At Thursday's announcement, the ECB's Chief Governing Council (sounds impressive, doesn't it?) cut the bank’s overnight deposit rate, trimmed by 10 basis points, to −0.50%, meaning that commercial banks must effectively pay just a little bit more to the ECB to hold their excess cash balances overnight.
There were other policy moves, such as a restart to the ECB's Asset Purchase Program, otherwise known as QE, with an unlimited timeline. The bank will purchase assets at a rate of 20 billion euros per month, until they see inflation begin to tick up, so, essentially, forever, or, until the currency is completely worthless or eviscerated by the continuous destruction of capital by negative interest rates.
It would be easy to say that the central bankers don't know what they're doing, because all of the stimulus applied to economies around the world for the past ten years hasn't produced anything close to a desired result, either increased inflation (which isn't good, by the way), or rising GDP in developed nations.
What the ECB and other central banks like the BoJ and the US Federal Reserve are doing is choking down the currency in desperate, disparate attempts to conceal the rot within the system, which essentially imploded in 2008.
Nothing has been done at the micro level to induce business formation. It's all been macro level stuff, aiding governments and big corporations, which have a stranglehold on the most profitable franchises worldwide.
This is apparently good for asset prices in risky segments, such as stocks, but also for gold and silver, which have popped on the news, but will no doubt retreat.
The end game is a global depression, which some claim we've been in since 2008, but that's splitting hairs. The final blow comes when currencies backed by nothing are thrown out with the bathwater by populations tired of being taxed to death and dragged roundly their ears and noses with shifting central bank tricksterism.
Negative interest rates, if they prevail, will destroy all fiat currency. It's just math.
At the Close, Wednesday, September 11, 2019:
Dow Jones Industrial Average: 27,137.04, +227.64 (+0.85%)
NASDAQ: 8,169.68, +85.52 (+1.06%)
S&P 500: 3,000.93, +21.54 (+0.72%)
NYSE Composite: 13,082.41, +88.41 (+0.68%)
Thursday, September 12, 2019
Wednesday, September 11, 2019
It's September 11
It's September 11.
Since this is a very solemn day in American life, there will be no economic or political analysis here. Just take a few moments and reflect upon what being an American means to you. Reflect upon what is important to you. Be honest with yourself. You may want to read what's below.
Recently, I was driving from upstate NY to Eastern Tennessee (moving... thank you, Andrew Cuomo). Watching all the cars and trucks moving up and down the highways, I thought, "all this law enforcement, laws, rules, regulations, restrictions, are bullshit. Look at all these people, traveling wherever they want, carrying whatever they please; there is no way the government can stop people from doing what they want, being free. There are just too many people. They can't control them all."
People need to stop being sheep, being herded, being told what to do. Unfortunately, the public school system has brought us to the brink, but, that was being said 50 years ago, when I was in high school. There are 330 million of us, a handful of them. Throw off the yoke of fear and the control net they throw over us via the media.
It takes a long time for individuals to awaken to the truth, but it can happen in an instant. The moment you shake off all the lies that have been told to you since you were a little kid is the moment you become free. Free to do as you please, without harming anybody else. If you want to farm, do it. If you want to weld, do it. Anything you want can be accomplished if you only have the will to start.
In the classic, "Think and Grow Rich," by Napoleon Hill, there is a great line which never fails:
Anyone who truly wants freedom can have it. Nobody needs to raise arms, fire a single bullet. All the power rests in the minds of the people, individually, and collectively.
At the Close, Tuesday, September 10, 2019:
Dow Jones Industrial Average: 26,909.43, +73.92 (+0.28%)
NASDAQ: 8,084.16, -3.28 (-0.04%)
S&P 500: 2,979.39, +0.96 (+0.03%)
NYSE Composite: 12,993.96, +33.24 (+0.26%)
Since this is a very solemn day in American life, there will be no economic or political analysis here. Just take a few moments and reflect upon what being an American means to you. Reflect upon what is important to you. Be honest with yourself. You may want to read what's below.
Recently, I was driving from upstate NY to Eastern Tennessee (moving... thank you, Andrew Cuomo). Watching all the cars and trucks moving up and down the highways, I thought, "all this law enforcement, laws, rules, regulations, restrictions, are bullshit. Look at all these people, traveling wherever they want, carrying whatever they please; there is no way the government can stop people from doing what they want, being free. There are just too many people. They can't control them all."
