Sunday Evening Post

Good Evening Capitalists,

If you've come here this evening seeking the "Truth" about the world and financial markets, then this is not the blog thread for you. You should rather turn your attention the World's ultimate "Seeker of the Truth" here.*

I've been out the last two weekends on various family vacations and so it took me a lot of time to get reacquainted with some of these charts and patterns. The bulk of the analysis was spent on the Dollar because I think, in many ways, it's the most important market and it's the market where more of my risk capital is "tied up."

When last we looked at the DXY it was at 81.59, and I had admitted to doubling my stake in the DXY, from 20-40% of a max. position. The index ultimately went lower (80.08), but it has been a decent "double down." The focus of this report is on the wave count and where short/medium term support might lie. The Bottom Line is this:

The DXY chart looks constructive. It appears headed in higher in the short, medium and longer term. There is near term support in the 82.50-82.54 area. It might make sense to buy any weakness to start the week and use 82.50 as a "stop." It seems like a decent risk/reward setup as one will know they're wrong fairly quickly.

Note: S&P 500 thoughts are coming shortly, but the report is not yet finished.




I know it's going to seem like a "cop out," but my wave count remains unchanged from the last several weeks. I don't think we have "the big one" down coming just yet, but the recent action is a bit ominous. My preferred case calls for several more weeks of congestive action before the "plunge-a-rooski." That stated, the "Big Picture" is that we put in a top at 1220 and the risk/reward remains to the downside. Unlike on April 25th however, when we were geared "max short" with S&P puts, the same downside "reward" doesn't seem to exist. At least not yet anyway. Therefore, we remain just 20% of a maximum short.

"Short term" resistance on the S&P futures resides at 1085. The most bearish count suggests an "imminent" collapse, so a decent risk/reward trade might be to short the S&P futures with a stop just above 1085. As with the DXY suggestion above, one will know very soon if it was a bad trade or a good one.

SP500 Update 22 Aug 10

* I think BR is a great Blogger. He gets his mitts on some grip analysis and interesting articles. However, that missive had a "jump the shark" feel to it: "The broader mission of what I try to do is seek the Truth." Ugh.


343 comments:

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Nic said...

Really solid analysis, thanks. I agree about the USD - a squizz at the monthly chart shows this is a very big pivot level.
Look forward to the S&P.

Nic said...

Some amusement for Leftback from MS:

US Fixed Income Markets Weekly.
The weakness in economic data has caused us to revise down our outlook for growth: we now expect 1.5% and 2.0% growth in 3Q and 4Q 2010, respectively. We also expect the unemployment rate to drift higher toward 10%, implying greater risk of deflation. Worsening macro fundamentals, the Fed’s Treasury purchases, foreign demand related to a weaker dollar, and the quest for carry are all supportive of ongoing strong demand, but this is balanced by near-term duration supply risks, as low yields spark at least a refi wavelet if not a refi wave; look for intermediate yield levels to remain rangebound near current levels over the near term. We remain broadly positive on spread product, due to a combination of stabilizing financial conditions and the strong supply-demand imbalance. In CMBS and ABS, we stay overweight but favor wider-spread sectors and moving down in credit. Stay overweight MBS given strong demand and fundamental value

Andy T said...

Thanks Nic. I feel like sort of "wuss" for not being even longer the DXY. Just something about it I don't quite "trust" yet...

Nic said...

Yeah I am the same. I have this feeling we got here a few weeks early and we might get chopped around a bit ....

Nic said...

In case you missed LB's previous MS posts, JP Morgan has cut its forecast for US real GDP growth by -50% to a sub-par pace of 1.5%-2.0% in 2H10 (previous forecast: 2.5%-3%)

Edith Ann said...

"and that's the truth"...

http://www.youtube.com/watch?v=jJMKupYF14I&feature=search

Barry Ritholtz Says:
August 20th, 2010 at 11:10 am
louis

I don’t ask for much — I’m a simple man with simple needs
Just a 600 HP V12, and the ability to fly anywhere i want on a private jet.

Col. Nathan R Jessup said...

"You can't handle the truth"

http://www.youtube.com/watch?v=5j2F4VcBmeo&feature=search

"Son we live in a world that has walls and those walls have to be guarded by men that have guns... Whose gonna do it? You? You Lieutenant Weinberg...?

Col. Nathan R Jessup said...

...as for "simple needs"

"I have neither the time nor the inclination to explain myself to a man who rises and sleeps under the blanket of the very freedom that I provide and then questions the manner in which I provide it.

I would rather you just said "thank you" and went on your way. Otherwise I suggest you pick up a weapon and stand at post. Either way, I don't give a damn what you think you are entitled to."

DL said...

Bull run in Spain:


http://tinyurl.com/268d6nc


(The first 15 second segment of the video is worth a look)

Anonymous said...

AR, did you pay the $50 to have blago sign your book?

http://abclocal.go.com/wls/story?section=news/local&id=7622225

mcHAPPY said...

Thanks, Andy.

Anonymous said...

Investors withdrew a staggering $33.12 billion from domestic stock market mutual funds in the first seven months of this year. Now many are choosing investments they deem safer, like bonds. - The New York Times

more-

The notion that stocks tend to be safe and profitable investments over time seems to have been dented in much the same way that a decline in home values and in job stability the last few years has altered Americans’ sense of financial security.

Gee you think? and looking at just demographics alone- the baby boomers want to protect what they can- now that the stock market has proven to be the risky investment it always was

Andy T said...

Indeed. Baby Boomers are running out of time now. It's no coincidence at all that we saw a massive run up in stocks (80's and 90s) when they were in their peak earning years. In retrospect, it's not surprising they plowed their bucks into "property" after the tech bubble blew up, thus creating the blow-off top in housing.

And, now what?

They're staring at retirement in 10-15 years from now. Their speculating years are probably behind them....

And, more to the point....who is going to "buy the assets" in their place. Who are they going to sell the Peter Lynch-inspired mutual funds to? Who's going to buy their primary residence when they decide to retire and move to their second homes in Costa Rica?

