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21st Sequential Weekly Outflow Confirms Investors Refuse To Be Suckered Into Stock Market
The massive, and completely unjustified, September ramp in stocks has done nothing to restore investor faith in a broken market: ICI has just reported that in the week ended September 22, domestic equity mutual funds saw a 21st sequential outflow of $2.5 billion, bringing the total Year To Date to over $70 billion. And here is the kicker: the programmed stock rally in September which was supposed to "restore" confidence in the market, has resulted in $16 billion worth of September... outflows. Congratulations New York Fed, NYSE, Getco, Goldman, and, of course, SEC. You have totally killed any hope of restoring market confidence. Which brings us to an interesting question: if Brian Sacks ramps the DJIA to 36,000 on tomorrow's POMO, and nobody noticed or cared, did Brian Sack ramp the market up?
Also, according to ICI's latest flow Trend tracker, total cash at mutual funds has just barely budged in August, creeping up to 3.5% from 3.4% in July, and 4% a year earlier. But the scariest number is the annual redemptions from stock funds, which as of August 2010 have hit a multi-year high of 25.8%, a number that has risen progressively from the 23.6% a year earlier.
Weekly flows compared to the laughable moves in stocks.
Cumulative flows:
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Woohoo!! Stick save!!
The last hour market pump has been reduced to the last 30 minutes pump. And now to the last 10 minutes.
Wake me when it's down to the last 10 milliseconds so I can stick a fork in it.
Are we jumping the shark here?
There will be one week in the near future in which outflows are balanced by inflows (to be sure, later revised downwards) and CNBC will use the data to "prove" the economy is all-better-now.
Good point. You can see that comin a mile away.
When does the next POMO injection from the Fed start ??? Anybody ???
Tomorrow.
cnbc tipped the entire strategy on monday with that poll they ran....
would you be more confident with lower unemployment,
or the Dow at 12000?
Clearly, Ben thinks the mega ramp is the perfect bread and circuses for the peasantry......thing is, he forgot to make sure the peasantry has money to come into the games. It doesn't......the banks stole the treasury and now whatever they have left....they have to hold on to so they can pay all the taxes.
Do you have data going further back than this? It would be nice to see 5 / 10 year charts.
TD is not your chart/data lackey...
It can't hurt to ask politely. Surely one of the other folks with chart posting privileges could humor the good man. I am interested to see as well.
I didn't say he was, but if you want to get a strong point across you should provide a wide range of data ,rather than the cherry picked/ technical analysis/(bull/bear) market chart where you pick the bottom and work up/down ;-)
Anyone can draw a line down on the past and ignore any data that contradicts their view.
http://www.ici.org/pdf/flows_data_2010.pdf
Here's the last time I updated it.
http://www.scribd.com/doc/35382893/Money-Flows-7-31-2010
Thank you. Glad someone realised updating 5 years of data manually when someone was likely to have it to hand was pointless.
no prob,
twitter me @noalpha_allbeta if you want any more graphs
dble post
Looks like buy high and sell low to me. If it plays out like this then the market will ramp up as all those who have fled into bonds will come back chasing stocks.
Gonna dump faster than it ramped come October 8th (End of current POMO)
I think POMO is going to get stampeded next week by a shitstorm of shorts.
BUT the "new and improved - better than expected" POMO schedule gets released October 13th!
ISM Friday.. 56 to high 40's is going to shock a lot of people on CNBC.
Or just shrugged off like yesterdays numbers. Or rally because qe.
Who the fuck knows anymore.
Natural gas blew out today (no pun intended) a little over 3 points, expect about a 1% retracement tomorrow. Cotton is oversold (down almost 4 points), expect a 2% bump up tomorrow.
Beware of burritos.
Now you tell me. Here I thought it was the sour cream.
That's a vicious rumor Rocky and I demand you take it back. NOW!
It's not the burrito that causes natural gas and flatulence, but the beans inside the burrito. Be careful there my dear coon or the burrito lobby will be setting leg traps around your hole in the ground. :>)
Bring it on already...
Careful Rocko, or I'll get my gator!
http://www.youtube.com/watch?v=JRbwOEFYtmA&feature=related
Lunch invite canceled. LOL
http://dogs.icanhascheezburger.com/tag/raccoon/
So if $10B or so has left equites in September, how much "institutional" POMO money has had to come in to affect an 8% rally? (Rhetorical question because I really don't give a shit about the answer.)
TD, we marvel each week at these numbers to the point where its gotten to be expected and commonplace. However, 21 sequential weekly outflows must have zero historic precedence. Is this something you can research? Specifically, what was the previous record for sequential outflows? (This questions in not rhetorical.)
Just wait until the start of December, when millions of unemployed people are going to lose their benefits (just in time for Christmas). They'll have to tap their 401k's (even more than they are now).
The dumb money is out of the market and never coming back. At least not for many years to come, or until there is real financial reform.
A bad Christmas season will see the death of many small businesses which see a major part of their profits in the holiday season. Wonder what that will do to the unemployment rate? Oh, I forgot, we won't see that until it's too late to fix.
