Nothing but headlines and rumors are moving the markets these days - and, incidentally, it's Monday, so stocks must go down - and, since Europe's already been sated by ECB president Mario Draghi's new proposal to bail out all sovereign nations in need by purchasing one, two and three year bond issues in exchange for said nations' acceptance of "conditions," all eyes have turned to the two-day FOMC meeting at which Chairman Ben Bernanke is supposed to announce his own version of bond-buying (AKA, QE3).
But, as with all things Ponzi-oriented and subject to whims, official data and sentiment - to say nothing of the upcoming presidential election - speculators, insiders, hedge fund managers and other market participants are a little nervous about what's to come on Wednesday afternoon, when the FOMC will surely announce no chance in policy, keeping rates at zero, and after that...
Chairman Bernanke may well hint at new stimulative measures or actually set a date for a plan to proceed, or, he may weigh all the factors, including Friday's uninspired non-farm payroll data, and do nothing (which would be, historically speaking, the correct path).
If that's the case - and that's what had investors worried in the final hour of trade today - then expect a sharp pull-back from the currently-inflated levels on the major indices. Additionally, the German high court is set to rule, earlier in the day on Wednesday, on the constitutionality of the ESM, and that could be an even bigger deal.
Some 70% or more of the German populace is opposed to the ESM, the funding mechanism that is supposed to - just like all other failed plans - save the Euro, because the bulk of the fund would be bourn by Germany and the good people of that country who pay taxes, which are already viewed as too high. The thought of more taxation in Germany, one of the highest-taxed nations in the world, is unpalatable to most, but taxpayers, alas, do not have a vote. The ruling will come at about the time markets open in the US, setting up for what could be a wicked roller coaster ride.
Thus, there's enough nervousness on Wall Street to make even the coolest of operators break into a cold sweat these days, as uncertainty exists at all levels of economies globally and in the political world.
Today's double digit losses on the major exchanges could be nothing more than profit-taking, or a precursor to some terrible future without government stimulus on both the European and American continents.
How sad. Brokers and dealers might actually have to do some fundamental analysis for a change instead of depending on round after round of money printing to keep the stock markets at nose-bleed levels. Time will tell, and the time is nigh.
Dow 13,254.29, -52.35 (0.39%)
NASDAQ 3,104.02, -32.40 (1.03%)
S&P 500 1,429.08, -8.84 (0.61%)
NYSE Composite 8,192.40, -42.11 (0.51%)
NASDAQ Volume 1,578,686,000
NYSE Volume 3,213,290,000
Combined NYSE & NASDAQ Advance - Decline: 2228-3284
Combined NYSE & NASDAQ New highs - New lows: 332-38
WTI crude oil: 96.54, +0.12
Gold: 1,731.80, -8.70
Silver: 33.63, -0.06
Monday, September 10, 2012
Friday, September 7, 2012
August Non-Farm Payrolls Miss Flatlines Stocks
The US economy showed another sign of sluggishness, as August Non-farm Payrolls rose less than expected, gaining 96,000 net new jobs for the month, well below consensus estimates of 125,000.
Additionally, June and July data sets were revised downward by a combined 41,000. June payrolls were just 45,000, while the number in July was revised down to 141,000.
The official jobless rate fell from 8.3% to 8.1%, as labor force participation fell to its lowest level in decades, at 63.5%.
The poor showing for the labor market was seen as a blow to president Obama's re-election bid, and also as cause for the Fed supplying more stimulus when the FOMC meets next week.
Volume more or less returned to the doldrums, following the massive ramp-up Thursday, following the unveiling of the ECB's new bond purchase program.
Stocks tended to just meander around the flat line, with the odd exception of the NYSE Composite, which gapped up at the open and stayed in a tight range all session long.
It's somewhat a sad commentary on markets that they are so well-coordinated in response to news, specifically that this or that central bank is making money easier for bankers to borrow at little to no interest, all the while the general public scratching out a living without any mechanism for saving.
Outward appearances may be deceiving. This kind of controlled economics seldom works out well in the long run.
Precious metals may be telling the markets something. Gold and silver soared again today and are at multi-month highs, generally a sign that economic or geopolitical conditions are strained and risk assets not to be trusted, though one could hardly suspect that anything evil may come the way for stocks, as well as they have performed this year.
