A flood of earnings and a flood in SOFLA

Lunch with the Feds this week.  Last week's Fed minutes tell an interesting story.

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Warm Up

- Earnings Are Out

- Flooding in SOFLA - we have pictures

- Lunch with the Feds

- Fed minutes tell an interesting story

- Re-Announcing CTP for Goldman Sachs (glitch last week)

Market Update

- Going Sideways

- Banks post decent results - but doesn't include post-crisis (bank run)

- Tesla, Netflix earnings and and next week gets busy

- Yellen making some noise - nosing in wrong business

- Rates - Moving wrong direction (remains massively inverted)

Yields

- Yields on 3-month T-Bills have reached new post-2007 highs of 5.06%+

3M Yield Chart

Fed Minutes

- Fed expects banking crisis to cause a recession this year, minutes show

- Fallout from the U.S. banking crisis is likely to tilt the economy into recession later this year, according to Federal Reserve documents released Wednesday.

- Though Vice Chair for Supervision Michael Barr said the banking sector "is sound and resilient," staff economists said the economy will take a hit.

- "Given their assessment of the potential economic effects of the recent banking-sector developments, the staff's projection at the time of the March meeting included a mild recession starting later this year, with a recovery over the subsequent two years," the meeting summary stated.

Apple Follow Up

- We discussed potential store closures???

- Apple opens first retail store in India

- Cook was there in Mubai this week to take selfies and smile

China

- GOLD AND JEWELS

- Jewellery and precious metals consumption in China soared 37.4% in March from a year earlier underpinning a 13.6% jump for the quarter and topping the list of items that stoked a surge in first-quarter retail sales, official data showed on Tuesday.

- "Economic fundamentals, risk aversion and the recovery of domestic consumption all drive the investment demand for jewellery and precious metals," said Pang Xichun, research director at Nanjing RiskHunt Investment Management Co.- China's economy grew at a faster-than-expected pace in the first quarter, with retail sales rising 10.6%, beating forecasts for a 7.4% increase by a large margin.

 Bank Earnings

- Generally okay - withing tolerance range

- None seems to include post Bank run (Tighter standards)

- Not much in guidance that is useful

Bank Of America

- Earnings: 94 cents per share versus 82 cents per share expected

- Revenue: $26.39 billion versus $25.13 billion expected

- Bank of America said its net interest income jumped 25% to $14.4 billion during the quarter, driven by benefits from rising rates and loan growth.

- Stock up marginally

Goldman Sachs

- Reports Q1 (Mar) earnings of $8.79 per share, excluding non-recurring items, $0.73 better than the S&P Capital IQ Consensus of $8.06; revenues fell 5.5% year/year to $12.22 bln vs the $12.66 bln S&P Capital IQ Consensus.

- Provision for credit losses was a net benefit of $171 million for the first quarter of 2023, compared with net provisions of $561 million for the first quarter of 2022 and $972 million for the fourth quarter of 2022.

- Global Banking & Markets generated quarterly net revenues of $8.44 billion, driven by strong performances in Fixed Income, Currency and Commodities (FICC) and Equities, including record quarterly net revenues in Equities financing.

- Net revenues were $12.22 billion for the first quarter of 2023, 5% lower than the first quarter of 2022 and 15% higher than the fourth quarter of 2022. The decrease compared with the first quarter of 2022 reflected lower net revenues in Global Banking & Mar...