24th Consecutive Outflow From Domestic Stock Mutual Funds Is In The Books

Tyler Durden's picture

At this point what is there to say that has not been said already 23 times in a row? ICI reports the latest fund flow data: flows into everything are up... except domestic stocks. The only silver lining: the outflow is declining, and we may just see an inflow next week. Although at $81billion in redemptions YTD, even an uptick eventually would be too little to late. The only marginal buyers continue to be the primary dealers (using POMO cash), desperate pension funds (getting led to the slaughter), and algos which churn stocks a few million times per day, end on a loss, but then collect liquidity rebates from the exchanges and are happy. Aside from these three, there is nobody else.

Weekly flows:

Cumulative flows:

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Jeff Lebowski's picture

What more to say....

How about:

  "Fuck it."

dehdhed's picture

i think investors are just saying 'screw it' with the mutual funds

say good-bye to the mutual fund industry

etrader's picture

Speaking of Outflow....

Some fixing income guys being show the door at Citadel.


treemagnet's picture

Does POMO only operate on POMO days?  If so, then what stops this thing on days - correct that, day, like yesterday from really, really tanking?  I sure as hell ain't any of you, so who?

Johnny Yuma's picture

I think a combination of people covering their short positions at the end of the day (who wants to be short over night!) and the market will generally hold to a certain level relative to it's daily pivot levels. For example, yesterday, the ES sold off all the way down to it's S2 level and was heavily defended at that level. If eventually bounced up out of that zone after dipping a bit lower than S2 at the end of the day. The flash crash day was one of those extremely rare blow out days where everything is in chaos. Wouldn't be surprised if we have another one soon... This market is standing on nothing but POMO... 

kengland's picture

This chart looks to be the inverse of the net short presented in the COT. It wouldn't suprise me if that was the case. Everyone is freaking short, and no, they do hold those positions over night.

Johnny Yuma's picture

Been short since April... 

doolittlegeorge's picture

short interest has declined in kind with this chart.

Johnny Yuma's picture

Yep, the squeeze is on via Banana Boys. Took 3/4's off near the lows letting the last 1/3 wonder... 

nmewn's picture

"I sure as hell ain't any of you, so who?"

There is nothing "bullish" about one percent swings in both directions...it's bearish...it has always been thus.

doolittlegeorge's picture

so what specifically are you shorting then?

Silverhog's picture

Declining outflow = tank empty

StychoKiller's picture

How soon before the POMO starts "cavitating?"

bada boom's picture

What do you mean by tank empty?  In actuality, it's still close to being filled.

Have you seen the numbers from ICI. http://www.ici.org/research/stats/trends/trends_08_10

However, the outflow trend has been negative for 3 years and will be so until the boomers are done.

Here's what is happening.  People are selling stocks, buying mostly bonds, and some etfs.  Industry / banks are selling bonds and buying some stocks, add in pomo, and you have stock increases.

And to followup, I have been watching the money market funds continually decrease among retail.  This money is going into bonds.  This is adding to the mix.  Once again, the seller's of bonds are most likely purchasing some stocks.

In general, this is one big game of musical chairs and the Fed is controlling the music.

Cdad's picture

Average Joe kickin' ass and selling into strength.  Sweet!

UncleFester's picture

Average Joe cashing out to support average Jane's lifestyle. Not so sweet!

pitz's picture

Cheaper stock for the rest of us!  Horray! 

Retail will come back when Dow = 25,000 or something like that.  And once again, be led to slaughter.

Not everyone can get rich from the stock market. 

bada boom's picture

Cheaper stock for the rest of us!

Hello, anyone home? Stock prices are getting higher what do you mean cheaper?

pitz's picture

Imagine where they'd be without these outflows.  Can you say Dow 15,000 or more? 



plocequ1's picture

Yea, Im confused too. Im still trying to figure out what happened to that  pretentious concept known as the Hindenburg Omen.

DarkMath's picture

It was eaten by the POMO.

treemagnet's picture

If my aunt had balls she'd be my uncle.

bada boom's picture

without these outflows,

Still around 7,000 or less.

Why? Stocks are a scam to fleece people of their money.

However, now they have become a tool to control them as well.

Downtoolong's picture

That's exactly what the banksters were banking on when they started buying, but, alas it didn't happen that way for them did it. Now imagine where we'll all be when they have to unload their spec positions.



Cdad's picture

Nonsense.  F'n BS pitz.  Wishful thinking.  Average Joe sold to you, and he is spending his money on food and rent.

Bagholder.  LOL!  And they call you the "smart money." LOLOLOLOL!

