U.S. Real Estate R.I.P, Except in L.A.?

OIL, DOLLAR AND STOCKS UP; ECB TO RAISE RATES

HedgeStreet traders are speculating on further declines in real estate across the U.S., but they think that the LA median price will beat $575K at the November 20th release. Higher strike binaries for all regions across the U.S. saw declines in traded prices. Yet, the $100 Los Angeles 575s and 590s are going strong. The 575s traded last at $66.70, and the 590s at $26.60, indicating a 2/3 chance of the median price beating the $575K level. Nonfarm Payrolls contracts close on Thursday. Hurricane Isaac has started trading.

U.S. stock markets were up last week; the S&P closed up 1.6% at 1335.85. The 10-year Treasury yield edged up to 4.637%, still near its low. Oil found its bottom, recovering $2.36, closing at $62.91.

The dollar rose 0.84% against the euro to $1.2681/€ and 1.37% against the yen to ¥118.12/$. Intra-day currency closes (12noon and 3pm) remain popular with HedgeStreet traders with CHF and CAD joining the pack this week. The ECB is expected to raise interest rates 25 bp, to 3.25%, on Thursday.

Starbucks 5¢ price increases go into effect this week – talk about inelastic demand! GM board meets to discuss prospective alliance with Renault, or what’s left of it. More laptop batteries get recalled.

ECONOMIC RELEASES THIS WEEK

Monday: Manufacturing ISM at 53.5, down 1, as strong business investment continues to drive new orders and production. This is an important release.
Tuesday: Auto sales expected at 5.4m, truck sales at 7.2m, down from the July total of 13.1, fluctuations driven by incentives.
Wednesday: Factory orders expected at +0.5%, volatile but with super strong non-transport and core investment goods. Services ISM at 56.0.
Thursday: Initial Claims expected at 315K.
Friday: Nonfarm Payrolls expected at 125K, the most important number of the week, which would show a slowing in payroll growth. Declines in retail, gains in health services and construction. Unemployment at expected at 4.7%, catches the news but less important. Hourly earnings expected at +0.1% will be watched by the Fed after a 0.5% revision.

7-ELEVEN DROPS CITGO … GM-RENAULT TALKS FAIL … THE GOVERNATOR FIGHTS GLOBAL WARMING … A 14-YEAR OLD FLEES TO CUBA

7-Eleven dropped Venezuela-owned Citgo as its gasoline provider, following Hugo’s admission of being inspired by Chomsky’s over-intellectual rantings … Talks between GM’s Rick Wagoner and Renault-Nissan’s Carlos Ghosn came to naught when Ghosn realized how ugly the Pontiac Aztec was … California Governor Schwarzenegger signed a bill capping greenhouse emissions, effectively allowing only the sale of Toyotas and Hondas and banning the sale of GM, Chrysler and Ford cars from the state … A Florida teenager Alfredo Diaz fled to Cuba after his dad took away his iPod and computer privileges for cheating in school elections. Fidel lured the boy with his state-of-the-art RCA-Victor … Comverse’s option-backdating chairman Kobi Alexander was nabbed in Windhoek, Namibia, while shopping for country club real estate. When you cheat and don’t get caught, you think you can do it forever …