Morning Audibles 3.5.10 - Time Can Melt Your Brain

I've been talking about this too long... The term "long" itself infers a need for measurement... Today, TIME is the thing we're going to be measuring... You're going to have to go back & review some of the charts I've been putting up for the past few weeks... You're going to have to do your own homework this... um... TIME...


If time IS a component... an actuality... then it is becoming quite relevant as we speak... Calibrated thus, we're probably talking about the next 13 hour trading TIMEFRAME... Draw your own conclusions, but beware... TIME CAN MELT YOUR BRAIN!


The Persistence of Memory - Salvador Dali (1931)

If you have TIME, read and find out what it's all about:



If time IS a component... an actuality... then it is becoming quite relevant as we speak... Calibrated thus, we're probably talking about the next 13 hour trading TIMEFRAME... Draw your own conclusions, but beware... TIME CAN MELT YOUR BRAIN! (see what it did to these poor fellows)... 


Note: The video clip is the alternative for those of you with NO TIME TO LOSE, or, you could skip below. The choice is yours.



IT IS the invisible presence that governs your world. Trailing you like an unshakeable shadow, it ticks and tocks incessantly - you can sense it in your heartbeat, in the rising and setting of the sun, and in your daily rush to make meetings, trains and deadlines. It brings order to our lives through the categories of past, present and future.

Time. There is nothing with which we are so familiar, and yet when you try to pin it down you find only a relentless torrent of questions. Why does time appear to flow? What makes it different from space? What exactly is it? It's enough to make your neurons misfire, then sizzle and smoke.
  
You are not alone. Physicists have long struggled to understand what time really is. In fact, they are not even sure it exists at all. In their quest for deeper theories of the universe, some researchers increasingly suspect that time is not a fundamental feature of nature, but rather an artefact of our perception. One group has recently found a way to do quantum physics without invoking time, which could help pave a path to a time-free "theory of everything". If correct,
the approach suggests that time really is an illusion, and that we may need to rethink how the universe at large works.

For decades, physicists have been searching for a quantum theory of gravity to reconcile Einstein's general relativity, which describes gravity at the largest scales, with quantum mechanics, which describes the behaviour of particles at the tiniest scales. One reason it has been so difficult to merge the two is that they are built on incompatible views of time. "I am more and more convinced that the problem of time is key both to quantum gravity and to issues in cosmology," says Lee Smolin of the Perimeter Institute for Theoretical Physics in Waterloo,
Ontario, Canada.

According to general relativity, time is stitched together with space to form four-dimensional space-time. The passage of time is not absolute - no cosmic clock ticks away the hours of the universe. Instead, time differs from one frame of reference to the next, and what one observer experiences as time, another might experience as a mixture of time and space. For Einstein, time is a useful measure of things, but nothing special.

Not so in quantum mechanics. Here time plays a key role, keeping track of the ever-changing probabilities that define the microworld, which are encoded in the "wave function" of a quantum system. The clock by which the wave function evolves records not just the time in one particular frame of reference, but the absolute time that Einstein worked so hard to topple. So while relativity treats space and time as a whole, quantum mechanics splits the universe into two parts: the quantum system being observed and the classical world outside. In this fractured universe, a clock always remains outside the quantum system.

Something has to give. The fact that the universe has no outside, by definition, suggests that quantum mechanics will be the one to surrender - and to many, this suggests that time is not fundamental. In the 1990s, for instance, physicist Julian Barbour proposed that time must not exist in a quantum theory of the universe. All the same, physicists are loath to throw out quantum theory, as it has proven capable of extraordinarily accurate predictions. What they need is a
way to do quantum mechanics in the absence of time. Single quantum event

Carlo Rovelli, a physicist at the University of Marseille in France, has found just that. In the past year, he and his colleagues have worked out a method to compress multiple quantum events in time into a single event that can be described without reference to time (Physical Review D, vol 75, p 084033).

It is an intriguing achievement. While Rovelli's approach to dealing with time is one of many, and researchers working on other models of quantum gravity may have different opinions on the matter, nearly every physicist agrees that time is a key obstacle to finding an ultimate theory. Rovelli's approach seems tantalisingly close to surmounting that obstacle. His model builds upon research into generalising quantum mechanics by physicist James Hartle at the University
of California, Santa Barbara, as well as Rovelli's earlier work on quantum systems.

The idea is this: suppose we have an electron characterised by its spin, a quantum property that is either "up" or "down" along whatever direction you measure it. Say we want to make two consecutive measurements of its spin, one in the x direction and one in the y direction. The probabilities of the possible outcomes will depend on the order in which we perform the measurements. That's because a measurement "collapses" the indeterminate state of the wave function, forcing it to commit to a given state; the first measurement will change the particle's state, which affects the second measurement.

Say we already know the electron's spin is up in the x direction. If we now measure the spin in the x direction followed by the y direction, we will find the x spin up - no change there - and then there is a 50:50 chance of finding the y spin up or down. But if we begin by measuring the y spin, that disturbs the spin in the x direction, creating a 50-50 probability for both measurements.

If reordering the measurements in time changes the probabilities, how can we calculate the probabilities of sequences of events without reference to time? The trick, says Rovelli, is to adjust the boundary between the quantum system under observation and the classical outside world where measuring devices are considered to reside. By shifting the boundary, we can include the measuring device as part of the quantum system.

In that case we no longer ask, "What is the probability of the electron having spin up and then spin down?" Instead we ask, "What is the probability of finding the measuring devices in a particular state?" The measuring device no longer collapses the wave function; rather, the electron and the measuring device together are described by a single wave function, and a single measurement of the entire set-up causes the collapse.