People need to stop being sheep, being herded, being told what to do. Unfortunately, the public school system has brought us to the brink, but, that was being said 50 years ago, when I was in high school. There are 330 million of us, a handful of them. Throw off the yoke of fear and the control net they throw over us via the media.
It takes a long time for individuals to awaken to the truth, but it can happen in an instant. The moment you shake off all the lies that have been told to you since you were a little kid is the moment you become free. Free to do as you please, without harming anybody else. If you want to farm, do it. If you want to weld, do it. Anything you want can be accomplished if you only have the will to start.
In the classic, "Think and Grow Rich," by Napoleon Hill, there is a great line which never fails:
Whatever the mind of man can conceive and believe, it can achieve.
Anyone who truly wants freedom can have it. Nobody needs to raise arms, fire a single bullet. All the power rests in the minds of the people, individually, and collectively.
At the Close, Tuesday, September 10, 2019:
Dow Jones Industrial Average: 26,909.43, +73.92 (+0.28%)
NASDAQ: 8,084.16, -3.28 (-0.04%)
S&P 500: 2,979.39, +0.96 (+0.03%)
NYSE Composite: 12,993.96, +33.24 (+0.26%)
Tuesday, September 10, 2019
Stocks Flat; Britain Should Leave The EU ASAP
Markets - whatever is left of them - seemed to be running on fumes Monday, as no Trump tweets nor economic news were sufficient to move stocks in general either way.
This kind of quiet may be just what investors are seeking: less volatility, less media madness, a more sanguine environment and some degree of security and safety. With all the talk of recession, the past few months have spooked some of the more ardent longs, but the market is still not conducive to short trades in any form.
One could conclude from recent action that stocks will hold their ground and move to new highs, as has been the case throughout the run from 2009 (buy the dip philosophy), and with another 1/4 point rate cut from the Fed a sure thing next week, that is the likely trading strategy for the day-trader and short-termer. Long term investors should be seeking value or growth, best, a combination of the two. With interest rates so low, dividend-yielding stocks with long track records are the safest and surest, plus, many will survive well under difficult conditions, should a recession actually arrive.
Central banks still have control of markets, a condition that may persist for quite a long time. It should serve memory well to reconsider the aftermath of the 2008 crash, wherein central banks coordinated to save everything, even unworthy companies, from default.
This might be a prime time to move from passive to active investing, with individual stocks preferred over ETFs or mutuals. Expect some noisy ups and downs over the next few months, though the next major event is Brexit, with a hard-line, no-deal escape from the EU by Great Britain set for October 31 by Boris Johnson, the most recent Prime Minister of the country.
It's been more than three years since jolly ole' England voted to leave the EU. Parliamentarians and stubborn bureaucrats have delayed the wishes of the people for too long and the wait may soon be over. Anything short of England removing itself from the EU - without onerous conditions - will be very bad for markets. The hyperbole of the media and those on the "remain" side of the issue have played the hysterics card for all it's worth.
Time is up. Populism should prevail in England and the result of leaving the EU, while dramatic, does not have to be traumatic.
At the Close, Monday, September 9, 2019:
Dow Jones Industrial Average: 26,835.51, +38.05 (+0.14%)
NASDAQ: 8,087.44, -15.64 (-0.19%)
S&P 500: 2,978.43, -0.28 (-0.01%)
NYSE Composite: 12,960.72, +27.34 (+0.21%)
This kind of quiet may be just what investors are seeking: less volatility, less media madness, a more sanguine environment and some degree of security and safety. With all the talk of recession, the past few months have spooked some of the more ardent longs, but the market is still not conducive to short trades in any form.
One could conclude from recent action that stocks will hold their ground and move to new highs, as has been the case throughout the run from 2009 (buy the dip philosophy), and with another 1/4 point rate cut from the Fed a sure thing next week, that is the likely trading strategy for the day-trader and short-termer. Long term investors should be seeking value or growth, best, a combination of the two. With interest rates so low, dividend-yielding stocks with long track records are the safest and surest, plus, many will survive well under difficult conditions, should a recession actually arrive.
Central banks still have control of markets, a condition that may persist for quite a long time. It should serve memory well to reconsider the aftermath of the 2008 crash, wherein central banks coordinated to save everything, even unworthy companies, from default.