Unemployment borrowing by the states is already starting into the fall rampup! Last year it didn't take off until after Halloween and skyrocketed after black friday. Still a bit early to see major jumps yet but the preview certainly looks gloomy.
Oh that's right, Halloween is to be responsible for some 225,000 jobs?
They have paid vacation and a 401k, right?
Hummm, sign me up for a good job.
How can I speculate on yet another extension?
Its not about confidence for the sheeple its about survival.Scarey stuff.The more they try to instill normality into the sheeples mindset the more people realise how rigged the game is.
Yeah, it's kind of a funny situation. The more it magically goes up, the more it looks like a high selling point, especially if you need that money for other things now.
The insiders seem to agree.
Each week we see this, but it does beg the question "who is buying?"
And although I love a good conspiracy theory as much as the next guy with a basement full of ammo and a years supply of corned beef, can I ask if its possible that these Mutual Fund outflows are just inflows into say ETFs or other "non mutual" vehicles? (based on the notion that they are not classified as mutual funds)
"Who is buying?"
Short ans: pension funds, endowments, and about 5 big institutional players trading back-&-forth with each other.
~Misstrial
If the idiots would let the market fall so it could find it's true value they might be able to catch an actual bid.
Nothing that as much as inconveniences the banksters will be undertaken by Western governments - get used to it.
It's an interesting game:
If you pump it up, those who are still in might see a top and trade out. So you lose players.
But if you let it fall, many current players get burned. So you lose players.
Nevertheless, the latter game setups for a good future position for the remaining players whilst the former ends with an epic fail for all eventually.
Think Tulip mania with a modern twist - insted of tulips we now have stocks and the only difference is the Fed is ther eto juice the "tulip" market to keep it from collapsing rapidly.
The ICI data for taxable bonds has a positive ytd inflow of 205 billion. So, someone is selling the bonds to retail / mutual funds.
I am beginning to think a lot of the money is flowing to the stocks that retail is selling.
I don't think they care about the market at this point, Tyler. They may just need that money to survive.
No doubt, "they" have been acting out in desperation lately, blatantly pushing things too far for their own good. And the sharks among also smell blood.
The second chart is easily explained. Mutual funds only own one stock: AAPL
Well, I for one look forward to see if the POMO sugarrush will overdose the markets tomorrow. It certainly felt as if it was close on Tuesday.
NFLX. WTF?
It's real
Look at the 5-year graph for NFLX. Bubble, if I ever saw one.
Short squeeze from hell. Reminds me of VW. When that sucker pops it's going to be quite a show. Only question is timing. Today was pretty astounding.
BIDU. Do you?
If I could get news like this on teh Lamestream Media, I might actually own a TV. Thank you, ZeroHedge/Tyler!!!
Chart: ES
Houston...we have hit some turbulence. Is everything back to "normal"?
http://99ercharts.blogspot.com/2010/09/es_29.html
This is Ground Control to Major Tom...
http://www.youtube.com/watch?v=8LVC9eW9Q4E&ob=av2n
The trend is your friend?
Start loading the shorts now if you haven't been doing so already this week. Next month is going to be a disaster of biblical proportions.
I would buy puts. I think shorting is absolutely crazy.
Normally I agree, but this is a "crazy like a fox" situation.
looks like orly's top call of 1150 is still holding.
That will hold until Monday. After that, look out below.
The only true prediction of market direction occurs on POMO days. That's when all bad news is ignored, or already baked in, and the banks start using Fed funds to buy stocks which hopefully, nobody will ever buy from them.
What about the GS flash crash today? Anyone see it? Thoughts?
Hey S-Wicked- this may be a second post but the first one got shoved to the bottom of the comment page:
Yes- I saw GS drop to 114 and change in a milli-moment and then ramp back to the 144 area. Can find nothing written about it on any of the blogs I follow. And - the drop does not show up if you pull up a chart of one dy activity. Anyone else?
Lets see, positive things that make me want to come back to the market.
1 It doesn't drop on bad news anymore.
2 You have it all to yourself.
3 Flash crashes are over faster.
4 The Ben Crash Protection Plan
5 Charts make no sense giving you a personal guessing edge
+666
you might want to think about what the value of the equity funds are, net of the outflows to make an informed comment on this. i.e. if total US equities market cap is $40 trillion (Sept. 2008 value) and the mkt is up 5% (pulled out of my ass) over the same period then the market gaine $2 trillion in value and only $70 billion was withdrawn. Not nearly as bullish as you would like to think.
you might want to think about what the value of the equity funds are, net of the outflows to make an informed comment on this. i.e. if total US equities market cap is $40 trillion (Sept. 2008 value) and the mkt is up 5% (pulled out of my ass) over the same period (21 weeks of redemptions) then the market gaine $2 trillion in value and only $70 billion was withdrawn. Not nearly as bullish bearish as you would like to think.
You know it's really, really bad when a company like NetFlix, which is being circled by sharks as we speak, is leading the herd.
NetFlix is one of the barracudas left in a pool of sharks. Sooner than later it will be fed upon.