Dow 13,306.64, +14.64(0.11%)
Nasdaq 3,136.42, +0.61(0.02%)
S&P 500 1,437.92, +5.80(0.40%)
NYSE Composite 8,233.98, +73.42(0.90%)
NYSE Volume 3,627,325,750
Nasdaq Volume 1,694,756,120
Combined NYSE & NASDAQ Advance - Decline: 3490-1997
Combined NYSE & NASDAQ New highs - New lows: 449-40 (extreme)
WTI crude oil: 96.42, +0.89
Gold: 1,740.50, +34.90
Silver: 33.69, +1.02
Additionally, June and July data sets were revised downward by a combined 41,000. June payrolls were just 45,000, while the number in July was revised down to 141,000.
The official jobless rate fell from 8.3% to 8.1%, as labor force participation fell to its lowest level in decades, at 63.5%.
The poor showing for the labor market was seen as a blow to president Obama's re-election bid, and also as cause for the Fed supplying more stimulus when the FOMC meets next week.
Volume more or less returned to the doldrums, following the massive ramp-up Thursday, following the unveiling of the ECB's new bond purchase program.
Stocks tended to just meander around the flat line, with the odd exception of the NYSE Composite, which gapped up at the open and stayed in a tight range all session long.
It's somewhat a sad commentary on markets that they are so well-coordinated in response to news, specifically that this or that central bank is making money easier for bankers to borrow at little to no interest, all the while the general public scratching out a living without any mechanism for saving.
Outward appearances may be deceiving. This kind of controlled economics seldom works out well in the long run.
Precious metals may be telling the markets something. Gold and silver soared again today and are at multi-month highs, generally a sign that economic or geopolitical conditions are strained and risk assets not to be trusted, though one could hardly suspect that anything evil may come the way for stocks, as well as they have performed this year.
Dow 13,306.64, +14.64(0.11%)
Nasdaq 3,136.42, +0.61(0.02%)
S&P 500 1,437.92, +5.80(0.40%)
NYSE Composite 8,233.98, +73.42(0.90%)
NYSE Volume 3,627,325,750
Nasdaq Volume 1,694,756,120
Combined NYSE & NASDAQ Advance - Decline: 3490-1997
Combined NYSE & NASDAQ New highs - New lows: 449-40 (extreme)
WTI crude oil: 96.42, +0.89
Gold: 1,740.50, +34.90
Silver: 33.69, +1.02
Thursday, September 6, 2012
Draghi Delivers Win-Win for Europe, Stocks
ECB president Mario Draghi pleased just about everyone when he unveiled the latest bond-purchasing scheme by the European Central Bank at a news conference early this morning. Stocks rose across Europe and the Americas with the NASDAQ reaching 11 1/2 year highs.
Portions of the new ECB bond purchase program, which is designed to purchase sovereign bonds with maturities of 1, 2, and 3 years, were purposely leaked to the press in the days and weeks prior to the official announcement, which came after the ECB's rate policy meeting (kept the official bank lending rate at 0.75%), during afternoon trading on European bourses and prior to the open of trading in New York.
The plan, called by Draghi, Outright Monetary Transactions (OMT) rests on five main pillars: 1) Strict conditionality will be applied to bond purchases 2) There will be unlimited purchases of bonds with a maturity of one to three years 3) The ECB will not have seniority 4) All transactions will be 'sterilized' 5) Purchases will be reported monthly.
Countries wishing to participate (notably Spain and Italy) will have to make a formal application and adhere to conditions, mostly in the form of austerity measures, something at which many governments have balked.
While the stock markets advanced broadly, the S&P reaching a four-year high there are some land-mines over which the ECB will have to traverse in order to make the program a success.
First, there is the matter of legality, upon which the German high court will rule on Wednesday, September 12. The court is reviewing previous bond-buying programs by the ECB, such as the ESM, to determine if such plans comply the rigors of the German constitution. If the court decides against such plans, everything in Europe will be thrown into chaos, as Germany is the major funder of bailout programs.
The matter of nations applying for funding is another sticking point. Spain and Italy are in fiscal crises, but the political leaders are wary of conditionality, submitting their government to severe austerity measures, such as the recently-proposed six-day work week for Greeks. Additionally, sticking to the conditions ofthe loans is often difficult if not impossible, though the OMT specifically says that bond purchases will be curtailed if conditions are not met.
with the ECB now in the Fed's arena of massive money printing, what lies ahead for the US and global economies is next week's FOMC meeting, at which it is widely believed Fed chairman Ben Bernanke will unveil some new liquidity program of his own, commonly called QE3, though recent economic data, such as today's August ADP employment report and the ISM Services data would seem to indicate that further easing by the Fed is not warranted nor wise at this juncture.
Thus, positive economic data, a recovering economy and anything outside the stock market viewed as positive to growth will be viewed by Wall Street as an impediment to more easy money, likely causing a sell-off in equities.