Where has time gone? Evolution in time is transformed into correlations between things that can be observed in space. "To give an analogy," Rovelli says, "I can tell you that I drove from Boston to Los Angeles but I passed first through Chicago and later through Denver. Here I am specifying things in time. But I could also tell you that I drove from Boston to LA along the road marked in this map. So I can replace the information about which measurement happens first in
time with the detailed information about how the observables are correlated."

That Rovelli's approach yields the correct probabilities in quantum mechanics seems to justify his intuition that the dynamics of the universe can be described as a network of correlations, rather than as an evolution in time. "Rovelli's work makes the timeless view more believable and more in line with standard physics," says Dean Rickles, a philosopher of physics at the University of Sydney in Australia.

With quantum mechanics rewritten in time-free form, combining it with general relativity seems less daunting, and a universe in which time is fundamental seems less likely. But if time doesn't exist, why do we experience it so relentlessly? Is it all an illusion?

Yes, says Rovelli, but there is a physical explanation for it. For more than a decade, he has been working with mathematician Alain Connes at the College de France in Paris to understand how a time-free reality could give rise to the appearance of time. Their idea, called the thermal time hypothesis, suggests that time emerges as a statistical effect, in the same way that temperature emerges from averaging the behaviour of large groups of molecules (Classical and Quantum Gravity, vol 11, p 2899).

Imagine gas in a box. In principle we could keep track of the position and momentum of each molecule at every instant and have total knowledge of the microscopic state of our surroundings. In this scenario, no such thing as temperature exists; instead we have an ever-changing arrangement of molecules. Keeping track of all that information is not feasible in practice, but we can average the microscopic behaviour to derive a macroscopic description. We condense all the information about the momenta of the molecules into a single
measure, an average that we call temperature.

According to Connes and Rovelli, the same applies to the universe at large. There are many more constituents to keep track of: not only do we have particles of matter to deal with, we also have space itself and therefore gravity. When we average over this vast microscopic arrangement, the macroscopic feature that emerges is not temperature, but time. "It is not reality that has a time flow, it is our very approximate knowledge of reality that has a time flow," says Rovelli. "Time is the effect of our ignorance."

Cosmic time

It all sounds good on paper, but is there any evidence that the idea might be correct? Rovelli and Connes have tested their hypothesis with simple models. They started by looking at the cosmic microwave background (CMB) radiation that pervades the sky - relic heat from the big bang. The CMB is an example of a statistical state: averaging over the finer details, we can say that the radiation is practically uniform and has a temperature of just under 3 kelvin. Rovelli and Connes used this as a model for the statistical state of the universe, tossing in other information such as the radius of the observable universe, and looked to see what apparent time flow that would generate.

What they got was a sequence of states describing a small universe expanding in exactly the manner described by standard cosmological equations - matching what physicists refer to as cosmic time. "I was amazed," says Rovelli. "Connes was as well. He had independently thought about the same idea, and was very surprised to see it worked in a simple calculation."

To truly apply the thermal time hypothesis to the universe, however, physicists need a theory of quantum gravity. All the same, the fact that a simple model like that of the CMB produced realistic results is promising. "One of the traditional difficulties of quantum gravity was how to make sense of a theory in which the time variable had disappeared," Rovelli says. "Here we begin to see that a theory without a time variable can not only still make sense, but can in fact describe a world like the one we see around us."

What's more, the thermal time hypothesis gives another interesting result. If time is an artefact of our statistical description of the world, then a different description should lead to a different flow of time. There is a clear case in which this happens: in the presence of an event horizon.

When an observer accelerates, he creates an event horizon, a boundary that partitions off a region of the universe from which light can never reach him so long as he continues to accelerate. This observer will describe a different statistical state of the universe from an observer who doesn't have a horizon, since he is missing information that lies beyond his event horizon. The flow of time he perceives should therefore be different.

Using general relativity, however, there is another way to describe his experience of time. The geometry of the space-time he inhabits, as defined by his horizon, determines a so-called proper time - the time flow he would register if he were carrying a clock. The thermal time hypothesis predicts that the ratio of the observer's proper time to his statistical time - the time flow that emerges from Connes and Rovelli's ideas - is the temperature he measures
around him.

It so happens that every event horizon has an associated temperature. The best known case is that of a black hole event horizon, whose temperature is that of the "Hawking radiation" it emits. Likewise, an accelerating observer measures a temperature associated with something known as Unruh radiation. The temperature Rovelli and Connes derived matches the Unruh temperature and the Hawking temperature for a black hole, further boosting their hypothesis.

"The thermal time hypothesis is a very beautiful idea," says Pierre Martinetti, a physicist at the University of Rome in Italy. "But I believe its implementation is still limited. For the moment one has just checked that this hypothesis was not contradictory when a notion of time was already available. But it has not been used in quantum gravity."

Others also urge caution in interpreting what it all means for the nature of time. "It is wrong to say that time is an illusion," says Rickles. "It is just reducible or non-fundamental, in the same way that consciousness emerges from brain activity but is not illusory."

So if time really does prove to be non-fundamental, what are we to make of it? "For us, time exists and flows," says Rovelli. "The point is that this nice flow becomes something much more complicated at the small scale."

At reality's deepest level, then, it remains unknown whether time will hold strong or melt away like a Salvador Dali clock. Perhaps, as Rovelli and others suggest, time is all a matter of perspective - not a feature of reality but a result of your missing information about reality. So if your brain hurts when you try to understand time, relax. If you really knew, time might simply disappear.

From issue 2639 of New Scientist magazine, 19 January 2008, page 26-29
--
Brian Atkins
Singularity Institute for Artificial Intelligence


SPX WEEKLY (with bollingers)

215 comments:

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McFearless said...

Nice thread C, interesting.

@Mannwich,

Saw you ask on the other site:

"Wouldn't that scenario ultimately inflict the most pain on shorts and new johnny-come-lately bulls?"

If you really are interested in what the range would be do a search for: max pain, options.

