In Case You Missed Them - Some Links of Interest (8/11/09)

Below are some links of interest, just in case you missed them. Some have already been posted to Twitter, and a number are weekend holdovers (a little too long today).

• Investors are pouring back into ETFs (Financial Times). From April 2008 to the end of last year, the value of global ETFs fell to $711 billion from $805 billion, but now assets invested globally in ETFs have increased to $862 billion. In flows account for roughly half of the rebound, with assets on track to reach $1 trillion by the end of the year.
• Is it too late for emerging market ETFs (ETF Trends)?
• Equity funds worldwide posted record weekly inflows, but most of the recent inflows went to developed markets (Asian Investor).
• No added stimulus from bonus-rich Goldman employees as they are told by their CEO to lay low and not make ostentatious purchases (Here Is The City).
• While small firms may not have the bonus power of Goldman, they are grabbing up talent as the larger Wall Street firms shed employees (WSJ).
• It appears that Morgan Stanley has better options traders (The Business Insider- Clusterstock). While taxpayers got 98 cents on the dollar from Goldman Sachs when it bought back its warrants, and 107 cents on the dollar from American Express, Morgan Stanley paid just 68 cents. This saved the company some $400 million (and when we say saved, we mean short changed the taxpayer).
• Ban on flash equity orders? No problem, just leverage the flash by moving to options (Zero Hedge).
• A visual of the history of bailouts, 1970-2008 edition (Financial Infographics, HT Barry Ritholtz).
• Oil prices have risen lately, causing Goldman to warn that as the economy rebounds, crude oil prices are likely to spike again given that the fundamental problems with the commodity markets still exist (The Business Insider - Green Sheet). Goldman went on to say that "Although the financial crisis has been addressed, the commodity crisis has not." (Financial Times) Elizabeth Warren discusses whether the toxic debt problem has really gone away (Clusterstock).
• Soon, maybe you can buy a new car on eBay (WSJ, Financial Times). Just don't expect a fuel efficient vehicle. Dealers are having a problem keeping cars on the lot (WSJ).
  
• Strong sales of coffee helped stimulate McDonald's earnings (Financial Times).
• The hotel industry is showing some improvement (Calculated Risk).
  
• They're back. Hedge fund investors, that is, but they are being selective where they allocate new money (WSJ). Like equities, hedge funds are also up for the year, with convertible arbitrage continuing to work (Bull Bear Trader). Managed futures continue to lag and under-perform.
• Nonetheless, while hedge fund gained in July, they still underperformed stocks as a whole, with funds up 3.4% on average, while the DJIA, Nasdaq, and S&P 500 varied between 7.4-8.6% (WSJ).
• Where else are hedge funds investing? Distressed debt. Deals on the rise as investors get aggressive using loan to own strategies (WSJ).
• But not all funds are still excited, as Tutor Investments is calling the recent move a bear-market rally, and believes that equity markets could decline later this year, creating yet another buying opportunity (Bloomberg). Slowing growth in China, and weak household income growth could create a drag on the global economy and the U.S. market.
• Is it time to get bearish on Wells Fargo again (hedgetracker.com). Goldman Sachs, Chanos, and Einhorn think so. Although he owns a boat load of Wells Fargo, Buffett's attention may be elsewhere as he appears to be increasing his holdings of foreign government bonds, as opposed to equities (The Telegraph).
• Speaking of Buffett, today he may feel that derivatives are not that bad after all. As it turns out, derivatives added $2.36 billion to earnings for Berkshire Hathaway, compared with $689 million a year earlier (Bloomberg).
• How is derivative trading going? Good if you are the ICE. The Intercontinental Exchange (ICE) is extending its lead in CDS clearing, clearing a notional value of more than $1.7 trillion since March as the joint venture between the CME group and Citadel hedge fund has yet to launch (Financial Times).
• While trading is up, understanding may be down as credit derivative models get more complex (Reuters - Felix Salmon).
• As for the U.S. market, volume is, well, anemic to say the least, as the SPY volume hits a low for 2009 (Zerohedge). I guess it is time to turn the machines back on. Then again, it is August (ETF Digest).
  
• The last two reporting periods have been the best for the markets over the last 8 years (Bespoke Investment Group). Does this signal the beginning of a bull market, as in 2002?
• Maybe we need a new useless index. Will learning proper etiquette be the new hemline index (Financial Armageddon)?
• Lowry Research's has reversed its position and is issuing an intermediate trend buy signal (Trader's Narrative).
  
• The VIX is signaling an S&P 500 swoon as September approaches as traders bet the VIX would increase 13% over the next five weeks - with the market moving in the opposite direction, 81% of the time (Bloomberg). But is this the correct analysis? (Daily Options Report)
• A look at the state of short-term mean reversion (MarketSci Blog).
  
• Now that we finally got a Dow Theory by signal, it is probably time to sell (Raymond James - Jeff Saut). HT Pragmatic Capitalist.
• Michael Steinhardt, Leon Cooperman, and David Gerstenhaber go on CNBC and discuss the state of the hedge fund industry (CNBC Video, The Big Picture, Zerohedge). Steinhardt mentions that "No one is long-term bullish."