It's an interesting dynamic.

DL said...

Andy T @ 8:57

Add the fact that most people are going to get stiffed on their entitlements. Just not enough money in the kitty to pay everyone.

Andy T said...

For what it's worth, I felt the desire to write some words on how and I why I use Wave Theory.

http://traders-anonymous.blogspot.com/2010/08/why-technical-analysis.html

prosciutto gristle said...

Thanks AT!

What about Hussman? Have you read today's piece?

http://hussmanfunds.com/wmc/wmc100823.htm

For months, Hussman has been calling for a 30%+ correction in precious metals. Now he's calling for an abrupt dollar crash in the next few weeks! I guess I accept the explanation for his change of heart, which is that Bernanke is a mind-boggling idiot. But jeezo!

Andy T said...

Hey Gristle (best handle on the Internet)!

Um, yeah I saw that article on clusterstock after I published. I'm not sure what to think after reading stuff like that. A part of me thinks it confirms that fact it's going higher. Hussman's a pretty smart guy, but lots of smart guys have been wrong on Treasuries the last few months.....so, who knows.

Mr. Market makes everyone look bad...

Nic said...

SPX - great thanks.

My big fear with the dollar is because the swing high this spring did not take out the 09 high is this is a big contracting triangle. The 80.20 area has been yearly lows 3 times previously for the dollar so I am hopeful and we have the same invalidation points. GL us!

Nic said...

This article from the Telegraph about US and Eurozone recovery cycles makes me feel a bit better being a dollar bull.

Euro crisis has not gone away, it is merely masked by other troubles

Bruce in Tennessee said...

The small fry leaving the stock market has also taught me something. This ZIRP is quietly deadly. Retirees and now the small fry have decided to hold on to what they have, since they can't get returns from housing or the equity markets. Hence, the ZIRP turns malignant and the result is the exact opposite that the master of the Great Depression expected.

...So much for unproven theorists. Maybe the same for community organizers..

Bruce in Tennessee said...

http://noir.bloomberg.com/apps/news?pid=20601087&sid=aikyPjJeRu60

Bernanke Must Raise Benchmark 2 Points in Latest Rajan Warning

“Low rates are not a free lunch, but people are acting as though they are,” said White, 67, who retired in 2008 from the Basel, Switzerland-based BIS and now chairs the Economic Development and Review Committee at the Paris-based Organization for Economic Cooperation and Development. “There will be pressure on central banks to follow an expansionary monetary policy, and I worry that one can see the benefits, but what people inadequately appreciate are the downsides.”

He and Rajan will have the chance to make their case at the Fed’s annual symposium in Jackson Hole, Wyoming, this week. In 2003, White told attendees central banks might need to raise rates to combat asset-price bubbles. In 2005, Rajan, 47, said risks in the banking system had increased. They were met with skepticism from then-Fed Chairman Alan Greenspan, 84, and Governor Donald Kohn, 67."

CV said...

@BinT

It's so much beyond what these idiots think they can control and maneuver with their little Jackson Hole symposiums...

Interest Rate policy may have meant something back in the day when economies were more or less functioning due to activity in the private sector (and the government could act as basically "toll booth operators" on the highway)...

But when the economy HAS BECOME the government, then interest rate policy, by default, has only one purpose... Keep THAT patient alive...

So it's kind of a waste of time even talking about theories when there is only one solitary objective...

In the past, that might have provided options, but not anymore... Why? Obvious, because the the debt burden has become too high due to all the entitlements, programs, and bailouts...

On this road there is only one policy... Keep rates low enough for the government to keep making its monthly nut (and rolling over what it has to) for as long as possible...

Then, when that's no longer possible, we go to war to solve it...

In that respect, because of the spending, Obama has brought us CLOSER to war than distanced us from "skirmishes"...

Bruce in Tennessee said...

I agree with most of that CV. However I hope Obama will continue on his whirlwind vacation tour and forget war until 2012. Maybe there is some decency in the man...

CV said...

Lookin' out for the little people as always...

CV said...

@Bruce

What was that hand signal in that avatar...

Is that a "crip til I die"? lol

Bruce in Tennessee said...

That hand signal is special super secret code. It means "I am available for political campaigning. PLEASE call me."

wunsacon said...

>> Obvious, because the the debt burden has become too high due to all the entitlements, programs, and bailouts...

...and also because of:
(c) dropped taxes on the rich, starting in 1981;
(d) dropped trade barriers to zero so that there is less tax revenue coming from private workers, whose jobs have/are all been/being offshored; and
(e) continue to pay high sums to public workers who -- after (a) and (b) above removed the revenue -- we can no longer afford to pay so much money to
(f) continue hiring in the government sector -- exacerbating the problems -- to do work (e.g., teaching) that the private sector would do better (e.g., by not building $600 million school campuses)
(g) went to war and occupy two countries
(h) feed a huge military budget, even when we're not at war

wunsacon said...

(i) "war on drugs"...

Mannwich said...

Morning all. Back to reality today. How goes the battle, folks?

karen said...

In case you were wondering:

http://www.businessinsider.com/preview-for-upcoming-week-august-22-2010-8

morning! awkward posting at the end of this thread.. rather hoping we can't exceed 1080 but 1086-88 even more..

CV said...

@wunsacon

correct... (mostly)

But the question is...

During (a)-(h) of above, most of time there we had not reached a "point of recognition"...

Some astute people saw (and warned about) what would happen 20 years down the road, but I'm talking about MASS RECOGNITION...

Not one or two beady eyed "Mr. Magoos" at a dusty desk somewhere, but when J6P America KNOWS there's a debt problem (which was hard to understand before when the gravy was just pouring out of the boat with no end in sight)...

So ask yourself...

Why? At this POINT OF RECOGNITION (when even "bowler Joe" knows he spent beyond his means and his Harley is on the front lawn along with half of his other belongings at the yard sale - and is not taking on ANY MORE, whatsoever)...

