Shortly after the open today, the Dow had shot up 88 points.
By noon, it was down 87, thus, making a 1% move in the course of 2 1/2 hours.
Coincidence or central planning aside, the upside move equaled the downside move, nearly to the penny.
From noon until 2:00 pm, the Dow index clawed back all of the losses and was trading positively again, up around 40 points, or, just about half of the early day gains. Eventually, the Dow closed up a few points, more or less unchanged.
Day-traders may be scratching their collective skulls over this odd pattern, though it should be noted that almost none of the moves - to the up or downside - had anything at all to do with fundamentals, sentiment, forward-thinking, the presidential election cycle, or the price of pork in China.
It probably had everything to do with front-running algos which dominate the so-called "trading," which has become more of a skimming operation by firms like Citadel and other adherents of non-free market operations.
The headline financial media will try to come up with story lines to match the mood, though none of them can adequately pass even the most rudimentary smell test. The financial talking heads in macro-land are faking it as best they can, while the market remains stuck in a no-man's land that's been in place for just about a year now (taking the long view), or, a truly narrow range on the Dow between 17,500 and 18,000 since March 18.
On 34 of the past 39 trading days (including today) the Dow closed within that range. Of the five days it closed outside that range, all of them were above the 18,000 line, the highest being 18,096, on April 20.
Essentially, stocks have been going nowhere for quite some time, especially over the past month and a half, in which the total range was roughly three percent.
Which brings us to the question of intra-day moves and whether or not to pay them any mind. Unless one is engaged in betting with friends on market swings, or day-trading (an occupation which can put your whole house in jeopardy), intra-day swings should be discounted dramatically. The old saying, "the trend is your friend," doesn't apply unless you're looking of weeks, months or years.
Going Nowhere, Slowly:
S&P 500: 2,064.11, -0.35 (0.02%)
Dow: 17,720.50, +9.38 (0.05%)
NASDAQ: 4,737.33, -23.35 (0.49%)
Crude Oil 46.39 -0.66% Gold 1,267.40 -0.30% EUR/USD 1.1376 +0.02% 10-Yr Bond 1.76 +1.15% Corn 387.50 -0.39% Copper 2.07 -0.05% Silver 17.08 -0.16% Natural Gas 2.13 -0.97% Russell 2000 1,108.60 -0.55% VIX 14.41 -1.91% BATS 1000 20,677.17 0.00% GBP/USD 1.4445 -0.01% USD/JPY 109.0300 -0.05%
Showing posts with label Dow. Show all posts
Showing posts with label Dow. Show all posts
Thursday, May 12, 2016
Tuesday, May 3, 2016
Stocks, Oil Lower As Dollar Rebound Pushes Bond Price; Silver Suffers
The past few weeks haven't been very kind to the almighty greenback, but today was a respite from some concerted selling, sending stocks and oil lower.
While that scenario makes perfect sense for stocks and commodities in general, it sure doesn't help when the master manipulators manage to gang up on the one asset underpinning everything... not gold, silver.
Massive silver price suppression over the past 15 years has pushed the coin of common men to unheard of ratios in comparison to gold, and today was textbook slamming against the metal of the working man. While the absurdity of the 70:1 and higher silver to gold ratio has been discussed here in the past - and elsewhere, by more astute students of real money, it bears repeating, and repeating, until the price suppression stops completely.
That may be more of a pipe dream than winning the lottery, yet it is the one eventuality that must come to pass if the rule of central bankers and their idiotic QE and NIRP policies are ever to end and the financial universe is to regain some semblance of real markets and real prices, as opposed to the obviously fraudulent ones foisted upon the world by central bankers, especially those entertained by the US Federal Reserve.
With unlimited power to create money out of thin air, there is no market the master bankers cannot control, so it is easy to assume that they can absolutely pollute and disintegrate all price discovery mechanisms when it comes to silver, one of the smallest markets (in dollar terms, by their wicked design) of all.
But, to the guy or gal who is looking to keep wealth out of the corrupted central banking system and regain some sanity in his or her financial affairs, silver is a bottom holding, a base unit of measure, and insurance against what appears to be an advancing monetary apocalypse.
A one ounce bar of silver can still be had for under $20 US, and that little sliver of metallic hope may be all that's left between survival and tortuous, tyrannical totalitarianism.
As for stocks, they are but pieces of paper promises, and highly overrated as investment instruments. Compaies come and go, nations rise and fall, but silver will remain
S&P 500: 2,063.37, -18.06 (0.87%)
Dow: 17,750.91, -140.25 (0.78%)
NASDAQ: 4,763.22, -54.37 (1.13%)
Crude Oil 43.90 -1.97% Gold 1,288.20 -0.59% EUR/USD 1.1497 -0.26% 10-Yr Bond 1.80 -3.49% Corn 379.00 -3.25% Copper 2.22 -2.16% Silver 17.46 -1.26% Natural Gas 2.08 +2.01% Russell 2000 1,121.76 -1.68% VIX 15.60 +6.27% BATS 1000 20,677.17 0.00% GBP/USD 1.4536 -0.88% USD/JPY 107.1130 +0.61%
While that scenario makes perfect sense for stocks and commodities in general, it sure doesn't help when the master manipulators manage to gang up on the one asset underpinning everything... not gold, silver.
Massive silver price suppression over the past 15 years has pushed the coin of common men to unheard of ratios in comparison to gold, and today was textbook slamming against the metal of the working man. While the absurdity of the 70:1 and higher silver to gold ratio has been discussed here in the past - and elsewhere, by more astute students of real money, it bears repeating, and repeating, until the price suppression stops completely.
That may be more of a pipe dream than winning the lottery, yet it is the one eventuality that must come to pass if the rule of central bankers and their idiotic QE and NIRP policies are ever to end and the financial universe is to regain some semblance of real markets and real prices, as opposed to the obviously fraudulent ones foisted upon the world by central bankers, especially those entertained by the US Federal Reserve.
With unlimited power to create money out of thin air, there is no market the master bankers cannot control, so it is easy to assume that they can absolutely pollute and disintegrate all price discovery mechanisms when it comes to silver, one of the smallest markets (in dollar terms, by their wicked design) of all.
But, to the guy or gal who is looking to keep wealth out of the corrupted central banking system and regain some sanity in his or her financial affairs, silver is a bottom holding, a base unit of measure, and insurance against what appears to be an advancing monetary apocalypse.
A one ounce bar of silver can still be had for under $20 US, and that little sliver of metallic hope may be all that's left between survival and tortuous, tyrannical totalitarianism.
As for stocks, they are but pieces of paper promises, and highly overrated as investment instruments. Compaies come and go, nations rise and fall, but silver will remain
S&P 500: 2,063.37, -18.06 (0.87%)
Dow: 17,750.91, -140.25 (0.78%)
NASDAQ: 4,763.22, -54.37 (1.13%)
Crude Oil 43.90 -1.97% Gold 1,288.20 -0.59% EUR/USD 1.1497 -0.26% 10-Yr Bond 1.80 -3.49% Corn 379.00 -3.25% Copper 2.22 -2.16% Silver 17.46 -1.26% Natural Gas 2.08 +2.01% Russell 2000 1,121.76 -1.68% VIX 15.60 +6.27% BATS 1000 20,677.17 0.00% GBP/USD 1.4536 -0.88% USD/JPY 107.1130 +0.61%
Friday, April 8, 2016
Stocks Stage Brave Friday Rally, Fall For Week As Yellen Denies Bubble
Janet Yellen, April 7, 2016:
So, apparently, April Fool's Day has been extended to April Fool's Week. The Chairwoman's comment was made in response to a question of whether the US economy was in a bubble.
It has become increasingly obvious to more than just high-rollers on Wall Street, that the occupants of various ivory towers in the Eccles Building are either clueless or lying, and, whichever camp one adheres to, the idea that their economic policies have been detrimental to the common good is without doubt.
Friday's action was nothing more than a dead cat bounce, with all three major indices ripping at the open, but running stagnant as the session wore on, finally ending with small gains.
For the week the degradation was uniform, the Dow lost 215.79 (-1.21%), the S&P shed 25.18 points (-1.21%), while the exuberant NASDAQ dropped 63.85 (-1.30%) points.
Oil gained six percent on the day, followed by more stable precious metals, particularly silver, which has rebounded nicely from a recent smack down.
Friday's Pop and Flop:
S&P 500: 2,047.60, +5.69 (0.28%)
Dow: 17,576.96, +35.00 (0.20%)
NASDAQ: 4,850.69, +2.32 (0.05%)
Crude Oil 39.51 +6.04% Gold 1,241.70 +0.34% EUR/USD 1.1395 +0.18% 10-Yr Bond 1.72 +1.71% Corn 362.00 +0.14% Copper 2.09 +0.48% Silver 15.37 +1.40% Natural Gas 1.99 -1.49% Russell 2000 1,097.31 +0.41% VIX 15.36 -4.95% BATS 1000 20,682.61 0.00% GBP/USD 1.4128 +0.51% USD/JPY 108.1670 -0.08%
"So I would say the US economy has made tremendous progress in recovering from the damage from the financial crisis. Uh, slowly but surely the labor market is healing. Um, for well over a year we’ve averaged about 225,000 jobs a month. The unemployment rate now stands at 5%. So, we’re coming close to our assigned congressional goal of maximum employment. Um, inflation which, um, my colleagues here Paul [Volker] and Alan [Greenspan]
um, spent much of their time as chair um, bringing inflation down from unacceptably high levels. For a number of years now inflation has been running under our 2% goal and we’re focused on moving it up to 2%. Um, but we think that it’s partly transitory influences, namely declining oil prices, and uh, the strong dollar that are responsible for pulling inflation below the 2% level we think is most desirable. So, I think we’re making progress there as well, and this is an economy on a solid course, um, not a bubble economy. Um, we tried carefully to look at evidence of potential financial instability that might be brewing and some of the hallmarks of that, clearly overvalued asset prices, high leverage, rising leverage, and rapid credit growth. We certainly don’t see those imbalances. And so although interest rates are low, and that is something that could encourage reach for yield behavior, I wouldn’t describe this as a bubble economy."
 |
| Janet Yellen; Stupid or insincere? |
It has become increasingly obvious to more than just high-rollers on Wall Street, that the occupants of various ivory towers in the Eccles Building are either clueless or lying, and, whichever camp one adheres to, the idea that their economic policies have been detrimental to the common good is without doubt.
Friday's action was nothing more than a dead cat bounce, with all three major indices ripping at the open, but running stagnant as the session wore on, finally ending with small gains.
For the week the degradation was uniform, the Dow lost 215.79 (-1.21%), the S&P shed 25.18 points (-1.21%), while the exuberant NASDAQ dropped 63.85 (-1.30%) points.
Oil gained six percent on the day, followed by more stable precious metals, particularly silver, which has rebounded nicely from a recent smack down.
Friday's Pop and Flop:
S&P 500: 2,047.60, +5.69 (0.28%)
Dow: 17,576.96, +35.00 (0.20%)
NASDAQ: 4,850.69, +2.32 (0.05%)
Crude Oil 39.51 +6.04% Gold 1,241.70 +0.34% EUR/USD 1.1395 +0.18% 10-Yr Bond 1.72 +1.71% Corn 362.00 +0.14% Copper 2.09 +0.48% Silver 15.37 +1.40% Natural Gas 1.99 -1.49% Russell 2000 1,097.31 +0.41% VIX 15.36 -4.95% BATS 1000 20,682.61 0.00% GBP/USD 1.4128 +0.51% USD/JPY 108.1670 -0.08%
Sunday, March 20, 2016
Coordinated Central Bank Easing Leads to Higher Stock Prices
First came the BOJ.
Then the ECB.
And, just this past Wednesday, the Fed chimed into the global monetary easing chorus with no increase in the federal funds rate, and a solid statement that the FOMC would likely only increase rates twice in 2016, for a paltry 1/2 percent increase.
Such a move would put the rate at 0.75 to one percent by December of this year, or, put another way, just a touch lower than the Greenspan put of the early 2000s.
Those unfamiliar with recent history would not understand how Greenspan's easy rate policy led to various mal-investments, not the least of which were in the housing market, which led to a boom and then a bust and the 2008 financial crisis.
So, what the central bankers are telling us in a unified voice, is that they'll gladly take the risk of another massive financial implosion in order to keep the global fiat currency regime intact.