A few discussion questions: What/who is holding this market up if the funds are selling? In contrast to seeming everyone else, is this not a great contrarian indicator long term in favor of the upside? I'm assuming a correction will take place but what is the net affect/historical significance of this? Anyone ever run data on fund outflows/inflows vs performance of the market?...assuming correlation what is the delay?
Hold up. I keep hearing this "contrarian indicator" being thrown around like it's novel and even applies in every situation. But not all trends can always be reversing. Just because you spot a trend does not mean things are about to go the other way. Type of trend and timing are everything. Sometimes running the other way can send you back into the fire.
But with that said, yeah, that would be interesting data, and I seem to remember it being covered before on ZH. Anyone remember?
May want to take a look at this article w/charts:
http://www.zerohedge.com/article/why-end-equity-cult-means-trillions-upcoming-outflows-stocks
~Misstrial
Anybody know about POMO after Oct. 8th?
Mmm, Zen.
Retail. There isn't a better contrary indicator known to man.
LOL yeah that explains everything - what is the market up this year?
If it were to ramp to 36,000. The answer would be....Yes he did ramp it. Because trees are falling, and bears indeed are shitting in the woods as we speak.
But like the data indicates, no one will be around to notice. Except Hal9000 of course.
duplicate post, refresh error
likely story
Retail. There isn't a better contrary indicator known to man.
I'm a little jealous of the traders that caught this leg up. It looks like it really is as easy as being on the right side of the moving averages. :)
Don't know much about stocks and it appears that most others don't either. I invest in only what I have some semblance of control, being a small business owner. But I say cash the IRA/401K, buy your wife a nice set of hoohaas and live life like your in Jamaica.
This is a form of welfare. POMO is pumping stocks and the only thing it seems to be doing is giving the middle class and upper middle class that do own stocks the opportunity pay their bills by selling their stock portfolios at a higher price point than Dow 6,000.
Crazy shit. With the tax dollars we've wasted pushing paper around the economy we could have replicated China's manufacturing infrastructure and bought all of Africa's mineral resources.
The real question should be what happens when the Fed an PDs can no longer buy billions of stock at 30-1 leverage without being permitted to sell ?
This experiment is failing them on so many levels. They picked the wrong time to reflate the unreflatable. All they have done is create a new stock bubble with a record dislocation of false prices and they do not even have a nominal number to show for it.
Wall Street is on it's last legs and are a dying business model rife with corruption. People will finally choose to invest in the truth. So now even with these trillions of taxpayer cash, false accounting, 3 Years of Zirp, infinite QE, a destroyed middle class and record gold how does the FED intend to back itself out of the markets ever?
The market would lose 60% in a week when that occurs. More jobs would be lost..pensions and 401ks vaporated.
I cannot belive they tried the same bubble creation of unprecedented proportions to fight the same problem caused by easy money.
Who will buy the auctions without banks getting ZIRP?
We are so fucked and so is the globe because the moment our consumers get placed 6 feet under further financially they follow suit.
Madness.
It IS madness and it is driving me mad. Anybody else feeling especially paranoid lately?
Try the Gold or the Silver pill.
Have plenty of pills, still doesn't make this fun.
Look, when even I, a happy-go-lucky kinda guy has to "invest" in high-speed Pb delivery devices, then yeah, Paranoia futures are waayy up!
Who stops the police from committing crime when all the police are corrupt?
Who stops the Fed when the entire global banking system and every global government is counting on them to keep the markets propped up?
This could go on a very, very long time.
Funny thing about computers/calculators, they'll keep on crunching numbers, even when the answers spell doom. Some Politician asked Charles Babbage, the inventor of the Analytical Difference Engine: "Mr. Babbage, if incorrect numbers are fed in, will correct answers come out?" How do you even deal with Stupidity^10??
Could it be that the market ramp is aimed at making "dumb money" quarterly statements look a bit better, to stem the exodus?
The robots are being good little juggernauts, ramping up the DOW to around 14,000, when TPTB believe it'll be "okay" to sell -- but no one's in any of the other cars on this rollercoaster from Hell!
I got out in November of 2007 and staying out, unless it's the odd short ETF.
I believe if you sold stock or mutual fund shares and purchaed an ETF it wouldn't register as an outflow.
"The massive, and completely unjustified, September ramp in stocks"
Denominated in what? The dollar, the credit of the government!?
C'mon Durden, you're smarter than that.
Who are the suckers, the stock buyers or the government buyers?
So, what happens when the Fed and International banks own a majority of all significant common equity? Someone is buying and if it is not "we the people" then it is "them".
Yes- dropped to 114 and change in a milli-moment and then back to the 144 area. Can find nothing written about it on any of the blogs I follow. You? And= does not show up if you pull up a chart of one dy activity.
cnbc tipped the entire strategy on monday with that poll they ran....
would you be more confident with lower unemployment,
or the Dow at 12000?
Clearly, Ben thinks the mega ramp is the perfect bread and circuses for the peasantry......thing is, he forgot to make sure the peasantry has money to come into the games. It doesn't......the banks stole the treasury and now whatever they have left....they have to hold on to so they can pay all the taxes.
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