Why is the "community organizer in chief" running around QUADRUPLING the ante (in spending) into a declining tax revenue base?

I mean, how the f*** stupid & out of touch is he?

CV said...

@Manny

You back?

I thought you were coming back next week...

Mannwich said...

@cv: Politically I believe he believes he has no choice. It's never about doing the "right thing" (for the country) with these folks. It's always, always about self-preservation above all. It's no different anywhere else either. Not that it's right but that's just the way it is and always will be.

CV said...

@wunsacon

"(i) "war on drugs"...

Ha!

This, now, I suppose, has become the WAR FOR DRUGS...

Troop buildup in Afghanistan so we can control the poppy production...

Part of the "HOPIUM & CHANGE" agenda

AmenRa said...

AUDJPY up, JNK up, yields up (5, 10, 30). SPX back above weekly 3LB mid 1072.11 and 1078.87 (the 1.618 from low). Damn Mondays.

Mannwich said...

@cv: Yep, back yesterday afternoon. We were supposed to be back later yesterday but took a cab from Kennedy to Newark out of desperation to get an earlier flight. We paid about $250 total to change our flight and for the cab but it was well worth it to get home earlier. Otherwise, we would have spent the day in depressing Kennedy running on fumes after the brutal flight from Johannesburg (about 20 hours total, including the stopover in Dakkar for fuel).

karen said...

Don Coxe webcast.. haven't heard one in years.

http://www.bellwebcasting.ca/audience/lobby/index.asp?eventid=70081727&lang=english&stage=&rndkey=&referral=9576836&sLoginVisible=

CV said...

"It's always, always about self-preservation above all. It's no different anywhere else either."

Great! Let's make him a saint...

Oh EVERYBODY ELSE is doing it, so just bend over and take it...

Not my style, sorry... Certain people enjoy being bent over and "administered to"... Not me...

Mannwich said...

Awesome trip though. Will share more later. Have some great photos, including ones of giraffes, zebra, warthog and other assorted animals. Walked right into three giraffes eating from some trees early last week on a morning walk. Beautiful area. They just stared at us and walked away slowly before trotting off into the hill. What a sight.

Mannwich said...

Not my style either, cv, and not excusing it at all. I guess it's just my way of accepting reality and lowering my expectations of these folks, while altering my life to live AROUND these people and the things they do.

Mannwich said...

If you think Obama is bad, check out countries like South Africa, where their own "people" in power have been screwing them ever since Mandela gave up power. Mbeki was an unmitigated disaster for that country, so much so that some blacks are pining for the days of apartheid again. Not kidding.

CV said...

@karen

Good morning...

Sorry if I sounded crabby in my other comments...

I'm not really crabby at all this fine Monday AM... It's just that I couldn't OUTLET anything in a thread post (because I wanted to let ANDY T's thread - post vacation - stand alone - since we haven't heard from him in 2 weeks)...

So... Good morning!

CV said...

@Manny

In any case... I want to hear about it (trip)...

Right now I'm a little distracted on the markets...

CV said...

I'm moved my stops on TBT all the way up to 32.00...

I got in at 31.39, and if it even corrects A LITTLE here, I'm going to take a small win & run...

I think todays move is all just the normal Monday jerk off...

McFearless said...

Manny,

the "manny indicator" was sort of switched on again while you left, dollar started what looks like could be a strong rise and the market started showing some trouble spots again.

so how about you leave again already, lol!

j/k btw.

Anonymous said...

LB is busy today but will return at the close. LB tends to agree with C regarding TBT, Monday momo etc...

LB notes that there isn't anything bullish on the horizon for the dollar this week, so what's to stop BUCKY taking a turn as the funding currency for a while? We have seen a correlation breakdown between EURJPY and SPX - and that is often characteristic of regime change in FX.

Can someone post the POMO schedule again? That would be useful for all, I think.

Mannwich said...

@ben: I'm leaving for Omaha and then CO on 9/7 (through 9/17). Mark your calendars! September also often historically a great time for a little dip, no?

McFearless said...

"M&A Activity Lifts Stocks in Early Trade"- AP

lmao

merger and acquisitions for the sake of merger and acquisition must be good for stocks!

that INTC Mcafee deal looked like a real good idea.....massive snark.

CV said...

@Manny (9:53)

When I have time, I'll get that to discussing that with you...

I've been to South Africa 3 times (all the times were BEFORE Mandela was President - late 80's)...

I'm going to tell you that Mandela and the ANC were no trophy...

Mandela was fine as a "figurehead"...

Economically though, his leadership sucked and really threw South Africa backwards for awhile...

Anonymous said...

LB also thinks that one might short GBPCHF. That looks tasty to him, as EURCHF is weak and GBP should weaken against all but USD.

LB wishes everyone a very rainy Manhattan Monday...

Mannwich said...

Agreed, cv. We'll table that discussion for now though. Very complicated over there.

McFearless said...

lol, nice Manny, and yes, seasonally you'd expect that to be weak anyway.

I think of Counting Crows when I think of Omaha:

http://www.youtube.com/watch?v=mToHbLlLd-A

or steaks.

karen said...

CV, for you: mrtopstep

RT @Eubiquitous CLOSING SPY LONG @$108.40 / SHORT TLT @$105.40.. now a 37 HANDLE TRADE

CV said...

@Anon/LB

The "Mannwich Indicator" trumps the "POMO Indicator"... :-)

McFearless said...

that's a pretty crap recording I gave there, first one I found.

CV said...

@karen

CV also took off a little of his "long SPY" hedge at 1181...

I had about 5 tranches each SHORT & LONG of SPY going into the weekend...

Now I'm 5 short 4 long...

karen said...

this is fascinating:

http://www.ritholtz.com/blog/2010/08/who-was-right-huxley-or-orwell/

Mannwich said...

@karen: Great one. I think they were BOTH right in many respects.

CV said...

