Morning Audibles 3.26.10 - Musical Chairs (to Tetris Music)

Sometimes waiting around for a market break feels like a game of musical chairs. 


I suppose musical chairs can be fun, when you're a kid. (OTOH, what a better way to teach kids at a young age that they don't fit in, they're losers, so go stand in the corner while the other kids fight it out). Now you know where the idea for the reality show 'Survivor' came from...


Don't these people look like they're having fun?


Usually doesn't end this way (with everyone laughing). And why does the guy in the pink shirt look like he wished the guy on the other end had landed in his lap instead. I mean, you'd think he's be fishing for dollar bills out of his pocket instead of staring down the aisle (if you know what I mean). For his own part, the other guy looks like he'd be happy to oblige. Couple more rounds guys. Only a couple more rounds and we can book you two a room!


Now try playing musical chairs against a bunch of computer driven algos written by MIT nerds, who, just to annoy you, decided to loop the TETRIS music as the "game on", "game off" indicator...


Quick! toggle that bar over to the left and flip it 90 degrees you jackass!


Sometimes the best thing to do is to shut off the music and let others play the game. Things are sometimes too confusing in the short term (whether you're a fundamental trader, a technical trader, or both).


- What's the dollar doing?
- Is options pinning involved?
- What's the latest yak from politicians?
- Why is this so over sold/bought?
- Why did Gross/Soros/Bernanke say that?


My K.I.S.S. idea was to take a weekly view of the SPX over the past 10 years to see if it revealed anything. Here's what I came up with...




The chart is "sans" annotations. I'm just going to tell you what I see here:


- The downward trend line is from the March 2000 highs (this makes the entire 2006-2008 period appear to be a bubble - we are back to that trendline, and IMO, in the "noise" phase where to takes the markets a few weeks to figure out if we're really going to go higher, or if this is a serious barrier).
- The wavy line is the 144MA (weekly). While we crossed through this to the upside on yesterdays move, the market came SERIOUSLY reeling back. Depending on Friday's action, we may not 'close' the week above that MA.
- The market went into serious meltdown in 2008 after abandoning that MA
- In 2003, it took the markets a few weeks of tap dancing on it before doing a skyward move. 8 months later, it had retraced the entire move.
- The fibonacci levels you see are the RETRACEMENT from October '02 lows back to the March '00 highs. Note that THAT retracement NEVER really got past 50%. That level corresponds to the price levels we're at now (not FIBO wise - based on the '07 highs/'08 lows), but rather we're around those previous price levels (as if you were to fold the chart and erase 7 years).


Draw your own conclusions... CV's takeaway is that it's about time for the market to decide if we're going to just "bubble-up" again, or, if this was all just an exercise to get back to a more manageable slide down, rather than armageddon... 


Or in other terms, this is where the music stops (or keeps playing)...




316 comments:

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Ben22 said...

Looks like risk was back on overnight....

Ben22 said...

Tetris,.....love that game

mcHAPPY said...

Ben,

Did you see Lara's count on the USD:JPY? Short-mid term strength, long term weakness.

Ben22 said...

McHappy,

No, I'll have to take a look, she's got the same count as I do on the DX basically.

Thanks for the reminder

Prashant said...

I still feel that despite USD strength over the past few sessions, metals have not shown the expected weakness, especially Silver. Intriguing to me.
And today Euro has been again retesting the 1.34 levels as if Greece etc has been Contained. How I hate that word. How I hate everything.

mcHAPPY said...

"How I hate that word. How I hate everything."

Prashant, you and Mannwich should go for lunch. lol

Nic said...

Prashant, I always thought that silver was an easier technical trade than gold because of less manipulation, but seems I was wrong - read this about manipulation in the LME:
http://www.gata.org/node/8466
When it decides to move though, they can't stop the momentum.

Ben22 said...

Nic,

I still think that (silver is an "easier" tech trade) that's why I stick to trading it rather than gold. That $5 move earlier this year was great, there will be another...

Nic said...

Agree :)

CV said...

@Prashant

Don't make me pull up the chart that shows what happened after they thought Bear Stearns was contained...

Anonymous said...

@ Cdn gold miners are dropping like a rock. Take a look at K.TO, and ELD.TO

Prashant said...

Ya, even housing was contained. The thing is that I am very bad trader so to say. I find it almost impossible to take long positions. I don't know whether that is because I feel the world economy going to pits or whether it is because I am by nature a pessimist etc.
When I contemplate my actions, I feel I would have done much better had I just bought when I actually sold. Would have been much much easier and much more profitable.

CV said...

@Prashant

It's getting there...

CV said...

GS isn't having too nifty of a start this morning...

QQQQ said...

silly guys... don't you know the SPX is going to 1298 cuz I picked that price on AndyT's other site.

speaking of silly and JPY (which I thought to short a week or more ago)... keeping with the theme... they sure like their games...

http://www.youtube.com/watch?v=4bekQU9l8hk&feature=related

Nic said...

Commodity currencies, dow transports, Russ2k, crude, metals all singing the same song today

Anonymous said...

@ Parshant, now you are here, how do you play LNG( home use) in India?.

CV said...

& to be honest...

I really only think the FXE move today is an "extend and pretend" bounce on HOPE that the declining wedge was finished...

The dollar kept doing that on the way down last year too, and everybody ended up jumping in 6-8 weeks early (including myself)...

1.29 baby... 1.29 (may 4)...

I-Man said...

Thank you for posting that monthly chart, CV.

Its what I stared at for most of last night, with a simple trendline drawn off the 2007 high, the 55 ema, and a projection line drawn off the 2002 lows.

The downtrend line, 55ema, and the projection line all intersect where we are right now.

I doubt we close March out above any of them.

mcHAPPY said...

I'm watching for China to announce a rate hike or increase in captial reserves or decrease in lending. Come on, CHINA!

I-Man said...

UUP should hold 24.

CV said...

@QQQQ (9:42)

After this next correction comes (which ought to be right around here somewhere - I'm expecting the "meat" of the correction to happen in the period between April 5 - April 30 timeframe)...

If we get a bounce... Then you're 2010 target might be appropriate...

You'd have to think that either the 1034 level would be HELD during the correction, or, taken out and quickly regained...

