston.
When the power goes out ATM's stop dispensing and the pumps don't pump.
He says even a couple hundred bucks in small bill can make a big difference.
We'll have more handy hints throughout the day but those two seemed especially pertinent.

New York City Waiting for Irene: What to Expect When the Storm Arrives

We last visited the WSJ's Metropolis blog on August 31, 2010: "Hurricane Earl Forecast: Storm Increasingly Likely for New York" which had a link we purloined for Wednesday's "Hurricane Irene May Skirt Carolina Coast, Target New York City".
Here's their Irene coverage:
Friday 8:34 AM

With New York, New Jersey and Connecticut all under states of emergency, the reality of Hurricane Irene’s looming impact is starting to hit home for most tri-state residents.

Hurricane warnings now extend northward up the East Coast to New York Harbor and beyond, foreshadowing a truly extreme event. A dangerous rise in ocean levels, half a day of 75+ mph sustained winds, and 10 or more inches of rainfall over the next 72 hours are all likely.

If you live in Zone A, please follow directions and evacuate if requested. If at all possible, complete your preparedness steps by Friday. Once Saturday rolls around, it will be too late. MarketWatch’s Jennifer Waters has a list of 10 survival tips for the vast majority of us who have never seen a hurricane before. Believe me, if there ever was a time to heed the warnings of local officials and follow a Red Cross preparedness checklist, this is it.

HURRICANE TRACKER: See the latest Atlantic hurricanes and tropical storms, and look back over past seasons.

The latest computer models continue to be in remarkable agreement around a likely landfall for Irene as a Category 1 or 2 hurricane somewhere between the Jersey Shore and central Long Island. The National Hurricane Center has barely changed their forecast track in the last 24 hours, which gives me even more confidence that Greater New York is Irene’s final destination.

As of 5 a.m. Friday, Irene is still right on NHC’s forecasted track — and right on the borderline of major hurricane status.

Irene will be a once-in-a-lifetime storm for most New Yorkers. Seriously, when Jim Cantore sets up his live broadcast from Battery Park, you know it’s for real.

A few years ago, Munich Re did a study on a strong hurricane traveling up the East Coast to make landfall in New York City. The estimated insured losses would be upwards of $100 billion, according to the study — the same order of magnitude as a certain hurricane that devestated New Orleans six years ago....MORE

Thursday 7:16 PM
New York Transit System Prepares for Full Shutdown
Thursday 5:41 PM
In the Hamptons, Distant Storm Spoils the Party
Thursday 4:55 PM
NYC Preaches Pet Preparedness Amid Hurricane Anxiety
Thursday 4:32 PM
Hurricane Who? How Irene Got Her Name

And many more. They're on it.

Wall Street Goes Down on the Farm (Don't wear the Bruno Magli's) ADM; CF; MOO

The writer, Tom Polansek is one of the most professional scribblers on the Ag/commodity beat but I would bet real money that there were a couple times he was unable to stop himself from laughing at the sight.
From the Wall Street Journal:

 

Tom Polansek/The Wall Street Journal

Illinois farmer Byron Jones, left, and Jake Rothman, an equity analyst for hedge-fund firm

Mayo Capital Partners, assess a corn field in Indiana.

REMINGTON, Ind.—Jake Rothman, an analyst at Boston hedge-fund firm Mayo Capital Partners, slogged through a muddy cornfield near here on Tuesday, looking for clues about the size of this year's U.S. crop.

Wearing an oversized raincoat borrowed from a farmer, the 35-year-old Mr. Rothman worked his way down one row until he was hidden in the tightly packed cornstalks.

"There's more uncertainty this year," he said while riding in a van to the next field. The coming harvest will affect grain processor Archer-Daniels-Midland Co., fertilizer maker CF Industries Holdings Inc. and other agriculture companies followed by Mr. Rothman.

Across the Midwest, dozens of analysts and investors are tramping corn and soybean fields this week in an annual ritual aimed at giving them an edge on their Wall Street rivals.

The four-day, seven-state marathon costs $80, not including travel costs, and is organized by Pro Farmer, an agriculture advisory firm. Participants walk dozens of fields and get details from farmers about the number of bushels likely to be harvested from each acre.

Instead of relying on the spreadsheets left behind on their office computers, analysts and investors on the "corn tour" become "scouts" who disappear into each field with a 30-foot-long yellow rope. They run the rope along a row of stalks and count the number of ears.

Along the 30-foot section, the scouts pull off the fifth, eighth and 11th ears—and then rip off the husks to count the number of kernels along the circumference of each ear. The scouts put their arms up in front of their faces to protect themselves from sharply edged corn leaves.

Pro Farmer plans on Friday to release a forecast for the average U.S. corn yield, or the projected harvest by acre. The annual measurement often moves commodity and stock prices, and it will be watched closely as traders debate by how much the U.S. Department of Agriculture will reduce its forecast next month.
On Thursday, corn for delivery in September rose 0.1% to a two-month high of $7.3225 a bushel on the Chicago Board of Trade. Corn futures are up 16% so far this year.