@karen

I wanted to use 1085 as a target...

But I was reading around on the weekend and saw 1085 mentioned many many times...

So that made me worried (and I settled on 1081 when I saw it)...

Who knows? This might be the week that we see 1081, then 1050, then back to 1085...

A barrel of fun for all the home gamers... :-)

CV said...

@karen

"Who was right, Huxley or Orwell?"

Answer: YES

But if you seek "the truth", at least you'll always know where to go...

CV said...

It's located right next to the car dealership that sells the 600hp V-12's...

karen said...

If you stick with the don coxe conference.. he gets into the looming pension problem.. "when you have a zero return on cash.. you are forced to make some sort of decision." The Q&A is good so far.. first person addressed Mountains of Cash corps are sitting on.. Coxe set that fallacy straight..

karen said...

Okay.. there was only one question for Coxe.. and he elaborated as he always does.. he finally said that if a corp was sitting on cash.. and had no reasonable place to invest it.. sitting on it at .2% wasn't ideal and they should pay it out to the stockholders (dividends.) Amen. :

karen said...

Oh, brother.. just got the latest Downunder Daily.. it's all about GOLD!

"We think the guaranteed way to create inflation is the helicopter drop strategy. Relying on credit growth – which requires the participation of what now appears to be a debt-shy private sector – may not work, at least not for some time. Which means that the near-term the risks are tilted more to a growth/deflation scare than an immediate inflation scare.

It’s the policy response to such a scare that has us thinking about the out-year inflation risks. This entire cycle has so been an example of breaking conventions, of desperate timesleading to desperate measures. If the deflation risk increases, we think more unconventional pro-inflation policy will come.

Put bluntly, we think that in such circumstance a policy mistake would be likely. It’s certainly possible to create inflation. We doubt policy makers’ ability to create just the right amount.
The problem for policy makers is that while they may be able to control money supply, it is more difficult to predict what happens to money velocity. Velocity can move aggressively. Historically, accelerating money velocity has often driven bursts of high inflation."

karen said...

"For now, all this is speculative. But we think three points are worth making:
First, this scenario highlights the risk – a risk we think, by historical standards, is relatively high – of the ultimate big-picture whipsaw for investors. The strategies that would succeed as downside/deflation fears increase are almost exactly the ones that would not succeed if the market suddenly focused on an inflation end-game. This would not be trading a range; this is a scenario requiring a major strategic about-face.
Second, even the prospect of a mild increase in inflation – let alone the risk of unexpectedly high inflation – underscores the medium-term risks for debt markets. Rates may be low for some time, but when you buy a long-end bond at under 3% you are taking a long-term bet.
Third, gold is the only asset that we think would cope well through the whipsaw. It has historically performed well in deflation and inflation environments. More to the point, even if the whiplash doesn’t unfold, we think the risk will stay alive for long enough to think that there’s further material upside to gold prices."

Bruce in Tennessee said...

http://www2.timesdispatch.com/news/2010/aug/23/obamgat23-ar-467455/

Obama keeps low profile on vacation

...Apparently people are getting a little hacked...imagine that.

Sulu said...

Whoever [CV] is, he sure talks gloomy...

Auric Goldfinger said...

I love Gold, Mr Bond......

wunsacon said...

>> Why is the "community organizer in chief" running around ...

CV, I can't defend the guy. I think he's getting bad advice from people who gave bad advice more than a few times. But, that's his fault. And it's my fault for voting for him (instead of, say, writing in Ron Paul -- which I hmm'd and haw'd over).

Mannwich said...

More proof that the we the people still haven't learned our lesson. Yet. Delusion is a powerful drug.

people still think house prices will go up 10% per year ... from David Streitfeld at the NY Times: Housing Fades as a Means to Build Wealth, Analysts Say

http://www.calculatedriskblog.com/2010/08/report-home-buyers-remain-optimistic.html

Leftback said...

"people still think house prices will go up 10% per year ... "

But their house will go up 20% y/y. LMFAO....

CV said...

"Mountains of Cash"

BWAAAAAAAAAAAAHHHH! :-)

Mannwich said...

But this shows you just how much denial there STILL is out there. Amazing. It will take another far bigger leg down to even come close to altering that view, IMO.

72bat said...

curious. blogspot won't permit me to highlight-and-copy text in comments, e.g., to copy a url. anyone else experiencing this?

CV said...

@karen

Is that DOWNUNDER DAILY, like...

The "Inflation for DUMMIES" version...

CV said...

@Sulu

Sorry pal... I'll start talking happy and everything will magically turn around in that moment, I'm sure...

CV said...

TBT stopped out at 32.00...

CV said...

@Sulu

Also...

If you don't enjoy reading "gloomy" comments from CV, then this isn't the blog for you...

There are other blogs around that specialize as grand debating societies and puppy management...

Perhaps that's more you're style, and I'll gladly escort you to the exit if you've lost your way here...

karen said...

CV.. will forward it to you.. it's the tag along to the Hair of the Dog one..

CV said...

"your" style...

I'm distracted here

CV said...

@72

Blogger has a mind of its own...

Leftback said...

To MOMO or not to MOMO. That is the question...

Leftback said...

The existing homes number is being sold ahead of the news....

CV said...

The most active PUTS on the board today are the SPY SEPT 102's

karen said...

Bill Gross Takes Backseat to Real Big Money: William Pesek

http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=a8B6ckZoyk4s

Leftback said...

Every high yielding dividend paying stock is up today.

Leftback said...

Rotation out of small caps and commodity/materials is overdue.

CV said...

Of course, all the C $4 and $5 strike calls are being bought as far as December...

So we all know the routine (which has been the same routine for every quarter of 2010)...

When the market starts to tank... The PPT buys chunks and chunks of the 18 gazillion C shares floating around...

Central Banking 101

karen said...

mrtopstep

[10:07:14 AM]: firming bonds adding pressure to spoos in light volume value volume level from Friday= 1067area

Prince Ally Wally said...