Also, just note, a lot of wavers are looking for a spike higher today...as a chance to go short. I also mentioned yesterday I've had three MF wholesalers tell me this week they've seen a lot more equity inflows the last few weeks, retail is buying stock lately, another melt up is not needed for more bulls, Rosie also wrote about this the other day "bulls getting more bullish"

IMO, this is not the start of the last leg of a triple zig zag, a scenario that would def. lead us to new highs. Andy's count gives the alternative to the super bear count, but it's still bearish.

McFearless said...

Ha! from Mish:

"Have Your Snow Job Decoder Ring Handy?"

Bruce in Tennessee said...

time emerges as a statistical effect....

I suppose that means if you could be a perfect isolated observer that you'd see time actually pass much faster on the surface of the sun than in space at temperatures very close to absolute zero. You wouldn't need an event horizon. That would mean that the recording "mechanism" would have to actually be capable of recording at those extremes to prove the hypothesis. The sun and the space around it have different times because of their temperature? Strikes me as the old Schrodinger's cat hypothesis...

CV said...

@bruce

I interpret "time emerges as a statistical effect", to possibly explain the warped behavior that tends to occur AT event horizons.

Then, when more and more "occurrences" tend to happen (abnormal as they may be), the overall statistical picture is pounded into and eventual AGREED UPON reality.

Then it is boxed up and put on a shelf, only to be taken out and used again when new sets of accumulated "misinterpretations" appear...

Or something like that... :-)

call me ahab said...

as I suspected- the dour predictions for the NFP all a big show

Tyler said...

I was watching the futures and time stamp and the jump came at 8:29:53 (and it wasn't a pre-release-monkeying-around-type-movement jump, it was THE jump) ... anyone else notice the early jump? did BLS release slightly (7s) early ?

CV said...

@ahab

As we were saying yesterday... It'll be the biggest NFP number in HISTORY!... Until the next one...

I responded to that comment by typing...

"The next comment that I make on this blog will be the most important one in history!"

I seriously forget now what the next comment I made was (I'm going to have to go back and look, just for fun)...

Point is made however...

CV said...

@tyler (8:54)

You know, it really doesn't matter to me...

Basically, I've been calling for this 1126 level to be taken out for 3 weeks now... There's a gap there, FILL IT...

Great, now it'll be filled... There will likely be some OVERRUN, because some of the shorter term technicals will permit it to happen, and there are also some minor fibos just above in the 1130-1131...

We could hit ALL of those in the morning, then the market is satisfied and we tip back down...

I really don't know what many are so riled up about... But it underlines the argument in my thread this morning...

With regards to TIME, "warped behavior" tends to occur around event horizons... Brains melt!

Anonymous said...

Thx Ben. Off to the nortlands of Duluth. Check in later.

Mannwich

call me ahab said...

CV-

great post- it's funny- I have been reading about quantum mechanics lately- and have brought up the double slit experiment here on these very threads-

it all comes to man's attempt to understand- without an observer- then all is meaningless

Karen said...

good morning.. will catch up on time in due time..

CV said...

@tyler

You can go back to my THREAD POST on February 22nd to see one of my references to 1116-1127... There's an "annotated" chart in that thread which explains the hypothesis (IN A LARGER PICTURE SENSE)...

Also, going back as far as "Super Bowl Week"... There were various notations that suggested the "step up" process in the 1080's...

This last move is, what I think, the FINAL PHASE of that...

Possibly today could be the final high...

CV said...

Although I'm not discounting, as some others are, that the eventual top might not be Monday or Tuesday...

Those are very important TIMEWISE in terms of FIBOS, and in terms of "anniversary" dates for the indices...

Tuesday will be one year out from last years lows...




KAREN - Don't spill the coffee! :-)

Mack said...

when do you stop looking at net flows though?
if the market/johnny continues to buy, are the institutions gonna be the one's to sell? someone has to start the chain reaction

CV said...

@Amen

I'm willing to reckon that this will be another case (like 1/14) where the SPY print exceeds the eventual cash...

Karen said...

i'm looking at an abandoned baby in uso.. trying for some dto.. oops, bot some dto.. i wouldn't recommend it to anyone else..

CV said...

@karen

This is looking fine to me thus far...

95% I'll go short sometime this morning... Unless something radically changes...

Karen said...

who was it that said when they divorced they only had cowboy boots and a ford truck?

CV said...

@karen

Wasn't me... I've never been married... & my Truck is a TOYOTA :-)

CV said...

That's it... I'm pulling the trigger right here...

See how she goes...

I-Man said...

Load the clip, kid!

call me ahab said...

Ford F100 and a pair of Tony Lama's-

pretty much all I had when I got married- in response to a question why someone getting married wouldn't sign a prenup-

so . . .I had nothing to lose- except my freedom- and that was a lot to give up-

anyway gotta roll- all have a good day

Anonymous said...

Bears aren't putting up much of a fight thus far. Perhaps they are waiting this out a bit longer before the selling begins...but I'm starting to think that we're going to re-test the highs sometime next week.

Leftback said...

SNOW JOB.. hilarious...

CV said...

@anon

Bulls are out of breath here...

Plus, the LAST thing they needed to see was another chart gap left behind on the open...

CV said...

It's just staying here for a bit to fill JOHNNY'S orders...

I-Man said...

Some of my old friends who I started in the business with were harassing me yesterday about my bearish views, raving about the "upside breakout in the SPX at 1125..."

So if that was the plan, then its worked...

These arent Johnny's either...

So its working really well.

Karen said...

do we know where onlooker went yet?

CV said...

@I-Man

I think the CLOSE today is what will be important...

1126+ and you get a REVERSAL on the 3LB weekly...

If 1126 can hold throughout the day, then the bulls may have a case... There will be some point in the day that I'm sure that notion will be challenged...

