Morgan Stanley Earnings Rise 35% on revenue!

Wealth Management

The global wealth-management division, which includes the brokerage joint venture, had $3.35 billion in revenue, up 7 percent from a year earlier, and a 12 percent pretax profit margin. The unit had $14.1 billion of net new assets, bringing the annual total to $22.9 billion and meeting Gorman’s target of more than $20 billion of inflows in 2010. - Source: Bloomberg.com

Good news today after the bad news the day before yesterday. Really?

Morgan Stanley had higher investment-banking revenue than GS for second time? or is it some kind of domino effect play by Fed regulation? To keep the US banking image up there not to loose any confidence, i definitely don't want to sound like a conspiracy theorist, just hard to believe that GS is loosing ground. MS CEO James Morgan has promised to reduce the portion of the compensation award in 2009, but it doesn't mean numbers would skyrocket to 35%+. But I guess good news for the market, but most of the investors are still skeptic after the yesterday's sell off.

Sentiment in the Market (01/17/2011)

Market sentiment is down today due to Mr.Steve Jobs' health. Hope he gets better soon.

We need more innovative thinkers like Steve in this world.

Text of his letter to his employees:

“Team,

At my request, the board of directors has granted me a medical leave of absence so I can focus on my health. I will continue as CEO and be involved in major strategic decisions for the company.

I have asked Tim Cook to be responsible for all of Apple’s(AAPL 348.48, 0.00, 0.00%) day-to-day operations. I have great confidence that Tim and the rest of the executive management team will do a terrific job executing the exciting plans we have in place for 2011.

I love Apple so much and hope to be back as soon as I can. In the meantime, my family and I would deeply appreciate respect for our privacy.

Steve.

I have a dream.... -MLK

Martin Luther King, Jr was not only an average American clergyman and activist but a person who changed lives of many African-Americans. It amazes me how one person can change societies and people by their perseverance, diplomatic communication and a great speech.

I have a dream that one day(soon) DJIA will reach 14K again!
I have a dream that oil will reach $115 soon (end of this year)!
I have a dream that everyone will be happy!

Happy MLK day everyone!

Is China Funding the US Debt?

Lately, I hear many news channels claim that China is funding US deficit spending.

It turns out to be only partially true — and by partially, I mean 7.5% true. But that means the statement is 92.5% false.

The biggest holders of US debt are American individuals, institutions, and Social Security. Americans own more than 2 out of every 3 dollars of US debt — about over 67%. Hence, US depends far less on the kindness of strangers than you might imagine if your listen to the intertubes.

Those viral animated bears may be clever, but they sure suck at math.

Total United States’ public debt was ~$13.562 trillion at the end of the fiscal year (30 September 2010). As of last week, January 4, 2011, the United States’ total public debt outstanding has surpassed 14 trillion dollars.

Political Calculations has whipped up a chart showing exactly who is holding US debt, and funding our deficit:

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click for bigger graphic

Summary of Week’s Events (1/14/11)

Positives:

1) Japan joins China in wanting to chip in to help Europe

2) Portugal, Spain and Italy all successfully sell debt and sets calmer tone for the week

3) US Treasury yields shrug off higher inflation readings and stay moderate (bond bulls should thank the Fed)

4) Stocks shrug off all the negatives below and continue to melt higher

5) Thailand, South Korea and China take prudent steps to cool inflation pressures

Negatives:

1) PPI, CPI (record high), Import Prices, inflation expectations in UoM, all point to upward inflation trend and JOC and CRB food indices hit record highs

2) Thailand, South Korea and China all tighten policy over inflation worries

3) Indian Sensex index falls to 4 month low after 8.4% wholesale inflation report and ahead of likely rate hike on Jan 25th

4) US Retail Sales a touch light

5) UoM confidence light

6) Initial Claims jump but seasonal issues

7) Muni’s break down.