So far, they're doing quite well. There've been no mass protests, riots, or other noticeable social uprisings in the dominant economies of the developed nations, and, while detractors will proclaim that this regime of low (and even negative) interest rates cannot continue without devastating consequences, the world keeps spinning, the rich get richer and the rest of us carry on in quiet, medieval fashion, mumbling vaguely about unfairness and impropriety.
Elsewhere, stock owners are popping the champagne corks and drinking lustily from the font of the Fed, the ECB and the Bank of Japan, especially in the USA, which just completed one of the quickest and most violent market reversals in recorded history, bringing the Dow Jones Industrials and S&P 500 back to breakeven for the year.
In just over a month's time, the Dow has rallied more than 2,000 points off the mid-February lows. The S&P took off from 1810.10 to close at 2049.58 on Friday, an impressive, 13.23% move. Who said timing wasn't everything?
Buy and hold will be the order of the day, it seems, as long as the central bankers retain complete control over every market, everywhere. When that changes, nobody knows, though many still try. The piper, it appears, will be paid at a later date, likely of the central banks' choosing.
For an overview of the central bank monetary madness, and possible preview of what's ahead, the Telegraph offers keen insight with:
Central banks are already doing the unthinkable -- you just don't know it.
For the week:
DOW: +388.99 (2.26%)
S&P 500: +27.39 (1.35%)
NASDAQ: +47.18 (0.99%)
Friday's Fun Fed Figures:
S&P 500: 2,049.58, +8.99 (0.44%)
Dow: 17,602.30, +120.81 (0.69%)
NASDAQ: 4,795.65, +20.66 (0.43%)
Crude Oil 41.13 -1.27% Gold 1,256.00 -0.71% EUR/USD 1.1268 -0.02% 10-Yr Bond 1.8710 -1.68% Corn 366.50 -0.54% Copper 2.29 -0.28% Silver 15.82 -1.30% Natural Gas 1.89 -2.22% Russell 2000 1,101.67 +0.95% VIX 14.02 -2.91% BATS 1000 20,677.17 0.00% GBP/USD 1.4471 -0.05% USD/JPY 111.5525 0.00%
Then the ECB.
And, just this past Wednesday, the Fed chimed into the global monetary easing chorus with no increase in the federal funds rate, and a solid statement that the FOMC would likely only increase rates twice in 2016, for a paltry 1/2 percent increase.
Such a move would put the rate at 0.75 to one percent by December of this year, or, put another way, just a touch lower than the Greenspan put of the early 2000s.
Those unfamiliar with recent history would not understand how Greenspan's easy rate policy led to various mal-investments, not the least of which were in the housing market, which led to a boom and then a bust and the 2008 financial crisis.
So, what the central bankers are telling us in a unified voice, is that they'll gladly take the risk of another massive financial implosion in order to keep the global fiat currency regime intact.
So far, they're doing quite well. There've been no mass protests, riots, or other noticeable social uprisings in the dominant economies of the developed nations, and, while detractors will proclaim that this regime of low (and even negative) interest rates cannot continue without devastating consequences, the world keeps spinning, the rich get richer and the rest of us carry on in quiet, medieval fashion, mumbling vaguely about unfairness and impropriety.
Elsewhere, stock owners are popping the champagne corks and drinking lustily from the font of the Fed, the ECB and the Bank of Japan, especially in the USA, which just completed one of the quickest and most violent market reversals in recorded history, bringing the Dow Jones Industrials and S&P 500 back to breakeven for the year.
In just over a month's time, the Dow has rallied more than 2,000 points off the mid-February lows. The S&P took off from 1810.10 to close at 2049.58 on Friday, an impressive, 13.23% move. Who said timing wasn't everything?
Buy and hold will be the order of the day, it seems, as long as the central bankers retain complete control over every market, everywhere. When that changes, nobody knows, though many still try. The piper, it appears, will be paid at a later date, likely of the central banks' choosing.
For an overview of the central bank monetary madness, and possible preview of what's ahead, the Telegraph offers keen insight with:
Central banks are already doing the unthinkable -- you just don't know it.
For the week:
DOW: +388.99 (2.26%)
S&P 500: +27.39 (1.35%)
NASDAQ: +47.18 (0.99%)
Friday's Fun Fed Figures:
S&P 500: 2,049.58, +8.99 (0.44%)
Dow: 17,602.30, +120.81 (0.69%)
NASDAQ: 4,795.65, +20.66 (0.43%)
Crude Oil 41.13 -1.27% Gold 1,256.00 -0.71% EUR/USD 1.1268 -0.02% 10-Yr Bond 1.8710 -1.68% Corn 366.50 -0.54% Copper 2.29 -0.28% Silver 15.82 -1.30% Natural Gas 1.89 -2.22% Russell 2000 1,101.67 +0.95% VIX 14.02 -2.91% BATS 1000 20,677.17 0.00% GBP/USD 1.4471 -0.05% USD/JPY 111.5525 0.00%
Thursday, March 17, 2016
Dow Ends Day In Green for 2016
Call it the luck of the Irish, or maybe the magic of Janet Yellen's Fed, but the Dow Jones Industrials ended the day up large, and in the green for 2016. The S&P is just five points away from a positive close for the year.
The NASDAQ needs to get closer to 5000 for breakeven for the year.
That's it. Funny money.
Today's closing quotes:
S&P 500: 2,040.59, +13.37 (0.66%)
Dow: 17,481.49, +155.73 (0.90%)
NASDAQ: 4,774.99, +11.02 (0.23%)
Crude Oil 41.67 +4.17% Gold 1,258.60 +2.34% EUR/USD 1.1318 +0.94% 10-Yr Bond 1.9030 -1.81% Corn 367.75 -0.14% Copper 2.29 +2.44% Silver 15.94 +4.70% Natural Gas 1.93 +3.59% Russell 2000 1,091.25 +1.56% VIX 14.44 -3.67% BATS 1000 20,682.61 0.00% GBP/USD 1.4473 +1.59% USD/JPY 111.3950 -1.23%
The NASDAQ needs to get closer to 5000 for breakeven for the year.
That's it. Funny money.
Today's closing quotes:
S&P 500: 2,040.59, +13.37 (0.66%)
Dow: 17,481.49, +155.73 (0.90%)
NASDAQ: 4,774.99, +11.02 (0.23%)
Crude Oil 41.67 +4.17% Gold 1,258.60 +2.34% EUR/USD 1.1318 +0.94% 10-Yr Bond 1.9030 -1.81% Corn 367.75 -0.14% Copper 2.29 +2.44% Silver 15.94 +4.70% Natural Gas 1.93 +3.59% Russell 2000 1,091.25 +1.56% VIX 14.44 -3.67% BATS 1000 20,682.61 0.00% GBP/USD 1.4473 +1.59% USD/JPY 111.3950 -1.23%
Thursday, March 10, 2016
Key Reversal As Dow Candlestick Engulfs Previous Four Sessions; ECB's Draghi To Blame
Money Daily been covering about this rally for the past two weeks but really didn't see the handwriting on the wall throughout. While saying the market would continue to rally at least until the ECB rate announcement by Mario Draghi (today), and possibly Yellen and the FOMC (on the 16th), there was no way to know when exactly it would stop or why.
But, now we all know. It was "buy the rumor, sell the news," all along. Everybody figured Draghi would go all in on QE and lowering the reserve rate (rumor) and he did (news), so, therein lies the reasons for first the pump in stocks and then the midday dump as Draghi then backtracked at his press conference, saying not to expect more over-the-top policy moves anytime soon.
Why? Draghi was giving Yellen and the Fed cover to keep rates where they are, for at least another month or meeting.
The main aspects of Draghi's "bazooka" approach are:
-- The key interest rate is dropped from 0.05% to ZERO.
-- Cut its deposit rate by 10 basis points, further into negative territory to -0.4%
-- The marginal lending rate, paid by banks to borrow from the ECB overnight, was cut from 0.3% to to 0.25%
-- Expanded the QE programme to €80bn (£61bn) a month, up from €60n
-- Expanded the LTRTO, offering more easy loans to Eurozone banks
Then we saw the usual late-day comeback, leaving US equity markets virtually unchanged, on a day that was arguably noteworthy and newsworthy. The markets, the speculators, had all of this priced in, and the gyrations were only to square their winners and losers.
This is the game. It's nothing more than a game, has no root in reality, fundamentals, supply/demand or any other tired metric of what we used to fondly call "analysis."
Markets are nothing more than tools for public entertainment and consumption. The central bankers, so long as they have the power to conjure endless amounts of fiat out of thin air, have complete control over all markets.
Finally, we are beginning to see the light at the end of the tunnel, though it appears to be just a flickering candle about to be snuffed out.
As far as technical analysis is concerned - again, giving the CNBC types and the marketeers sufficient cover - the Dow candlestick chart shows today as a key reversal day, with today's action - up, then down, then back up - engulfing the previous four sessions on the Dow. Interesting also is the pint at which the rally ended, almost exactly at the 200-day moving average. It's almost as if it was planned, though that kind of statement might brand one as a wearer of tin-foil hats and a believer in astrology or Scientology.
These kinds of "outside" reversals almost always signal a change in direction, so, outside of more malignant market manipulation, stocks should head south on Friday and continue in that general direction heading up to the FOMC meeting Tuesday and Wednesday of next week.
Upon the Fed keeping rates unchanged, it will be "mission accomplished" for the time being. multiple flavors of options expire on Friday, so expect volatility heading into the end of next week.
Then again, one could hold real assets outside the system, those being anything raised without the assistance of fiat money (think animal husbandry, vegetable gardening and barter), or the hated precious metals and/or gemstones.
In he end, people use money or currency to buy the things they need to lead free, comfortable lives. If one were to master the ability to minimize dependence on the fiat money system and maximize the ability to produce energy, food and goods, there would be little need for any kind of currency except that controlled by the actual buyers and sellers.
There, the survivalist, off-the-grid types make perfect sense.
Thursday's Round-trip Extravaganza:
S&P 500: 1,989.57, +0.31 (0.02%)
Dow: 16,995.13, -5.23 (0.03%)
NASDAQ: 4,662.16, -12.22 (0.26%)
Crude Oil 37.88 -1.07% Gold 1,271.90 +1.15% EUR/USD 1.1179 +1.64% 10-Yr Bond 1.9290 +1.96% Corn 363.00 +0.97% Copper 2.23 -0.31% Silver 15.59 +1.43% Natural Gas 1.80 +3.03% Russell 2000 1,063.99 -0.82% VIX 18.05 -1.58% BATS 1000 20,677.17 0.00% GBP/USD 1.4282 +0.49% USD/JPY 113.2420
But, now we all know. It was "buy the rumor, sell the news," all along. Everybody figured Draghi would go all in on QE and lowering the reserve rate (rumor) and he did (news), so, therein lies the reasons for first the pump in stocks and then the midday dump as Draghi then backtracked at his press conference, saying not to expect more over-the-top policy moves anytime soon.
Why? Draghi was giving Yellen and the Fed cover to keep rates where they are, for at least another month or meeting.
The main aspects of Draghi's "bazooka" approach are:
-- The key interest rate is dropped from 0.05% to ZERO.
-- Cut its deposit rate by 10 basis points, further into negative territory to -0.4%
-- The marginal lending rate, paid by banks to borrow from the ECB overnight, was cut from 0.3% to to 0.25%
-- Expanded the QE programme to €80bn (£61bn) a month, up from €60n
-- Expanded the LTRTO, offering more easy loans to Eurozone banks
Then we saw the usual late-day comeback, leaving US equity markets virtually unchanged, on a day that was arguably noteworthy and newsworthy. The markets, the speculators, had all of this priced in, and the gyrations were only to square their winners and losers.
This is the game. It's nothing more than a game, has no root in reality, fundamentals, supply/demand or any other tired metric of what we used to fondly call "analysis."
Markets are nothing more than tools for public entertainment and consumption. The central bankers, so long as they have the power to conjure endless amounts of fiat out of thin air, have complete control over all markets.
Finally, we are beginning to see the light at the end of the tunnel, though it appears to be just a flickering candle about to be snuffed out.
As far as technical analysis is concerned - again, giving the CNBC types and the marketeers sufficient cover - the Dow candlestick chart shows today as a key reversal day, with today's action - up, then down, then back up - engulfing the previous four sessions on the Dow. Interesting also is the pint at which the rally ended, almost exactly at the 200-day moving average. It's almost as if it was planned, though that kind of statement might brand one as a wearer of tin-foil hats and a believer in astrology or Scientology.