I don't mind being short here... If it looks bad at the end of the day, I might cover, but BULLS have to be feeling a little lactic acid right now...

I-Man said...

Oh shit, I totally forgot about Onlooker...

Where the hell did he go?

CV said...

@karen

I've been asking about onlooker...

But it seems to me in the back of my mind he'd said he was going to be absent because of a trip or something...

I-Man said...

Upon closer inspection I could see a wiggle up to 1134...

CV said...

I wonder if that VIX daily candle will turn out to be an "abandoned baby"?

I-Man said...

TLT looking ripe for a snapback on the 1min

CV said...

They're really gunning this thing...

10 minute RSI's on SPX are up in the 86 percentile...

AmenRa said...

Currently GS & AAPL have weekly 3LB reversals up.

McFearless said...

@all,

Onlooker is just taking a break I think. Seems that a lot of people the last few days were saying they needed to "de-news" a little bit, I think he's just doing that. He'll be back...I'm sure of it.

I-Man said...

Aint nuttin but an algo party...

I-Man said...

Wonder how many folks just got stopped out at 1130?

CV said...

@DL

So DL... You were calling for a VIX 17.50 print...

We printed 17.49... Where do you stand?

I-Man said...

@ Ra:

What do you see?

CV said...

@I-Man

Here's what I see...

Headline: Striking Greek workers shut down transport and tried to storm parliament as lawmakers passed 4.8 billion euros ($6.5 billion) in budget cuts, including wage reductions, needed to trim the region’s biggest budget deficit.

No worries people... VIX at 17.5... Go back to buying stocks!

I-Man said...

I caught some footage of that earlier, and the only thing going through my head was...

Those greeks are lucky those arent american riot cops...

Looks like a teaparty with the Queen compared to Seattle.

McFearless said...

Lol, I gotta say, reading comments today are funny on the blogs.

Bears are trippin

I'm looking for short entries.

Perhaps I'll be poorer by the end of next week as a result.

Perhaps not.

AmenRa said...

I-Man

I have a 17.49 print also. Plus a weekly 3LB reversal down on the VIX (trading below 17.91).

I-Man said...

Sorry Ra, I meant generally speaking, on the SPX 1min timeframe...

IE: when does the switch get flipped?

.
.
.


Sell em Lloyd. Do it. DO IT.

Karen said...

unfortunately, i have to leave this party for a couple hours in 15 min.. will leave laptop home but take trusty iphone w/ e*trade app..

McFearless said...

As an example, just read the comments at Dan's site, top thread.

Someone call the Whaaambulance, all these bitches blaming wave for bad trades.

Pathetic.

EW is never wrong.

I-Man said...

@ B22

When Bears be trippin, the switch soon to be flippin...

CV said...

@Amen

That VIX candle is just like the 1/11 candle...

Start of "abandoned baby"... The 1/11 candle pierced the DAILY BB's (but more importantly pierced the WEEKLY BB's)... I remember highlighting that in a chart)...

Anyway, it's not piercing any BB's here, but its very similar... Also, todays low was LOWER than the CLOSE from that 1/11 candle...

Just saying...

I-Man said...

We are right where we really broke down from off the Jan highs, at 1135...

This is such a good short setup here, I dont think I'll ever see one this clearly again.

Too bad I'm sitting it out, but then again, if I wasnt, I would already be neck deep short, and freaking out right now.

Patience is a virtue.

McFearless said...

I agree I-man, don't get me wrong, I've been getting my ass kicked for about two weeks, but I feel extremely calm right now, and, it's a beautiful day here in DE!

If we go to new highs then I'll just have made bad trades, all my fault, not EW.

CV said...

@McF (10:48)

Whaaaaaaaambulance - LOL

See... I love EW, but it's only a guideline for me... Something that I mix into a SOUP of a bunch of other things...

Just yesterday I had a PLAN B chart up here on this thread... Plan B had NOTHING to do with EW, just some other minor technicals...

But this is PRECISELY the purpose of my thread topic today... TIME is a collection of unknown perceptions... There is confusion in the process of getting all of the various potential outcomes to resolve...

It's IMPOSSIBLE to fit it precisely to someones preconceived notions...

So naturally, some will be calling the "Whaaaaaaaaaaambulance"... :-)

McFearless said...

Been a while since I saw so many DOW 20k calls on the boards, and Daneric says Hulbert claims his newsletters are just as bullish as they were in 07. Mutual fund's are all in, cash levels basically at record lows.

Now, we just got a huge GDP print, among other "good" data, if you have time, do yourself a favor and map out over the last 35-40 years what happened to stocks when all these things were present.

I-Man said...

Nothing like good news to mark a turn.

CV said...

@McF

Priced to PERFECTION

CV said...

and as for PERFECTION...

...as Rosie says, "if this is what a recovery looks like, I'd hate to see the downturn"...

Anonymous said...

Similar set up on the EURUSD to the Jan 11 too.

On the 4 hour chart the MA 20 is now above both the MA 50 and MA 100.

The price isn't following yet like it did then. In the jan 11 timeframe there was a jump above all of the MA's.

The price is stuck at the MA 100 now.

Interesting morning.

bob

McFearless said...

C,

EWI commented that last fall they had a very large pick-up in subscriptions. I know what is going on here, they made fantastic calls in 07 to go all in short, covered all shorts on 2/23/09 and called for minimum to 1k on the S&P and they got some good press as a result and then people thought, well I'm going to subscribe and they will tell me all the right trades and I'm going to get rich biatch!

Fast Forward to today. I bet RP's assistants are getting reamed by some Johnny about their calls here in the near term, saying EW doesn't work (not that they'd actually know, because they dont' want to learn it, they just want to be told how to make money and never lose) and how RP must be one of the biggest money losers in the history of the world, the Fed controls everything, etc etc etc.

