Succinct Summation of Week’s Events 6.26.15 (+ bonuses)

Curiously, this weekend's summation contains no mention of the Greece crisis, even though the market more or less revolved around that particular issue all last week.  Also no mention of what I thought was the most important news of the week that received only a glancing mention in the financial media (and none in the mainstream media) and that was the revised Q1 Commerce Dept report that found GDP had shrunk by a mere 2/10% instead of the previously reported 7/10% (which had also been a revision from the originally stated nearly 2%).

It's possible that next week there may be still another revision that shows that Q1 actually grew.  That's been the trend in this economy, the world changes practically every day.  But ... the GDP numbers not withstanding, a lot happened with Greece this weekend.  You already have the Saturday update.  Today, the Greek government ordered all banks shuttered Sunday and Monday.  The result has been lines around the block at every ATM there and a rush from the ECB to keep the Greek banks supplied with sufficient cash to meet this demand so as to avert panic.  Tourists are being advised not to go without sufficient funds as it may not be possible to use banks.  On Tuesday, Greece officially defaults unless one side and/or the other caves at least a little bit.  My expectation, based on past history, is that a little caving is exactly what's going to happen.  As bonuses, I'm including links to articles that have quite a lot more detail about this situation.

Since my training and background is in financial analysis and no one believes more strongly than financial analysts in the old saying, "There are lies, there are damn lies, and there are statistics" ... (or as a placard that I always proudly displayed in my office at Northrop and which originated with Mark Twain - "Figures Never Lie, But Liars Always Figure"), no one is more aware than we that numbers cannot be trusted.  That's why we're paid so damn well.  Senior management depends on us to look at the numbers and tell them what they really mean!  In view of that, Friday's Wall Street Journal had an excellent article that serves as a mini-course on how to correctly read numbers.  It's no substitute for an MBA, but it's a good summary.  That is extra bonus #1.  Extra bonus #2 is a link to an 8 minute video posted today that mines pearls of wisdom from Bill Gates.  Hope everyone had a great weekend.

Succinct Summation of Week’s Events 6.26.15

by Barry Ritholtz - June 26th, 2015, 4:00pm

Succinct Summations week ending June 26th

Positives:

1. Consumer spending rose by 0.9% in May, the biggest gain in six years.
2. Weekly jobless claims came in at 271k, vs the 274k forecast.
3. Existing home sales rose 5.1% to 5.35m vs expectations of 5.26m, the highest since 2009.
4. New home sales came in at 546k, up from 534k previously and higher than the 525k expected.
5. Consumer sentiment rose to 96.1, a five-month high.

Negatives:

1. Markit US services PMI came in at 54.8, down from 56.2 and the lowest since January.
2. Durable goods fell 1.8% vs an expected decrease of 1.5%.
3. Markit US manufacturing PMI fell for the third straight month to 53.4, the lwest reading since October 2013.

Greece to introduce capital controls, keep banks shut as crisis deepens | Reut

U.S. urges Europe, IMF to reach a deal to keep Greece in euro zone | Reuters

How much Greece owes to international creditors | Reuters

How Not to Be Misled by Data - WSJ

A Conversation with Bill Gates | The Big Picture