That's my bogey at the moment...

That 1034 area is important because it's where a a 13:1 up day occurred... The last two places that occurred were last October (18:1 up), and July, (30:1 up)... Both areas led to higher movements...

Basically, P2 is extending, but it's getting weaker as it goes...

So far there's NO THRUST here up at 1080, it needs to regroup...

I-Man said...

Want to see 117.30 hold up as SPY resistance.

CV said...

@I-Man

That was a WEEKLY chart (just so you know)...

Fat finger you! :-)

CV said...

If the market does sell off today (which I think it might)...

I doubt it would go lower than 1150 for now...

I-Man said...

Touche, I saw the time scale and figured monthly.

The two look very similar for sure-

But I was looking at a monthly chart... (its still early out here, thats my excuse.)

But go ahead, draw a projection line off those two 02 lows and you'll see it too.

(Thats also MA's 1987 projection line, give or take some minute degrees)

CV said...

Upward side would be 1183...

I know, I know, what a range...

But I doubt it wants to hang around here... It's itchin to go someplace...

AmenRa said...

CV

The S&P will close at 1160 just to say the week closed higher LMAO.

I-Man said...

Closing the week out at 1153 would make a nice weekly candle on the SPX...

CV said...

@I-Man

One thing (IMO), I always do (in re: to Martin Armstrong), is factor in a calculation of what it would look like from Feb 27, 2007 (which was his "end of cycle")...

So if you draw a trendline down from that (on the same chart)... The present line has basically retraced to just about where the market fell apart in '08 (on a relative basis)...

Just an exercise...

I-Man said...

And a monthly close right around the 1130 "breakout" would make a REALLY nice shooting star on the monthly candle.

Which, interestingly enough, lines up nicely with the 55ema in the daily timeframe, which often acts as a magnet... especially around potential trend changes.

CV said...

@I-Man

Last two WEEKLY closes had a .99 and a .90 on them...

No integers please! They're putting things ON SALE these days, you see?

CV said...

I think MAX PAIN on SPY is still at 115

I-Man said...

55ema on the daily now = 1127

call me ahab said...

from CNBC- mortgage delinquencies-

"A new measure would attack that problem by giving unemployed homeowners three months of forbearance, essentially buying time.

A write-down in the principal of the loan, as opposed to a simple reduction in the mortgage rate, will now be given serious consideration; loan servicers will receive additional incentives the longer the loan stays current.

More incentives will also be provided to second-mortgage holders to write down the value of those loans."

three months forbearance- wow- as if they have been paying anyway. The administration will ultimately step in and reimburse the write downs- the 2nd trust companies are holding a worthless asset- how much out of a 100% will they be compensated?

the full 100 is my guess

I-Man said...

Lets see if SPY 117.30 can keep a lid on the Johnny Hour festivities.

CV said...

Full GDP release from the BEA.

Final GDP:

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 5.6 percent in the fourth quarter of 2009, (that is, from the third quarter to the fourth quarter), according to the "third" estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.2 percent.
The increase in real GDP in the fourth quarter primarily reflected positive contributions from private inventory investment, exports, personal consumption expenditures (PCE), and nonresidential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.
The acceleration in real GDP in the fourth quarter primarily reflected an acceleration in private inventory investment, an upturn in nonresidential fixed investment, an acceleration in exports, and a deceleration in imports that were partly offset by decelerations in PCE and in federal government spending.

Revision basis:

The third estimate of the fourth-quarter increase in real GDP is 0.3 percentage point, or $11.6 billion, lower than the second estimate issued last month, primarily reflecting downward revisions to nonresidential fixed investment, to private inventory investment, and to PCE.

Deflator:

The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 2.0 percent in the fourth quarter, 0.1 percentage point more than in the second estimate; this index increased 1.3 percent in the third quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 1.5 percent in the fourth quarter, compared with an increase of 0.3 percent in the third.

The government:

Real federal government consumption expenditures and gross investment were unchanged in the fourth quarter, compared with an increase of 8.0 percent in the third. National defense decreased 3.6 percent, in contrast to an increase of 8.4 percent. Nondefense increased 8.3 percent, compared with an increase of 7.0 percent. Real state and local government consumption expenditures and gross investment decreased 2.2 percent, compared with a decrease of 0.6 percent.
Current-dollar GDP

Current-dollar GDP -- the market value of the nation's output of goods and services -- increased 6.1 percent, or $211.7 billion, in the fourth quarter to a level of $14,453.8 billion. In the third quarter, current-dollar GDP increased 2.6 percent, or $90.9 billion.

CV said...

IOW - Nothing to trade off of...

I-Man said...

@ Ahab

When can I walk away from my student loans scot-free? I thought Obama would pay them off... thats why I voted for him.

McFearless said...

@Prashant,

A pessimist is nothing more than an informed optimist. As such, it IS hard to get long for anything more than a trade right now....

CV said...

We're neither Japan or Zimbabwe...

That's comforting!

Sushi & Zebra jerky are a horrible food combination...

QQQQ said...

@CV,

agree with your thoughts mostly but I think'n if there is a bigger move up it'll take us to the 1225-1250ish level for a 2010 high, but who's to tell. I picked 1298 back then knowing if we had a good year moving up, that's where there will be tons of resistance.

Oh, always thought that the 666 low would never be seen again. Maybe 900's, or even a bigger maybe, 800's, but not for long.

thx for the chart... simple :)

call me ahab said...

I-Man-

no shit- where's my basket of goodies already-

also- when they make a 4 year degree a "right"- you'll really be complaining-

and that the IRS will be the enforcer of HC- and whether people are enrolled- that seems a peculiar match up-

I still think it is un-American and probably un-constitutional to "make" someone insure their own health and well-being-

talk about a nanny state- our best days are behind us

CV said...

WOPR is busted...

9:23 AM 3/26/2010
NYSE Services Impacted
Connectivity issue from NYSE to DTCC


Due to a network connectivity issue, the NYSE & NYSE Amex cash equities markets are unable to deliver compared trade information to DTCC at this time. All trading systems and order and report processing are functioning normally. Compared trades from today's trading session will be stored and delivered to DTCC once connectivity is restored.

Updates will follow as available

---

IOW, as soon as we find out how many blocks of longs Lloyd sold, we'll tell you how much you lost!