These people have no business in the market, now I hope they all capitulate and go long, with dreams of Dow 20,000 and Peeps for Easter in their heads.

Anonymous said...

Walked by the break room a bit ago and a few Govt. employees were watching CNBC, guess someone turned them bullish cuz a couple of them are changing their TSP to ALL IN the S-fund now.

(maybe we're getting closer to the top when things like this start to happen... maybe)

qqqq

72bat said...

@ i-man @ 10:52 & ben @ 10:54 -
somewhat reassuring to be keeping company with the likes of you two, trying to be cool (as i-man) and calm (as mcfearless)

AmenRa said...

EURJPY 1.233
Risk On!!!


Man, I'd kill for a monthly 3LB reversal just to stop this madness.

I-Man said...

Yeah, its hard to be cool when there is a gun in your face.

I feel you man...

They dont make it easy.

CV said...

@72bat

Hey bat... no love for CV here? :-)

I-Man said...

http://www.youtube.com/watch?v=lgjiOSRnNIM

Cool Rasta...

"Sit up and meditate, no time fi contemplate."

CV said...

More "funnies" from Art Cashin...

"a horrible [NFP] number would have been seen as a buying catalyst due to the "non-recurring" nature of snow in February"

McFearless said...

@72bat,

You know what I do on a day like today, just read. Statements from most are all emotion driven. It speaks volumes.

Today is a day that makes Johnny make bad bad moves, just look at QQQQ's post. And even in that post, there's a maybe.... Hell, if I just walked by some people in a break room huddled around watching CNBC talking about getting long, well....

All bulls site the same exact reason each time for why they are bullish, they have one argument. Bears have too many too count, so ask yourself, why is it that the bulls are the one's with all the confidence and bears all over the boards are saying today there is no reason to be bearish?

I-Man said...

I-Man whispers...

CV... notice the high print in SPY this morning came in at exactly 10:30am?

And hasnt made a higher print since...

(Its just time.)

McFearless said...

Let me offer something, though it's purely anecdotal:

Guy in my office is terrible with money, if people knew his personal finances they would NEVER hire him, they'd run away FAST. In 2008 he lost almost all of the money he managed for clients, he's been scraping by since then and bought a book from a rep that retired last year so he's got 10-12 million or so in AUM.

In the summer of 2007 he made this comment to me:

"The US will never have another bad recession because of China"

In the summer of 2008 he held all of these:

Oil, stocks like, MOS, CHK, XTO, POT, BIDU, and loaded to the gills with emerging markets, he was also big into "floating rate" funds.

Many weeks ago, and I commented here about it at the time, he was walking a client to our lobby and has to pass by my office door on his way, and I hear him saying to his clients:

"Brazil is a great investment right now because they got the Olympics"

On Tuesday he came in my office to ask me what I thought about things, and I said I don't know because there is no point talking to him so that's easier. He said:

"There might be another recession but I don't see that for at least another five years" and...get this....his reason why:

China. Again.

He's also betting on inflation AND, he is buying BIDU, up here. He bought it at the last peak and puked it out or clients made him sell in the 100's.

Hulbert is saying his newsletters are most bullish since 07, and every single retail FA that I know is a buyer.

This is bubble mode people, no thought behind it at all, but of course, that's what happens in a GIB (trademark)

Perhaps he's correct though, and we are going to infinity.

McFearless said...

Oh, and if you are curious how he "bought a book" if he's bad with money the answer is:

He had his mother take a HELOC on her house, which was paid in full, to fund his office expenses and the purchase of the book. The week after the loan was finalized he bought a giant TV for his office, which was apparently "for client presentations", he also is now driving a new Caddy.

The whole thing blows my mind.

So yeah, like I said, bubble mode.

72bat said...

@ cv
your pulling the trigger @ 9:51 did not pass un-noted, just that i-man and ben expressing how they FEEL, resonated with me

CV said...

@McF

Interesting on BIDU (which we have talking about here)...

We've been talking about 526 for weeks now... yesterday it hit 525 even (Amen even mentioned that in the wrap)...

Today's high print, thus far? 524.98 (despite todays strong PRICE tape)...

We'll see what happens...

McFearless said...

@72bat,

And to be real, I used to freak out all the time about stuff like this, just like a Johnny, making emotional trades, but after I got into wave a few years ago that stopped.

CV said...

@72bat

I did pull a little trigger earlier (around 1131)...

I don't bother anymore trying to "CALL" the top... When we're AROUND something that seems kind of right, I'll do something...

Yesterday, I drew a PLAN B chart that showed the potential for, say, a 1137 move... So I left a little powder for that in case it happens...

In any case, this is the first trade I've made since the middle of January (except for a small day trade on TLT calls about two weeks back)...

McFearless said...

@C,

the bidu trade, in either direction, is not for me right now. It's really hard to count waves on individual stocks, I stick to the big indexes, the currencies, and some commodities.

I did some stocks in 09 when I was bullish, but that's because you could have picked almost anything due to the trend of the market. So I just tried to find some of the crappiest crap that I could and then I went long it.

anyway, still a fun stock to watch.

CV said...

@McF

I decided the same thing eventually... That I wasn't going to do anything with BIDU...

However, I'm still watching it as sort of a "barometer" with regards to all these major indices... There4, it's on my radar screen...

Kinda like watching the VIX...

Anonymous said...

MCF @11:36

But you have to spend money to make money....

bob

I-Man said...

Looks like a great day to start nibbling on some FXY, fwiw...

Looks like the retest is working according to plan...

CV said...

@bob

You also have to LOSE MONEY to, um, BE BROKE...

McFearless said...

Bob,

No you don't. I worked hard to gain clients trust over the last several years, now I get a lot of referrals, people call me.