These kinds of "outside" reversals almost always signal a change in direction, so, outside of more malignant market manipulation, stocks should head south on Friday and continue in that general direction heading up to the FOMC meeting Tuesday and Wednesday of next week.
Upon the Fed keeping rates unchanged, it will be "mission accomplished" for the time being. multiple flavors of options expire on Friday, so expect volatility heading into the end of next week.
Then again, one could hold real assets outside the system, those being anything raised without the assistance of fiat money (think animal husbandry, vegetable gardening and barter), or the hated precious metals and/or gemstones.
In he end, people use money or currency to buy the things they need to lead free, comfortable lives. If one were to master the ability to minimize dependence on the fiat money system and maximize the ability to produce energy, food and goods, there would be little need for any kind of currency except that controlled by the actual buyers and sellers.
There, the survivalist, off-the-grid types make perfect sense.
Thursday's Round-trip Extravaganza:
S&P 500: 1,989.57, +0.31 (0.02%)
Dow: 16,995.13, -5.23 (0.03%)
NASDAQ: 4,662.16, -12.22 (0.26%)
Crude Oil 37.88 -1.07% Gold 1,271.90 +1.15% EUR/USD 1.1179 +1.64% 10-Yr Bond 1.9290 +1.96% Corn 363.00 +0.97% Copper 2.23 -0.31% Silver 15.59 +1.43% Natural Gas 1.80 +3.03% Russell 2000 1,063.99 -0.82% VIX 18.05 -1.58% BATS 1000 20,677.17 0.00% GBP/USD 1.4282 +0.49% USD/JPY 113.2420
Friday, February 12, 2016
Stocks Always Rebound After Sound Drubbings... Except When They Don't
Regular readers of Money Daily may notice that our editorial point of view - on days like today - sees no reason for stocks to go higher for just about any reason.
There's a method to the madness: it's because the economy stinks and most of the stocks that comprise the major averages are either overpriced or making use of devious accounting tactics to hide the truth.
Today was textbook manipulation to the upside, and, as it turns out, insufficient to cover the losses from earlier in the week. That's the problem with glowing headlines about stocks going up: the writers of such headlines and articles fail to point out that these stocks are coming off being beaten down.
For instance, today's gain on Bank of America (BAC) was 7%, but, it closed at 11.95. It was 18 six months ago, and 14 just a few weeks ago. Some for WTI crude oil, which was up a whopping 11.33% today. Outstanding. However, the closing price was $29.18, more than a 70% decline from 18 months ago.
Anybody even remotely suggesting that the economy and/or equity markets are sound should be shackled, drug off to the nearest body of water and thrown in. Stupidity (from central banks and paid economists) is what got the markets and the economy into the current mess.
Enough is enough, today's results notwithstanding.
For the week:
S&P 500: -15.27 (-0.81%)
Dow: -231.13 (-1.43%)
NASDAQ: -25.63 (-0.59%)
Today's fancy, farcical feast:
S&P 500: 1,864.78, +35.70 (1.95%)
Dow: 15,973.84, +313.66 (2.00%)
NASDAQ: 4,337.51, +70.67 (1.66%)
Crude Oil 29.18 +11.33% Gold 1,239.30 -0.68% EUR/USD 1.1250 -0.57% 10-Yr Bond 1.7480 +6.33% Corn 358.75 -0.42% Copper 2.03 +1.37% Silver 15.76 -0.25% Natural Gas 1.97 -1.45% Russell 2000 971.99 +1.92% VIX 25.40 -9.74% BATS 1000 20,089.57 +1.80% GBP/USD 1.4499 +0.10% USD/JPY 113.2750 +0.60%
There's a method to the madness: it's because the economy stinks and most of the stocks that comprise the major averages are either overpriced or making use of devious accounting tactics to hide the truth.
Today was textbook manipulation to the upside, and, as it turns out, insufficient to cover the losses from earlier in the week. That's the problem with glowing headlines about stocks going up: the writers of such headlines and articles fail to point out that these stocks are coming off being beaten down.
For instance, today's gain on Bank of America (BAC) was 7%, but, it closed at 11.95. It was 18 six months ago, and 14 just a few weeks ago. Some for WTI crude oil, which was up a whopping 11.33% today. Outstanding. However, the closing price was $29.18, more than a 70% decline from 18 months ago.
Anybody even remotely suggesting that the economy and/or equity markets are sound should be shackled, drug off to the nearest body of water and thrown in. Stupidity (from central banks and paid economists) is what got the markets and the economy into the current mess.
Enough is enough, today's results notwithstanding.
For the week:
S&P 500: -15.27 (-0.81%)
Dow: -231.13 (-1.43%)
NASDAQ: -25.63 (-0.59%)
Today's fancy, farcical feast:
S&P 500: 1,864.78, +35.70 (1.95%)
Dow: 15,973.84, +313.66 (2.00%)
NASDAQ: 4,337.51, +70.67 (1.66%)
Crude Oil 29.18 +11.33% Gold 1,239.30 -0.68% EUR/USD 1.1250 -0.57% 10-Yr Bond 1.7480 +6.33% Corn 358.75 -0.42% Copper 2.03 +1.37% Silver 15.76 -0.25% Natural Gas 1.97 -1.45% Russell 2000 971.99 +1.92% VIX 25.40 -9.74% BATS 1000 20,089.57 +1.80% GBP/USD 1.4499 +0.10% USD/JPY 113.2750 +0.60%
Friday, January 15, 2016
Stocks Slammed Globally, S&P Under 1900; Dow Drops Below 16,000
Wall Street is, at last, getting the just desserts from seven years of Fed policies that have funneled trillions of dollars into the hands of the wealthiest people in the country.
The kicker is that the American public, the 65-70% that still works for a living, are going to get the worst of it.
Today's carnage in US equity markets was not an isolated event by any means. It began years ago, but, in its most current manifestation, the collapse began in China last night, when the SSE fell nearly 5% in its last session of the week.
The contagious selling fever spilled over into European markets, with the DAX, CAC-40, and FTSE-100 ending the day down by 2.54%, 2.38% and 1.93%, respectively.
Prior to markets opening in the US, however, there was a spate of poor economic data released.
Retail sales for December came in at -0.1. PPI went negative (deflation) in December, at -0.2%. Empire Manufacturing (a gauge for economic activity in the NY Fed district, collapsed from a reading of -6.2 in December, to a ghastly -19.4 in January.
Industrial Production fell 0.4%. Capacity Utilization slumped to 76.5%.
Then came the news from Wal-Mart that they would be closing 269 stores this year, with 154 of them in the United States. The full list of Wal-Mart store closings can be seen here.
By the time markets actually opened at 9:30 am ET, futures were showing the Dow down by more than 350 points and the indices all fell off a cliff at the sound of the opening bell.
By midday, the Dow was down more than 500 points, the NASDAQ had shed close to 150, and the S&P was sporting losses of more than 50 points.
While today's crashing stock indices were certainly bloody, they weren't even close to the 10 worst one-day Dow declines of all time, so all is not lost.
As the session wore on, the signs of a failing economy - both here in the US and globally - were everywhere. The 10-year note fell briefly below 2.00%. With 1/2 hour left to go, declining issues were leading advancers roughly 6:1. Intel (INTC) was down nine percent. Citigroup (C) was posting a 6% loss; Microsoft (MSFT) was clinging to a four percent downside. Bank of America (BAC), which was pushing 17 two weeks ago, sliced through 15 and was trading in the range of 14.40, down 4.0% on the day.
With more companies reporting Q4 and annual earnings next week, the action this week and today might just be an appetizer for what's about to come, and that might be a recession, collapsing corporate earnings, liquidations, bankruptcies and the wholesale destruction of pension funds - heavily invested in equities - nationwide.
For its part, the Fed trotted out William Dudley, president of the NY Fed and vice chairman of the FOMc, who noted that negative rates could be considered in light of the recent market volatility. His tongue-lapping of the markets didn't seem to carry much weight. Investors were only interested in getting out and limiting the damage prior to the long weekend.
The day's closing prices:
S&P 500: 1,880.28, -41.56 (2.16%)
Dow: 15,988.08, -390.97 (2.39%)
NASDAQ: 4,488.42, -126.59 (2.74%)
Crude Oil 29.67 -4.90% Gold 1,088.90 +1.43% EUR/USD 1.0920 +0.53% 10-Yr Bond 2.03 -3.10% Corn 362.50 +1.26% Copper 1.95 -1.57% Silver 13.90 +1.14% Natural Gas 2.10 -1.73% Russell 2000 1,005.44 -1.97% VIX 27.70 +15.66% BATS 1000 20,066.91 -1.99% GBP/USD 1.4255 -1.13% USD/JPY 117.0050 -0.97%
For the week:
S&P: -41.76 (-2.17)
Dow: -358.71 (-2.19)
NASDAQ: -155.21 (-3.34)
The kicker is that the American public, the 65-70% that still works for a living, are going to get the worst of it.
Today's carnage in US equity markets was not an isolated event by any means. It began years ago, but, in its most current manifestation, the collapse began in China last night, when the SSE fell nearly 5% in its last session of the week.
The contagious selling fever spilled over into European markets, with the DAX, CAC-40, and FTSE-100 ending the day down by 2.54%, 2.38% and 1.93%, respectively.
Prior to markets opening in the US, however, there was a spate of poor economic data released.
Retail sales for December came in at -0.1. PPI went negative (deflation) in December, at -0.2%. Empire Manufacturing (a gauge for economic activity in the NY Fed district, collapsed from a reading of -6.2 in December, to a ghastly -19.4 in January.
Industrial Production fell 0.4%. Capacity Utilization slumped to 76.5%.
Then came the news from Wal-Mart that they would be closing 269 stores this year, with 154 of them in the United States. The full list of Wal-Mart store closings can be seen here.
By the time markets actually opened at 9:30 am ET, futures were showing the Dow down by more than 350 points and the indices all fell off a cliff at the sound of the opening bell.
By midday, the Dow was down more than 500 points, the NASDAQ had shed close to 150, and the S&P was sporting losses of more than 50 points.
While today's crashing stock indices were certainly bloody, they weren't even close to the 10 worst one-day Dow declines of all time, so all is not lost.
As the session wore on, the signs of a failing economy - both here in the US and globally - were everywhere. The 10-year note fell briefly below 2.00%. With 1/2 hour left to go, declining issues were leading advancers roughly 6:1. Intel (INTC) was down nine percent. Citigroup (C) was posting a 6% loss; Microsoft (MSFT) was clinging to a four percent downside. Bank of America (BAC), which was pushing 17 two weeks ago, sliced through 15 and was trading in the range of 14.40, down 4.0% on the day.
With more companies reporting Q4 and annual earnings next week, the action this week and today might just be an appetizer for what's about to come, and that might be a recession, collapsing corporate earnings, liquidations, bankruptcies and the wholesale destruction of pension funds - heavily invested in equities - nationwide.
For its part, the Fed trotted out William Dudley, president of the NY Fed and vice chairman of the FOMc, who noted that negative rates could be considered in light of the recent market volatility. His tongue-lapping of the markets didn't seem to carry much weight. Investors were only interested in getting out and limiting the damage prior to the long weekend.
The day's closing prices:
S&P 500: 1,880.28, -41.56 (2.16%)
Dow: 15,988.08, -390.97 (2.39%)
NASDAQ: 4,488.42, -126.59 (2.74%)
Crude Oil 29.67 -4.90% Gold 1,088.90 +1.43% EUR/USD 1.0920 +0.53% 10-Yr Bond 2.03 -3.10% Corn 362.50 +1.26% Copper 1.95 -1.57% Silver 13.90 +1.14% Natural Gas 2.10 -1.73% Russell 2000 1,005.44 -1.97% VIX 27.70 +15.66% BATS 1000 20,066.91 -1.99% GBP/USD 1.4255 -1.13% USD/JPY 117.0050 -0.97%
For the week:
S&P: -41.76 (-2.17)
Dow: -358.71 (-2.19)
NASDAQ: -155.21 (-3.34)
Wednesday, January 13, 2016
Stocks Massacred Again; S&P Below 1900; Dow Sheds Over 1200 Points in 2016
Another day, another 350+ point loss on the Dow.
There isn't much to say about this kind of result except that it isn't showing any sign of abating. It's what happens when you throw trillions of dollars for speculators to over-leverage on risk assets of all manner and then shut off the free money supply tap.