Leftback said...

Discussion of yen and Treasuries at Macro Man today. The new year in Japan is going to be carry positive, and it's Q2 funds in the US as well, so April 1, for sure, equities up, yen down, don't get in the way of that one.
April 2 is the NFP number and a strong number is priced in. Work that out.

With this in mind, it's time to think about fading the action that develops. Magic Monday ahead of us, so we are not going home short today. We like a strong dollar play next week, maybe Tues-Wed.

One thing we are sure about, Treasury yields have already made that move for the time being. Only a +500K job number would bust yields higher from here. Not going to happen.

Mannwich said...

I got three letters for you - T L T.

karen said...

morning! nice discussion above! MMNF, LB.

Leftback said...

JOHNNY HOUR almost over!

Leftback said...

BTW the little video of Hugh Hendry posted at Traders Anonymous is great. The BBC guy is very amusing.

CV said...

@LB

No way am I going to challenge your thoughts on anything bond related, but we're SO DAMN CLOSE to that 4% yield number on the 10y...

Just seems to me they tag it for s*** & grins (like last June), then pretend to get all scared and pile into it...

To me, nobody cares anymore about NFP... But when 10y hits 4 (especially during prime house buying season - and with the 'tax credit' window expiring along with QE)... They stand at attention...

JMO

McFearless said...

I'm considering dropping my health care completely with the new bill. Why pay for it? If I get sick I can't get denied for coverage....I'm young, healthy, why not put my capital to work instead. The penalty each year is going to be way less than paying a premium for coverage as someone that is self employed.

I have to imagine a lot of people in my boat will consider this....

call me ahab said...

gotta roll out-

"The penalty each year is going to be way less than paying a premium for coverage as someone that is self employed."

b22- astute observation my man-

everyone have an awesome Friday

Nic said...

I <3 HH

CV said...

@McF

That's the communist spirit!

Soon we'll all be bolsheviks!

Leftback said...

C: Yes it's possible, but we will follow the auction cycle, so if they are going to sell em bitches, they will do it the mon and tues before the 10y/30y auction, so that means watch out, april 5-7, maybe begin a long end short april 1. Would be a buyer in size on april 8 in the morning if we see significant selling ahead of the auction. Remember that the issuance is only massive in the 5/7y, not the 30y.

We like a strong dollar trade mar 30-31, after magic monday. Shorting gold, silver and miners are the candidates. Right now we think EUR:JPY is topped, and they will probably sell in the afternoon.

I-Man said...

You're on fyah Leftback...

Very clear analysis this week.

Prashant said...

Anon @ 9.43
No idea on LNG. I did though try to pick a bottom on Natural Gas and got gassed badly.

McF: When I see people all around, most are ignorant/unaware AND not unhappy. If you have read the Classic Catch 22, you will see that it is only Yossy who is worried abt the RIGHT thing coz he values it correctly and clearly sees the risks around.
Apologies on the off topic chatter.

CV said...

@LB

What's the status in London on April 5th...

We have markets closing April 2nd (Good Friday), but Europe tends to have it's holiday the Monday after...

Also... What does that mean for NFP? Since Friday is closed, when is it being reported? April 1? or April 9?...

Mannwich said...

Is this bullish? I know unemployment is a "lagging indicator" but should it still be getting worse in over half the states at this point the "recovery"? And how is the national unemployment rate droppoing? Fuzzy math?

http://www.calculatedriskblog.com/2010/03/unemployment-rate-increases-in-27.html

Nic said...

Easter Monday holiday in Europe ...

Mannwich said...

I was out last night and somehow the discusion of Wall Street came up (I think I was making the point that relative to the welfare queens of Wall Street that Joe Mauer isn't "overpaid" and likely worth every penny due to his legit special talents). A guy at the bar overheard me (I should have NEVER gone there) and interjected with my thought, telling me he "disagreed" with me because "most of the banks" (e.g. WFC, GS, etc.) "didn't need the TARP money" and were forced to take it. I calmly reminded him that without the gov't bailout of AIG, Goldman would be belly up and he agreed, but he still didn't agree with my premise. Of course, he works for Piper Jaffray. Needless to say, his wife dragged him out there as things started to get a little testy.

CV said...

@Nic

I swear... That's when somebody always tries to put a move on currencies & metals...

When you have one market (on one side of the pond or the other) closed, and another one open...

So you basically have "back to back" (Friday 2 and Monday 5) like that...

Leftback said...

NFP will be announced April 2. London is probably closed for Good Friday and Easter Monday. So the Asian markets get first crack. You'll have to stay up late with Susan Li. Not exactly the worst assignment. Then NY comes in on April 6. Personally I don't think anything happens as a "good" number is now priced in or will be by then, the Tsy market will be the major focus initially, and we will be playing defence ahead of April 2.

What we should think about is ALCOA. Pretty soon someone has a Q2 earnings that doesn't have EASY COMPS and they miss. So, how about, we get an UP week, on Q2 fund flows, then after they stuff Granny's savings into the sausage machine, then they sell em...? When are the earnings? Watch the commodity and industrial guys.

Mannwich said...

And, I had another guy (a young, up and coming doctor in the community) at the table who knows a senior Goldman guy (and Citi guy) and backed up my assertions, so I did have some help (not that I need it). It was interesting though, and it really hammered home just how little most people know (even informed people) about this crisis, as some bystanders just looked on blankly as we debated.

Leftback said...

"most of the banks" (e.g. WFC, GS, etc.) "didn't need the TARP money"

LMAO. Bar Brawls will be up during the P3....

CV said...

@manny

Underneath it all, it says something...

I mean, if everything were so fine and dandy, why would a Piper Jaffray guy be nervous at all...

Hell, he should have been buying everyone a round of drinks!

karen said...

Four Takeaways on This Week's Auctions

Mannwich said...

@lb: It definitely got a little testy, although he agreed with my take on Goldman getting a backdoor bailout via AIG. I could tell the whole issue pisses him off. Very defensive. At first, I had misgivings for being the center of attention (unlike my wife, I HATE being the center of attention in any group), but afterwards, I was glad that I brought it up. These jackals need to know we KNOW and we're pissed. I think he was surprised with how much I knew and was just going to come over and slap me down. Well, I don't think so buddy. He was dealing with the wrong Mannwich on those matters. These kinds of disputes will become more common over time, IMO.