This might be a prime time to move from passive to active investing, with individual stocks preferred over ETFs or mutuals. Expect some noisy ups and downs over the next few months, though the next major event is Brexit, with a hard-line, no-deal escape from the EU by Great Britain set for October 31 by Boris Johnson, the most recent Prime Minister of the country.
It's been more than three years since jolly ole' England voted to leave the EU. Parliamentarians and stubborn bureaucrats have delayed the wishes of the people for too long and the wait may soon be over. Anything short of England removing itself from the EU - without onerous conditions - will be very bad for markets. The hyperbole of the media and those on the "remain" side of the issue have played the hysterics card for all it's worth.
Time is up. Populism should prevail in England and the result of leaving the EU, while dramatic, does not have to be traumatic.
At the Close, Monday, September 9, 2019:
Dow Jones Industrial Average: 26,835.51, +38.05 (+0.14%)
NASDAQ: 8,087.44, -15.64 (-0.19%)
S&P 500: 2,978.43, -0.28 (-0.01%)
NYSE Composite: 12,960.72, +27.34 (+0.21%)
Monday, September 9, 2019
Weekend Wrap: Stocks Gain, All Clear Signal Given Investors; Gold, Silver Dashed
Sorry. On the road again, drive-by post:
Two straight weeks of positive returns have pushed the major Us indices back above their 50-day moving averages, an okey-dokey signal to investors that the 0.25% federal funds interest rate cut from the FOMC is in the bag later this month (September 17-18), and the trade/tariff food fight between the US and China will continue unabated, alternating between "talks are ongoing," to "talks are off again," to "all options are on the table," or other such nonsense.
Trade and tariff talk seems to have a mysterious effect on traders, sending them into emotional buying and selling fits on headlines. Actually, the headline readers are algorithms, keyed to respond to major developments, or, in the case of the trade war, rumors of minor developments.
On the week, stocks vacillated, but moved higher in tandem, precious metals were dashed, as anyone who has an interest in the prices of such knew they would be. Both gold and silver are still trading near multi-year highs, so it's obvious that more flogging will be necessary until the morale of holders and buyers is sufficiently dashed.
As the global charade of overinflated sovereign budgets and overstretched consumers continues, the debt cycle looks to be extended at any cost by the overlords of banking, the central banks. Their position is as precarious as it has ever been. Rumors of an ouster of the Fed by congress in the United States are vastly overstated and wishful thinking by freedom-loving folks, yet they persist.
At this point in the day-to-day noise chamber that is Wall Street, caution is best served cold and reliance on a financial planner could be a major mistake going forward. It's all hands on deck, every man and woman for him/herself, babies being thrown overboard.
Happy sailing!
At the Close, Friday, September 6, 2019:
Dow Jones Industrial Average: 26,797.46, +69.26 (+0.26%)
NASDAQ: 8,103.07, -13.76 (-0.17%)
S&P 500: 2,978.71, +2.71 (+0.09%)
NYSE Composite: 12,933.38, +15.58 (+0.12%)
For the Week:
Dow: +394.18 (+1.49%)
NASDAQ: +140.19 (+1.76%)
S&P 500: +52.25 (+1.79%)
NYSE Composite: +196.50 (+1.54%)
Two straight weeks of positive returns have pushed the major Us indices back above their 50-day moving averages, an okey-dokey signal to investors that the 0.25% federal funds interest rate cut from the FOMC is in the bag later this month (September 17-18), and the trade/tariff food fight between the US and China will continue unabated, alternating between "talks are ongoing," to "talks are off again," to "all options are on the table," or other such nonsense.
Trade and tariff talk seems to have a mysterious effect on traders, sending them into emotional buying and selling fits on headlines. Actually, the headline readers are algorithms, keyed to respond to major developments, or, in the case of the trade war, rumors of minor developments.
On the week, stocks vacillated, but moved higher in tandem, precious metals were dashed, as anyone who has an interest in the prices of such knew they would be. Both gold and silver are still trading near multi-year highs, so it's obvious that more flogging will be necessary until the morale of holders and buyers is sufficiently dashed.
As the global charade of overinflated sovereign budgets and overstretched consumers continues, the debt cycle looks to be extended at any cost by the overlords of banking, the central banks. Their position is as precarious as it has ever been. Rumors of an ouster of the Fed by congress in the United States are vastly overstated and wishful thinking by freedom-loving folks, yet they persist.
