U.S.: Markets positive this morning, recovering from last week’s leap in oil prices and continued Middle Eastern violence.  All eyes will continue to watch the escalating situation in Libya. The Fed releases January consumer credit numbers this afternoon, estimated to increase $3.4BE v $6.1B prior. Look for the release of retail sales this Friday amidst a light release calendar.

Europe: Greece’s credit rating was lowered three notches today by Moody’s due to the rising risk of default and the country’s probable difficulties in reducing its budget. Greece’s new B1 rating matches that of Bolivia and Belarus, prompting the Greek Finance Ministry to call it “completely unjustified.” Greece is scheduled to issue bills tomorrow, while Portugal and Italy are also expected to issue this week.  Ireland’s PM Kenny requested a repayment extension on the EU bailout loans on Friday during a meeting of right-wing EU leaders. The request came with an appeal to cut interest rates on the package that once again fell on deaf ears as the Finnish finance minister stated that “there are no free lunches.” Ireland’s incoming ruling party also declared today that a restructuring of senior bank debt may occur. The rising party will take office this Wednesday and plans to create a “war cabinet” to face the country’s spiraling debt levels. Monday figures showed that ECB overnight loan facility had borrowings of €758MM v €515MM prior. Although the borrowing numbers are somewhat more stable than recent spikes, the heightened level reveals continued financial pressures in the Euro zone. SOVXWE widened out to 180bp on the news of the Greek downgrade and increased stress in the periphery. Markets will see increased caution this week in the lead up to the EU summit at the end of the week designated to create a rescue mechanism.  Friday’s talks will likely involve many of the same themes we have seen lately in order to create a new/revised/upgraded support mechanism.  With the ECB seemingly wanting to take a backseat on the credit front and return to traditional inflation fighting policy measures, the meetings should take on a whole new meaning for the markets as ever-larger band-aid measures become necessary.  BOE rate decision coming up on Thursday.  

Asia: Japanese rating agency R&I announced that it may cut Japan’s sovereign debt rating one or two notches before local elections in April due to political tension that has halted budget repairs. Oil prices will be an especially important factor to watch in Asian markets given the rising inflation pressures in the region.  China released its five-year plan over the weekend with lofty goals attached.

From
U.S.: Markets positive this morning, recovering from last week’s leap in oil prices and continued Middle Eastern violence.  All eyes will continue to watch the escalating situation in Libya. The Fed releases January consumer credit numbers this afternoon, estimated to increase $3.4BE v $6.1B prior. Look for the release of retail sales this Friday amidst a light release calendar.

Europe: Greece’s credit rating was lowered three notches today by Moody’s due to the rising risk of default and the country’s probable difficulties in reducing its budget. Greece’s new B1 rating matches that of Bolivia and Belarus, prompting the Greek Finance Ministry to call it “completely unjustified.” Greece is scheduled to issue bills tomorrow, while Portugal and Italy are also expected to issue this week.  Ireland’s PM Kenny requested a repayment extension on the EU bailout loans on Friday during a meeting of right-wing EU leaders. The request came with an appeal to cut interest rates on the package that once again fell on deaf ears as the Finnish finance minister stated that “there are no free lunches.” Ireland’s incoming ruling party also declared today that a restructuring of senior bank debt may occur. The rising party will take office this Wednesday and plans to create a “war cabinet” to face the country’s spiraling debt levels. Monday figures showed that ECB overnight loan facility had borrowings of €758MM v €515MM prior. Although the borrowing numbers are somewhat more stable than recent spikes, the heightened level reveals continued financial pressures in the Euro zone. SOVXWE widened out to 180bp on the news of the Greek downgrade and increased stress in the periphery. Markets will see increased caution this week in the lead up to the EU summit at the end of the week designated to create a rescue mechanism.  Friday’s talks will likely involve many of the same themes we have seen lately in order to create a new/revised/upgraded support mechanism.  With the ECB seemingly wanting to take a backseat on the credit front and return to traditional inflation fighting policy measures, the meetings should take on a whole new meaning for the markets as ever-larger band-aid measures become necessary.  BOE rate decision coming up on Thursday.  

Asia: Japanese rating agency R&I announced that it may cut Japan’s sovereign debt rating one or two notches before local elections in April due to political tension that has halted budget repairs. Oil prices will be an especially important factor to watch in Asian markets given the rising inflation pressures in the region.  China released its five-year plan over the weekend with lofty goals attached.