The crop tour gives analysts and investors some down-to-earth numbers, gut instinct and dirty hands to go with the government's official data. Expectations are for a large corn crop, but no longer the record haul predicted earlier this year. Exact figures won't be known until farm combines have harvested tens of millions of acres, which will take months. The crop's size will ripple through the economy and financial markets....MORE

HT: Abnormal Returns

What Type of Movement Are SPX Options Pricing Into Jackson Hole (SPY; VIX; VXX)

From Option Pit:

...One of the nice things about the weekly options is that on a Friday event we can figure out exactly what the options market thinks the net movement will be after Ben Bernanke speaks.  The August options that expire tomorrow in the SPX are trading:

 

This implies that market is expecting movement of about 27 points out of Mr. Bernanke's speech.  If we consider that last year, with the market lower this speech moved the market 30 points, maybe 27 points isn't that much.  My thoughts though are that this is extremely over priced, especially when compared to straddles in the regular contract months.  Does it make sense to own a 27 straddle with 1 day left to expire or an 80 dollar straddle with 20 days left to expire like this one:

 

With all of the up and down garbage that has been going on in the market, I have little doubt in my ability to gamma scalp my way into a profit on the September straddle, a straddle that expires tomorrow might be quite a bit tougher to gamma scalp.  The one thing I have to worry about is how VIX futures are lining up right now.  There is a HUGE backwardation between VIX cash and September Futures...MORE

A Couple Hurricane Irene Driving Tips

1) West

2) Fast

Back tomorrow with treefall risks in North Carolina and Virginia, the special problems of the Chesapeake Bay, wind tunnels in the Big Apple, stocks to short, stocks to buy and more.

This week:

Wednesday
Hurricane Irene May Skirt Carolina Coast, Target New York City

Tuesday
Hurricane Irene and the Insurance Companies (ALL; TRV; CB; ERIE)

Monday
Irene: How to Short a Hurricane or the Political Implications of the Next Landfalling Typhoon

Why Analysts Should Keep it Simple (BAC)

I just read half of a manager's lengthy defense of a position in Bank of America that sounds to be seriously underwater.
After a few thousand words I asked myself if this was the highest use of my time and got a ringing "No" for an answer.
I've never cared for the 37-page investment thesis approach to investing.
Instead, I've hung around people who are very quick on their feet and who make decisions-based-on-imperfect-information all day long and I've sort of acquired the trait.

Here's a repost from 2008, I'm with the General on "failing forward fast":
Ag Stocks and The Berlin Airlift (AG; MOS; MON; POT)

Last night in "Commodities Comeuppance" I said my best guess was that the ag stocks would be up today. When POT and MOS opened down I was reminded of a vignette from the Berlin Airlift.

We're coming up on the 60th anniversary of the Soviet blockade that June.
During the summer the two million people that the Brits and Americans were trying to feed could get by with two tons of coal per day (over the course of the airlift 80% of the weight hauled was coal) but as the blockade went on, it was apparent that the Sov's. intended to starve the city and it became imperative that an efficient method of delivering coal be found.

During winter the absolute minimum requirement was 3100 tons of coal per day. The little C-47's could haul around three tons per flight. The first week of the airlift, deliveries averaged 90 tons per day. The second week, 1000 tons/day.

It was decided to experiment with a low-speed, low-level drop of coal onto an empty field, the idea being that if it worked, B-29 Superfortress' with a 105 mph stall speed and 22-25 ton capacity would solve the problem.

On the appointed day the senior commanders went to the field, the plane came over, low and slow, dropped the coal, packed 100 pounds to a bag, the bags landed, exploded open, the coal was pulverized and a great black cloud of coal dust covered everyone watching.

One of the Generals, I forget if it was LeMay, Tunner or Smith, said "Doesn't work" and that was that.

When I saw the ag stocks open this morning I thought
"Doesn't work".

The logistics geniuses figured out what needed to be done, took 300 of the 400 10-ton capacity C-54's in the U.S. fleet, developed flight rules so efficient that the Germans called it "die Luftbrücke" (Air Bridge) and on Easter Sunday 1949 in a move to crush the Soviet's spirit, they decided to show off with the "Easter Parade".

In the 1440 minutes of that day, they flew 1398 flights into Berlin delivering 12,940 tons of coal.
The Soviets gave up the blockade the next month, two million people didn't starve or be forced to live under Moscow masters and thousands of kids remembered the candy bars the pilots would tie to handkerchief parachutes and drop as they came into Tempelhof.

39 British and 31 American airmen were killed in crashes during the airlift:...

Now I'm going downstairs to clear my head and buy a cookie, two much higher uses of my time.

Conspiracy Theory: Is the Berkshire Bandito Frontrunning a Bernanke Annoucement? (BAC; BEK.a)

From Economic Policy Journal:

...A trader emails:

probably means Bernanke is going to offer the mkt something

Remember, Buffett bought his Goldman Sachs stake just days before the huge bankster bailout was announced.  And Buffett spoke with the President earlier this week.

As for Buffett, he's in full Howdy Doody mode. He told CNBC that he got his idea to buy BAC while he was in the bathtub....

Pardon me while I adjust my chapeau.