That costs me 0, and makes me money.

Not to mention, the advisor didn't spend "money", he spent DEBT.

CV said...

I'd love to see that VIX Daily candle resolve out to be a HAMMER...

DL said...

CV @ 10:35

You remembered.

Actually, I didn’t expect to see the 17.5 level quite this soon.

. . . . . .

I suppose we can get to SPX 1150 within the next few weeks. I think, though, that the air gets a lot thinner above that level.

Anonymous said...

I agree, I have to get the snark out of me.

There are few that I know that don't believe this. One is a brother that works with doctors. You have to hear some of the 'wisdom' that he puts out.

bob

McFearless said...

DL,

I'm curious, what is it exactly that you base your market calls on? You give a lot of statements about this price or that, but the only thesis I've seen from you is that of what the Fed will do, or what Obama will do.

I know you must be using more than that, so I'm wondering...what do you use?

Mix of TA and fundamentals?

Anonymous said...

A friend who is very well paid told me recently that he put all of the equity in his house(bought at the top) into a boutique store for his wife to run. She hired a manager and a another person to watch the counter. She sells overpriced 'clothing and accessories'.

I can't even begin to reason with someone like that.

bob

McFearless said...

Dont' get me wrong, you do in fact need to spend money as you expand your business, but word of mouth referrals for what I do can get you very far.

DL said...

McFearless,

I use a mix of TA, macroeconomics, and sentiment.

It's all rather "ad hoc", and undisciplined, actually.

McFearless said...

Thanks DL, was just wondering, that's about what I thought. Whatever works for you right.

I-Man said...

Hey, where's the bond guy?

CV said...

@DL (12:05)

Certainly we're in a zone now that makes that a possibility...

But even if it gets to 1150 again, I don't mind being short here... I know you're here every day, and therefore I know you've read my comments about being patient in reaching the 1126 level... I hadn't pulled any triggers until today...

I still feel the market is WAY overbought here (equally, if not MORE than it was OVERSOLD at 1044)... All "short term" OB/OS levels...

So hanging around here to see if the market wants to tack on another 15 points doesn't bother me... Especially when I see a 1076 gap on the other side of the trade (that's 41 points down)...

The dollar, which has been tracking sideways now for awhile, I believe will soon make it's next move up... When that happens, I don't want to be LONG this market...

DL said...

McFearless,

That's not to say I'm uninterested in EW theory. I did buy a book on it, and I tried to make sense of it. I'm still open to learning more about it. I am very much open to the idea that it "works" over short time periods, e.g., 12 months or less.

I-Man said...

DXY sure had an interesting morning session didnt it?

CV said...

@bob (12:09)

The best "one liner" I can come up to respond to that idea, is that I'm sure that guys wife, in time, will find TRUE RELIGION...

I-Man said...

Thats interesting to me DL, as I look to EW more for the longterm, as opposed to the shorter time periods.

CV said...

@ben

You liked that "science" article on time didn't you?

DL said...

I prefer to consider "waves" over periods when the memory of market participants is still fresh.

Anonymous said...

CV

He's one of the smartest and hardest working people I know and he is VERY well paid for it. But, he is terrible with money. I've tried to talk him into just taking one year off from spending. With what he makes he could be his own bank in a year. In one ear and out the other. Money is cheap now and it just keeps getting cheaper.

bob

CV said...

@DL

I'm not so sure people HAVE any memories anymore...

I'd bet half the people you asked couldn't even give a "standard deviation" accounting to the people they'd TEXT MESSAGED during any given day...

McFearless said...

@C,

Oh, you know I did. Articles like that are def. my "thing".

@DL,

That's pretty interesting you like the short term aspect of EW, lots of people that only sort of get into it say the opposite, the see the bigger waves, but can't use it to short term trade.

I of course say it does both,....fractals.

CV said...

@McF

Here's DL's trading set up... No wonder he's been good on his calls lately :-)

DL said...

McFearless,

I'm certainly not going to try to compete with you when it comes to EW theory.

But I am willing to accept the proposition that the "waves" are a result of the psychology of the market participants.

What may have happened 20 years earlier would seem not to affect psychology so much.

Anonymous said...

@ Ben,

to many posts... so little time to read :(

In the retirement account, I'm not real bullish on the market right now.

I just thought it was funny what they were saying when I passed through the break room. Stuff like "this market is probably going back to the highs of a couple of years ago", "Obama is turning this country around", "unemployment has turned around"... words to that affect.

In my trading account, I trade/gamble stocks... have PHB @ 17.50ish and TM @ 74.75. Not sure how long I'll keep these though... at least a few more weeks, Toyota, probably longer.

qqqq

DL said...

TM (Toyota) should eventually pan out.

Question is, how long one has to wait.

McFearless said...

DL,

Well, that statement is correct, what happened 20 years earlier doesn't have an impact on psychology, social mood does not change because of exogenous events.

QQQQ,

Maybe I'm the dumb one, but after 26 consective months of job losses I'm not really sure I get the whole "turning the country around" talk, so I'm with you...that's funny to me.

DL said...

Traders,

Before positioning yourself for the Monday open, don't overlook the Mannwich "out of town" indicator.

Leftback said...

LB wishing he had hedged last night, but that is over my shoulder now. Expecting some selling of equities and buying of Ts into the close today and then we would hedge.

As always today is not so much about THE NEWS as THE REACTION. The Larry Summers Snow Job was predictable.

It is still all about the dollar (and yen, as in carry).

Macro Man went to a registration system, hope it works.

I-Man said...

Sell em Lloyd...

You know you want to...

CV said...

One thing I'm noticing... AGAIN...

Pretty light volume... A little more than earlier in the week, but still very low overall...

If this were BULLS CHARGING (like last summer), I'd have expected MUCH MORE on a day like today where it seems like the bullish sentiment is getting stronger...

qqqqtrader said...