Minion's picture

He's doing what the funds are doing - buying strength.  They are the "smart money"....... and not doing so great this year.  ;)

Minion's picture

Would POMO exist without those outflows? 

SDRII's picture

Nice pick up in the FT Alphaville on the short interest in the ETF complex...




Ethics Gradient's picture

Just imagine what would happen if AAPL and it's iPad wasn't there to help the stock market cope with it's heavy outflows....

Thank you, thank you, you're too kind. I'm here every night this week. Try the linguine.

Bearster's picture

Bashing HFT's aside, how much do they get per share for providing "liquidity"?  (I assume "liquidity provider" is a special case recognized by regulators, i.e. not a product of the free market?)

Assuming it is a fraction of a penny per share, that wouldn't make up for much of a trading loss.

sysin3's picture

Shit, it must be my ex-wife buying.  That bitch will buy anything, on credit.

Vampyroteuthis infernalis's picture

Average six pack retail traders ran out of both money and patience. They have been robbed and nothing is left to take out of the their accounts.

doolittlegeorge's picture

that's why "if the government goes after the taxpayer it's bullish."  there IS something left.  consider a "gift" if you like. for what purpoese Wall Street cannot fathom...but they will take it.

UncleFester's picture

Actually, they are going after future, yet to be born, taxpayers.  Must be nice to tap into reserves that don't exist yet.

Zexe's picture

Come on , i am tired of this bullshit, no desperate pension fund is getting led to the slaughter, only idiot bears like me reading this BS every single day eaiting for the markets to crash. The flash crash was a 1 in 25 years event, it s gone, only idiot bears have wet dreams waiting gor another one.

i shud have better listened to doug kass and cramer. Fuck you doomers and stupid bears. fuck you ZH. You BS is up.

H. Perowne's picture

Looks like Beaker has some time on his hands while moving his stuff from CNBC to Fox . . .

TheGreatPonzi's picture

I actually agree with you on one thing: the markets will not go down as long as the FED exists. So waiting for a stock market crash is indeed stupid. The only meaningful event to come will be the hyperinflation. The FED will never give up until this. I'm tired of waiting too, but nobody can give a precise timeline.

antidisestablishmentarianismishness's picture

Well, you may be losing money but at least you can console yourself with the knowledge that everything is shitty. 

sysin3's picture

Sir, please step away from your medication.

Alternatively, if you are not currently on medication, please acquire some.

DosZap's picture


your likely right, the Bernake Crew will make damn sure it doesn't happen again, even if it KILLS us all.

It is, with DEBT.

Pension Funds are desperate because they are so far Underwater, and Underfunded, their shitting bricks.

Plus why do you read it?.Tyler is showing you there is NO Money to speak of going in, and a hell of a lot thats come out.

WHY do you think that is?.The Outflow folks are just sick of dragging money bags around right?.

No, their not stupid, and their not going to get a 40-50% SET back for the 3rd time in 40yrs. When the main shareholders are getting out at a better than 2-1 basis...you should guess they know something J6P doesn't.

Every time these poor folks get nailed for a 20-30% loss, it takes a 100% return, just to get back to even.

doolittlegeorge's picture

yet ZIRP is bankrupting the pension system, too.  "Provide confidence by showing it with non-free money and allow for failure."  No failure=trader temptation.  Add a "huge wad" of "no credibility when it comes to the currency" and as Yoda said "not afraid?  You will be.....You will be."

lizzy36's picture

Well flash crashes are not the content of my wet dreams, but god bless.

Outside of convergence trades, last i checked the only investing advice ZH has given was to pull your money out of the equity markets and buy PM's. How one lost money on that trade is beyond me.

Finally, a macro theme of ZH is personal responsibility. It is not ZH's job to manage your money. If you lose money, on your investments, the person you should be saying fuck you to, is staring back at you in the mirror.


doolittlegeorge's picture

not true.  been consistently bullish on bonds here as well.  thank God they've been right, however...POMO up the arse in that space is CHEATING.  Monetizing the debt IS the crime.  Period.  Spending hasn't stopped, has it?  Just the opposite, right?  And the spending shows up...where precisely?

homersimpson's picture

Zexe must mean "gambler" or "dumbass investor" in Swahili - regardless - don't let the door hit you on the ass on the way out of ZH. F__k you bulltard. Don't hate on us because  the stock market is a great ponzi scheme.

the rookie cynic's picture

This is just my opinion, I don't pretend to be able to predict the future, but I think Zexe may be confusing a bear market rally with a secular bull market.

UncleFester's picture

That terminology is so 20th century...