شكرا

CV said...

@karen

I really hope we hit 1050-ish...

Not a prediction... Just hope...

CV said...

Might happen by Wednesday... Never know :-)

McFearless said...

still liking the small cap short idea over that of the S&P in the near term.

CV said...

Deflationspotting: Norfolk Southern To Issue $100 Million In 100-Year Debt

http://www.zerohedge.com/article/deflationspotting-norfolk-southern-reopen-100-year-debt-offering

Wasn't CV just talking about this last week... (although I was talking more about 50y)...

It must have gotten lost between all those "gloomy" comments...

karen said...

simple fact: fxa:fxy (or $xad:$xjy) is in a downtrend on the 13/34 ema chart..

Anonymous said...

here's some great reading- well maybe not-

"The Demonization of Barack Obama – It’s Not Just Religion"

http://www.cnbc.com/id/38814966

But the biggest lies may involve the economy. The drumbeat of doom and gloom has been incessant from talk radio . . .If you keep repeating, every day, that the economy is in free-fall, people eventually will believe it. Never mind that GDP grew by 5% in the fourth quarter of last year; the doomsayers kept predicting an economic collapse – and sure enough, like a self-fulfilling prophecy, public confidence began to collapse by spring.

you see folks- we had 5% GDP 4th qtr 2009- and if weren't for those right wing radio retards talking the economy down we would be full on recovery- happy land- everyone back on the hamster wheel-

I guess the flip side is for this writer to explain why we should believe in an economic recovery- but I guess we can just blame the economy on talk radio

72bat said...

in tbp comments on "Seeking the Truth — Or Obscuring It?"
farmera1 is clearly of a cv mindset:
"The frightening thing is that to a large extent, I think the final outcome is now fixed. I’ve pretty much given up and am now spending my time on how to prepare for the inevitable; the die is cast. . I no longer think it is possible to influence the final outcome. The only remaining question is can my family survive. I am taking what steps I can to do the best with truly nasty possibilities."

karen said...

On #BloombergTV - Sam Chandan of Real Capital Analytics, Sees More Bank Failures on Commercial Loans: Video http://ow.ly/2tnzB

Natually this annoys the heck out of me as a holder of underwater DRV. one point under now..

CV said...

How much future GDP did we bring forward (and for how many years) to print that 5% number in one quarter?

I forget (which I do sometimes - amidst all my gloominess), so please tell me...

Anonymous said...

CV-

no doubt- read the article- the writer's intelligence is questionable-

we will see more and more finger pointing

McFearless said...

"If you keep repeating, every day, that the economy is in free-fall, people eventually will believe it."

this is dumb because it's simply not true, and the reason it's being repeated is because people's moods have already led them to believe the economy is in free-fall, not becasue they were told it was. This is exactly what was happening March 2009, the economy WAS in free-fall, and there was a "drumbeat" of constant negative news then, ....and THEN the market rallied 80% over 13 months and as the market rallied the economic data improved!

If it were simply as easy as reporting positive news every day the market, in theory, should never ever go down.

karen said...

FXI tapped it's uptrend line again today..13 looks like it could pass under 34 ema.. personally, i bet it goes up again.. but this is something that 'bears' watching!

CV said...

@72bat

Ironically... The more time passes, the LESS dire I imagine the situation to eventually be...

Less & less I see the prospects of mass riots & migrations, etc...

I basically just see "shortages"...

Some "shortages" in a sense of there actually being less of certain goods that people take for granted today...

Other "shortages", simply in a sense that there will eventually be price inflation on the most basic of items:

- like certain foodstuffs (fancier items)
- fuel & energy (and the like)...

Anonymous said...

If it were simply as easy as reporting positive news every day the market, in theory, should never ever go down.

B22- C'mon man- it's the radio announcers singlehandedly bringing down the economy!

CV-

Baltimore looked good on Saturday- Bulger looked good- not a bad back up there-

also- looking forward to the premier of the C'mon Man segment tomorrow

karen said...

its not it's : ) we should just have a rule to ignore typos..

McFearless said...

ahab,

well, if we go down hard again, just blame Tony Robbins.

CV said...

@ahab

"we will see more and more finger pointing"

We'll ALWAYS see finger pointing... The only difference happens to be the FINGER POINTING DU JOUR...

The FPDJ, at the moment, with regards to the economy, is MORE STIMULUS vs. END TO STIMULUS...

My personal view is that if you have a patient that has had a cardiac arrest, the best solution isn't to pump him up with epinephrine & put him on a treadmill and order him to start walking and the exercise will do him good...

Instead - maybe a little bed rest ought to be the idea for awhile...

Of course, if Congress changes hands in November, the DO NOTHING (bed rest) crowd will be "finger pointing" saying that we're not helping the patient...

That's the drumbeat...

karen said...

going down hard?? rolling my eyes in anticipation of our inimitable LB, who has been quite in and out today.

CV said...

@ahab

But that ALWAYS been the problem with America right?

Not ENOUGH drugs...

Anonymous said...

b22- FWIW-

I actually liked the Tony Robbins links put up by Nic- nothing groundbreaking- but he seemed to be telling his audience (???) that they should be prepared and why

CV- exactly- akin to the political cartoon put up by BR over the weekend-

the point being obviously- that if the Democrats had done stimulus right and there was no GOP stonewalling then things would be most excellent right now

CV said...

@ahab

It's basically C'MON MAN every day around here... :-)

CV said...

That's because we don't deal the TRUTH

CV said...

CV is "lying" to all you people...

Nothing to see here... Please return to your homes in an orderly fashion...

CV said...

I'm wondering...

Who would the average person tend to believe?...

a) the guy taking money to tell them the truth?
b) the guy "lying" to you FOR FREE

Hmmm...

CV said...

Speaking of that... Did anyone see the Mishkin interview? - lol

CV said...

In case you missed it...

http://www.zerohedge.com/article/watch-former-fed-governor-fred-napoleon-dynamite-mishkin-dire-need-diaper-change

karen said...