@ DL

Agree... my Ford Expedition has had more recalls than Toyotas. Also, had to replace the transmission @ 125K miles on the Ford.

I bot TM because I thought it was beat'n down to much. IMO, the msm went a bit overboard on toyotas problems.

qqqq

I-Man said...

@ C

Didnt you have an alternate time count you were toying with that expired around 1:30pm?

CV said...

Of course AAPL is at an all time high tho...

I wonder what's going to happen when RE-DISTRUBUTE THE WEALTH Obama declares that AAPL must give free iPhones to everyone...

You know... to make this country STRONGER!

I-Man said...

And re: volume

I was noticing the same thing, and actually switched over to SPY just so I could watch it. (My company is too cheap to pay for SP volume feeds... ridiculous.)

Amazing how the volume dries up when the programs are turned off.

You can really see them at work today on the SPY 1min chart.

CV said...

@I-Man

There were discrepancies on that...

I was counting "candles" to 1:30, but Amen did the math and put the end in the Monday or Tuesday timeframe...

Frankly, I'm still confused on that...

I'm looking for 233 60 minute candles (on the SPY), since the 1/14 high... That's my bogey...

I-Man said...

There will always be discrepancies...

Its not so much the process, but the variables, if you know what I'm sayin...

I-Man said...

Speaking of algo's...

Did one just get turned on? Or is this a fake?

I-Man said...

Sorry...

Yall know how I get when I have time to watch 1min bars.

You could call it hyper.

Leftback said...

Next Thursday - 30y auctions, so hold your powder on TLT calls until at least Tu or W, are we all agreed, gang?

CV said...

@LB

Agreed on that... 2x

CV said...

Emphasis on "GREED"

Leftback said...

AGREED is GOOD.

AmenRa said...

CV

There were 2 days that the market was closed. 1/18/10 & 2/8/10.

Leftback said...

EUR-JPY 123.0700 2.1587 1.79%

never makes for a Happy Fulfilled Bear....

CV said...

@Amen

I realize that... I'm just counting the "sticks" I see on my screen (10 week view of 60 minute candles)...

Probably what I'm seeing is that fact that the DAY demarcations are done on a 7 candle differential... Whereas there are only 6.5 hours in the trading day... I haven't tried to probe further, but it's probably why your calculations are different that what I'm counting...

AmenRa said...

CV

I noticed that also. That "7th" candle is only 30 min so count the 7th candle every other day.

CV said...

@Amen

That would about account for the discrepancy...

Leftback said...

Gold giving up its gains as Bucky makes a stand.

CV said...

FOR THOSE OF YOU WHO AREN'T EXACTLY RAGING BULLS AT THE MOMENT (DESPITE TODAY'S MOVE) - I ADDED A WEEKLY SPX CHART TO THIS THREAD TO GIVE A LARGER PERSPECTIVE TO WHERE WE STAND AT THE MOMENT - CHART ABOVE

Leftback said...

Today was what we discussed yesterday, a HOT JOBS number would have triggered a dollar rally, clavadista de commodities. A COLD JOBS number, dollar rally risk aversion.

It was the GOLDILOCKS number that did in the BEARS. All 3 of us.

Karen said...

I'm back! did i miss any phenomenal links for news items? aapl made a new high.. does that mean GS will make a new high as well?

DL said...

Speak of Goldilocks and guess who appears?

Karen said...

srs about to make a new 52 week low.. someone buy it!

Karen said...

faz did make a new 52 week low..

Karen said...

clearly the inverse etfs will be banned/shunned/delisted any day.

Anonymous said...

new highs gaining some altitude here

http://stockcharts.com/h-sc/ui?s=$NYHGH&p=D&yr=3&mn=0&dy=0&id=p62502335955

qqqq

CV said...

@qqqq

Yeah, just like they did in Oct '07, Oct '09, and again in January...

Clearly a BUY signal [snark off]

Anonymous said...

A bear's lament: I'm lonely.

I-Man said...

@ anon

Bear's shouldnt be sad or lonely here...

They should be DROOLING.

Anonymous said...

lol, don't know about snarking off but it's definetly bubblelicious

qqqq

mcHAPPY said...

@Ben 11:36

mcHAPPY hearts your stories from the inside. Thanks.

Leftback said...

Welcome back, KAREN, how are you today?

(He asked courteously, on his best behavior..)

Karen said...

are all eyes on 2326??

I-Man said...

That would be a double top... yeesh.

Anonymous said...

The euphoria is pretty impressive. The question for me now: To hold (my shorts through the weekend) or not to hold.

mcHAPPY said...

Anyone else think a DXY in the very low 100 range possible by July?

mcHAPPY said...

Anyone else think the charts could show us a VERY high 90's or VERY low 100 on the DXY by July?

CV said...

From here, a 61.8% retracement back to 1044 brings you to that 1076-1078 gap...

50% takes you to that 1090 support level...

CV said...

23.6% takes you back to the 1116 level...

where there is ALSO a gap...

Leftback said...

I think time and boredom have melted my brain,

"are all eyes on 2326??"

LB's eyes are on KAREN.

CV said...

Bears right now ought to get to watching the NO TIME TO LOSE clip to improve their humor...

McFearless said...

McHappy,

Even for me that's hard to swallow (A DXY at 100 by July) wouldn't mind seeing that, but I don't think it's very likely that soon.

Anon,

How do you measure impressive Euphoria? What do you mean by that?

I-Man said...

Getting pretty close K...

McFearless said...

For example, I might describe this as impressive if say, we had some volume, but we don't. I might call it impressive if we had more stocks hitting new 52 week highs than we did at the Jan top, but we don't. I might call it impressive if the dollar was completely breaking down, but it isn't. I might call it impressive if consumers were rushing to borrow, but they aren't.