At this point in the day-to-day noise chamber that is Wall Street, caution is best served cold and reliance on a financial planner could be a major mistake going forward. It's all hands on deck, every man and woman for him/herself, babies being thrown overboard.
Happy sailing!
At the Close, Friday, September 6, 2019:
Dow Jones Industrial Average: 26,797.46, +69.26 (+0.26%)
NASDAQ: 8,103.07, -13.76 (-0.17%)
S&P 500: 2,978.71, +2.71 (+0.09%)
NYSE Composite: 12,933.38, +15.58 (+0.12%)
For the Week:
Dow: +394.18 (+1.49%)
NASDAQ: +140.19 (+1.76%)
S&P 500: +52.25 (+1.79%)
NYSE Composite: +196.50 (+1.54%)
Friday, September 6, 2019
Stocks Rise on Jobs Data, Fed Backing
Chalk up Thursday's stock gains to massive intervention by the Fed and/or their agents.
Not only did stocks go ballistic at the opening bell, but the day was marked by huge moves in bonds and precious metals.
Notably, the yield on the 10-year note rose by more than a full 10 basis points, bouncing off a low of 1.46% to clamber higher to a 1.57% close. That yield is the highest since August 22, and the 2s-10s settled non-inverted, with the two-year bouncing from 1.43% to 1.55%. However, all of the short-maturity bonds - 1 month through 1 year - are higher than the 10-year, suggesting that whatever magic was produced in markets will likely be short-lived.
As far as gold and silver are concerned, the central bankers - who hate competing currencies - slammed them both into the ground. Silver was treated with special disdain, the metal dropping from $19.57 per ounce to $18.64 during the day and the battering continued overnight. Silver, as of this writing, is quickly approaching $18.00.
Gold closed out trading in New York at $1552.00 per ounce on Wednesday, but, as of Thursday's close, was down more than $33, ending at $1518.70. It's still sliding, with the current bid at at $1505.00.
With August non-farm payroll data due out at 8:30 am ET, stocks are poised to whip higher if the numbers are solid. ADP reported on Thursday that private payrolls added 195,000 jobs in the month, a number well above estimates of 145,000.
As the US and China propose to resume talks, a good payroll report should help stocks continue their journey higher, heading back toward record highs. With the Fed surreptitiously backing stocks - because that's the only way they can save themselves from being completely discredited - it's plain and obvious where the money is going.
At the Close, Thursday, September 5, 2019:
Dow Jones Industrial Average: 26,728.15, +372.68 (+1.41%)
NASDAQ: 8,116.83, +139.95 (+1.75%)
S&P 500: 2,976.00, +38.22 (+1.30%)
NYSE Composite: 12,917.76, +121.45 (+0.95%)
Not only did stocks go ballistic at the opening bell, but the day was marked by huge moves in bonds and precious metals.
Notably, the yield on the 10-year note rose by more than a full 10 basis points, bouncing off a low of 1.46% to clamber higher to a 1.57% close. That yield is the highest since August 22, and the 2s-10s settled non-inverted, with the two-year bouncing from 1.43% to 1.55%. However, all of the short-maturity bonds - 1 month through 1 year - are higher than the 10-year, suggesting that whatever magic was produced in markets will likely be short-lived.
As far as gold and silver are concerned, the central bankers - who hate competing currencies - slammed them both into the ground. Silver was treated with special disdain, the metal dropping from $19.57 per ounce to $18.64 during the day and the battering continued overnight. Silver, as of this writing, is quickly approaching $18.00.
Gold closed out trading in New York at $1552.00 per ounce on Wednesday, but, as of Thursday's close, was down more than $33, ending at $1518.70. It's still sliding, with the current bid at at $1505.00.
With August non-farm payroll data due out at 8:30 am ET, stocks are poised to whip higher if the numbers are solid. ADP reported on Thursday that private payrolls added 195,000 jobs in the month, a number well above estimates of 145,000.
As the US and China propose to resume talks, a good payroll report should help stocks continue their journey higher, heading back toward record highs. With the Fed surreptitiously backing stocks - because that's the only way they can save themselves from being completely discredited - it's plain and obvious where the money is going.
At the Close, Thursday, September 5, 2019:
Dow Jones Industrial Average: 26,728.15, +372.68 (+1.41%)
NASDAQ: 8,116.83, +139.95 (+1.75%)
S&P 500: 2,976.00, +38.22 (+1.30%)
NYSE Composite: 12,917.76, +121.45 (+0.95%)
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