Didn't I say $copper was the new $gold?

$10,000 copper by 2012 - not far-fetched at all!
Credit Suisse analyst Michael Shillaker has gone on record as predicting $10,000 copper by 2010, but this could yet be a fairly modest prediction

http://www.mineweb.com/mineweb/view/mineweb/en/page36?oid=110093&sn=Detail&pid=92730

Ben, don't lose your marbles over this.. i'm posting it facetiously.. it's all predicated on CHINA ! what isn't ??

Anonymous said...

Re the Truth-

I saw that link over the weekend- I put up a youtube clip w/ John Lennon singing "gimme some truth"-

good ol' tune by the way-

anyway- the comments- outside of a few- were all folks tripping over themselves w/ accolades-

outside of Dead Hobo and a few others- all said they were truth seekers-

duh- aren't we all? Is someone going to say that they are a truth obscurer when in their own minds they are trying to understand and make things fit their world view?

CV said...

@karen (12:01)

What... is China getting the Olympics again - lol

karen said...

that video was too much! UFB!!!

CV said...

More "groupthink" (otherwise known as poodlenomics)...

"The quarterly Goldman Hedge Fund Trend Monitor, aka the HF groupthink update, is released, chock full of HF holding trivia, such as that should Apple ever miss its priced to absolute perfection business model, a whopping 181 hedge funds are going to suffer, and 75 HFs, who have Apple as a top 10 holding, are going to get crushed. Also, we uncover the latest top 10 hedge funds ranked by equity assets (DE Shaw, RenTec and Paulson are the new top 3, although with 2,048 and 2,669 holdings for the first two, they are now receiving 2 and 20 for their quant models which as the NYT highlighted recently no longer work). On the other end of the quant spectrum, are the traditional hedge funds, and as of Q2, the typical fund had an average of 63% of its long-equity assets invested in its 10 largest positions, compared to 30% for a typical large-cap mutual fund, 17% for a small-cap mutual fund, 19% for the S&P and just 2% for the Russell 2000. The top 5 most concentrated hedge fund holdings are AutoNation (46% of market cap held by HFs), Sears (45%), AutoZone (32%), Pactiv (28%) and Novell (27%). Also hilarious perpetual LBO candidate Radioshack has hedge funds make up 24% of its market cap. In other words, any bad news here will kill the stock price faster than a HFT can frontrun the exponential pulling of bids. On the other side, or the names most hated by hedge funds, is Brown Forman, where only 0.2% of HFs make up its market cap, followed by Roper Industries, Stericycle, Hormel, and Praxair. From a surprise upside potential perspective, Goldman estimates that the most HF-shorted names is Crown Media, which has a 99 day short interest ratiom followed by Lifeway Foods, Isramco, K-Fed Bancorp, First South Bancorp, and Costar Group. Shorts Squeezes in these names could be violent. Looking at ETFs, the biggest gross long ETF held by HFs is GLD with $8 billion in long ownership, while the most shorted is SPY with $27.6 billion in shorts, indicating that funds are now "hedging" using this proxy for the entire market. Lastly, in confirmation that hedge funds are for the most part worthless "groupthink" contraptions which merely ride a leveraged beta wave, and suck out management fees, Goldman highlights that the "Most Concentrated" basket of stocks has underperformed the "Least Concentrated" stocks materially since February 2007, confirming that HFs have actually destroyed value in both the past 3 years and YTD, by underperforming the market."

McFearless said...

ahab,

I agree re: robbins

I've never had a problem with someone suggesting that others step aside from risk for a time, you can't get hurt by that advice, he didn't act like he was some market god in those videos either.

Leftback said...

This is why the 3-5y is strong today, front running the POMO..

August 24, 2010
Outright Treasury Coupon Purchase
2/15/2013 – 7/31/2014

Leftback said...

Thursday they will target the 10y and 30y, so look for front running of that on Wednesday.

August 26, 2010
Outright Treasury Coupon Purchase
2/15/2021 – 8/15/2040

karen said...

ahab, just for the record.. it was Ben that mentioned the Tony Robbins video and then I found and posted the link.. sorry.. but i am literal to a fault..

CV said...

Re: Robbins...

When I saw the link, I was like, "please don't make me go there"...

But then what he was saying were some basic words of caution...

So in the end, there was nothing for me to criticize...

Leftback said...

Welcome to the "free market" by the way...

CV said...

@LB (12:07/8)

It's also an opex week for PM's

karen said...

alaidi, Aussie looking more negative & elections more of a sideshow to me; especially as equity technicals breakdown (on a Monday?)

Anonymous said...

karen-

sorry- must have missed your post- Nic posted a couple Tony Robbins links on Saturday (or Friday night- can't remember)

CV said...

@karen (12:01)

I'm laughing too... But listen... CV would LOVE copper at $10,000...

Nickels bitchez! :-0 (75% copper since 1946)...

Anyway, it's a joke... Want to create mass havoc? Get copper prices that high...

People would be running around town setting fire to houses and pulling out the copper pipes...

It would be mass bedlam! - lol

Anonymous said...

LB-

thought that was an interesting link you posted- "Brits in New York" or something along those lines-

I have been all over but never London (outside of Heathrow)-

but London is a bit of a mecca in its own right- no?

CV said...

Maybe it would solve the housing problem though...

Burn all the units to the ground and you'd have no choice but to rebuild again...

Your pipes would be worth more than your house...

The new units they build with PVC anyway...

Say goodbye to electric cars with copper prices that high tho...

karen said...

ahab.. sorry! i wasn't on-line this weekend.. we discussed the tony robbin's video earlier in the week.. but perhaps it was a different one!

CV said...

Why is it that people don't stop and think about things before they just blurt out these inane comments?

Don't answer that!

karen said...

odd tweet: zerohedge

Did that joker just say Bridgewater is distressed?
half a minute ago via TweetDeck

karen said...

my dto is up about 11%.. i don't want to be greedy, really.. just right, LOL

CV said...

