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And Scene: ICI Reports 13th Consecutive Week of Massive Domestic Equity Outflows As Banks Start To Panic
What more can we say here that we have not said for 12 times in a row already. Retail investors are dunzo. The latest update from ICI shows that the week ended July 28 saw a record 13th consecutive outflow from domestic mutual funds as stocks bloody surged. Good thing the HFT algos can now essentially communicate with each other in the actual unique flow patterns of cancelled stock bids, thereby announcing to all other participants the plans of one which promptly become those of all, in the most under the radar concerted effort to "club" the market's HFT participants as one big trading force. As for retail: it is all over. We won't even chart the latest move. Figure it out: nearly $50 billion in outflows YTD as the market is well green. When the coordinated computerized front running game (of stupid carbon based lifeforms) in which one Atari machine sells to another, and repeats into infinity, while all book liquidity rebates, comes to an end and the theater is finally perceived to have been burning all along, watch out for the binary stampede.
But don't take our word for it. According to the FT, banks are starting to panic that as a result of collapsing trade volumes, profit target misses and massive layoffs are just around the corner.
US banks with Wall Street operations are bracing for a slump in trading profits this year after the third quarter got off to a poor start, with global economic uncertainty and Europe’s sovereign debt woes leading to a slowdown in market activity in July.
Executives said volumes and profitability last month were even lower than during the sluggish second quarter, with hedge funds particularly reluctant to take big bets on equities and debt.
“July was a miserable month for trading,” one senior banker said. “If August and September don’t rebound sharply, banks will be forced to cut jobs.”
The squeeze in trading profits highlights the rising importance of groups’ consumer and commercial banking operations, whose performance is improving as the economy heals.
The lack of activity led many banks to miss internal targets for trading revenues in both fixed income commodities and currencies – a key recent driver of profitability – and equities.
John Brady, senior vice-president at MF Global, said: “A lot of the drop we have seen in trading volumes during June and July follows violent changes in markets during the preceding months.”
Retail investors have also shunned stocks. US equity mutual funds have been hit by 12 straight weeks of outflows totalling $40.7bn, says the Investment Company Institute.
Better make that very unlucky 13.
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Market only goes up, bitchez. ;-)
Flash Crash 2.0? Get your 59% limit orders in place!
i think the peasants turned off the TV.....
time to make a monitor -- always on -- mandatory like it is in North Korea...
I mean, dont' we all understand that we are obligated to give every dime we have to Jamie Dimon?
what's wrong with these people?
It's not enough to fear Big Brother, you must love Big Brother!
We won't even chart the latest move. Figure it out: nearly $50 billion in outflows YTD as the market is well green.
Shame, because a chart can say 50 billion words.
+ 50 bln
For example, my parents, both 60 years old, are waiting to get back 5% more (which puts them 5% down from their peak) and they are pulling the trigger. They don't trust this shit anymore and can't risk losing a good portion of their nest egg. They'll liquidate several hundred thousands of dollars themselves.
I have to believe tons of others like them are out there. This won't stop as the boomers look for the exits. Kind of a cruel trick to gun the market in hopes of sucking in people only to see those looking for the exit split. Problem is, the boomers have the money. Gen X and Y are tapped.
I'm two months from 60, and while I've been out since mid-'08 (the only time I've ever gotten things right) I'm hearing reasonably identicle stories from my peers. Burned twice in 10 years? Enough is enough. As much as the PTB will do everything within their powers to prop things up, ultimately the market will win, though it's taking longer than I had imagined.
I wish your parents the very best...and you, too.
I'm 53, sold everything and went into cash in Oct/Nov '07, saving myself and my wife six figures (X multiple) in unrealized losses. Started moving assets into precious metals then, still employing the barbell strategy of PMs in the role of wealth preserver, hedged heavily with cash. Told my family and some friends, too, they chose to not listen. FWIW I told my friends "everybody out of the pool" on June 6th this year. It was obvious that the energy had ended when QE ended, and that the "stimulus" had been back-loaded to try to ramp the economy into the elections but that that was failing to have any real effect.
The PMs are for wealth preservation, moving it into the next currency regime, whatever it might be. Miners are for "investment". No leverage. Cash stands guard over the mess to avoid forced liquidation of the PMs and miners during any prolonged deflation. I am personally convinced that we're headed for either QE until something (like the currency) breaks, or prolonged deflation leading to a sovereign debt crisis that in turn triggers a currency crisis. Either way, the cash becomes a throwaway once it's no longer needed to guard the PMs. That's my story and I'm sticking to it, until something fundamentally changes.
Upper 50s here. Only 100 more shares to go and I'm out. Let em trade among themselves - sooner or later one of the players will get cold feet.
Superb nick.
I did in fact laugh out loud.
I have said it before but I will say it again: I liquidated a half mil of my parent's money (both about 62) during april and may (last positions on may 6). I tell everyone I know to get out of the market, regardless of age. Good luck to your folks and no, the 50% downside risk is not worth the imaginary upside gain.