Comparing Warren Buffet's Rescue Deals (BAC; GS; GE)

From Deal Journal:
Terms of Warren Buffett’s Rescue Deals

Warren Buffett’s rode to Bank of America’s rescue this morning, by investing $5 billion in the battered banking giant. Buffett is known for carefully choosing to make investments in companies under siege, and he charges dearly for his seal of approval.

The blueprint for the Bank of America deal was deals Buffett struck during the financial crisis. Here is a look at the terms of his crisis investments in three key companies:

Bank of America, 2011
$5 billion
preferred stock plus 6% annual dividend
warrants to buy 700 million shares at $7.14 a share (in the money as of today)

General Electric, Oct. 2008
$3 bilion
preferred stock plus a 10% annual dividend
warrants to buy 134.8 million GE share at a price of $22.25 (out of the money)
Redeemed at at cost of $3.3 billion....MORE

Buffett to Invest $5 Billion in Bank of America (BAC; BRK.b)

BAC is up 17.74% at $8.23.
From DealBook:

Warren Buffett comes to the rescue, again.

On Thursday, Berkshire Hathaway, run by Mr. Buffett, announced plans to invest $5 billion in Bank of America.

The conglomerate has agreed to buy 50,000 preferred shares that will pay a 6 percent annual dividend. Bank of America has the option to buy back the shares at any time for a 5 percent premium.

The investment by Mr. Buffett should allay concerns by the market that Bank of America lacks sufficient capital. Shares of the financial firm have been battered by recent weeks over liquidity fears. The stock is currently trading at $7, down from more than $15 at the beginning of the year.

“We are building the best franchise in financial services and we have laid out a clear plan to deliver long-term shareholder value,” Bank of America chief executive Brian Moynihan said in a statement. “I remain confident that we have the capital and liquidity we need to run our business. At the same time, I also recognize that a large investment by Warren Buffett is a strong endorsement in our vision and our strategy.”...MORE

Here's the press release.

This port ain't big enough for the both of us: Roman Abramovich's $1bn yacht refused mooring at Antibes

It is a big boat.*
From the Daily Mail:

Even billionaires sometimes struggle to find space to park.

For Roman Abramovich, that moment came when he tried to moor his £1billion yacht Eclipse - the largest in the world at 557ft long.

The Russian tycoon was beaten to the only space in the harbour big enough to moor his giant vessel, Eclipse.

Chelsea battleship: Eclipse, the world's biggest yacht, owned by Russian businessman Roman Abramovich, lies at anchor off the coast of Antibes, near Nice, south-eastern France

Saudi Prince Al-Waleed bin Talal Alsaud - whose own yacht Kingdom KR5 is a mere 265ft long - took the coveted mooring in ‘Millionaire’s Quay’ in Antibes, in the French Riviera.

Prince Al-Waleed is the world’s 26th richest man with £12.3billion, according to Forbes magazine, while Mr Abramovich is 53rd with a fortune of £8.4billion....MORE

HT: Wealth Report 

*One of my mentors was a bit of a go getter, he worked his way through the Navy's ratings and ranks, from Seaman to Commander.


The Navy put him in charge of a destroyer but he never really got used to the idea, he would, for example, use terms like "driving the boat".


One of his admirals suggested a career change after a docking accident. He had told the inquiry the mishap occurred while he was "parking the boat".


The yacht is larger than the destroyer was.

Bow Down to China: "U.S. To Deny Taiwan New F-16 Fighters"

From DefenseNews:

Bowing to Chinese pressure, the U.S. will deny Taiwan's request for 66 new F-16C/D fighter aircraft, a Taiwan Ministry of National Defense (MND) official said.

"We are so disappointed in the United States," he said....MORE

As we said on August 6th:
Stir Fry Medley: Born in the USAAA (Livin' in the USAA+)

Funny thing about being a debtor, other people call the tune.
China was more than willing to lend America the money to fight in Iraq, for them the war was about oil:

August 28, 2008 Al Jazeera
China agrees $3bn Iraq oil deal 

That post continued with a scolding delivered by one of the Chinese-government approved press agencies:

From Xinhua:
After historic downgrade, U.S. must address its chronic debt problems

BEIJING, Aug. 6 (Xinhua) -- The days when the debt-ridden Uncle Sam could leisurely squander unlimited overseas borrowing appeared to be numbered as its triple A-credit rating was slashed by Standard & Poor's (S&P) for the first time on Friday.

Though the U.S. Treasury promptly challenged the unprecedented downgrade, many outside the United States believe the credit rating cut is an overdue bill that America has to pay for its own debt addition and the short-sighted political wrangling in Washington.

Dagong Global, a fledgling Chinese rating agency, degraded the U.S. treasury bonds late last year, yet its move was met then with a sense of arrogance and cynicism from some Western commentators. Now S&P has proved what its Chinese counterpart has done is nothing but telling the global investors the ugly truth.

China, the largest creditor of the world's sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China's dollar assets....

The editorial went on to tell the U.S. to quit spending so much on the military. 
The F-16 story mentions:

A June report by the Perryman Group, a Texas-based economic and financial analysis firm, estimated that Taiwan’s F-16C/D program would create more than 16,000 jobs and almost $768 million in U.S. federal tax revenue. Much of that tax revenue and new jobs would go to election battleground states: California, Connecticut, Florida, Maryland, Ohio, Texas and Utah....