@karen

Just to piss you off...

Commercial Real Estate Gains for First Time in 2 Years: Study

http://www.cnbc.com/id/38815566

Anonymous said...

gotta roll-

all have a good day

Anonymous said...

Nice trade... and nice legs...

CV said...

Just to piss EVERYONE off...

AIG Confirms It Paid Back $4 Billion of US Loans

http://www.cnbc.com/id/38812547

Leftback said...

Not you, ahab... yes, London is a melting pot these days...

Leftback said...

"Trade With Some Serious Tools" - Schwab ad...

Leftback said...

I mean, we do that every day....

karen said...

get this! http://globaleconomicanalysis.blogspot.com/2010/08/benevolence-by-jpmorgan-jpmorgan-offers.html

Charles Schwab said...

If you switch to Scottrade, you'll miss out on all THE FUN.

Charles Schwab said...

Karen,

Did you get filled today?

... your order, I mean.

karen said...

remember when the mere mention of a tropical storm would cause crude to rise? i'm so confused !!

http://www.accuweather.com/blogs/news/story/35958/tropics-flaring-up-with-daniel.asp

CV said...

I read this comment over at dan's a few moments ago, and FWIW... It's basically where I see things at the moment as well...

---

"My preferred wave count right now is:
subminuette (black) ii topped at today's high of 1081.58. We're now (1071) working on micro (red) [4], the subminuette (black) iii hopefully reaching 1060 and thereafter black iv and v bottoming in a pink minuette (iii) around 1055, unless we get a waterfall much lower.

Please advise where I'm possibly wrong. Thanks !"

CV said...

@karen

I was watching Bloomberg overnight, and some of the headlines were regarding the Chinese demand for barrels of oil had decreased considerably in the past 3 months...

That with the fact that we got thru the weekend without and attacks on Iranian reactors, and I think you have OVERRIDING things versus tropical storms at the moment...

karen said...

let's debate! from a pen pal on the importance/irrelevance of the velocity of money..

"The value of money is determined by supply and demand. As money is only demanded because of its purchasing power, it follows that if its purchasing power is expected to disappear then prices will rocket as the demand for money collapses. Goods will be withdrawn from sale, the remaining goods will demand prices that even the astronomical increase in the money supply cannot accommodate. This is a process that no formula can capture."

http://www.brookesnews.com/071202velocity.html

McFearless said...

"The value of money is determined by supply and demand."

false
perhaps soon I need to make a post for the site on this topic.

CV said...

@karen

Are you trying to give ben an aneurism by prompting that debate? :-)

CV said...

@McF

Tell me... paper napkin... Can you "see" that pattern (1:02)...

I can see it...

I'm still waiting for a 1050ish low challenge sometime this week...

SPY 106, last week, wasn't good enuf for me :-)

Bruce in Tennessee said...

There you guys go again..I get busy all morning, and when I return you've P***ed away a perfectly good green start on the DOW.

...Don't make me have to send you to your rooms.

CV said...

@Bruce

CV is making money... (I sold TBT for a dinky profit, and unhinged one tranche of the "longs" I had on my 50/50 SPY)...

I now have enough to buy a 6 pack of "karen type" beer for the NFL Preseason (AZ-Tenn) game tonight...

CV is "livin large"!

CV said...

Plus... I'll be looking forward to my weekly installment of...

C'MON MAN!

Bruce in Tennessee said...

I am not hopeful for the Titans this year...besides I am a Colt fan...I think Peyton has been very good for pro football.

Eli should also learn to play with his hat on...

karen said...

what i care about is money and credit.. that is where price distortion comes into play.. Inflated home prices used as ATM machines severely distorted the money supply in grand ponzi style.. just as inflated stock prices during the dot.com did..

CV said...

I'm feeling pretty good also because my Fantasy Baseball Team has clinched a spot in the playoffs...

I'm only in 3rd place right now, but NEITHER of the first 2 teams has beaten CV's team in the regular season...

They were 0-3-1 vs CV going into last week (where I played the first place team)... I was getting soundly thumped until my team pulled out a miracle Sunday and ended up TIED... So now I'm 3-0-2 vs. them going into the playoffs...

All I can say to the team from yesterday is...

http://www.youtube.com/watch?v=RD1KqbDdmuE&feature=search

CV said...

@Bruce

Peyton has been outstanding for football...

karen said...

CV, I wish you hadn't mentioned my Stellas chilling in the refrigerator.. I am ever so thirsty now : )

karen said...

i was looking the POT chart earlier after listening to Donald Coxe.. Corey did I write up on how the bears got trapped:

http://blog.afraidtotrade.com/twists-turns-and-traps-chart-updates-for-potash-pot/

Leftback said...

Today really is a massive waste of time.
Momo Tuesday? Or the "plungearooski"?

Everyone is expecting a Godawful home sales number.

Thanks, Karen, I'd love a Stella by the beach ......

CV said...

@karen

"what i care about is money and credit.. that is where price distortion comes into play.. Inflated home prices used as ATM machines severely distorted the money supply"

Here's the thing...

I think it is erroneous, by economists, to try and FOLLOW the so called "money supply" from here forward...

If you want to say that

1. The phenomenon of "boomers" made money FLOW INTO the stock market from the early 80's to 2000...

2. Then, that FLOWED INTO housing in the early naughts...

Now they're all trying to figure out where "it" will FLOW next... (as if it's something that actually exists)...

First of all, most of it is either credit anyway, and/or chased overpriced assets... So it has vanished...

What unencumbered cash there happens to be (held by very few who "cashed out")... Has, and will continue to go UNDERGROUND, or risk being sponged away by government... Or, the money itself will eventually become worthless and have no purchasing value...

So there is no money supply...

It's like me coming to you right now and borrowing a billion dollars, and you coming to me and borrowing a billion dollars...

Hey - we just created $2 billion dollars right...

Let the commerce begin!

McFearless said...