Leftback said...

I believe at some point Piper Jaffray man "BRIAN" may not go out in public, or at least will keep quiet about his business. Wait until all the JOHNNYs lose money in the stocks they bought late in 2009 and early 2010.

J6P isn't that bright but once the market goes down and Wall Street pays bonuses again, and then he figures this stuff out he is gonna want to smack some Wall Street a**hole in the mouth. GS employees are smarter than Piper guy and are already basically in hiding.

Leftback said...

Karen, I agree with the last three bond guys 100%. The RBS guy is a tool.

karen said...

Rosenberg this morning:

• A sign of how nutty this market has become — housing starts back to June 2009 levels, new home sales at a record low; yet the homebuilding sector is up 23% YTD

• Net speculative long positions in Canadian dollar stands out like a sore thumb compared to the other commodity based currencies

• Getting more worried, not less — currently, the most glaring anomaly is the divergence between the direction of the U.S. dollar and the S&P 500

CV said...

@LB

These past days I've kind of been thinking of a PLAN B for MoMo Mondays & Tuesdays (beginning of month & quarter)...

If equities stay thus elevated into the end of Month, & you are Jamie & Lloyd...

Why not just take the opportunity to do some 'distributing'... Let em BUY THE DIPS this time...

In February, they leaned on the Momos to hold support... When that was finished, they were able to call the whole thing up (on low volume)... Now comes dumpage time...

The MoMos won't get stopped out here... Only RETAIL will...

Just an idea...

karen said...

Picked up this link at Jim-the-Realtor's site (thanks Nic!)

http://www.metrotrends.org/jobsandhousing.html

McFearless said...

Manny,

The people making any sort of bullish argument about jobs are looking at temp hires. Green shoots there. lol.

@Ahab/C,

re: healthcare
Just thinking of what is smart, I imagine 99% of people in my position, when they consider this, are going to come to the same conclusion.

Leftback said...

C: Magic Mondays will become Misery Mondays, but not yet.

Temp hiring is up b/c hiring managers don't buy the recovery and companies want to save on health care and other benefits.

Watch the hours worked. That's the key.

Mannwich said...

@ben: I understand that premise, but what if these "temp" jobs become permanently "temporary", just like Japan? Same thing happened there and over 30% (I believe) of their workforce are now permanent temps. How are we different? We are Japan X 1,000.

Leftback said...

Algos are gonna sell. We close flat.
No-one wants to go home short or long, right?

Manny: "Window people" are coming to the US soon. Most long recessions create "non-jobs" to avoid total collapse. Look for teenager "job creation schemes" and all that stuff again later in the year.

CV said...

@karen

(on Rosie & the dollar/SPX "anomaly")

IMO - If one stops and thinks of the idea on a QUARTERLY basis, think of the trend, possibly, as follows (if you're just a CEO - and you're doing quarterly reporting and earnings projections)...

- Q309 (October), You were 'loving it', DGDF, bolster your balance sheet by keeping payrolls down and pocket the currency tailwind you're getting.

- Q110 (January), The dollar had only really 'reversed' for about 2 weeks. So you weren't sure if it was even REAL, or just a minor 'correction'. GDP reports seemed 'nice' (even though they were inflated by inventory restocking and government spending)... Hell, why 'project' anything negative and tank your stock... At WORST, steady as she goes...

- Q210, UH OH! Now this dollar move seems REAL and EXTENDED... Can't count on those tailwinds anymore... Plus, where are my markets? Europe is going begging to the IMF at the moment... Japan is is crisis... China wants to report a trade defecit and wants to start a trade war... Plus, OBAMACARE just made it so that the health providers can "gouge me at will" for the next few years... I might even have to lay off workers here...

CV is QUITE SUSPECT about what earnings season brings about (especially for TECH)...

McFearless said...

Manny,

Yep, I thought the same thing as you, temp jobs led to permanent hires (IN THE PAST) but that doesn't describe what is going to happen now.

I work with the Pres of a staffing company in Philly, branch offices in MD, DE, and NJ and he gives me a lot of very timely updates on temp hires and he says at least for their business, which works primarily with financial institutions that temp hires have slowed quite a lot since October of last year, and it's not because permanent hires have picked up.


On another note, I'm looking to pick up some shares of BZQ or FXP today.

CV said...

@McF

I think EVERYONE is going to come to the EXACT same conclusion as you did...

Excuse me, but this is why Obama is so fucking stupid (Actually, to be fair, Obama hasn't even read the bill, it's just his signature that's on it)...

But these people NEVER UNDERSTAND the unintended consequences of their policies (that's why they're stupid)...

They don't realize that when you create SOCIALIST policies (to the detriment of the productive class), the reaction is to turn normally PRODUCTIVE people into seekers of BENEFITS & FREEBIES...

It happens 100% of the time...

So great, you want to create a system where I have a choice...

1. Pay a marginal fine for something I don't need, yet.
2. Tell me that, by law, I can never be turned down.

My God... That's like saying... Hey, I'm not going to pay for auto insurance, but if I wreck my car, I can sign up for a policy...

What a bunch of nimrods!

CV said...

@LB

Most of any 'positive' number on NFP is going to be CENSUS jobs...

Traders know this already... nothing to see here...

That's only crap for CNBC, Kudlow, Gibbs, and Rohmer to get excited about...

Leftback said...

Inventory restocking is over, and China is overheated.

The Q210 earnings are going to be suckola. Is Mr Market smart enough to start pricing that in before they are released in July?

mcF: Agree on China and Brazil but wary of the Q2:1st week fund flow. Lots of BRIANS waving JOHNNYS into the EM funds.

Leftback said...

Added equity shorts, leaning against Spx 1175 and EUR 1.3410

If that goes, we are out.

CV said...

@LB

"The Q210 earnings are going to be suckola. Is Mr Market smart enough to start pricing that in before they are released in July?"

x100

That's why I think it goes down in April...

Get it out of the way... Then you have all of May and June to "window dress" and cause confusion...

Lloyd calls the CNBC news desk and says... "Keep putting yapping flaps on the screen who say "sell in May and go Away" about 50 times an hour... Get Johnny as scared as shit..."