Oh well.

See also:
June 28, 2011 
Barron's Cover: China's Military Buildup
January 10, 2011 
General Electric Teaming With China to Challenge Boeing, Airbus (GE; BA; UTX)

What Can (should) Chairman Bernanke Announce at Jackson Hole?

Folks who are betting on an announcement Friday have more guts than I do.
To help refine the speculation here are some alternatives the Fed may be considering.
From FT Alphaville:
Fantasy Fed options

While the world seems divided on whether Friday’s Jackson Hole meeting will result in the announcement of a fresh round of quantitative easing or not — we thought we’d run with the premise that QE in its conventional form is now redundant or impossible.
(For why we think this, see here and here.)
So what, if any, are the possible alternatives?
Here are some we’ve seen thrown about recently:
From Neil Soss at Credit Suisse:

1) Providing liquidity directly to key credit markets – this basically means renewed TALF style facilities, with the aim of getting high-powered money distributed into the real economy via businesses.

2) Making term bank loans with strings attached (a la BoJ) — a plan which essentially restricts Fed funding to institutions that can come up with productive use of the money.....

...Now for some far out FT Alphaville ideas:
7) Fed intervenes directly via the derivative market by actually writing a literal Bernanke put – Similar to the above, though this time the Fed would be targeting equity market levels rather than GDP.



Fed adjusts conventional QE — instead of purchasing Treasuries or agency debt (due to the scarcity issue), the Fed decides to purchase equities or ETFs direct, a la Japan, possibly even foreign debt....MUCH MORE

Should the Fed try some of the waaay-out Alphaville ideas and fail, we have been authorized by Long or Short Capital to offer their proprietary End-of-the-universe Puts:

...That is why Long or Short is now offering LHC End of the Universe Puts. It’s a simple put option wherein the buyer retains the write to sell the Universe at a strike price of “Existing”. Based on our Black-Holes model used to value all “end of the world” options, the July 2012 vintage options are currently priced at $20....

I shall also have the numbers guys put together some prop bets on each of the FTA options

"Bank of America "Returns" The JPM Upgrade Favor By Slashing Jamie Dimon's Q3 EPS By 25%" (JPM; BAC; C; GS; MS)

"Like a gang of clowns in a pie shop."*

From ZeroHedge:

One of the key catalysts (aside from the retarded rumor that JPM would buy Bank of America) that prevented BAC's stock from dropping to a 5 handle yesterday, was JPM's credit upgrade of Bank of America (report here). Sure enough, the reacharound from BAC is as usual missing, with the response from the bank's banking analyst Guy Moszkowski, being to... downgrade JPM. And he did not stop there: he also cut, GS, MS, and C: in other words the entire TBTF brigade. Someone should probably explain to Guy that any sell off in BAC's peers will be doubly acute in the stock of BAC itself, which has now become the whipping boy for the shorts, and the proxy of all that is wrong in the US and European banking system. Then again, with the palpable sheer panic in the corridors of 1 Bryant Park, we doubt anyone at that bank has any idea what they are doing at all.
From the BAC report:

Lowering 3Q forecasts, POs on magnified seasonal decline due to heightened volatility, which has been particularly difficult to manage following S&P US-debt downgrade. Firms likely saw sizable inventory hits; partially offset by better equity trading, particularly in cash, though derivatives challenged given volatility spike. IB weaker as well, as volatility dampened deal appetite. GS PO to $148 from $153, MS to $25 from $26; JPM to $51 from $55; C to $50 from $53....MORE

*The Wall  Street Journal's Tim Annett was an uncontested winner of the prestigious Climateer Line of the Day award back in September, 2007:
Climateer "Line of the Day" and Day Trading Hot Chinese Alt-Energy (What could possibly go wrong?)

Speaking of the WSJ's Blog Empire (see below), Tim Annett posting at MarketBeat was yesterday's winner with a walk-off home run*:

Like a gang of clowns in a pie shop, Wall Street brokerages had a merry old time slapping one another with various downgrades, earnings-estimate parings and price-target reductions in the lead-up to their recent earnings announcements....

Profile: Paul Tudor Jones--"High Fees, High Life"

Mr. Jones is one of the best at what he does, global macro. Links below the jump.
From Deal Journal:

Billionaire hedge fund manager Paul Tudor Jones is cutting his fees from really unusually high, to merely unusually high, according to a story from Deal Journal colleague Greg Zuckerman.
Deal Journal is taking a closer look at the 56-year-old hedge fund veteran, whose Tudor Investment Corp., has $11 billion in assets under management, according to LionShares.

How Rich Is He? Jones has a net worth of $3.3 billion, according to Forbes, which lists him as the 336th-richest person in the world. Jones reportedly took home $440 million for himself last year, according to Absolute Return+Alpha.

Background: A Memphis native, Jones graduated with a B.A. and B.S. from the University of Virginia. He started out in the finance business by trading cotton. The trade that elevated him into the league of chattering classes came on Black Monday in 1987, when Jones made an estimated $100 million even as the Dow plunged 22%.
 ......