That's exactly what the Fed did on December 16, when they decided that the economy was strong enough - and gaining momentum - to withstand a rate hike. Dismissing the fact that it was only 25 basis points, the Fed, which has been wrong on everything from the effects of QE and ZIRP to employment, housing and growth, moved at the wrong time. The business cycle had already turned negative; it was exhausted and the consumer had been tapped out.
Not that the consequent decline in stocks was solely the fault of the Federal Reserve, no, the government, spending and taxing and taxing and spending the United States into 19 trillion dollars of unpayable debt, has had an equal hand in the destruction of American business enterprise.
Of course, the demise of the industrial giant wasn't all done overnight. It's taken decades of mismanagement to destroy the American dream and the destroyers aren't done yet. Stock market declines aren't the end of the road, either. Rather, they're just a symptom of the underlying malaise that will be unleashed full force as this election year unwinds.
Stocks are just the visible part of the credit bubble. The other parts consist of moving parts of underfunded pensions, bankrupt trust funds, the fraud of Obamacare, the welfare system, the education complex, military overspending, and a plethora of other wasteful programs funded by the unaware, eyes-shut, American public.
So, the start of 2016 isn't going to be anything monumental, despite the Dow losing 1273.62 in just the first eight trading sessions of the year. Bear in mind that the Dow has to lose roughly another 1500 points (to 14,679) before it's officially a bear market, and there's little doubt that this decline will eventually become a bear market with further downside from there.
No, the first few weeks of January, 2016 will likely be referred to as the "good old days," before the tsunami of deflation finally took hold of the global economy and would not let go. These will be recalled as the time before government fraud and waste was still acceptable, before we realized that unemployment wasn't really five percent, but 15%, or 20%, or more.
Today's trading was nothing short of a waterfall event. The main indices were up at the open, and in a classic bear market pattern, sold off and were negative within the first hour of the session. The Dow, which lost nearly 365 points, wasn't even the worst of it. In fact, on a percentage basis, it was the best of the three. The S&P lopped off 2.5%, the NASDAQ withstood a whopping 3.41% decline.
The 10-year note traded down to 2.05% and will be sporting a one-handle soon, possibly by the end of this week.
This isn't pretty. If you haven't gotten out of the way and out of stocks by now, and into cash or gold or silver, you have nobody to blame but your own greedy self.
Good luck winning the lottery, because your equity holdings are about to be wiped from the face of the earth.
Today's Sad Story
S&P 500: 1,890.28, -48.40 (2.50%)
Dow: 16,151.41, -364.81 (2.21%)
NASDAQ: 4,526.06, -159.85 (3.41%)
Crude Oil 30.40 -0.13% Gold 1,093.80 +0.79% EUR/USD 1.0881 +0.30% 10-Yr Bond 2.0660 -1.71% Corn 358.75 +0.56% Copper 1.95 -0.26% Silver 14.15 +2.90% Natural Gas 2.28 +1.20% Russell 2000 1,010.19 -3.30% VIX 25.22 +12.24% BATS 1000 20,143.62 -2.36% GBP/USD 1.4413 -0.15% USD/JPY 117.7130
1273.62
There isn't much to say about this kind of result except that it isn't showing any sign of abating. It's what happens when you throw trillions of dollars for speculators to over-leverage on risk assets of all manner and then shut off the free money supply tap.
That's exactly what the Fed did on December 16, when they decided that the economy was strong enough - and gaining momentum - to withstand a rate hike. Dismissing the fact that it was only 25 basis points, the Fed, which has been wrong on everything from the effects of QE and ZIRP to employment, housing and growth, moved at the wrong time. The business cycle had already turned negative; it was exhausted and the consumer had been tapped out.
Not that the consequent decline in stocks was solely the fault of the Federal Reserve, no, the government, spending and taxing and taxing and spending the United States into 19 trillion dollars of unpayable debt, has had an equal hand in the destruction of American business enterprise.
Of course, the demise of the industrial giant wasn't all done overnight. It's taken decades of mismanagement to destroy the American dream and the destroyers aren't done yet. Stock market declines aren't the end of the road, either. Rather, they're just a symptom of the underlying malaise that will be unleashed full force as this election year unwinds.
Stocks are just the visible part of the credit bubble. The other parts consist of moving parts of underfunded pensions, bankrupt trust funds, the fraud of Obamacare, the welfare system, the education complex, military overspending, and a plethora of other wasteful programs funded by the unaware, eyes-shut, American public.
So, the start of 2016 isn't going to be anything monumental, despite the Dow losing 1273.62 in just the first eight trading sessions of the year. Bear in mind that the Dow has to lose roughly another 1500 points (to 14,679) before it's officially a bear market, and there's little doubt that this decline will eventually become a bear market with further downside from there.
No, the first few weeks of January, 2016 will likely be referred to as the "good old days," before the tsunami of deflation finally took hold of the global economy and would not let go. These will be recalled as the time before government fraud and waste was still acceptable, before we realized that unemployment wasn't really five percent, but 15%, or 20%, or more.
Today's trading was nothing short of a waterfall event. The main indices were up at the open, and in a classic bear market pattern, sold off and were negative within the first hour of the session. The Dow, which lost nearly 365 points, wasn't even the worst of it. In fact, on a percentage basis, it was the best of the three. The S&P lopped off 2.5%, the NASDAQ withstood a whopping 3.41% decline.
The 10-year note traded down to 2.05% and will be sporting a one-handle soon, possibly by the end of this week.
This isn't pretty. If you haven't gotten out of the way and out of stocks by now, and into cash or gold or silver, you have nobody to blame but your own greedy self.
Good luck winning the lottery, because your equity holdings are about to be wiped from the face of the earth.
Today's Sad Story
S&P 500: 1,890.28, -48.40 (2.50%)
Dow: 16,151.41, -364.81 (2.21%)
NASDAQ: 4,526.06, -159.85 (3.41%)
Crude Oil 30.40 -0.13% Gold 1,093.80 +0.79% EUR/USD 1.0881 +0.30% 10-Yr Bond 2.0660 -1.71% Corn 358.75 +0.56% Copper 1.95 -0.26% Silver 14.15 +2.90% Natural Gas 2.28 +1.20% Russell 2000 1,010.19 -3.30% VIX 25.22 +12.24% BATS 1000 20,143.62 -2.36% GBP/USD 1.4413 -0.15% USD/JPY 117.7130
1273.62
Wednesday, December 30, 2015
Doubtful That Stocks Will Post Gains for 2015
Stocks took a nosedive into the close, with the three major indices closing at the lows of the session.
More than likely, traders are taking whatever they've made and walking away, as there is only one more day left to buy, sell or hold in 2015.
Crude got hit again and should test the December lows once January commences and the realization that global GDP is going to come in at under two percent or thereabouts for the year. As mentioned earlier, US fourth quarter GDP - which will be first estimated nearing the end of January - will have to measure in the range of 2.8%, which will be a real stretch, as holiday sales have not been very robust and housing - as evidenced again by pending home sales in November, came in at -0.9%, well below already tame estimates of a gain of 0.5%.
Crude Oil closed at 36.65, down 3.22%; Gold and silver were ambushed once more by the global cartel and the ten-year note finished just about where it did yesterday,yielding 2.30%, a pretty good jump of 7-8 pips from the close on Monday.
Natural Gas ended at 2.22, off 6.41%, after a big run-up based upon projections of a colder January for the Northeast via a European model. NOAA's three-month forecast for January-March remains unchanged, showing a warmer than normal winter for much of the Northeast and Midwest. So much for the rapid rise off generational lows. Like oil, there's an absolute glut of Nat Gas, a positive boost for consumers. Storage facilities in the Northeast are near record capacities.
If history is any guide, consumers will continue paying down debt if oil, automotive fuel and natural gas continue to trade at lowered levels. Wall Street may like like the idea, but Main Street is relishing the break from a near-decade of high prices.
Outside of the insanity that is the NASDAQ, a loser close on the S&P will send 2015 investors home flat or losers on the annum. The Dow looks to have no chance to finish in the black for the year.
Here are closing prices at the end of 2014:
S&P: 2,058.90
Dow: 17,823.07
NASDAQ: 4,736.05
Wednesday's closing prices:
S&P 500: 2,063.36, -15.00 (0.72%)
Dow, 17,603.87: -117.11 (0.66%)
NASDAQ, 5,065.85: -42.09 (0.82%)
It's not looking very pretty and January appears to be setting up for a dramatic sell-off.
Tomorrow: Money Daily's Forecasts for 2016
More than likely, traders are taking whatever they've made and walking away, as there is only one more day left to buy, sell or hold in 2015.
Crude got hit again and should test the December lows once January commences and the realization that global GDP is going to come in at under two percent or thereabouts for the year. As mentioned earlier, US fourth quarter GDP - which will be first estimated nearing the end of January - will have to measure in the range of 2.8%, which will be a real stretch, as holiday sales have not been very robust and housing - as evidenced again by pending home sales in November, came in at -0.9%, well below already tame estimates of a gain of 0.5%.
Crude Oil closed at 36.65, down 3.22%; Gold and silver were ambushed once more by the global cartel and the ten-year note finished just about where it did yesterday,yielding 2.30%, a pretty good jump of 7-8 pips from the close on Monday.
Natural Gas ended at 2.22, off 6.41%, after a big run-up based upon projections of a colder January for the Northeast via a European model. NOAA's three-month forecast for January-March remains unchanged, showing a warmer than normal winter for much of the Northeast and Midwest. So much for the rapid rise off generational lows. Like oil, there's an absolute glut of Nat Gas, a positive boost for consumers. Storage facilities in the Northeast are near record capacities.
If history is any guide, consumers will continue paying down debt if oil, automotive fuel and natural gas continue to trade at lowered levels. Wall Street may like like the idea, but Main Street is relishing the break from a near-decade of high prices.
Outside of the insanity that is the NASDAQ, a loser close on the S&P will send 2015 investors home flat or losers on the annum. The Dow looks to have no chance to finish in the black for the year.
Here are closing prices at the end of 2014:
S&P: 2,058.90
Dow: 17,823.07
NASDAQ: 4,736.05
Wednesday's closing prices:
S&P 500: 2,063.36, -15.00 (0.72%)
Dow, 17,603.87: -117.11 (0.66%)
NASDAQ, 5,065.85: -42.09 (0.82%)
It's not looking very pretty and January appears to be setting up for a dramatic sell-off.
Tomorrow: Money Daily's Forecasts for 2016
Wednesday, December 16, 2015
Pre-FED-Hike Notes for the Truly Deranged and/or Excited
As of 12:30 pm ET, amazingly, the Dow, NAZ and S&P are all right at (or pretty damn close) both their 40 and 200-day MAs.
In other words, the entire market will be essentially flat going into the FOMC announcement. No clues for anyone, except that move up in PMs this morning.
Putting on my best guessing hat - which stragely resembles a dunce cap - I'd say the 0.25% rate hike is all but a done deal. The Fed has gone too far and they know it.
This is really a now-or-never condition, and they must go with NOW, because NEVER doesn't really mean never. It means they will have to do this at some point. There will be significant pain ahead, but only for those who are highly leveraged, over-indebted or just plain stupid.
Everyone has had seven years to prepare for this moment. If you haven't gotten a whiff of what's coming, you are not to be pitied. You will be dismembered and disposed of by the gnarly beast of deflation.
That's my take.
Final note: Yesterday, over at ZeroHedge, I reiterated my call from about two years ago that silver would see $12. Another poster said $8.25 was the target, or bottom. I'm fine with that. Will be buying at $12 and buying even more if and when it ever gets to $8.
90 minutes to lift-off. Good luck to all.
In other words, the entire market will be essentially flat going into the FOMC announcement. No clues for anyone, except that move up in PMs this morning.
Putting on my best guessing hat - which stragely resembles a dunce cap - I'd say the 0.25% rate hike is all but a done deal. The Fed has gone too far and they know it.
This is really a now-or-never condition, and they must go with NOW, because NEVER doesn't really mean never. It means they will have to do this at some point. There will be significant pain ahead, but only for those who are highly leveraged, over-indebted or just plain stupid.
Everyone has had seven years to prepare for this moment. If you haven't gotten a whiff of what's coming, you are not to be pitied. You will be dismembered and disposed of by the gnarly beast of deflation.
That's my take.
Final note: Yesterday, over at ZeroHedge, I reiterated my call from about two years ago that silver would see $12. Another poster said $8.25 was the target, or bottom. I'm fine with that. Will be buying at $12 and buying even more if and when it ever gets to $8.
90 minutes to lift-off. Good luck to all.