And last, I might really be impressed if bulls could find another argument besides "the Fed will make it so", but that aint happening either.

I-Man said...

I can almost smell the distribution...

Leftback said...

I see a 2320 top not 2326 for the NAZZ in 2009, what did I miss?

I-Man said...

1/11/10

COMP-O High 2326.28

Leftback said...

Meant 2010, brain dead.

Leftback said...

"MISTER BEAR? Your delivery of COLD STEEL is here...."

Karen said...

$bkx is up against the 100dma barrier..

uh, where is that bull trap i thot i saw?

CV said...

@ben

There has been a little pickup in volume in this past half hour tho...

Probably seeing 'some' bear capitulation...

Can't wait to see the AAII numbers at the end of this week...

McFearless said...

It's strange because all the biggest global indexes look weak here still....not really sure what to make of that.

Today I'm cursing silver like I used to the dollar when I was early on that trade.

Damn you silver.

Still my baby though, lol.

Anonymous said...

McFearless,

Impressive may not be the right adjective. IMO, there are better choices: irrational, absurd, etc.

Someone is buying today and I don't know the rationale for it. I would like to think that we are experiencing that last bit of short-covering before we top. But maybe it is simple euphoria.

Leftback said...

Has to be some short covering involved, a lot of shorts were set up to defend a zone above 1125-1129 and just folded.

It is what it is.

Leftback said...

Consumer credit was UP $5B, anyone catch that?

McFearless said...

Anon,

Who knows, I've been on the wrong side clearly for a few weeks now.

I like absurd the best....

I wouldn't use irrational only because it always applies to some degree. I find it to be a mistake to ever look for rationale for the stock markets price, unless of course you are trying to identify the wave pattern and the rationale of your count. Otherwise you are trying to figure out the impossible since there is often no rationale at all when it comes to market participants, it's emotion driven.

I-Man said...

Anyone catch the size of that TLT trade at 3:17?

McFearless said...

Lefty,

Yes, I saw that. Can't say it came as a huge surprise given that we just saw people spent more than they earned. You didn't think they were spending savings did you?

DL said...

I suppose before long we’ll get into another tight trading range like the one from 11/15/09 to 12/15/09.

CV said...

@McF (3:11)

Silver?

Silver Surfer - You're doing it Wrong!

Leftback said...

"Anyone catch the size of that TLT trade at 3:17?"

SCHADENFRUEDE'S FIXED INCOME DESK WEARS BIG SHOES.

Karen said...

not much but auctions on the econ calendar next week..
i've decided that today is just a freak out after 3 days of indecisiveness..
oh dear, did i just invite a cv link?

Karen said...

i wonder how many abandoned babies today will net me..

yes, go ahead and accuse me of withfull thinking.. it's nothing new that i crave them.. laughing.

Anonymous said...

http://www.youtube.com/watch?v=wqQGOP6650I

They taste like burning.

bob

DL said...

So what do you bears make of the R2000 chart? Decisively above the January high.

DL said...

Karen,

Know any good "dead baby" jokes?

Leftback said...

Auctions ahead, short end weaker into Tu, long end weaker into W/Th.

That's not hard to figure out, is it !! Karen, do you have a size limit on abandoned items that you collect? LB could be considered a stray...

Leftback said...

"So what do you bears make of the R2000 chart?"

Effing Small Caps.

Lord John said...

I will not be a weak hand. I will not be a weak hand.

I-Man said...

I'm telling you guys, this thing is DONE.

DL said...

I don't know if this thing is "done", but if the market is up again on Monday, I would be inclined to short some SPY calls (March or April).

CV said...

@DL (3:28)

GIB

My 2nd choice? That scene from AIRPLANE...

"I could make a hat, or a brooch, or a teradactyl"...

Anonymous said...

Green Shoots 2! After all it's March again. Euphoria?

I am sad and angry that I missed that Canadian bank run during that last sell off. Oh well.

72bat said...

do i detect a note of resignation amongst some?
not feeling too good myself.

Karen said...

$wlsh putting in a very bullish weekly candlestick.. unless the second week of march 2010, echos the second week of may 2009.. i confess to being stupefied, here and now.

I-Man said...

@ DL

Someone's fading a grip of calls today... no doubt.

Anonymous said...

schadenfreude- laughing at others misfourtune. What is laughing at my own?

Holding strong, it just burns.

bob

Leftback said...

Plan your trade, trade your plan... live to fight another day.
A bad day is no excuse not to analyze next week's trading set up.

CV said...

There's no crying in baseball!

anonymous proctologist said...

and the next week's trading set up is ...???

Leftback said...

We aren't usually MOMOs at SAM, but we are buying TBT even after today. Just seems like the tendency to sell long bonds on Mondays is very strong.
So we want to get flatter Ts into the weekend. There could easily be more to this upside move in yield, and can will add tight stops on Monday.

Leftback said...

You guys like that anonymous proctologist line...

Ben Dover said...

LB,

absolutely

Anonymous said...

Looking at the weekly candle on the EUR, wider shadows than the previous. Red at this moment.

Big fan of 'anonymous proctologist'

bob

Leftback said...

Did anyone see that Hours Worked was 33.1 ???

The New Normal.

DL said...

I'm sensing a slight diminution in the quality of market analysis here.

CV said...

@DL

It's hard to talk out of your @ss when it has an insertion in it...

Anonymous said...

CAD green against the USD and JPY at this moment. Carry on full speed.

Leftback said...

Leveraged carry traders are always full of fun, wit and bonhomie.

Until the unwind. Then they all have to visit the proctologist.

CV said...

@anon

Carry On

CV said...

My Wayward Son

DL said...

Anon @ 4:02

I don't know, going long CAD/USD with a bit of leverage might not be such a bad idea in here.

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