Tomorrow's non-farm payroll report for August is the linchpin to Fed action. Anything over 150,000 net new jobs may cause the Fed to hold back from further easing. There's also widespread belief that the Fed will be reluctant to move so close to the US presidential elections, not wishing to be perceived as a political entity.
Next week is shaping up to be epic, one way or the other.
Dow 13,292.00, +244.52 (1.87%)
NASDAQ 3,135.81, +66.54 (2.17%)
S&P 500 1,432.12, +28.68 (2.04%)
NYSE Composite 8,160.40, +168.39 (2.11%)
NASDAQ Volume 1,883,115,000
NYSE Volume 3,919,524,250
Combined NYSE & NASDAQ Advance - Decline: 4360-1203
Combined NYSE & NASDAQ New highs - New lows: 494-39
WTI crude oil: 95.53, +0.17
Gold: 1,705.60, +11.60
Silver: 32.67, +0.35
Portions of the new ECB bond purchase program, which is designed to purchase sovereign bonds with maturities of 1, 2, and 3 years, were purposely leaked to the press in the days and weeks prior to the official announcement, which came after the ECB's rate policy meeting (kept the official bank lending rate at 0.75%), during afternoon trading on European bourses and prior to the open of trading in New York.
The plan, called by Draghi, Outright Monetary Transactions (OMT) rests on five main pillars: 1) Strict conditionality will be applied to bond purchases 2) There will be unlimited purchases of bonds with a maturity of one to three years 3) The ECB will not have seniority 4) All transactions will be 'sterilized' 5) Purchases will be reported monthly.
Countries wishing to participate (notably Spain and Italy) will have to make a formal application and adhere to conditions, mostly in the form of austerity measures, something at which many governments have balked.
While the stock markets advanced broadly, the S&P reaching a four-year high there are some land-mines over which the ECB will have to traverse in order to make the program a success.
First, there is the matter of legality, upon which the German high court will rule on Wednesday, September 12. The court is reviewing previous bond-buying programs by the ECB, such as the ESM, to determine if such plans comply the rigors of the German constitution. If the court decides against such plans, everything in Europe will be thrown into chaos, as Germany is the major funder of bailout programs.
The matter of nations applying for funding is another sticking point. Spain and Italy are in fiscal crises, but the political leaders are wary of conditionality, submitting their government to severe austerity measures, such as the recently-proposed six-day work week for Greeks. Additionally, sticking to the conditions ofthe loans is often difficult if not impossible, though the OMT specifically says that bond purchases will be curtailed if conditions are not met.
with the ECB now in the Fed's arena of massive money printing, what lies ahead for the US and global economies is next week's FOMC meeting, at which it is widely believed Fed chairman Ben Bernanke will unveil some new liquidity program of his own, commonly called QE3, though recent economic data, such as today's August ADP employment report and the ISM Services data would seem to indicate that further easing by the Fed is not warranted nor wise at this juncture.
Thus, positive economic data, a recovering economy and anything outside the stock market viewed as positive to growth will be viewed by Wall Street as an impediment to more easy money, likely causing a sell-off in equities.
Tomorrow's non-farm payroll report for August is the linchpin to Fed action. Anything over 150,000 net new jobs may cause the Fed to hold back from further easing. There's also widespread belief that the Fed will be reluctant to move so close to the US presidential elections, not wishing to be perceived as a political entity.
Next week is shaping up to be epic, one way or the other.
Dow 13,292.00, +244.52 (1.87%)
NASDAQ 3,135.81, +66.54 (2.17%)
S&P 500 1,432.12, +28.68 (2.04%)
NYSE Composite 8,160.40, +168.39 (2.11%)
NASDAQ Volume 1,883,115,000
NYSE Volume 3,919,524,250
Combined NYSE & NASDAQ Advance - Decline: 4360-1203
Combined NYSE & NASDAQ New highs - New lows: 494-39
WTI crude oil: 95.53, +0.17
Gold: 1,705.60, +11.60
Silver: 32.67, +0.35
Wednesday, September 5, 2012
Nothing Moves in Advance of Draghi's ECB Announcement
Remember those days of late August, when the markets traded in narrow ranges and closed within a tiny fraction of a percentage point on super-low volume?
Today was another one of those days. Stock pickers are waiting for the ECB meeting on Thursday, when president Mario Draghi is supposed to release details of his plan to fund all of the peripheral nations that are broke, bankrupt or about to be.
Last week, everyone waited for the Chairman of the Federal Reserve, Ben Bernanke, to give a speech at Jackson Hole, Wyoming, and signal that the Fed was soon to unleash more free capital into the corrupt, dysfunctional, insolvent banking system.
