Good morning.
Great weather and an ethanol mandate story have put pressure on our market.
Yesterday morning we had reports of the mandate being lowered to the tune of 300 mil bushels and by the time we close that number had swelled to 1billion.
Everything closed weak and we are weaker overnight. Corn down 2, beans down 5 and wheat down 2.
What I saw yesterday was indicative of story scaring some longs and spurring on some speculation in some shorts. A large number of Dec $4.00 puts were bought near the close as well as a huge number of Nov $4.30 puts. There was a lot of call selling and put buying in May corn as well giving one the impression that something was up.
We shall see if there are any legs to the story but the puts got suddenly popular.
The other big story was that this Cool Hand Luke Congress has gotten together to 'talk'. That is how bad things are that we have a 2% pop in equity prices when we get our leaders together. Sad.
Equities are up small overnight after yesterday's huge move. The 10 year is at 2.68% up a tad but not much higher than over the last few weeks which says to me that we still have the same bad economy, the same leaders in Washington and the same risks going forward.
Today will be interesting as we follow the talking heads to see what the'deal' may be.
It's all kind of disappointing.