Biggest Holdings: Jones is a “macro” investor who spreads investments across global markets. The five-biggest equity components of Tudor Investment Corp. are an ETF tied to emerging markets ($67.15 million market value as of June 30, according to LionShares ), Microsoft ($28 million), Google ($27 million), an ETF tied to Chinese stocks ($19.1 million) and real-estate investment trust ProLogis Inc. ($14.5 million). Our colleague Zuckerman reports Jones has held firm in this month’s wild market ride thanks to a slug of gold-related investments and bearish positions in stocks....MORE

The WSJ story that Deal Journal links to has some performance facts:

"...But Mr. Jones, a "macro"-oriented investor who makes bets in various global markets, is navigating the recent market downturn better than most competitors. He has managed to score gains of about 3.2% in the flagship fund this month through Aug. 19, according to investors, and the fund is up about 1.1% so far this year.

The firm's $1.4 billion Tudor Tensor fund, which follows computer models, lost 4.4% so far this year through Aug. 19, investors say. This fund isn't changing its fees, which are in line with the rest of the industry.
By contrast, the Standard & Poor's 500 dropped 13% in August, through Aug. 19, and fell nearly 11% for the year through that date...."

Some of our previous posts on Tudor:

May 22, 2009 
Paul Tudor Jones Interview at Institutional Investor

July 21, 2008 
Paul Tudor Jones on Oil
Mr. Jones says the historic spike in oil is a direct result of speculation by pensions and endowments using "Long only" index products. These products were mainly peddled by Goldman salesmen, we have dozens of links on the subject.

September 29, 2010 
"Tudor Sells Completely Out of Renewable Energy Holdings (LON: REH)"
A superb call.

September 1, 2009 
Paul Tudor Jones: "Goldman Sachs Wrong on Economic Recovery"
Even when he's wrong he's worth reading

October 29, 2010 
"PAUL TUDOR JONES: BUY THE MOMENTUM BUBBLE"
Reversing his position from the post immediately above.

November 12, 2010 
Paul Tudor Jones Questions Fed’s Bond Buying




Feb. 25, 2011 
"Paul Tudor Jones On The ‘Undervaluation Of The Chinese RMB And The Subsequent Loss Of Competitiveness In The US Manufacturing Sector’"

Hurricane Irene May Skirt Carolina Coast, Target New York City

And then visit the President and Michelle on Martha's Vinyard.
Here's the current 5-day forecast, more on New York Hurricanes below the map.

 
Figure 3 Official track forecast of Irene at 2AM EDT.

The 1821 Norfolk and Long Island Hurricane is one of two hurricanes in recorded history to have directly struck what is now modern New York City (the other was in 1893).

The hurricane struck the city on September 3, 1821; it is estimated to have made landfall at Jamaica Bay.
Though the hurricane struck at low tide, it produced a storm surge of over 29 feet (9 m) along several portions of the New Jersey coastline, causing significant overwash.

When finally the storm reached New York City, it caused widespread flooding as far north as Canal Street.

Back in 2005 New York Press published an interesting piece looking at a hypothetical strike:
THE BIG ONE

Experts say it's only a matter of time before a major hurricane

...A hurricane like this one can usually be counted on to curve eastward and die a harmless death over the Atlantic. But with a large area of high pressure hovering just off the east coast, the computer models at the National Hurricane Center in Miami are largely in agreement: This one is heading north, tracking a direct hit on New Jersey somewhere north of Atlantic City. Like the legendary "Long Island Express" of 1938, the fastest-moving hurricane ever recorded, it's moving quickly.

While no human or computer can ever be completely sure what a hurricane is going to do, this is looking like a worst-case scenario for New York City, the kind of scenario "that gives emergency managers serious gastrointestinal distress," says Lee. Because of its counter-clockwise rotation, the right side of a hurricane is the most powerful part of the storm. The right side of this storm is fixing to land a haymaker on New York Harbor. If it makes landfall during high tide, the devastation will be unprecedented.

With the storm expected to hit within 24 hours, Mike Lee is in constant communication with Mike Wyllie, meteorologist-in-charge at the National Weather Service's New York office in Upton. The OEM's emergency operations center, meanwhile, is buzzing, while the mayor and his chiefs are hunkered down in the situation room. They have an incredibly difficult decision to make, a decision that has never before been made in New York City. They are preparing to order the evacuation of 900,000 New Yorkers whose homes are in the path of catastrophic flooding in the event of a category-4 hurricane. They will provide shelter for nearly a quarter million. And while the storm is still far enough away that it could drift off course and miss New York City completely, a full evacuation may take up to 18 hours. They need to decide now. The fact that a mayoral election is only two months away doesn't make the decision any less complicated. An unnecessary evacuation could be a political catastrophe.

Though it sounds like science fiction, the above scenario is all too plausible. "Try to tell someone in Sheepshead Bay that they have to evacuate immediately because within the next 24 hours they'll have 30 feet of storm surge on their neighborhood," says Mike Lee, before pausing to let you think about three stories of ocean water roiling through your own neighborhood. "They'll laugh at you—absolutely laugh at you," he says. "I mean, I barely even believe it."

I met Lee at this year's Long Island/New York City Emergency Management conference and spent some time with him at the OEM "bunker" in Brooklyn. It turns out that the region's emergency managers aren't only worrying about terrorism these days. The big topic of discussion at the Melville, Long Island, Hilton was hurricanes. And the strong consensus is that the metropolitan region is due for a big one. Overdue, in fact.