Sunday, April 19, 2015
Financial Recap for w/e 4/17/15: Friday's China Fears Stun Markets
The week can be summarized succinctly as four normal days followed by a bummer of a Friday, which took back all of the week's gains and then some when it became obvious to anyone and everyone that China might not be the raging dynamo of capitalism once thought.
With a drop on the Dow of nearly 300 points, Friday's whiplash took the DJIA back to break-even for the year and ended the week with the Industrials off 231.35 (1.28%). The remainder of the week was mostly mundane, with the average down Monday, up Tuesday and finally into positive territory on Wednesday. Thursday was flat.
Following a pattern similar to that of the Dow, the S&P 500 also lost steam, down 20.88 (0.99) for the week, a loss not nearly as dramatic as the Blue Chips. However, the S&P ended up less than one percent on the year, a condition which central planners and fund managers are finding unpleasant and unprofitable.
Nearly four full months into the new year, investors are still searching for a catalyst beyond the usual dramatics from the Federal Reserve to move markets higher. Considering the poor performance out of China and the rest of the EM, the catastrophic condition that is the European Union, and the general negative tone of US macro data, in deference to the usual "recovery" noise, a very good argument for profit-taking has appeared.
The NASDAQ suffered a similar fate, gapping lower on Friday to post a massive 76-point decline for the day. On the week, the NASDAQ was lower by 64.25 points (1.28%), equaling the DJIA as the worst percentage performer.
Beyond the aforementioned wall of worries, what has markets particularly off-balance are comments from a variety of Federal Reserve officials, some which are for a rate increase ASAP, while others seem to have reversed course and favor the wait-and-see approach, which is wearing thin on all fronts. Clarity does not serve the Federal Reserve well at this juncture - indeed, maybe not at any time - as market reaction is exceedingly swift to judge.
The constant din of jawboning from current and former Fed officials has provided market participants with a kind of backstop mechanism, one which has successfully prevented an outright bubble in stocks (a debatable point) and, at the same time, limiting any downside action to less-than-correction levels.
As stocks have not seen a significant retreat since the summer of 2011 - and even that was mild and short-lived - the argument for a correction of ten percent or more has its followers, though bearish thoughts have been effectively eviscerated by the Fed and its hyperactive role in the market.
With a June rate increase now seen as nearly off the table, the view is that September will be the most opportune time for the Fed to act to raise the federal fund rate off the zero bound, though many voices are already saying that 2016 or beyond will be the date at which the "renormalization" process takes flight.
With central banks and, especially, the Fed, so deeply ingrained in equity and bond markets, it has become difficult, if not entirely impossible, to accurately predict future market movements.
Perhaps this is a condition with which markets should be desirous. Complacency and indecision might turn out to be the best weapons against deflation and outright recession. Lessons learned from past experience are no longer helpful as the global economy has never been so utterly and consistently commanded, contrived and controlled. Eventually, one would suspect a shakeout. As usual, getting the timing right is a paramount consideration, though the recent activities of markets and central banks has left all participants scratching for solutions.
With a drop on the Dow of nearly 300 points, Friday's whiplash took the DJIA back to break-even for the year and ended the week with the Industrials off 231.35 (1.28%). The remainder of the week was mostly mundane, with the average down Monday, up Tuesday and finally into positive territory on Wednesday. Thursday was flat.
Following a pattern similar to that of the Dow, the S&P 500 also lost steam, down 20.88 (0.99) for the week, a loss not nearly as dramatic as the Blue Chips. However, the S&P ended up less than one percent on the year, a condition which central planners and fund managers are finding unpleasant and unprofitable.
Nearly four full months into the new year, investors are still searching for a catalyst beyond the usual dramatics from the Federal Reserve to move markets higher. Considering the poor performance out of China and the rest of the EM, the catastrophic condition that is the European Union, and the general negative tone of US macro data, in deference to the usual "recovery" noise, a very good argument for profit-taking has appeared.
The NASDAQ suffered a similar fate, gapping lower on Friday to post a massive 76-point decline for the day. On the week, the NASDAQ was lower by 64.25 points (1.28%), equaling the DJIA as the worst percentage performer.
Beyond the aforementioned wall of worries, what has markets particularly off-balance are comments from a variety of Federal Reserve officials, some which are for a rate increase ASAP, while others seem to have reversed course and favor the wait-and-see approach, which is wearing thin on all fronts. Clarity does not serve the Federal Reserve well at this juncture - indeed, maybe not at any time - as market reaction is exceedingly swift to judge.
The constant din of jawboning from current and former Fed officials has provided market participants with a kind of backstop mechanism, one which has successfully prevented an outright bubble in stocks (a debatable point) and, at the same time, limiting any downside action to less-than-correction levels.
As stocks have not seen a significant retreat since the summer of 2011 - and even that was mild and short-lived - the argument for a correction of ten percent or more has its followers, though bearish thoughts have been effectively eviscerated by the Fed and its hyperactive role in the market.
With a June rate increase now seen as nearly off the table, the view is that September will be the most opportune time for the Fed to act to raise the federal fund rate off the zero bound, though many voices are already saying that 2016 or beyond will be the date at which the "renormalization" process takes flight.
With central banks and, especially, the Fed, so deeply ingrained in equity and bond markets, it has become difficult, if not entirely impossible, to accurately predict future market movements.
Perhaps this is a condition with which markets should be desirous. Complacency and indecision might turn out to be the best weapons against deflation and outright recession. Lessons learned from past experience are no longer helpful as the global economy has never been so utterly and consistently commanded, contrived and controlled. Eventually, one would suspect a shakeout. As usual, getting the timing right is a paramount consideration, though the recent activities of markets and central banks has left all participants scratching for solutions.
Friday, March 6, 2015
GOOD=BAD; NFP +295,000, DOW -278.87, NASDAQ -55.44, S&P 500 -29.78
As bizarre as global economics has become, almost nothing compares to the algo-crazed stock markets in the United States, where computers are programmed to interpret diverse news report headlines and respond accordingly.
One of the more perverse actions was visible today, when, after the BLS announced, in their monthly non-farm payroll release, that the US had created (mysteriously, magically) 295,000 net new jobs in the month of February stocks traded sharply to the downside and continued that trend for the remainder of the session.
At issue is the proposed June 0.25% increase (that's right, 25 bips) to the federal funds rate that the Federal reserve has been hinting at for the better part of the past two years. Maybe they've been hinting about this seminal event for longer, but, honestly, one has only so much patience for the garbled issuance of verbiage from the masters of misinformation.
Supposedly, the argument on Wall Street is thus: if the economy is truly improving and gathering steam, then the Fed will raise interest rates, meaning that inside players like the big banks, insurance companies and some hedge funds are going to find it much more difficult to make money, because, when you're borrowing billions of dollars at almost nothing, and investing it in dubious stocks and other investments that might not pan out as you had expected - unless the Fed has your back - and, leveraging up those investments 10, 20, maybe 30 times, any increase in your cost of borrowing might bring on disastrous events.
So, as soon as the bells and whistles went off signaling the opening of trade on the final day of the first week of March, the selling ensued, and did so with resolute alacrity and vigor not seen when the markets were going up (all of the past six years, on low volume).
The whole set-up is patently absurd and it's purely the cause of the Fed, which has kept rates too low for too long, and now must reap what they have sewn, so welcome to the great deflation, part two, which began in 2008, and was interrupted by the Fed and Wall Street in March of 2009. If stocks sell off like this merely on the rumor that the Fed will hike rates a measly 1/4 percent, imagine what kind of carnage will ensue when they actually do it.
Where the absurdity begins is difficult to ascertain, though the Fed, through their continued press releases after FOMC meetings, has linguistically backed themselves into a corner. They've repeatedly maintained that they will raise interest rates on a data-driven, unspecific schedule, and the data released today by the BLS was undeniably good, showing strong job growth and an unemployment rate at the lowest point in nearly a decade, at 5.5%, which, to almost anybody's eyes, is pretty much full employment.
There's one little problem with the figures the BLS releases the first Friday of every month: they're BULLS--T, garbage, manipulated, massaged, goal-sought, and thoroughly distort the true nature of the labor market. In other words, there's almost no way there were 295,000 new jobs created in the US last month, and the figures for the past year, and the year before that and before that, etc., are even more misleading. The US economy has been hollowed out, and, while it may be better here than it has been in years, it is not much better.
Now, the Fed knows these figures are made from pure cloth, but they are tied to them. Call today a test of the algorithms, a dry run for the main event, which should occur around the middle of June or by early July. The Fed and the government have to continue to spread the lie that the US economy is strong, vibrant and growing, and, because of that, while most other countries in the world are lowering interest rates (because they honestly know their economies stink), the US is prepared to embark upon one of the more ludicrous propaganda and financial experiments in the history of mankind.
The Federal Reserve, should they go through with their supposed plan to begin raising interest rates in June 2015, will be attempting the impossible, and doing a most dangerous thing: they will be trying to slow down an economy they proclaim - and would like everyone to believe - is growing, which in reality is contracting and deflating.
Our money is heavily on the side of reality winning that argument.
Related trades today concerned all US treasuries, which sold off, sending yields higher. Oil, gold and silver were all lower.
Dow Jones 17,856.85, -278.87 (-1.54%)
S&P 500 2,071.26, -29.78 (-1.42%)
Nasdaq 4,927.37, -55.44 (-1.11%)
Ironic notes: Today was Alan Greenspan's 89th birthday; Apple will replace AT&T in the Dow Jones Industrials on March 18 (just in the nick of time?)
One of the more perverse actions was visible today, when, after the BLS announced, in their monthly non-farm payroll release, that the US had created (mysteriously, magically) 295,000 net new jobs in the month of February stocks traded sharply to the downside and continued that trend for the remainder of the session.
At issue is the proposed June 0.25% increase (that's right, 25 bips) to the federal funds rate that the Federal reserve has been hinting at for the better part of the past two years. Maybe they've been hinting about this seminal event for longer, but, honestly, one has only so much patience for the garbled issuance of verbiage from the masters of misinformation.
Supposedly, the argument on Wall Street is thus: if the economy is truly improving and gathering steam, then the Fed will raise interest rates, meaning that inside players like the big banks, insurance companies and some hedge funds are going to find it much more difficult to make money, because, when you're borrowing billions of dollars at almost nothing, and investing it in dubious stocks and other investments that might not pan out as you had expected - unless the Fed has your back - and, leveraging up those investments 10, 20, maybe 30 times, any increase in your cost of borrowing might bring on disastrous events.
So, as soon as the bells and whistles went off signaling the opening of trade on the final day of the first week of March, the selling ensued, and did so with resolute alacrity and vigor not seen when the markets were going up (all of the past six years, on low volume).
The whole set-up is patently absurd and it's purely the cause of the Fed, which has kept rates too low for too long, and now must reap what they have sewn, so welcome to the great deflation, part two, which began in 2008, and was interrupted by the Fed and Wall Street in March of 2009. If stocks sell off like this merely on the rumor that the Fed will hike rates a measly 1/4 percent, imagine what kind of carnage will ensue when they actually do it.
Where the absurdity begins is difficult to ascertain, though the Fed, through their continued press releases after FOMC meetings, has linguistically backed themselves into a corner. They've repeatedly maintained that they will raise interest rates on a data-driven, unspecific schedule, and the data released today by the BLS was undeniably good, showing strong job growth and an unemployment rate at the lowest point in nearly a decade, at 5.5%, which, to almost anybody's eyes, is pretty much full employment.
There's one little problem with the figures the BLS releases the first Friday of every month: they're BULLS--T, garbage, manipulated, massaged, goal-sought, and thoroughly distort the true nature of the labor market. In other words, there's almost no way there were 295,000 new jobs created in the US last month, and the figures for the past year, and the year before that and before that, etc., are even more misleading. The US economy has been hollowed out, and, while it may be better here than it has been in years, it is not much better.
Now, the Fed knows these figures are made from pure cloth, but they are tied to them. Call today a test of the algorithms, a dry run for the main event, which should occur around the middle of June or by early July. The Fed and the government have to continue to spread the lie that the US economy is strong, vibrant and growing, and, because of that, while most other countries in the world are lowering interest rates (because they honestly know their economies stink), the US is prepared to embark upon one of the more ludicrous propaganda and financial experiments in the history of mankind.
The Federal Reserve, should they go through with their supposed plan to begin raising interest rates in June 2015, will be attempting the impossible, and doing a most dangerous thing: they will be trying to slow down an economy they proclaim - and would like everyone to believe - is growing, which in reality is contracting and deflating.