Meanwhile, Lloyd melts the thing up through EOQ (on even LOWER volume than before), and Brian has something to chirp about on the 4th of July BBQ...

I'm not sure how many more times they'll be able to do this, but it's worked thus far...

McFearless said...

LB,

Yes, need to keep any fund flows in mind, I'll buy in increments most likely over the next week or three.

Leftback said...

This was a quite splendid read. Nic and Karen, any thoughts?

Goodbye QE

Leftback said...

C,

I would be SHORT equities at 3.59pm on Monday July 5, and
LONG babes in bikinis at Brian's big time BBQ back yard bash.

Johnny's will buy in, so a Magic Momo Monday. Then, shazamm...

CV said...

@LB

July 5th the market is closed...

But I get your point...(especially with regards to your LONG positions) :-)

Nic said...

I'm a big fan of long USDNOK, HUF is scarier and not such a good technical setup. USDNOK is a better long to me than USDJPY too.
I like USDCAD long, I think the break of support was a fakeout which this pair loves to do but if you think China is going to wobble or tighten more then AUDUSD is a better short than USDCAD is a long. Technically AUD is a better looking too. I just wouldn't get to married to it because of the yield differential.

Bruce in Tennessee said...

McFearless said...
I'm considering dropping my health care completely with the new bill. Why pay for it? If I get sick I can't get denied for coverage....I'm young, healthy, why not put my capital to work instead. The penalty each year is going to be way less than paying a premium for coverage as someone that is self employed.

...Ben, you are not alone in this thinking. As you know, this is my profession. It appears to me that in 4-6 years we will not have private insurance under this bill if it stands through its court challanges. There is no way a private insurer can make things work if people are allowed to only sign up when they get sick. Of course,this is the plan.....

Nic said...

V good read thanks LB

CV said...

That would be the day before the semifinals matches at the World Cup...

So for your sake, I hope USA & Argentina are in the semifinals, and these two fans are at Brians party...

http://images2.wikia.nocookie.net/wikiality/images/d/d9/Body_painting_soccer_flag_argentina_usa.jpg

AmenRa said...

Almost forgot. 1176.22 is a 76.4% from the March 09 low. S&P did a head fake through that level yesterday.

Leftback said...

USDNOK is a cracker b/c they are an OIL ECONOMY.

So USD strength, lower crude, lower NOK, it's a beaut.
I like USDCAD too, b/c Canada "sells rocks and trees".
USDAUD is a racing certainty once China starts to slow.

Aussies think they are immune from bubbles......

Bruce in Tennessee said...

@McF

I think EVERYONE is going to come to the EXACT same conclusion as you did...

Excuse me, but this is why Obama is so fucking stupid (Actually, to be fair, Obama hasn't even read the bill, it's just his signature that's on it)...


CV...I don't think Obama is stupid. He's not the sharpest tool in the shed, but he's not stupid. This is a much different law under Obama than we'd might have had under H. Clinton, and I don't think that is by accident.

CV said...

@Amen

Here's another headfake...

http://www.iaff2969.com/pics/pumpkinhead.jpg

That guy REALLY doesn't have the head of a pumpkin!

Mannwich said...

Not defending the bill, guys, but isn't this very nearly the same bill Romney passed in Mass? If so, how does he distance himself from his OWN bill when running in '12?

karen said...

Excellent, LB, thanks.. added Naufal to the list of men I <3 and bookmarked his twitter.

I've been distracted this morning perusing Laguna Beach real estate.. so many homes!! over 300 for rent and 400 for sale! but I quite agree with Jim-the-Realtor, prices still falling.

Leftback said...

The HC law that was passed will be useful for all the temps who will not find full-time jobs in the New Normal. High unemployment will now be a permanent structural feature of our economy.

Leftback said...

Goodness, Karen. K <3 s everyone except LB !!

CV said...

@Bruce

Look, I'm not really fond of tossing around classifications like STUPID at will...

But like Forrest Gumps mother said...

"Stupid is as stupid does"

Obama Has:

- Selected Tim Geithner as Treasury Secretary
- Selected Larry Summers as economic advisor
- NOT fired either
- Let Pelosi & Reid draft a HC bill
- Signed it

Do you want me to make additions to that list?

Leftback said...

Hey, Blanky. Stop peeking at my stops. We know you do that....

Bruce in Tennessee said...

Manny:

There are elements in this bill, and I noticed that Mish's crew had a good cry over this bill this morning, that simply won't allow private insurance. I don't really care who runs against Obama, or whether he wins or loses. The fact is, if this bill remains law, there is absolutely no other outcome but government sponsored health care. Period.

I trained in 3 VA hospitals,government funded care for veterans, and I see what is about to happen to medicare funding.

The best practical advice I can give you is try to maintain close to your ideal body weight, exercise your entire life, and try not to outlive your money.

Lord Blankfiend said...

That's PROPRIETARY INFORMATION.

So, what if we do peek at sell orders and front run block trades..?
Do you think the SEC is going to come after GOLDMAN SACHS?

Bruce in Tennessee said...

CV:

Obama has always wanted a one payer, government health care plan. This was never a secret...

And I know you already know this.

Leftback said...

Sell em, algos. JOHNNY buys in the morning, ALGOS sell in the afternoon.
Beautiful. EVERYONE makes bank.

Except JOHNNY.

Mannwich said...

@Bruce: Thanks for the perspective. I talked to a couple of my doctor friends at the bar last night and they admitted they had no idea what the repercussions would be for them.

My sense is that if the bill is indeed a total disaster, then it won't stand as-is. It will change, so I think all the hysteria is overdone. If it's that bad, and assuming the GOP can retain some level of coherence, dignity and thoughtfulness, they should be able to take control of both houses in Nov, no? That would mean this thing won't stand, IMO, especially if the GOP also wins back the WH in '12, so it doesn't serve the other side to get all hysterical about it. Just calculate ways to when back power and change it. Elections have consequences. The GOP really only has themselves to blame. They had all this time to change HC system but didn't think there was a problem. Well, enough Americans think otherwise.

CV said...