Now we wait for Draghi. It's a complete disaster unfolding right before our eyes and barely worth commenting upon because Bernanke didn't say anything the markets didn't already know, and, in all likelihood, neither will Draghi. Either that, or he'll do what the Europeans are so good at, making funny noises, promising something for a later date, your basic can-kicking exercise.
The clock is ticking...
Dow 13,047.48, +11.54 (0.09%)
NASDAQ 3,069.27. -5.79 (0.19%)
S&P 500 1,403.44, -1.50 (0.11%)
NYSE Composite 7,992.01, -10.31 (0.13%)
NASDAQ Volume 1,432,807,125
NYSE Volume 2,782,468,000
Combined NYSE & NASDAQ Advance - Decline: 2308-2724
Combined NYSE & NASDAQ New highs - New lows: 274-59
WTI crude oil: 95.36, +0.06
Gold: 1,694.00, -2.00
Silver: 32.33 -0.08
Today was another one of those days. Stock pickers are waiting for the ECB meeting on Thursday, when president Mario Draghi is supposed to release details of his plan to fund all of the peripheral nations that are broke, bankrupt or about to be.
Last week, everyone waited for the Chairman of the Federal Reserve, Ben Bernanke, to give a speech at Jackson Hole, Wyoming, and signal that the Fed was soon to unleash more free capital into the corrupt, dysfunctional, insolvent banking system.
Now we wait for Draghi. It's a complete disaster unfolding right before our eyes and barely worth commenting upon because Bernanke didn't say anything the markets didn't already know, and, in all likelihood, neither will Draghi. Either that, or he'll do what the Europeans are so good at, making funny noises, promising something for a later date, your basic can-kicking exercise.
The clock is ticking...
Dow 13,047.48, +11.54 (0.09%)
NASDAQ 3,069.27. -5.79 (0.19%)
S&P 500 1,403.44, -1.50 (0.11%)
NYSE Composite 7,992.01, -10.31 (0.13%)
NASDAQ Volume 1,432,807,125
NYSE Volume 2,782,468,000
Combined NYSE & NASDAQ Advance - Decline: 2308-2724
Combined NYSE & NASDAQ New highs - New lows: 274-59
WTI crude oil: 95.36, +0.06
Gold: 1,694.00, -2.00
Silver: 32.33 -0.08
Tuesday, September 4, 2012
Stocks Fail on Stormy Tuesday; The Misinformation Age
Well, it's not Monday, but it is the first day of the workweek, so stocks must go down. And they did, with the exception of the NASDAQ, which went from the worst-performing index to the best in a matter of 40 minutes - from roughly 2:00 pm to 2:40 pm EDT, going from a loss of 10 points to a gain of 15.
The Dow and S%P tagged along somewhat, but that drove the NAZ higher was none other than Apple (AAPL), which recorded almost half of its 9.73-point gain during that time period.
So, why then does CNBC report that the surge in stocks - the Dow was down nearly 115 points at the lows of the day, the NASDAQ off more than 26 - was due to a tweet by PIMCO's Bill Gross, who, mentioning that Mario Draghi, head of the ECB, willingness to offer 1, 2, and 3-year "loans" (bond purchases) to sovereign nations in the Eurozone, was reflationary and that investors should buy GOLD, TIPS AND REAL ASSETS.
Note that Gross did not say "STOCKS," though CNBC, the masters of misinformation, wishes the assembled masses of hoe viewers would believe that Mr. Gross is a perma-bull, when the exact opposite is true.
Welcome to the age of heightened misinformation.
There was a story today out of Stanford about organic foods not being any better than mass-produced, GMO, pesticide-riddled crap that drives US corporate agribusiness.
I'll take lower levels of pesticides in my urine for $400, Alex.
Just guessing, but could the major contributors to these Stanford researchers possibly be Monsanto and the US Dept. of Agriculture?
Other misinformation predominates what passes for news and journalism these days. For instance, according to the ECB's Mario Draghi, buying 1, 2, and 3-year bonds from sovereign nations does not violate the EU's basic treaty, which forbids such actions... OK. Obama and Romney sound like they differ widely on policies, when both, in fact, are nothing but shills for wealthy individuals and corporations which fund their campaigns. Facebook has lost 50% of market value since its IPO four short months ago, but it's still a solid company.
Trading volume, which was supposed to rebound as soon as all the Wall Street heavy hitters returned after Labor Day, was only a little better today than during July and August. US markets are so thinly-traded that manipulation by a group of well-timed players or even the PPT is easier than ever.