Our money is heavily on the side of reality winning that argument.
Related trades today concerned all US treasuries, which sold off, sending yields higher. Oil, gold and silver were all lower.
Dow Jones 17,856.85, -278.87 (-1.54%)
S&P 500 2,071.26, -29.78 (-1.42%)
Nasdaq 4,927.37, -55.44 (-1.11%)
Ironic notes: Today was Alan Greenspan's 89th birthday; Apple will replace AT&T in the Dow Jones Industrials on March 18 (just in the nick of time?)
Friday, January 17, 2014
Dow, NASDAQ Up for Week, Dow, S&P Down Thus Far in 2014
Stocks ended the week in truly bizarre fashion, with the Dow up, but the S&P and NASDAQ lower. Obviously, trading was not uniform across the indices and the Dow was higher due primarily to gains by American Express (AXP) and Visa (V), which really skewed the average, as there were only ten stocks showing gains on the day, versus 20 which ended the session lower.
While the market is somewhat bifurcated and, and maybe even trifurcated, the various swings on the indices are caused mainly by excessive trading in story stocks, those which have reported earnings either after the previous day's close or in the morning prior to the open.
Overall, earnings season is just barely underway, with 10% of companies in the S&P 500 having reported, but the distressing trend is that fully half of those companies have missed earnings estimates and top-line growth (revenues) continues to just beat or fall short, a pattern five years running that is giving not just investors, but the markets themselves, pause.
There hasn't been much progress in terms of the January Barometer, and with Monday a holiday, markets are closed, leaving just nine sessions remaining in January. Time flies, and, it seems some money wants to flee away with it.
What is down solidly is the yield on the 10-year note, which hit a 2014 low of 2.82 today, less than two weeks after seeping through the 3.00% mark. Despite the Fed's tapering by $10 billion, its $85 billion per month bond purchase program (QE by any other name), interest rates have not followed the game plan.
What is up? Gold. Higher by 4% so far this year, and, likewise, silver, also higher by about 4%.
For the week:
Dow +21.51
S&P 500 -3.67
NASDAQ +22.92
For the year:
Dow -118.10
S&P 500 -9.66
NASDAQ +20.99
DOW 16,458.56, +41.55 (+0.25%)
NASDAQ 4,197.58, -21.11 (-0.50%)
S&P 1,838.70, -7.19 (-0.39%)
10-Yr Note 99.37, +0.31 (+0.31%) Yield: 2.82%
NASDAQ Volume 2.10 Bil
NYSE Volume 3.60 Bil
Combined NYSE & NASDAQ Advance - Decline: 2337-3366
Combined NYSE & NASDAQ New highs - New lows: 352-38
WTI crude oil: 94.37, +0.41
Gold: 1,251.90, +11.70
Silver: 20.30, +0.25
Corn: 424.00, -4.00
While the market is somewhat bifurcated and, and maybe even trifurcated, the various swings on the indices are caused mainly by excessive trading in story stocks, those which have reported earnings either after the previous day's close or in the morning prior to the open.
Overall, earnings season is just barely underway, with 10% of companies in the S&P 500 having reported, but the distressing trend is that fully half of those companies have missed earnings estimates and top-line growth (revenues) continues to just beat or fall short, a pattern five years running that is giving not just investors, but the markets themselves, pause.
There hasn't been much progress in terms of the January Barometer, and with Monday a holiday, markets are closed, leaving just nine sessions remaining in January. Time flies, and, it seems some money wants to flee away with it.
What is down solidly is the yield on the 10-year note, which hit a 2014 low of 2.82 today, less than two weeks after seeping through the 3.00% mark. Despite the Fed's tapering by $10 billion, its $85 billion per month bond purchase program (QE by any other name), interest rates have not followed the game plan.
What is up? Gold. Higher by 4% so far this year, and, likewise, silver, also higher by about 4%.
For the week:
Dow +21.51
S&P 500 -3.67
NASDAQ +22.92
For the year:
Dow -118.10
S&P 500 -9.66
NASDAQ +20.99
DOW 16,458.56, +41.55 (+0.25%)
NASDAQ 4,197.58, -21.11 (-0.50%)
S&P 1,838.70, -7.19 (-0.39%)
10-Yr Note 99.37, +0.31 (+0.31%) Yield: 2.82%
NASDAQ Volume 2.10 Bil
NYSE Volume 3.60 Bil
Combined NYSE & NASDAQ Advance - Decline: 2337-3366
Combined NYSE & NASDAQ New highs - New lows: 352-38
WTI crude oil: 94.37, +0.41
Gold: 1,251.90, +11.70
Silver: 20.30, +0.25
Corn: 424.00, -4.00
Friday, September 20, 2013
Dow Takes A Header on Realignment
It was a little like old times today. Back before there were supercomputers running the show, there used to be a term called, "late at the close," which signified the level of volume in the final frantic minutes of trading. Financial news announcers would say things like, "the tape was 12 minutes late at the close," meaning that the ticker tape that recorded trades ran past 4:00 pm due to the heavy volume.
Today, the Dow didn't settle out until well after ten minutes beyond the official close, due to the realignment. Bank of America, Hewlett Packard and Alcoa went out; Nike, Goldman Sachs and Visa went in.
It wasn't a fair exchange, and that had something to do with stocks closing at the lows of the day and the Dow outpacing the other averages to the negative. Bank of America is basically an insolvent holding company of the Fed, Hewlett Packard is a dead stock with limited upside potential and Alcoa is more or less nothing other than a proxy for the commodity price of aluminum.
The new entrants seem to have futures, though the addition of Goldman Sachs seems more sinister than anything else. After all, the company has been termed a "giant squid," because its tentacles reach into the netherworld recesses of business and politics.
Still stocks took a pretty good header today and prospects for the remainder of the month - just six more trading days - are not bright, since a government shutdown looms, Obamacare continues to move toward implementation and the complete catastrophe of the US health and labor markets and the country continues to spiral deeper into debt with a rancorous debate soon to come on raising the debt ceiling.
Nonetheless, the Fed has everyone's back, until, of course, they don't, at which time they will have the front, all sides and the keys to all of your property, real, personal and possibly intellectual, if they can strike a deal with Google, Yahoo, Amazon and the NSA.
The future is (fill in the blank... we're too afraid to).
And, BTW, when Warren Buffett says stocks are "fairly valued," it's time to sell, because that's what he's doing.
For the week:
Dow: +75.03
NASDAQ: +52.55
S&P 500: +21.92
Dow 15,451.09, -185.46 (1.19%)
Nasdaq 3,774.73, -14.66 (0.39%)
S&P 500 1,709.91, -12.43 (0.72%)
10-Yr Bond 2.73%, -0.02
NYSE Volume 5,065,868,500
Nasdaq Volume 2,335,355,500
Combined NYSE & NASDAQ Advance - Decline: 2339-4314
Combined NYSE & NASDAQ New highs - New lows: 332-45
WTI crude oil: 104.67, -1.72
Gold: 1,332.50, -36.80
Silver: 21.93, -1.365
Today, the Dow didn't settle out until well after ten minutes beyond the official close, due to the realignment. Bank of America, Hewlett Packard and Alcoa went out; Nike, Goldman Sachs and Visa went in.
It wasn't a fair exchange, and that had something to do with stocks closing at the lows of the day and the Dow outpacing the other averages to the negative. Bank of America is basically an insolvent holding company of the Fed, Hewlett Packard is a dead stock with limited upside potential and Alcoa is more or less nothing other than a proxy for the commodity price of aluminum.
The new entrants seem to have futures, though the addition of Goldman Sachs seems more sinister than anything else. After all, the company has been termed a "giant squid," because its tentacles reach into the netherworld recesses of business and politics.
Still stocks took a pretty good header today and prospects for the remainder of the month - just six more trading days - are not bright, since a government shutdown looms, Obamacare continues to move toward implementation and the complete catastrophe of the US health and labor markets and the country continues to spiral deeper into debt with a rancorous debate soon to come on raising the debt ceiling.
Nonetheless, the Fed has everyone's back, until, of course, they don't, at which time they will have the front, all sides and the keys to all of your property, real, personal and possibly intellectual, if they can strike a deal with Google, Yahoo, Amazon and the NSA.
The future is (fill in the blank... we're too afraid to).
And, BTW, when Warren Buffett says stocks are "fairly valued," it's time to sell, because that's what he's doing.
For the week:
Dow: +75.03
NASDAQ: +52.55
S&P 500: +21.92
Dow 15,451.09, -185.46 (1.19%)
Nasdaq 3,774.73, -14.66 (0.39%)
S&P 500 1,709.91, -12.43 (0.72%)
10-Yr Bond 2.73%, -0.02
NYSE Volume 5,065,868,500
Nasdaq Volume 2,335,355,500
Combined NYSE & NASDAQ Advance - Decline: 2339-4314
Combined NYSE & NASDAQ New highs - New lows: 332-45
WTI crude oil: 104.67, -1.72
Gold: 1,332.50, -36.80
Silver: 21.93, -1.365
Tuesday, August 20, 2013
Dow Fades Into Close for 5th Straight Losing Session
Issues persist in global financial markets and investors are beginning to shift assets back into fixed income, since yields are rising and should continue to do so, though chances that the Fed will begin tapering in September appear to be diminishing as economic data and corporate reports are not suggestive of a strengthening economy.
The Dow, which, along with the other major indices, was positive all session long, finally succumbed to selling pressure in the final minutes of trading, ending the day with a minor loss, though still the fifth straight session in the red.
What's not being talked about much is where the Dow Industrials currently are settled, well below the 50-day moving average (roughly 15,275) and in danger of sparking another rout in stocks. Additionally, Dow stocks are largely among the best dividend-payers, just the kind of risk asset that investors are shunning, with interest rates on the rise and fixed income carrying much less perceived risk than even blue chip stocks.
The Dow components aren't exactly going to be sold off in wholesale fashion - there's too many diversified investors in them - but they have obviously been under pressure since the start of August, despite Fed incantations and deliberations over QE tapering beginning sometime in the near future.
For gambling types, the biggest question is whether the Fed will actually begin tapering its bond-buying in September, or, at some later date. Some suggest that the economy is so weak, and the Fed terrified of causing a market panic, that tapering will not and cannot occur in the current environment. The secondary issue of by how much the Fed will taper is also in play. Being that the Fed is now so trapped and dovish, the tapering might be an inconsequential number, like $10 billion, reducing their total bond purchases to $75 billion a month, still an enormous liquidity lift.
In such a case, wherein the Fed reduces QE by a mere $10 billion a month, in either September or October, and then continues to cut down on bond purchases at a rate of around $10 billion a month every two to three months, would probably be enough to rattle markets a bit without causing a correction or crash. Of course, the US and global economies are currently in such a weakened state that markets may crash and burn on their own, despite what the Fed and other central banks conspire in their rigging.
The outlook remains the same, with the bias toward the downside. September, with the Federal government politicians back from their extended, annual August recess, is shaping up to be momentous, what with budget negotiations and an expected fight over raising the debt ceiling again, with the outlier that the Republican Tea Partiers may be so inclined as to stall negotiations on both issues to a point at which the government is shut down. On top of the already-expanding sequester, these kind of childish hissy fits from our political elite might be enough to topple the markets into bear territory.
It's an eventuality, as the bull market is approaching the 54-month mark, which it will reach on September 9. The week of September 8-15 figures to be dramatic, with the anniversary of 9/11 and expected hijinks in the corridors of power.
One thing is for sure: the housing market is already under stress and, unless interest rates suddenly reverse course (unlikely), the so-called recovery in housing is over, dead and done. Real estate prices nationwide should experience a fairly sharp pullback over the next three to 12 months, because there are not enough qualified purchasers out there, interest rates are driving up the cost of buying and carrying a mortgage, and, the number of homes still held off the market by the banks continues to be an enormous, unseen force driving down real estate. Bargains are out there, but one has to look hard and long for the right ones at the right entry price. This is not a market for bold speculation, but rather for considered, strategic purchasing of the right property, be it for housing, farming or simply to escape the madness which is headed toward everyone within 10 miles of a major population center.
Major shifts in the economies of billions of people are underway and will play out over the next five to seven years, transforming the economic landscape beyond what most people can imagine.
