Trash Talking Sheiks Up Last Bulls Standing

With the market on the verge of a technical breakdown, sovereign wealth funds are turning the knife on each other and us, which should allow them to buy whatever they want, cheaper:

If there ever was a sign that the enormous Persian Gulf funds have become confident, Westernized investors, it's this: Now they are trash-talking each other's investments.

Asked about the billions of dollars invested in Citigroup by rival sovereign wealth funds and Prince Walid bin Talal of Saudi Arabia, the British-educated chief executive of Dubai International Capital, Sameer al-Ansari, told a private equity conference in Dubai today: "It's going to take more than that to rescue Citi."

Al-Ansari's comments will be taken as another indication of investors' lack of confidence in Citigroup's efforts to turn itself around. Porffolio

The market has made an admirable stand over the past month and a half, but the past week has been one capitulation after another. The jaw-boning has trickled all the way to Main Street, and they are buying gold hand over fist in what hopefully will become a short term blowoff as we approach $1,000. But predictions of super spikes in gold have been making the rounds, fueling the imagination of traders.

The January lows were a fleeting experience, and the retest might be as well, like a hot knife through butter.

Everyone seems a little cranky. Famed value investor Marty Whitman is not happy with the naysayers attacking his position in MBIA, and is trash talking the Bill Ackman and other bears, claiming they do not understand distressed investing:

Whitman, who has made a name by buying assets most other investors shun, in January increased his stake in MBIA, the largest bond insurer, at $12.15 a share and now holds about 10 percent of its outstanding shares.Third Avenue also has bought $326 million of the $2.6 billion MBIA has raised in new capital through note sales, which Whitman said made the company “strongly capitalized.”

Whitman said Ackman’s bearish views had made it possible to buy MBIA at depressed prices. But the founder of hedge fund Pershing Square Capital Management does not seem to understand how property and casualty insurance is profitable, he said. Reuters

Bernanke’s speech today failed to inspire; we have been trying to find something constructive to say about him but are at a loss for words. The medicine he has doled out might not work, but we will not find out for months in any case. Commodity speculators have been taking full advantage.

Another technical inflection point is upon us, and outside of short covering, buyers are scarce.

Fed Governors Fisher and Mishkin are speaking at 1PM EST, look for their comments to contradict recent Fed Heads and confuse everyone further.

I am a reluctant net buyer today. Care to join me?

Dubai: Citi May Need More Cash
Portfolio

Whitman holds firm on MBIA, Ambac bets
Reuters
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The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.

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