@Lord Blankfein

"Do you think the SEC is going to come after GOLDMAN SACHS"

---

No... Because I know that the SEC guys are too busy looking at porn all day to care...

http://gawker.com/5501445/meet-the-high+ranking-sec-official-who-surfed-porn-while-your-401k-vanished?skyline=true&s=i

mcHAPPY said...

Long USDCDN is a good thing IMO. Every Tom, Dick, and Harry is crowing about parity and beyond up here.

CV said...

@Bruce (12:00)

"Obama has always wanted a one payer, government health care plan. This was never a secret...

And I know you already know this."

---

yes, I DO know this... I've known it all along...

But CV thinks it's a STUPID IDEA... and has thought it is a STUPID IDEA all along...

Last summer, my expression of that thought got me KICKED OFF Ritholtz for a week...

So these days, CV pens his own thoughts... elsewhere...

Leftback said...

Yes, CAD bulls are obviously LOONIES.

CV said...

@Manny

Damn Jeff... You're a 'Renaissance Man' :-)

Talking to Piper Jaffray guys, doctors, & all...

I'm betting you took them all to the cleaners in "pop-a-shot" :-)

Leftback said...

C and Bruce, love you guys but so not in agreement on health care.

The europeans really think you are all insane on this, Aussies too.
So I am with Sr. Ritholtz on this, it's a part of a civilized society.
Is this a good bill? No of course not, it's stuffed with pork....

Bruce in Tennessee said...

Manny:

I have read your postings about your health care coverage over the months, and I emphasize with you. Frankly, thanks to a lot of things, this won't affect me much. But I don't think you'll see the best and brightest persue medicine as it changes. Not for the money, but most of us MD's frankly know better than some government lacky how to treat patients. Were I 18 now, I'd probably get a Ph.D. in physics or EE and start my own company or teach. And every day I go to the OR, I KNOW that I'll have a good outcome and that there isn't another swinging D... who can do this better than me..! But I don't plan to work for the government...

Bruce in Tennessee said...

Leftback:

You are a good kid, and I love you too. I see Mr. Brown wants to cut doctors' salaries....

Send me a postcard in a few years when you are older...son, you see, if you don't work for yourself, you do what the man wants...

Mannwich said...

I hear you, Bruce. My brother (a CPA, CFP, who mostly works with small business) is also vehemently against this. Given my own person situation, I'm obviously FOR the pre-existing condition part of the bill (if it works, that's the big caveat), but I have no idea what to think of the rest of it, to be honest.

@cv: Yes, unfortunately, I'm a "jack of all trades, master of none", like many of my friends. I envy them a bit and I think in some ways they envy me back. Life is funny that way. They're somewhat amused (and fascinated) with diatribes about Wall Street because they don't anywhere near the amount of time to delve into this crap as much as I do. Nor do they want to, but they love to hear my perspective. Makes for interesting conversation at the bars. Unfortunately, not all are into these kinds of serious discussions out at the bars, so I have to be cognizant of my audience when diving in (e.g. last night I could tell there were some folks who were uncomfortable with my level of "passion"). I just have a hard time spending the evening discussing "safe" subjects. It bores me to tears. Thankfully, my wife doesn't discourage it. She loves it too. Now I do like to have fun, but I find serious subjects to be fun (challenging). Not everyone does though.

Mannwich said...

I meant "UNLIKE many of my friends" who have intense, focused careers......

CV said...

@Bruce

Deep down... I'm in agreement with EVERYONE on the HC subject...

- I'm not against the concept
- I'm against the implementation

Sometimes (actually mostly), politics is like retrofitting old buildings...

Sometimes it's just better to raze the building and start from scratch...

This is what this country, AMERICA (and the world for that matter), needs to do...

It's too complicated... It's time to 'bite the bullet' and start from scratch (with everything)...

Forget about EVERYTHING you think you're entitled to...

If you want to create a system where everyone shares benefits, FINE, do it... But don't try to retrofit one system into another... Bulldoze the first, and let everybody pull equal weight, starting from scratch, in the new system...

This 'redistribution' system will only serve to make different factions fight against each other... FOREVER...

CV said...

...and my LAST WORDS on the HC subject...

If the bill is SO GOOD...

Why doesn't it apply to the POTUS, the FLOTUS, or Congress...

Answer me that...

BinT said...

CV: You and I are probably simpatico..

CV said...

I mean... All those people should be so proud and pleased that they're the FIRST ONES standing in line to pay premiums and reap the extraordinary rewards, right?

Mannwich said...

@CV: GREAT point. (@12:21 p.m.) I've often asked the very same thing. If it's good for us, why not them?

CV said...

@Bruce

"simpatcissimo"

CV said...

...senza dubbio

Leftback said...

Two-tier system, Bruce. Govt docs for the indigent, and you can do CABG and heart valves for former GS bankers and UPS execs. You make coin. Everybody happy.

Leftback said...

ALGOS were fed the same pattern as yesterday, LB making monster gains if this keeps up, sell em JAMIE...

Mannwich said...

@lb: I've often had those thoughts well. Why not some basic level of coverage for the lower and middle classes and if the rich can afford to pay more (and most of them can, right) for a higher level of service, then I'm sure there will be a market for those services and therefore those doctors and clinics will still thrive. Preventative and catastrophic care for all is a must to not only drive down costs but to have a healthier populace. That can only help our productivity in theory, no?

CV said...

@LB

if this thing gets down to the 1150's are you going to cover those shorts going into the weekend?

just curious...

BinT said...

I'll post one other thing, then probably shut up..although I am taking today off!

If you look at government sponsored health care through the years, there are things that are simple points that are bothersome.

Medicare started under the Johnson administration, and like a lot of big pot ideas, people paid into a big pot and later drew out of the "same" big pot. But they didn't, money wasn't kept track of, and costs became astronomical. Medicare? Try getting an intenist to see a new patient you've operated on. Good luck with that.

So costs skyrocketed and reimbursements shrank..why? Because as the plan matured the government tried to cover more and more and pay less and less.

Now 500 billion is to be cut from medicare to help pay for the new plan. How do you think that is going to work out?

Part 1

Anonymous said...

Y'all have been on fire all week. Awesome stuff. Keep it up.

DL said...

McFearless @ 10:28

One of a long list of variables that the CBO failed to take into account in its "smoke and mirrors" cost estimate.