Dow 15,002.99, -7.75 (0.05%)
NASDAQ 3,613.59, +24.50 (0.68%)
S&P 500 1,652.35, +6.29 (0.38%)
NYSE Composite 9,421.56, +35.67 (0.38%)
NASDAQ Volume 1,285,024,000
NYSE Volume 3,266,316,500
Combined NYSE & NASDAQ Advance - Decline: 4827-1777
Combined NYSE & NASDAQ New highs - New lows: 75-316
WTI crude oil: 104.96, -2.14
Gold: 1,372.60, +6.90
Silver: 23.07, -0.095
The Dow, which, along with the other major indices, was positive all session long, finally succumbed to selling pressure in the final minutes of trading, ending the day with a minor loss, though still the fifth straight session in the red.
What's not being talked about much is where the Dow Industrials currently are settled, well below the 50-day moving average (roughly 15,275) and in danger of sparking another rout in stocks. Additionally, Dow stocks are largely among the best dividend-payers, just the kind of risk asset that investors are shunning, with interest rates on the rise and fixed income carrying much less perceived risk than even blue chip stocks.
The Dow components aren't exactly going to be sold off in wholesale fashion - there's too many diversified investors in them - but they have obviously been under pressure since the start of August, despite Fed incantations and deliberations over QE tapering beginning sometime in the near future.
For gambling types, the biggest question is whether the Fed will actually begin tapering its bond-buying in September, or, at some later date. Some suggest that the economy is so weak, and the Fed terrified of causing a market panic, that tapering will not and cannot occur in the current environment. The secondary issue of by how much the Fed will taper is also in play. Being that the Fed is now so trapped and dovish, the tapering might be an inconsequential number, like $10 billion, reducing their total bond purchases to $75 billion a month, still an enormous liquidity lift.
In such a case, wherein the Fed reduces QE by a mere $10 billion a month, in either September or October, and then continues to cut down on bond purchases at a rate of around $10 billion a month every two to three months, would probably be enough to rattle markets a bit without causing a correction or crash. Of course, the US and global economies are currently in such a weakened state that markets may crash and burn on their own, despite what the Fed and other central banks conspire in their rigging.
The outlook remains the same, with the bias toward the downside. September, with the Federal government politicians back from their extended, annual August recess, is shaping up to be momentous, what with budget negotiations and an expected fight over raising the debt ceiling again, with the outlier that the Republican Tea Partiers may be so inclined as to stall negotiations on both issues to a point at which the government is shut down. On top of the already-expanding sequester, these kind of childish hissy fits from our political elite might be enough to topple the markets into bear territory.
It's an eventuality, as the bull market is approaching the 54-month mark, which it will reach on September 9. The week of September 8-15 figures to be dramatic, with the anniversary of 9/11 and expected hijinks in the corridors of power.
One thing is for sure: the housing market is already under stress and, unless interest rates suddenly reverse course (unlikely), the so-called recovery in housing is over, dead and done. Real estate prices nationwide should experience a fairly sharp pullback over the next three to 12 months, because there are not enough qualified purchasers out there, interest rates are driving up the cost of buying and carrying a mortgage, and, the number of homes still held off the market by the banks continues to be an enormous, unseen force driving down real estate. Bargains are out there, but one has to look hard and long for the right ones at the right entry price. This is not a market for bold speculation, but rather for considered, strategic purchasing of the right property, be it for housing, farming or simply to escape the madness which is headed toward everyone within 10 miles of a major population center.
Major shifts in the economies of billions of people are underway and will play out over the next five to seven years, transforming the economic landscape beyond what most people can imagine.
Dow 15,002.99, -7.75 (0.05%)
NASDAQ 3,613.59, +24.50 (0.68%)
S&P 500 1,652.35, +6.29 (0.38%)
NYSE Composite 9,421.56, +35.67 (0.38%)
NASDAQ Volume 1,285,024,000
NYSE Volume 3,266,316,500
Combined NYSE & NASDAQ Advance - Decline: 4827-1777
Combined NYSE & NASDAQ New highs - New lows: 75-316
WTI crude oil: 104.96, -2.14
Gold: 1,372.60, +6.90
Silver: 23.07, -0.095
Friday, August 9, 2013
More Churning as Stocks End Week Lower
Stocks disappointed this week, but after all was said and done, the damage was, at worst, marginal, or as Chairman Bernanke and his crony capitalists might call it, modest.
The same pattern of trading appeared every day of the week, typified by a weak start, a bottoming out before noon and a half-hearted rally - on exceptionally-low volume - into the close.
All said, the major indices barely budged.
For the week, the Dow was the biggest loser, down 233 points. The NASDAQ shed all of 29 points, while the S&P dropped a whole 18 points. All this may be indicative of is rotation out of dividend-payers to more speculative stocks, a kind of reverse shoot-the-generals move which is about as back-asswards as this market can get. On the other hand, why should it be any different? Even though the Fed has signaled - with both hands and feet and the waving of other extremities, ear-pulling, farting and goofy faces - that they're going to taper bond-buying in September, why should traders care. It's still a month away, more than ample time to do some shorting, dip-buying and re-selling.
Like a freight train without a locomotive, the market, and the economy, are going nowhere fast.
The whole enterprise is pretty damned stupid.
Meanwhile, silver had made a nice move over the past two days, up more than 4%.
Here's a re-posting of a comment left on another site:
Bravo to all who participate in keeping the spirit of America alive, while the government tears it down.
I should say that I think the tide is turning. These a-holes are visibly shaken on a daily basis and it's only a matter of time before the hackers, the self-employed, the thinking people in America bring this system crashing to its core.
Wall Street and the government (and I mean government at all levels, right down to towns and villages) are beyond corrupt. They are now so transparently out-of-touch and ugly to be contemptible. On a daily basis, I meet more and more people who are just refusing to play along any further, from the contractors who give discounts for cash payments, to landlords of homes in foreclosure, to simple, everyday working people whose loathing for this broken system has turned to disgust and disobedience.
Americans are a rare breed. We'll play along for a while, but, in the meantime, we work our own plans, and eventually there's a clash. Governments always fall. Free people who are willing to fight - by whatever means necessary - will always be free. Few are afraid any longer. The bogeymen of terrorism and national security are being laughed at by the masses.
Sure, there's still a lot of sheeple out there, but there are now enough people with backbone who are unafraid because they no longer want to endure this madness from people like Obama, Hayden, McCain, the banksters, etc., who will actually protect the sheeple from themselves and their nanny state government.
There used to be a poster here with the moniker, "CrashIsOptimistic," and that's now the status quo. The elites - fuck-ups that they are - will cause their own demise, hastened by the very people they wish to subjugate.
Grow your own, run your own, mind your business, and when the tax man or the repo man comes calling, play dumb. My experience with a bad mortgage has now run beyond four years and it's been a valuable learning experience, so much so, that other people are asking my advice, which, is simply, FIGHT.
Carry on. They can kill us all, but seriously, who wants to live under the thumb of tyrants?
Dow 15,425.51, -72.81 (0.47%)
NASDAQ 3,660.11, -9.02 (0.25%)
S&P 500 1,691.42, -6.06 (0.36%)
NYSE Composite 9,622.11, -12.59 (0.13%)
NASDAQ Volume 1,524,848,625
NYSE Volume 3,203,273,250
Combined NYSE & NASDAQ Advance - Decline: 3006-3470
Combined NYSE & NASDAQ New highs - New lows: 249-131
WTI crude oil: 105.97, +2.57
Gold: 1,312.20, +2.30
Silver: 20.41, +2.14
The same pattern of trading appeared every day of the week, typified by a weak start, a bottoming out before noon and a half-hearted rally - on exceptionally-low volume - into the close.
All said, the major indices barely budged.
For the week, the Dow was the biggest loser, down 233 points. The NASDAQ shed all of 29 points, while the S&P dropped a whole 18 points. All this may be indicative of is rotation out of dividend-payers to more speculative stocks, a kind of reverse shoot-the-generals move which is about as back-asswards as this market can get. On the other hand, why should it be any different? Even though the Fed has signaled - with both hands and feet and the waving of other extremities, ear-pulling, farting and goofy faces - that they're going to taper bond-buying in September, why should traders care. It's still a month away, more than ample time to do some shorting, dip-buying and re-selling.
Like a freight train without a locomotive, the market, and the economy, are going nowhere fast.
The whole enterprise is pretty damned stupid.
Meanwhile, silver had made a nice move over the past two days, up more than 4%.
Here's a re-posting of a comment left on another site:
Bravo to all who participate in keeping the spirit of America alive, while the government tears it down.
I should say that I think the tide is turning. These a-holes are visibly shaken on a daily basis and it's only a matter of time before the hackers, the self-employed, the thinking people in America bring this system crashing to its core.
Wall Street and the government (and I mean government at all levels, right down to towns and villages) are beyond corrupt. They are now so transparently out-of-touch and ugly to be contemptible. On a daily basis, I meet more and more people who are just refusing to play along any further, from the contractors who give discounts for cash payments, to landlords of homes in foreclosure, to simple, everyday working people whose loathing for this broken system has turned to disgust and disobedience.
Americans are a rare breed. We'll play along for a while, but, in the meantime, we work our own plans, and eventually there's a clash. Governments always fall. Free people who are willing to fight - by whatever means necessary - will always be free. Few are afraid any longer. The bogeymen of terrorism and national security are being laughed at by the masses.
Sure, there's still a lot of sheeple out there, but there are now enough people with backbone who are unafraid because they no longer want to endure this madness from people like Obama, Hayden, McCain, the banksters, etc., who will actually protect the sheeple from themselves and their nanny state government.
There used to be a poster here with the moniker, "CrashIsOptimistic," and that's now the status quo. The elites - fuck-ups that they are - will cause their own demise, hastened by the very people they wish to subjugate.
Grow your own, run your own, mind your business, and when the tax man or the repo man comes calling, play dumb. My experience with a bad mortgage has now run beyond four years and it's been a valuable learning experience, so much so, that other people are asking my advice, which, is simply, FIGHT.
Carry on. They can kill us all, but seriously, who wants to live under the thumb of tyrants?
Dow 15,425.51, -72.81 (0.47%)
NASDAQ 3,660.11, -9.02 (0.25%)
S&P 500 1,691.42, -6.06 (0.36%)
NYSE Composite 9,622.11, -12.59 (0.13%)
NASDAQ Volume 1,524,848,625
NYSE Volume 3,203,273,250
Combined NYSE & NASDAQ Advance - Decline: 3006-3470
Combined NYSE & NASDAQ New highs - New lows: 249-131
WTI crude oil: 105.97, +2.57
Gold: 1,312.20, +2.30
Silver: 20.41, +2.14
Wednesday, June 12, 2013
Stocks Erase Early Gains; Dow Down Three Straight for First Time in 2013
Equities took another shot to the ribs on Tuesday as bears took control of the trading.
After an initial gain of 119 points on the Dow, sentiment turned radically negative for really no apparent reason, as selling into strength became the preferred strategy after months of buying dips.
The Dow posted its first three-day losing streak of 2013, with the other major averages following suit. Today's closing numbers put the S&P and the Dow dangerously close to their 50-day moving averages: 1610 for the S&P; 14970 on the Dow, and, any troubling signs from Thursday's initial unemployment claims could shoot the averages right through support and into a proverbial no-man's land.
Trading volume was rather tepid, but losers outnumbered gainers again, by a roughly 3:1 margin. The major indices now have entered an area that is decisively below the midpoint between recent highs and lows, trending lower, as has been the mantra for most of the month of June.
The dark lining inside the silver cloud came in the form of WTI crude oil prices, which hit a three-week high.
Bias remains bearish short-term, as new lows outpaced new highs for the second straight session and are deteriorating.
Where this goes from here is anyone's guess, though most are placing their wagers toward continued weakness in stocks as interest rates bumped up slightly again today, the 10-year closing at 2.23%, but that's what makesgambling investing so interesting.
Dow 14,995.23, -126.79 (0.84%)
NASDAQ 3,400.43, -36.52 (1.06%)
S&P 500 1,612.52, -13.61 (0.84%)
NYSE Composite 9,189.42, -66.06 (0.71%)
NASDAQ Volume 1,501,521,500
NYSE Volume 3,677,878,750
Combined NYSE & NASDAQ Advance - Decline: 1675-4828
Combined NYSE & NASDAQ New highs - New lows: 129-428
WTI crude oil: 95.88, +0.50
Gold: 1,392.00, +15.00
Silver: 21.80, +0.15
After an initial gain of 119 points on the Dow, sentiment turned radically negative for really no apparent reason, as selling into strength became the preferred strategy after months of buying dips.