The 1938 Long Island Express, a borderline category-4 hurricane that plowed into West Hampton, causing widespread death and devastation across New York, New Jersey and New England, was the last major hurricane to hit the region. Statistically speaking, "a storm of that magnitude may repeat every 70 to 80 years or so," Lee says. "So, do the math. Whether it happens this year, next year, or in five years, it's going to happen." And with this year's hurricane season forecasted to be even busier and more dangerous than last year's record-setter, "It's just a matter of time," Lee says.

Though it is rare for big hurricanes to hit the New York metropolitan region, there are a variety of "oceanographic, demographic and geologic characteristics that greatly amplify any hurricane" that comes our way, according to Nicholas Coch, a professor of coastal geology at Queens College. In many ways, Coch explains, "The New York City area is the worst possible place for a hurricane to make a landfall."

New York's first vulnerability is psychological. This is a city where children playing in the dirt are told by their mothers to "get up off the floor." We tend to forget that we have any connection whatsoever to the natural world. The vast majority of the city's eight million inhabitants simply have no idea that a hurricane can happen here.

"We live in a complacent coastal city," Lee says. "A lot of people don't even think that there are beaches here," never mind 478 miles of coastline. In fact, New York City is behind only Miami and New Orleans on the list of U.S. cities most likely to suffer a major hurricane disaster. Compounding the problem is the fact that many of the New Yorkers who lived through 1985's Hurricane Gloria believe they've experienced the worst of what nature has to offer. "That wasn't a hurricane," meteorologist Wyllie says. The storm was billed as a category-2 that weakened before it hit and came in at low tide. "Gloria was nothing."

New York's second vulnerability is demographic. During the decades of calm between major hurricanes, the city grows and forgets. During the great hurricane of 1821, only 152,000 people lived in New York City. When the next major, direct hit came in 1893, the city's population was 2.5 million. At the time of the 1938 storm, Long Island wasn't a densely populated suburban sprawl; it was a rural home for oyster fishermen, potato farmers and wealthy industrialists. The same storm today would wreak incredible havoc. AIR Worldwide Corporation estimates $11.6 billion in New York losses alone.

More than 20 million people live in the greater metropolitan region. Many live on coastal land, reclaimed swamp and barrier islands. Much of Lower Manhattan is built on landfill. Places like Rockaway, Coney Island and Manhattan Beach "are stretches of land that nature has created to protect the mainland from hurricanes," Lee says. "In our civilization this is also the most desirable land to develop and build on. We're not going to undevelop it. So we now have to deal with the threat."

Coch, the six-foot-seven-and-a-half professor once nicknamed "Dr. Doom" because he was the first scientist to widely publicize New York City's hurricane history and vulnerabilities, put it more poetically in a 1995 New York Times interview: The only difference between now and then is that "now we have millions of people to offer the God of the Sea."

New York City's biggest vulnerability is the most unyielding geology. The New York bight is the right angle formed by Long Island and New Jersey with the city tucked into its apex. "Hurricanes do not like right angles," Lee says. "[They allow] water to accumulate and pile up."

Couple this with the fact that New York resides on a very shallow continental shelf, and as a big storm pushes north, New York Harbor "acts as a funnel." As storm surge forces its way into the harbor and up the rivers, it has nowhere to go but onto land. New York City, it turns out, has some of the highest storm-surge values in the country. "When we see a category-3 storm making landfall in Florida, it may only have a 12-, 13-foot storm surge," Lee says. "For us here, a category-1 storm can give us 12 feet of storm surge."

Storm surge is the dome of seawater that is lifted up and pushed forward in front of a hurricane. It acts almost like a mini-tsunami, causing sea levels to rise rapidly and violently. Most people believe that high winds and rains are the main dangers of a hurricane. In fact, inland flooding caused by storm surge is the big killer. In 1821, stunned colonial New Yorkers recorded sea levels rising as fast as 13 feet in a single hour at the Battery. The East River and Hudson Rivers merged over Lower Manhattan all the way to Canal Street. According to Coch, the fact that the 1821 storm struck at low tide "is the only thing that saved the city."

To get a sense of the damage that storm surge can do to New York City, call 311 and ask them to send you a full-color copy of the New York City Hurricane Evacuation Map. It is a truly mind-boggling document. If a storm like the Long Island Express makes a direct hit on the city, everything below Broome Street will be inundated, some parts under as much as 20 and 30 feet of water. Chelsea and Greenwich Village are completely flooded, with the Hudson spilling over all the way to 7th Avenue. Likewise, the East River and East Village become one, with ocean water surging all the way to 1st Avenue. If you haven't evacuated before the storm, forget it. During the storm, Manhattan's east- and west-side highways vanish. Tunnels and bridges become unusable.

The outer boroughs also get hit hard. Opposed to that new Ikea being built on the waterfront in Red Hook? Don't worry. There's a decent chance it won't be there after a moderate-size hurricane. Residents of Williamsburg-Greenpoint should seek out a male and female of each species and get in their arks. In a kind of one-two-punch effect, a major hurricane will push ocean water down from the Long Island Sound into the Upper East Side, South Bronx and northern Queens, flooding those areas severely. Vast stretches of southern Brooklyn, Queens and Staten Island will be devastated. The map shows Atlantic Ocean storm surge reaching as far inland as Flatbush, just south of Prospect Park, with 31.3 feet of water atop Howard Beach.