Leftback said...

LB would cover into the close on a bounce off spx 1150.

Rome didn't burn in a day. I-Man, you lurking?

BinT said...

This administration is just not going to have these radical ideas work. Who wants to be an ant when it is becoming so much easier to be a grasshopper.

Unlimited tiers of unemployment insurance
No risk health insurance
Mortgages that the government apparently co-signed when you took it out
Banks that have become so big that there is a new amendment that they most stay around until the next millenium.

...The Europeans are even worse off than we are.

Whether the rest of the world looks at us with a jaded eye matters not...it is whether we are still true to what got us here.

I think we are devolving...

CV said...

@Mannwich (12:27)

People always then to think of things as WHAT IS (instead of "what could be)... NOT YOU Jeff, I'm just generalizing here...

So think of this (basically this is how CV's cabesa works)...

If I'm someone like Bruce, I'd be thinking EXACTLY about something like your statement

"I'm sure there will be a market for those services and therefore those doctors and clinics will still thrive

That's it... POLICY change leads to creative innovation & cottage industries... In a way, it's the 'flip side' of UNINTENDED CONSEQUENCES...

- Someone decides to jack up copper prices... A cottage industry arises where thieves go around ripping copper pipes out of abandoned houses...

- Aluminum prices rise, people take their trucks and knock down aluminum street poles in the dead of night and haul them away

- Tax people to death, they move their assets offshore (or to better tax havens)

As much as you try to change the rules, there will be clever people to take advantage of loopholes...

So if I'm Bruce... and this passes... I band together with my associates and market myself privately to wealthy conclaves (who will tend to flock together themselves)...

Bruce... need an agent? :-)

I-Man said...

I was distracted by mundane clerical work...

But I like what I see.

DL said...

Mannwich @ 12:02

Agree.

No way this HC bill survives (in its present form) after 2012; but at the same time, neither will the status quo.

I-Man said...

Now, if young Bucky can get his ass off the mat, we might get somewheres.

I-Man said...

And hell yes I would cover at 1153 if given the chance...

Why take any unnecessary stress into the weekend?

Even if there's a gap down at the open on Monday, I'd still be feeling "stylin".

DL said...

CV @ 12:36

"Harley Street" physicians.

Leftback said...

IF Jappy wakes up along with Bucky, then it's Katy bar the door.

Leftback said...

Every town in England has a little Harley Street.

Memphis will have one, then you can go to Beale Street for BBQ.
You will be fine, Bruce, if your scalpel is as sharp as your mind.

Nic said...

AUDJPY & NZDJPY are where its at ...

Nic said...

Cos Europe/Greece is all solved now, right ;)

I-Man said...

anon @ 12:31

Thanks! I was thinking the same thing! This has been a great week for tape talk here...

CV said...

@LB (12:33)

Exactly... NERO had to finish his 'Charlie Daniels' diddy first...

Right now I'm thinking

.021 from 1180.69 = 1155.90

1153.80 is a support level (so it might dip and bounce back to find a home around 1156)...

Nice little GAP WINDOW to fill there as well... Then, perhaps, we can call it a day...

I-Man said...

If we can take out 1164 on the downside, then those next 10 points could come very fast.

That would be a very profitable daytrade to end the week for someone...

CV said...

@I-Man (12:46)

I'll x2 that...

Thanks, in NO SMALL PART, to the ladies...

Gentlemanly bow there...

Bruce in Tennessee said...

Actually guys, most doctors are bright introverts. Most of the bubbas I know mostly just like to treat patients.

But most of my income now comes from other investments than my practice. Has for a decade. Again this year, after depreciating the dogs and the mailbox (!), I am sending UNCLE 6 figures. So life is good. But I really am not sure how much longer I'll keep it up.

But the really stellar physicians...most of them that I know are branching out into other things. Multitasking at this point. It truly is difficult to get a new medicare patient seen by a primary care MD...just about won't happen...

Nic said...

LB if you think USD is going to do well for a bit and China is going to wobble some more I like AUDCAD as a short. Bounced off top of a multi-year range and wedge about to break down

CV said...

@I-Man (12:48)

Put your 12:48 together with my 12:48...

Dude... You and I are on the same page man...

Leftback said...

Well, JOHNNY's morning money is in BLANKY'S pocket. Now, LLOYD wouldn't want more, would he?

Tightening up here, don't want to get toasted by the PPT.

I-Man said...

@ CV

Ya mon.

Leftback said...

BRUCE in SYDNEY, not TENNESSEE, could be in a world of hurt soon.

See if you're Bruce, Wayne and Sheila you could be looking at housing market crash, industry slowdown, depreciating currency and equity crash all at the same time. So STAGFLATION a possible, because of a falling AUD. A very nasty cocktail indeed.

Leftback said...

Bring 1150. I want to taste it.

Nic said...

Did anyone get stuck in gold today? there is apparently a mine near the centre of the quake

Nic said...

copper ugly for same reason

Leftback said...

Quake?

CV said...

@LB

Bruce, I think, is going to stick to the Memphis BBQ for now because he's heard This is how they do it in England

CV said...

@LB

Yeah... Quake in Chile this AM...

Nic said...

New quake in Chile mining region today LB

Mannwich said...

I think we need more people like Senator Kauffman giving us the straight dope. But he's leaving the Senate, isn't he? Of course he is.....our institutions are chock FULL incompetents and criminals who are left behind when the competents flee.

http://www.zerohedge.com/article/senator-kaufman-blasts-dodd-bill-says-it-gives-regulators-reshuffled-set-regulatory-powers-a

Mannwich said...

Simon Johnson weighs in.....

http://www.huffingtonpost.com/simon-johnson/senator-which-part-of-too_b_514293.html

AmenRa said...

LB

Another earthquake in Chile in an area with a big copper mine.

CV said...

@LB

Not a 'Quisp', mind you, a 'QUAKE'

CV said...

Sorry people... CV is a bit looney today :-)

Bruce in Tennessee said...

http://finance.yahoo.com/tech-ticker/businesses-react-to-rising-cost-of-obamacare-they're-cutting-benefits-450638.html?tickers=mdt,cat,vz,xlv,ixj,%5Edji,%5Egspc&sec=topStories&pos=2&asset=&ccode=

"Remember the part in the ObamaCare pitch when they said if you like your current healthcare, it won't change?