The Dow posted its first three-day losing streak of 2013, with the other major averages following suit. Today's closing numbers put the S&P and the Dow dangerously close to their 50-day moving averages: 1610 for the S&P; 14970 on the Dow, and, any troubling signs from Thursday's initial unemployment claims could shoot the averages right through support and into a proverbial no-man's land.
Trading volume was rather tepid, but losers outnumbered gainers again, by a roughly 3:1 margin. The major indices now have entered an area that is decisively below the midpoint between recent highs and lows, trending lower, as has been the mantra for most of the month of June.
The dark lining inside the silver cloud came in the form of WTI crude oil prices, which hit a three-week high.
Bias remains bearish short-term, as new lows outpaced new highs for the second straight session and are deteriorating.
Where this goes from here is anyone's guess, though most are placing their wagers toward continued weakness in stocks as interest rates bumped up slightly again today, the 10-year closing at 2.23%, but that's what makes
Dow 14,995.23, -126.79 (0.84%)
NASDAQ 3,400.43, -36.52 (1.06%)
S&P 500 1,612.52, -13.61 (0.84%)
NYSE Composite 9,189.42, -66.06 (0.71%)
NASDAQ Volume 1,501,521,500
NYSE Volume 3,677,878,750
Combined NYSE & NASDAQ Advance - Decline: 1675-4828
Combined NYSE & NASDAQ New highs - New lows: 129-428
WTI crude oil: 95.88, +0.50
Gold: 1,392.00, +15.00
Silver: 21.80, +0.15
Tuesday, June 11, 2013
Stocks Decline Globally as QE and ZIRP Show There are Limits
With losers outpacing gainers by a 4:1 margin, stocks got trashed today around the globe, starting in Japan - which triggered the entire equity rout - and ending here in the USA where the Dow lost 108 points, and, despite that stiff selloff, was still easily the best performer of the major indices on a percentage basis.
The NASDAQ and NYSE Composite took the day's losses the worst, off 1.06% and 1.10% respectively. The S&P dropped by just more than one percent.
The worldwide selling spree was set off when the Japanese leadership declined to extend their bond and market easing measures past what was already in place. Speculators expected the BoJ to increase bond and ETF purchases, but came away disappointed.
That sent the Nikkei and Topix tumbling to the downside, and greeted European investors with markedly negative prospects as their trading day began.
In the US, futures were heavily to the downside, resulting in the indices hitting their lowest points just minutes into trading. Remarkably, stocks came nearly all the way back - with the Dow going positive for a few moments before noon, but the low-volume rally fooled nobody and sellers came back in force to take stocks back down for the rest of the session.
Adding to the already nervous environment, the 10-year note bounced up as high as 2.28%, but ended the day at a relatively benign 2.18%, though fear of higher rates and a tapering of the Fed's bond buying program remained a key market driver in both stocks and bonds.
A fortnight of protests in Turkey finally exploded into a somewhat violent repression by government forces, who used water cannons and tear gas to disperse about 10,000 protesters. Also, late in the day, news broke that the ACLU had filed suit against the US government over the NSA's recently-exposed monitoring of nearly all domestic communications, calling the activity unconstitutional.
This is truly a dangerous environment, both for investors and ordinary citizens. Stocks are hovering in a range just below all-time highs and recent lows, while Washington is awash in scandals ranging from covering up the assassination of a diplomat and others in Libya (Benghazi), to wiretapping reporters to having the IRS harass political opposition. In another time, there would be protests all over the Washington Mall and cries for impeachment of president Obama would be drowning out reasonable discourse. But, Americans have grown so used to government malfeasance and the country has become so dependent on government entitlements that nobody seems capable of raising their voice to an administration and a congress that has trampled the constitution ever since 9/11/2001.
What will it take to shake things up and clean the garbage out of our corrupt-to-the-core political and financial system? A severe market crash? A politician with will and integrity? A hot war in Syria? Something else?
Stay tuned for what should develop into a very contentious, heated summer of pandemonium in markets and politics. The events of the past two to three weeks have been just the warm-up act. The main attraction begins when the cronies turn on each other.
Dow 15,122.02, -116.57 (0.76%)
NASDAQ 3,436.95, -36.82 (1.06%)
S&P 500 1,626.13, -16.68 (1.02%)
NYSE Composite 9,255.44, -102.56 (1.10%)
NASDAQ Volume 1,477,085,500
NYSE Volume 3,854,662,750
Combined NYSE & NASDAQ Advance - Decline: 1286-5251
Combined NYSE & NASDAQ New highs - New lows: 131-308
WTI crude oil: 95.38, -0.39
Gold: 1,377.00, -9.00
Silver: 21.65, -0.279
The NASDAQ and NYSE Composite took the day's losses the worst, off 1.06% and 1.10% respectively. The S&P dropped by just more than one percent.
The worldwide selling spree was set off when the Japanese leadership declined to extend their bond and market easing measures past what was already in place. Speculators expected the BoJ to increase bond and ETF purchases, but came away disappointed.
That sent the Nikkei and Topix tumbling to the downside, and greeted European investors with markedly negative prospects as their trading day began.
In the US, futures were heavily to the downside, resulting in the indices hitting their lowest points just minutes into trading. Remarkably, stocks came nearly all the way back - with the Dow going positive for a few moments before noon, but the low-volume rally fooled nobody and sellers came back in force to take stocks back down for the rest of the session.
Adding to the already nervous environment, the 10-year note bounced up as high as 2.28%, but ended the day at a relatively benign 2.18%, though fear of higher rates and a tapering of the Fed's bond buying program remained a key market driver in both stocks and bonds.
A fortnight of protests in Turkey finally exploded into a somewhat violent repression by government forces, who used water cannons and tear gas to disperse about 10,000 protesters. Also, late in the day, news broke that the ACLU had filed suit against the US government over the NSA's recently-exposed monitoring of nearly all domestic communications, calling the activity unconstitutional.
This is truly a dangerous environment, both for investors and ordinary citizens. Stocks are hovering in a range just below all-time highs and recent lows, while Washington is awash in scandals ranging from covering up the assassination of a diplomat and others in Libya (Benghazi), to wiretapping reporters to having the IRS harass political opposition. In another time, there would be protests all over the Washington Mall and cries for impeachment of president Obama would be drowning out reasonable discourse. But, Americans have grown so used to government malfeasance and the country has become so dependent on government entitlements that nobody seems capable of raising their voice to an administration and a congress that has trampled the constitution ever since 9/11/2001.
What will it take to shake things up and clean the garbage out of our corrupt-to-the-core political and financial system? A severe market crash? A politician with will and integrity? A hot war in Syria? Something else?
Stay tuned for what should develop into a very contentious, heated summer of pandemonium in markets and politics. The events of the past two to three weeks have been just the warm-up act. The main attraction begins when the cronies turn on each other.
Dow 15,122.02, -116.57 (0.76%)
NASDAQ 3,436.95, -36.82 (1.06%)
S&P 500 1,626.13, -16.68 (1.02%)
NYSE Composite 9,255.44, -102.56 (1.10%)
NASDAQ Volume 1,477,085,500
NYSE Volume 3,854,662,750
Combined NYSE & NASDAQ Advance - Decline: 1286-5251
Combined NYSE & NASDAQ New highs - New lows: 131-308
WTI crude oil: 95.38, -0.39
Gold: 1,377.00, -9.00
Silver: 21.65, -0.279
Thursday, April 11, 2013
New Highs All Around... Again
Can it really be this easy?
Apparently, investing has become more sport than discipline, as the major indices drove again to new highs - the NASDAQ bounding over 3300, with the Dow, the Comp. and S&P 500 setting new all-time record closes.
In addition to the Fed's constant $85 billion/month put, there are other factors at work. Money is pouring out of Japan and Europe since the Cyprus incident and the BOJ's experimental monetary policy that makes Bernanke's monetizing of US debt appear paltry.
The Japanese central bank, while openly buying all the government issued treasuries it can, is also tinkering in the open markets, buying ETFs and REITs, especially.
If Bernanke gets a whiff of this kind of action, US markets could be buffeted with even more stimulus by the Fed, openly buying stocks to levitate the equity markets higher.
When it will end is anybody's guess, but, despite some Fed officials openly saying - in yesterday's leaked February Fed minutes - that they'd like to taper the bond purchases this year and possibly end them by year's end, Friday's non-farm payroll and today's news that first quarter PC shipments fell by 13.9% globally, the worst decline since records began being kept in 1994.
While Wall Street is flying high, the real economy may not be quite so robust. Many argue that the US is still in a recession, and that the one which began in 2007 never really ended. High levels of unemployment has become endemic, a structural rather than a cyclical issue.
Nonetheless, the markets continue to roar higher, and the chances for a significant pull-back seem about as good as a chicken hatching a coyote. There hasn't been a major decline since August of 2011, and that one was caused by our congress and president nearly letting the government breach the debt ceiling.
The mountains of debt being piled up in Washington are of little concern to Wall Street, though, nor, it appears, to the millions of American who have jobs, or are collecting on one of a myriad of entitlement programs.
It wasn't supposed to work this way, but, for now, it's what we've got as an economy and there's practically nobody arguing against its continued success.
Of those groups getting murdered by the rise of stocks are retirees, who cannot make any money safely, i.e., in fixed income investments, gold and silver bugs and anyone who's not "in."
The question remaining is when these groups capitulate and join the party, will the rug be pulled from under them?
Dow 14,865.14, +62.90 (0.42%)
NASDAQ 3,300.16, +2.91 (0.09%)
S&P 500 1,593.37, +5.64 (0.36%)
NYSE Composite 9,234.62, +45.53 (0.50%)
NASDAQ Volume 1,793,031,500
NYSE Volume 3,476,424,250
Combined NYSE & NASDAQ Advance - Decline: 3663-2761
Combined NYSE & NASDAQ New highs - New lows: 563-25
WTI crude oil: 93.51, -1.13
Gold: 1,564.90, +6.10
Silver: 27.70, +0.044
Apparently, investing has become more sport than discipline, as the major indices drove again to new highs - the NASDAQ bounding over 3300, with the Dow, the Comp. and S&P 500 setting new all-time record closes.
In addition to the Fed's constant $85 billion/month put, there are other factors at work. Money is pouring out of Japan and Europe since the Cyprus incident and the BOJ's experimental monetary policy that makes Bernanke's monetizing of US debt appear paltry.
The Japanese central bank, while openly buying all the government issued treasuries it can, is also tinkering in the open markets, buying ETFs and REITs, especially.
If Bernanke gets a whiff of this kind of action, US markets could be buffeted with even more stimulus by the Fed, openly buying stocks to levitate the equity markets higher.
When it will end is anybody's guess, but, despite some Fed officials openly saying - in yesterday's leaked February Fed minutes - that they'd like to taper the bond purchases this year and possibly end them by year's end, Friday's non-farm payroll and today's news that first quarter PC shipments fell by 13.9% globally, the worst decline since records began being kept in 1994.
While Wall Street is flying high, the real economy may not be quite so robust. Many argue that the US is still in a recession, and that the one which began in 2007 never really ended. High levels of unemployment has become endemic, a structural rather than a cyclical issue.
Nonetheless, the markets continue to roar higher, and the chances for a significant pull-back seem about as good as a chicken hatching a coyote. There hasn't been a major decline since August of 2011, and that one was caused by our congress and president nearly letting the government breach the debt ceiling.
The mountains of debt being piled up in Washington are of little concern to Wall Street, though, nor, it appears, to the millions of American who have jobs, or are collecting on one of a myriad of entitlement programs.
It wasn't supposed to work this way, but, for now, it's what we've got as an economy and there's practically nobody arguing against its continued success.
Of those groups getting murdered by the rise of stocks are retirees, who cannot make any money safely, i.e., in fixed income investments, gold and silver bugs and anyone who's not "in."
The question remaining is when these groups capitulate and join the party, will the rug be pulled from under them?
Dow 14,865.14, +62.90 (0.42%)
NASDAQ 3,300.16, +2.91 (0.09%)
S&P 500 1,593.37, +5.64 (0.36%)
NYSE Composite 9,234.62, +45.53 (0.50%)
NASDAQ Volume 1,793,031,500
NYSE Volume 3,476,424,250
Combined NYSE & NASDAQ Advance - Decline: 3663-2761
Combined NYSE & NASDAQ New highs - New lows: 563-25
WTI crude oil: 93.51, -1.13
Gold: 1,564.90, +6.10
Silver: 27.70, +0.044
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