@all, fwiw, I posted some of my own thoughts on andy's "why TA" thread. feedback welcome as always. fair warnings, it's three long posts total.

CV, sorry, I haven't seen all these posts yet, been a little hectic here at the office so far today, will look in a little bit.

CV said...

@karen

I'm going to buy "Stellas" tonight when I watch the game (in your honor)...

karen said...

topstep.. sorry i was reading!

http://www.youtube.com/watch?v=Xe0bQ2g1frs

CV said...

@Bruce

Eli... Ouch!

I've had that happen before... But it wasn't on my high forehead, it was right on my right cheekbone...

Couple of stiches fixed me right up tho!

karen said...

LB.. crude under $73 is not a massive waste of time : )

karen said...

NEW YORK (Dow Jones)--Crude oil futures fell Monday as concerns about weakening demand and rising inventories pushed prices below $73 a barrel.

Light, sweet crude for October delivery recently traded 91 cents, or 1.2%, lower at $72.91 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange traded 89 cents, or 1.2%, lower at $73.37 a barrel.

Gains are likely to become increasingly difficult as U.S. demand begins its annual late-summer decline, this time from a peak that disappointed many traders who had expected a surge in gasoline consumption. Despite reaching the peak of the U.S. summer driving season, typically the period of highest demand for gasoline, stockpiles are above five-year highs.

Leftback said...

K.,

Indeed. Crude $69 could be quite stimulating...

Greek 2y at 11%, YC is inverting again.... more bailouts ahead.
They should just boot them and bring back the Drachma.

CV said...

@karen

"Crude oil futures fell Monday as concerns about weakening demand and rising inventories pushed prices below $73 a barrel."

My (1:05)... again...

Why is everything so US centric?

There was a big story, overnight that China, (the 2nd largest user of crude), and largest "marginal" consumer has reduced consumption of barrels by 50% since April...

Gee whiz!

CV said...

Instead of building vacant cities, maybe the Chinese should just start buying oil and rocketing it into space to create the illusion of growth...

DL said...

LB @ 1:53


"They should just boot them and bring back the Drachma".

YES!!! That's what I've been saying all along.

Glad you finally came around.

Mannwich said...

I'm in that camp as well, DL.

karen said...

$27 Million in Funding for Electronic Health Records
1:53 PM ET 8/23/10 | PR Newswire
Contractors will find comprehensive information and current opportunities related to state and local governments' electronic health records (EHR) incentives program through INPUT's Electronic Health Record Incentive Funding and Certification Program. The report covers funding sources, information technology implications, and certification requirements that support the national health care agenda. It also provides deeper insight into the $27 million in economic stimulus funding available to eligible physicians who demonstrate meaningful use of certified EHR systems.

Mannwich said...

I thought this was interesting:

Monday at the Treasury: an overlong exegesis

http://www.interfluidity.com/v2/933.html

CV said...

I'll take the other side...

I'd rather they keep them in the Euro and watch the Euro collapse...

Then my dollars buy more...(for awhile)

karen said...

CV.. I agree 100%.. I posted that 1:52 tongue in cheek : )

Leftback said...

Greece is a useless member of the EC. They are all tax cheats, especially the shipping magnates. The people are also completely screwed by being in the Euro. I demand the Drachma. I demand cheap olive oil, feta, kalamata olives, and I will take one of those funny smelling anise drinks.

Without Betty, the UK would also be in a massive recession.... look at what is happening in Ireland.

CV said...

@karen (2:01)

Translation...

BLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHExpect another $27 million bill to be paid by youBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAHBLAH....

karen said...

Jeff, you are a real jetsetter! I had no idea you were off in Africa! seems as though you are always traipsing across the US as well.. will check interfluidity.. haven't been there in a while.. thanks.

CV said...

@LB (2:03)

You're thinking too small...

Greek drachma = cheap greek exports

Greece in Euro = cheap european exports

Why settle for olive oil when you can have a Porsche or Audi?

Mannwich said...

@karen: Yes, we love to travel but as a fairly tall person (6'2") I LOATHE flying. A tough one for me to reconcile but the traveling usually wins out anyway. This flight was particularly brutal, the worst one I've endured, especially the way home (literally 24 out of 29 hours were spent on a plane Saturday and Sunday). I'm still feeling it today. Thank God for Ambien.

CV said...

@karen

Hear that? AMBIEN...

If Jeff starts "sexting" you, you'll kno why...

karen said...

a little humour: http://www.elitetrader.com/vb/showthread.php?threadid=128320

CV said...

Tomorrows Headlines Today...

MINNEAPOLIS STAR TRIBUNE

"Woman in MSP suburb chases 6'2" man out of the house with a 9-iron..."

Leftback said...

C.

Already got a BMW. But thanks....
LB could get into a Porsche.

karen said...

Jeff, that article was too long on ideas and too short on practicality! Besides, I loathe social engineering. Period.

Leftback said...

C.

She told him this was the thin end of the wedge....

Leftback said...

She also said he was going to DRIVE 'er crazy....

Leftback said...

He only stopped by her house FOUR WOOD....

karen said...

LB.. ??? a Bitch, Moan, Whine? or...

http://acronyms.thefreedictionary.com/BMW

Mannwich said...

I tend to agree, karen. Just thought it was somewhat interesting.

@cv: The Ambien only comes out in desperate situations like that one, so no sexting for me.

CV said...

Uh oh!

CAR WARS

"A long time ago in a galaxy far far away..."

McFearless said...

I've decided cars are nothing but a giant waste of money.

breaking news I know....

CV said...

@Jeff

I've never taken that stuff...

I'd probably end up sleepwalking and doing a high wire act on some telephone wires or something...

On a plane? I suppose I'd end up being a "wingwalker" like Nic...

Nic... is that your secret?

karen said...

Ben, Ben, Ben.. Cars are just bigger watches.. : )

karen said...

I'm waiting for LB's breaking news.. he bot a BMW this weekend, rolling my eyes.

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