Turns out it might.

Companies are already announcing that their healthcare premium costs are going through the roof. Some are responding by firing people. Some are cutting benefits. And some are presumably eating it.

But costs they are a-rising.

A few examples from the WSJ:
-- Caterpillar said it would cost the company at least $100 million more in the first year alone.
-- Medical device maker Medtronic warned that new taxes on its products could force it to lay off a thousand workers.
-- Verizon announced to employees that it will likely have to cut healthcare benefits to offset the new costs.

So, people who like your employer-provided health insurance, get ready to pay more or get less."

...Forget reading all that,here it is:

Prepare to say goooddoye to the things you know, and helllllloooo to the things you don't.. (Steve McQueen in the Reivers)

Hello to one and only one health care provider. I know, cost, I know...but just mull it over...

Leftback said...

Thanks, good day not to be shorting miners.

CV said...

Here we go I-Man... 1153 city

Brian the Broker's Shapely Assistant Tawny said...

It can't go down, can it? The Dow thingy?

DL said...

Thank god it's only today.

I-Man said...

Yall see this one?

http://www.breitbart.com/article.php?id=D9EMECM00&show_article=1

"SKorean navy ship sinks in waters near NKorea"

I'll tell you right now, thats either a staged move, or a big deal.

Bruce in Tennessee said...

CV, if you and Lefty are ever planning on going back to Memphis, let me know. My daughter lives there, and I meet an old ophthalmologist there from med school and we bend our elbows over a weekend every year...

Leftback said...

Profit taking, prior to the EoQ window dressing.

Enjoy. The Magic will be back on Monday.
The 2003-4 market was a lot like this. Right, DL?

Leftback said...

It would be fun to watch someone big get their stops blown here.

Mannwich said...

You know what I've also found interesting lately - when I'm out and meeting different people, there's VERY little (if any) talk about "what you do" or one's jobs. It's almost as if nobody wants to talk about it because A.) their job is too depressing and stressful to talk about, or B.) they don't really have a job or aren't making any money......it's almost like nobody wants to open that can of worms and bring down the vibe.

DL said...

I think this puppy has at least one more rally in it before the correction.

1180 on Monday or Tuesday.

CV said...

Probably a bounce to 1165 coming soon, then another rollover... down to 1153 in the Lloyd hour...

Catch into the close...

CV said...

@DL (1:10)

I wouldn't doubt you there... I still have 1183 as a bogey on that Mon/Tue move...

Leftback said...

Manny, spot on, everyone knows it is ALICE IN WONDERLAND time.

When we have to pay the piper... ugliness.

CV said...

@Bruce

You have MY WORD on that memphis invite...

CV 'loves' that town!

Lord Blankfiend said...

I HAVE MY OWN HOUR...

JOHNNY has 9.30-10.30... LLOYD OWNS THE CLOSE.

CV said...

@Manny (1:10)

Look at it from a different perspective...

The GYM is probably PACKED (because all the people are unemployed)...

My gym is rockin'!

karen said...

A tidbit on the CA new-home and first time buyer tax credit bill just signed:

Standing before a Fresno housing project, Schwarzenegger said the tax credits will help meet his administration’s goal of creating “jobs, jobs, jobs.” He added:
“We are the eighth largest economy in the world. It would be absolutely insane for us to sit back and wait for the economy to come back.”
The state tax credit will become effective May 1, shortly after a federal tax credit expires.

DL said...

Bought some April 117 SPY calls a few minutes ago. Will sell on Monday or Tuesday.

Mannwich said...

So is mine, cv. In the middle of the afternoon. Thinning out a bit now because the runners are running outside again. People hate to be indoors here once the winter breaks, for obvious reasons.

CV said...

@karen

...and shortly thereafter, more IOU's will be issued...

I wonder if the GOVERNATOR thinks he's the President of Austria, and EU member, and thus is in line for an IMF bailout?

DL said...

"jobs, jobs, jobs".

You want to create jobs?

a) outlaw farm equipment; and

b) borrow more money from the Chinese to pay people to dig ditches and fill them up again.

CV said...

@Jeff

I can imagine... Especially in Minny...

Minnesotans just LOVE outdoors (more than anyone I know)...

Bruce in Tennessee said...

Heading to the hiking trails. Later.

CV said...

This 1165 is an interesting place to watch...

I don't expect the "bounce-ola" to go much further...

maybe sideways for an hour...(relatively)

McFearless said...

A South Korean naval ship sank following an explosion near a disputed maritime border with North Korea in the Yellow Sea, prompting a rescue mission to save approximately 100 sailors.

A short time later, a second naval ship fired shots at an unidentified vessel, according to South Korea’s Yonhap news agency. Defense officials were trying to determine what caused the explosion, which occurred about 10:45 p.m. local time. President Lee Myung-bak convened an emergency meeting of senior security and defense officials.

I-Man said...

We should know in a few minutes or so what kind of games they want to play into the close.

2nd mouse gets the cheese... the first shorts in on this move off 1165 will get toyed with. How hard they get toyed with will say alot.

CV said...

@Bruce

Thanks for the comments doc! :-)

Always nice to hear your perspective!

CV said...

@I-Man

I swear dude... you're in my head!

Leftback said...

Flight to safety!! SELL THE WON.

Buy Yen !! BUY TREASURIES !!!

karen said...

The aapl chart is a trip.. especially in light of the volume.. emphasis on light.

Mannwich said...

@cv: It's unbelievable when spring hits. The place really comes alive in so many ways.

Nic said...

Karen is it just me or is these home buyer tax credit mental? Is there a shortage of homes? Does California have a printing press it's been hiding? It's as ridiculous as Spain chipping in to bail out Greece.

CV said...

PLAYBOOK

- 1165.34 is the relative bogey on that last bounce...

- When it fails on TRENDLINE (in an hour or so)... Dip down to 1153...

- Shorts get covered... PPT to 1155-1156 (maybe better) into close...

- DL's 1180-1183 scenario on tap for Mon-Tue

- close the books on this STUPID ASS QUARTER...

CV said...

@Manny

When do the BUGS arrive?

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