From Brian Yelvington of Knight Capital

The Bottom Line
The trend is your friend. North American equity markets continue to trend higher. The focus is on economically sensitive equities and ETFs that have favourable seasonal characteristics until at least May.

…..go HERE to view 45 charts including seasonality charts and commentary

U.S. equity index futures are mixed this morning. S&P 500 futures were unchanged in pre-opening trade. The favourable impact on index futures from weakness in the U.S. Dollar and strength in the Chinese stocks was offset by growing concerns that the conflict in Libya will become a full blown civil war.

The conflict in Libya triggered further gains in crude oil, up another $2.15 to $106.57. Energy equities are expected to respond at the opening. President Obama is considering access by the energy sector to the Strategic Oil Reserve in order to potentially curtail rising crude oil and gasoline prices.

The Shanghai Composite Index added 53 points to close at a four month high. The Chinese government pledged in its State of the Union address that economic growth will continue without additional inflation pressures.

Weakness in the U.S. Dollar added to strength in commodities priced in U.S. Dollars. Gold added $9.40 to reach another all time high. Silver increased $1.04 to reach a 31 year high. Platinum added $5.

Weakness in the U.S. Dollar prompted a gain in the Euro despite news that Moody’s downgraded Greece’s sovereign debt by three notches to B1 and maintained its negative outlook.

Higher crude oil and jet fuel prices prompted Air Canada to assign a fuel surcharge to passengers traveling to the U.S.

Western Digital offered to acquire Hitachi’s hard drive division for $4.3 billion cash.
Family Dollar Stores was unchanged after Normura downgraded the stock from Buy to Neutral.

Molson Coors fell $1.00 after Argus downgraded the stock from Buy to Hold.
Cienna plunged 6.8% after the company reported less than consensus fiscal first quarter earnings.

Silver Wheaton added 2.5% despite a downgrade by RBC Capital from Outperform to Sector Perform.

…..go HERE to view 45 charts including seasonality charts and commentary

The single most astonishing fact about foreign exchange is not the high volume of transactions, as incredible as that growth has been. Nor is it the volatility of currency rates, as wild as the markets are these days.

http://www.zerohedge.com/article/paul-farrell-4-bombs-would-ignite-wall-street-revolution

MAKING MONEY: The most popular piece I’ve published in 40 years of writing these Letters was entitled, “Rich Man, Poor Man.” I have had dozens of requests to run this piece again or for permission to reprint it for various business organizations.

Making money entails a lot more than predicting which way the stock or bond markets are heading or trying to figure which stock or fund will double over the next few years. For the great majority of investors, making money requires a plan, self-discipline and desire. I say, “for the great majority of people” because if you’re a Steven Spielberg or a Bill Gates you don’t have to know about the Dow or the markets or about yields or price/earnings ratios. You’re a phenomenon in your own field, and you’re going to make big money as a by-product of your talent and ability. But this kind of genius is rare.

For the average investor, you and me, we’re not geniuses so we have to have a financial plan. In view of this, I offer below a few items that we must be aware of if we are serious about making money.

Rule 1: Compounding: One of the most important lessons for living in the modern world is that to survive you’ve got to have money. But to live (survive) happily, you must have love, health (mental and physical), freedom, intellectual stimulation — and money. When I taught my kids about money, the first thing I taught them was the use of the “money bible.” What’s the money bible? Simple, it’s a volume of the compounding interest tables.

Compounding is the royal road to riches. Compounding is the safe road, the sure road, and fortunately, anybody can do it. To compound successfully you need the following:  perseverance in order to keep you firmly on the savings path. You need intelligence in order to understand what you are doing and why. And you need a knowledge of the mathematics tables in order to comprehend the amazing rewards that will come to you if you faithfully follow the compounding road. And, of course, you need time, time to allow the power of compounding to work for you. Remember, compounding only works through time.

But there are two catches in the compounding process. The first is obvious — compounding may involve sacrifice (you can’t spend it and still save it). Second, compounding  is boring — b-o-r-i-n-g. Or I should say it’s boring until (after seven or eight years) the money starts to pour in. Then, believe me, compounding becomes very interesting. In fact, it becomes downright fascinating!

In order to emphasize the power of compounding, I am including this extraordinary study, courtesy of Market Logic, of Ft. Lauderdale, FL 33306…..

……read more & view the chart & Rules #2, #3& #4 HERE