"A lot of people say, 'How can you come up with these numbers? Thirty feet, that's ridiculous. It's science fiction.' Actually," Lee says, "It's science fact." Hurricanes in the southern U.S. have proven the Army Corps of Engineers' storm-surge calculations to be accurate within a few inches.

For a taste of what will happen to the city's infrastructure, we can look at the damage wrought by the great nor'easters of the early 1990s. During those storms, the L train had to be backed out as the 14th Street tunnel began filling with water, and the FDR highway was so badly inundated that 50 motorists had to be rescued by dive teams. In the event of a direct hit by a category-3 hurricane, surge maps show that the Holland and Battery Tunnels will be completely filled with sea water, with many subway and railroad tunnels severely flooded as well. The runways of LaGuardia and JFK airports will get flooded by 18.1 and 31.2 feet of water, respectively.

Then there are the winds. The city's two million trees will be a huge problem. "New York City's trees haven't been stressed in years except for an isolated severe thunderstorm or two," Wyllie says. They've had plenty of time to grow and wrap their roots around underground phone, electric, gas and water lines. As they are uprooted in the heavy winds, a lot of infrastructure both above and below ground is going to get wrecked.

As for skyscrapers, "The impact of catastrophic winds on high-rise buildings is still a little vague," Lee says. "We don't feel we have enough data on that."

We do know that hurricane wind speeds multiply at higher altitudes. At 350 feet, the height of high-rise buildings on the Battery and the towers of the George Washington Bridge, hurricane winds will be twice as fast as they are on the ground. Newer, glass-skinned towers are not likely to do well in those conditions. Neither will human beings caught outside amidst flying debris. To give a sense of the unbelievable force of hurricane winds, Lee shows a photo from one of the four storms that struck Florida last year. It depicts a blunt piece of two-by-four driven straight through the trunk of a palm tree.

"It would be nasty," Wyllie agrees. "If you get sustained winds going 80 to 90 miles per hour in the city—whoa, you can't believe the destruction. We've never seen that. And as you go up 200, 300 feet," he considers that for a moment. "That'll be 100, 110 mph winds. Watch out."...MORE

Economic Policy Journal Doesn't Much Care for the National Infrastructure Bank

No siree.
From EPJ:
I Warned You About the National Infrastructure Bank

On August 6, I wrote:
Now a long-time D.C. insider has tipped me off as to how the banksters plan to squeeze the next phase of the budget deal for their own benefit. This insider writes to me:

What hat trick do the “banksters” try next? IMHO, they love to hide their best and biggest tricks in plain sight.

It’s the “national infrastructure bank.” Leading Democrats on the Hill are teeing up a national infrastructure bank to be incorporated into the next budget deal. As an example, Chuck Schumer is proposing using the proceeds from a new, one-year repatriation tax to fund the start up costs of such a national infrastructure bank

Bottom line, the banksters have a key man in place to guide the next budget deal and turn it into a bankster feast. Expect the result to be the National Infrastructure Bank...

Now, Mr. Insider, Nouriel Robini, has stopped his defense of the Federal Reserve for the moment to run propaganda for the coming National Infrastructure Bank, he just sent out this barrage of tweets:

"The Case for an Infrastructure Bank" by Felix Rohatyn. Oped column in the WSJ http://t.co/nA8CB9z 

---

Bi-partisan (Senators John Kerry - D and Kay Bailey Hutchison - R) support for National -Infrastructure Bank.

---

If return > cost, debt financed pub infrastructure self pays either via user fees or the higher revenues that the increase in GDP generates

...MORE 

Bank of America Cruelly Brings Up SEC in First Line of Response to Henry Blodget; Dick Bove and Chris Crocker Comment (BAC)

The stock is trading at $6.18, down 24 cents but off its low of $6.01.
First up, Dick Bove, who appears to be suffering from some type of cognitive/neurological deficit, on Bloomberg TV via DealBreaker:

Dick Bové: Short All The Shares Of BAC You Can Borrow But It Won’t Do Any Good

...“There is no impact whatsoever on Bank of America’s balance sheet, based upon the price of its stock in the open market. If the price of the stock goes to a penny a share, it has no impact on the balance sheet of Bank of America. Bank of America sells the stock to the public, it takes in the money, and that is the end of the transaction as far as Bank of America is concerned. If you’re going to break a bank, you’re going to have a run on its deposits. That’s not happening. Exactly the opposite is happening…Deposits are pouring into Bank of America… MORE

Roger that, break a bank, not.
What the heck is he talking about? Pity about the TIA's.

Might as well go back to MarketBeat, which appears to enjoys stirring this fetid stew:
Bank of America Fires Back at Henry Blodget

...Here’s the full statement, which minces no words:

Mr. Blodget is making “exaggerated and unwarranted claims,” which is what the SEC stated publicly when he was permanently banned from the securities industry in 2003....MORE

Chris Crocker has some thoughts on Mr. Blodget's treatment at the hands of the behemoth:

How fucking dare anyone out there make fun of Henry after all he has been through.!