Keep an eye on gold and silver, maybe especially silver, which has exploded over the past three weeks. Gold's being suppressed below $1700, though it seems the central banking cartel cannot hold that level much longer. The Dow fell below 13,000 today, but was pumped back above it, ditto the S&P at 1400. These trades and ranges are due to break down soon.
Today's ISM reading of 49.6 was the third in a row showing contraction, though now, according to Steve Liesman of CNBC. the number to watch is 42.6, which would show contraction for the entire economy. Pure bunk.
Construction spending was off 0.9% in July. That a sizable decline, and why stocks fell out after the two reports at 10:00 am EDT.
Just to refresh one's memory, here's a nifty video of why we're where we are.
Dow 13,035.94, -54.90 (0.42%)
NASDAQ 3,075.06, +8.10 (0.26%)
S&P 500 1,404.94, -1.64 (0.12%)
NYSE Composite 8,002.31, -12.61 (0.16%)
NASDAQ Volume 1,505,270,625
NYSE Volume 3,086,772,250
Combined NYSE & NASDAQ Advance - Decline: 3319-2194
Combined NYSE & NASDAQ New highs - New lows: 288-64
WTI crude oil: 95.30, -1.17
Gold: 1,698.40, +10.80
Silver: 32.41, +0.97
The Dow and S%P tagged along somewhat, but that drove the NAZ higher was none other than Apple (AAPL), which recorded almost half of its 9.73-point gain during that time period.
So, why then does CNBC report that the surge in stocks - the Dow was down nearly 115 points at the lows of the day, the NASDAQ off more than 26 - was due to a tweet by PIMCO's Bill Gross, who, mentioning that Mario Draghi, head of the ECB, willingness to offer 1, 2, and 3-year "loans" (bond purchases) to sovereign nations in the Eurozone, was reflationary and that investors should buy GOLD, TIPS AND REAL ASSETS.
Note that Gross did not say "STOCKS," though CNBC, the masters of misinformation, wishes the assembled masses of hoe viewers would believe that Mr. Gross is a perma-bull, when the exact opposite is true.
Welcome to the age of heightened misinformation.
There was a story today out of Stanford about organic foods not being any better than mass-produced, GMO, pesticide-riddled crap that drives US corporate agribusiness.
Two studies of children consuming organic and conventional diets did find lower levels of pesticide residues in the urine of children on organic diets, though the significance of these findings on child health is unclear, noted the researchers.
I'll take lower levels of pesticides in my urine for $400, Alex.
Just guessing, but could the major contributors to these Stanford researchers possibly be Monsanto and the US Dept. of Agriculture?
Other misinformation predominates what passes for news and journalism these days. For instance, according to the ECB's Mario Draghi, buying 1, 2, and 3-year bonds from sovereign nations does not violate the EU's basic treaty, which forbids such actions... OK. Obama and Romney sound like they differ widely on policies, when both, in fact, are nothing but shills for wealthy individuals and corporations which fund their campaigns. Facebook has lost 50% of market value since its IPO four short months ago, but it's still a solid company.
Trading volume, which was supposed to rebound as soon as all the Wall Street heavy hitters returned after Labor Day, was only a little better today than during July and August. US markets are so thinly-traded that manipulation by a group of well-timed players or even the PPT is easier than ever.
Keep an eye on gold and silver, maybe especially silver, which has exploded over the past three weeks. Gold's being suppressed below $1700, though it seems the central banking cartel cannot hold that level much longer. The Dow fell below 13,000 today, but was pumped back above it, ditto the S&P at 1400. These trades and ranges are due to break down soon.
Today's ISM reading of 49.6 was the third in a row showing contraction, though now, according to Steve Liesman of CNBC. the number to watch is 42.6, which would show contraction for the entire economy. Pure bunk.
Construction spending was off 0.9% in July. That a sizable decline, and why stocks fell out after the two reports at 10:00 am EDT.
Just to refresh one's memory, here's a nifty video of why we're where we are.
Dow 13,035.94, -54.90 (0.42%)
NASDAQ 3,075.06, +8.10 (0.26%)
S&P 500 1,404.94, -1.64 (0.12%)
NYSE Composite 8,002.31, -12.61 (0.16%)
NASDAQ Volume 1,505,270,625
NYSE Volume 3,086,772,250
Combined NYSE & NASDAQ Advance - Decline: 3319-2194
Combined NYSE & NASDAQ New highs - New lows: 288-64
WTI crude oil: 95.30, -1.17
Gold: 1,698.40, +10.80
Silver: 32.41, +0.97
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