He lost his aunt, he went through a divorce. He had two fuckin kids.

His husband turned out to be a user, a cheater, and now he's going through a custody battle. All you people care about is….. readers and making money off of him.

HE’S A HUMAN! (ah! ooh!) What you don’t realize is that Henry is making you all this money and all you do is write a bunch of crap about him.

He hasn’t performed on stage in years. His song is called “give me more” for a reason because all you people want is MORE! MORE-MORE, MORE: MORE!.

LEAVE HIM ALONE! You are lucky he even performed for you BASTARDS!
LEAVE HENRY ALONE!…..Please.

Perez Hilton talked about professionalism and said if Heenry was a professional he would’ve pulled it off no matter what.

Speaking of professionalism, when is it professional to publicly bash someone who is going through a hard time.

Leave Henry Alone Please…. !
Leave Henry Blodget alone!…right now!….I mean it.!

Anyone that has a problem with him you deal with me, because he is not well right now.

LEAVE HIM ALONE!

We'll have more of Mr. Crocker's incisive micro/macro top-down, bottoms-up analysis a bit later

Noblesse Oblige: "The aristocrats cashing in on Britain's wind farm subsidies"

Okay, it's not Oblige, it's more like Noblesse, Score!!!
From the Telegraph:

The aristocrats cashing in on Britain's wind farm subsidies
 Growing numbers of the nobility are being tempted to build giant wind farms on their estates by the promise of tens of millions of pounds being offered green energy developers.

They are among the nation's wealthiest aristocrats, whose families have protected the British landscape for centuries. Until now that is.

For increasing numbers of the nobility – among them dukes and even a cousin of the Queen – are being tempted by tens of millions of pounds offered by developers to build giant wind farms on their estates.

An investigation by The Sunday Telegraph reveals how generous subsidies – that are added to consumer energy bills – are encouraging hereditary landowners to build turbines up to 410ft tall on their land.

With controversy over onshore wind farms growing, the role of the landed establishment in fuelling the 'scramble for wind' will alarm opponents.

They claim wind farms are blighting the countryside while failing to deliver a reliable supply of electricity despite the cost.

Latest figures show the amount of electricity generated by UK wind farms actually fell last year because of the lowest average wind speeds this century.

However, supporters say a network of wind farms will guarantee Britain cheap, sustainable energy in the future.

The turbines being hosted by the landed gentry are almost always many miles from the aristocrats' own homes. The Duke of Gloucester, who lives in an apartment in Kensington Palace in London, is hoping to build a wind farm 85 miles away on his ancestral estate in Northamptonshire, which he moved out of in 1994. Each turbine could earn the Duke, who is the Queen's cousin, up to £20,000 a year and possibly much more.
It comes as Sir Reginald Sheffield, David Cameron's father-in-law, whose baronetcy was created in the mid 18th century, admitted last week he earns as much as £350,000 a year from eight turbines on his estate at Bagmoor in Lincolnshire.

In a letter last week to the Spectator magazine, Sir Reginald protested that he did not own the turbines on Bagmoor farm and that his estate received only a "modest income" amounting to "less than one tenth" of £3.5 million.

Calculations by an energy think tank suggested Sir Reginald could be receiving about £120,000.
The Duke of Roxburghe has angered locals – including the neighbouring Duke of Northumberland – after winning a lengthy planning and legal battle to build 48 turbines, each about 400ft high, on unspoilt moorland in the Scottish borders.

Construction work began about two months ago with the building of a road 10 miles long through previously pristine countryside to reach the wind farm site.

The Duke, who is worth about £100 million, will reportedly earn as much as £2.5 million a year from the deal although a spokesman, who declined to discuss the actual amount, said that figure was not accurate.
One industry expert said a more realistic figure was in the order of £720,000 a year.

In the course of the 25-year lifespan of the wind farm at Fallago Rig that could net the Duke anywhere between £18 million and £62.5 million.

The details of the deal struck with an energy company remain confidential although The Sunday Telegraph understands the Duke's earnings are performance related – in other words the more the wind blows the more money he will make.

One industry expert estimated Fallago Rig could generate about £875 million income over the next quarter of a century for the Duke and his commercial partner North British Windpower.

Half that sum is in the form of a consumer subsidy, introduced by the last Labour government to encourage renewable energy projects, and which is added on to household electricity bills.

The turbines will not be visible from Floors Castle, the Duke's ancestral home about 25 miles away.
The Duke of Beaufort, who is worth £120 million, is trying to build 19 turbines on land near Swansea – about 100 miles from his family seat at Badminton House in Gloucestershire....MORE 

THE stately Turbines of England,
   How beautiful they stand!
Amidst their tall ancestral trees,
   O'er all the pleasant land.
The deer across their greensward bound
   Thro' shade and sunny gleam,
And the swan glides past them with the sound
   Of some rejoicing stream. 

(of revenue)

-Felicia Browne Hemans
Blackwoods Magazine April, 1827

I wish Noel Coward were around to comment:

The stately homes of England,

How beautiful they stand,

To prove the upper classes

Have still the upper hand.