Good Job!
......but Leo says it is?
To all those liquidators, make sure any cash that doe not go into fixed income and its going to sit in the bank - make sure its in a small community bank or creidt union. Make it a point to walk into your bank, the one you have a forty year relationship with, and tell the branch manager in the Private Bank to their face that the way they have treated Citizens these last years; insurance, mortgages, reverse-morgages, credit card rates and fees, and finanical advising is hateful to the Republic. Get crazy with the rhetoric. Poke your finger into their chest (That means you little old ladies). and take your money somewhere else. The only way to hurt the big banks is to take money and their income away. And for G_d sakes don't do any business with a bloodsucker "trust company."
Your money isn't safe there either. Get a contractor to jackhammer up some concrete in a walk-in closet, and pour new concrete around a newly-installed floor safe.
Don't trust any banks at this point.
my grandparents are 90 and 89. they been 100% tax free bonds since 1971 with the exception of $40,000 in 2003 on a bankruptcy reorginization. there broker begged them not to do it. told them it was throwing there money away. and it did. I stay up late at night worred my grandparents are going to live through two great depressions. what is so sad for me is that grandpa read the wall street journal religiusly for 50 years. and nothing i can tell him will sway his opinion on money. he thinks he safe. i lose sleep.
It's all good. X and Y will be able to buy a McMansion for a buck and a half before this is all over. And a cool Chevy Volt for 18k after federal rebate. If you're nice to your Boomer parents, they may even leave you a few stray coins come check out time ......unlike my parents who gave me a swift kick in the ass on the way out the door.
Only the very wise Boomers will have a few coins to pass along to their children. The great majority of the "Plague" (as I like to call them) will be destitute as they spent up all of their wealth trying to out purchase their neighbors in some kind of freak suburban spending contest. Sorry to be a wet blanket here, but X & Y have a TON of crap to clean up with little equity to collect for doing so. (while at the same time fighting Boomers for jobs that X and Y should have but can't because Boomers already SPENT their retirement and now are forced continue to work) Pardon me for not having any feelings of compassion, but this is the current State of the Union... and it SUCKS.
AccreditedEye -
Quitcherbitchin !!! Cry me a river . Boomers died for your sorry whining butt. Not our fault if you sniveling ,gotta have it now , no matter the damage brats have screwed up the markets . Don't see no boomers at the Squid , just young dumb selfsih self centered egotistical punks like you
All top brass at the Squid are boomers...as well as most of the other PD's. You invented the culture of debt. You developed and perfected short term-ism. You inherited a legacy from the generation before you and squandered it, passing much less in resources and opportunity to the generations that follow you. I'm not "crying" anything, I simply state the facts sir. Pardon me for not having sympathy for your generation, nor an overwhelming feeling to share anything with it.
your parents are getting greedy waiting for that extra 5%. good luck to them. i have a feeling they wont get it and will decide to liquidate down 20% from here.
Agreed. They should get out of stocks immediately. If his parents have let's say 500k in the market, hi-risking half a mil for 25k is nonsensical.
Or at least buy some 5-10% OTM protective puts on their positions. Cheap insurance at todays low volativility levels. Buy insurance when you don't need it.
Apologies.
You had already made the point.
Should they not just suck up the 5%.
The peak was a mirage.
http://www.youtube.com/watch?v=qUO8ScYVeDo&feature=related
"Hey! Think the time is right for a palace revolution
But where I live the game to play is compromise solution"
If August and September don’t rebound sharply, banks will be forced to cut jobs.”
I love the smell of ransom notes during midterm season. It smells like, September 15-17th, 2008.
"I love the smell of ransom notes during midterm season."
It does, huh...
It smells like you better pass some damn Wall Street friendly welfare in a BIG hurry you bribe takin' little Democrat whores....
Or it's SODOMY time!
John Brady?
Anyone see the size of the neck on that guy?
I wouldn't want to run into that guy in a dark alley.
I doubt I'd take his trading advice, either.
I'd probably do the opposite of what he recommends to the public.
Anyone know what percentage of total assets a $50 billion outflow amounts to?
Does it matter what the % is? These were the long term investors in equity, not the traders. I see it as akin to the withdrawl of the reserves of a bank which the leverage builds itself off of.
great comment Rag.
aka the real money before th 300 % + leverage happens.
A volatile heart attack awaits the market as there is no more floor (long term fundamental investors) and no more ceiling (shorting is quasi illegal). As I am not a robot with that can react millisecond by millisecond I'll watch this one from the sidelines.
Aren't pension funds the last saps in the game?
Aren't pension fund managers bribed to be Wall Street's patsy losers with pensioner's money? CalPERS et al?
It's a novice's question....
Yes, I think it does matter. I had the same question. What is the first question that comes to mind when you hear a certain stock lost $10 a share? And if for no other reason to support the dire nature of the reporting.
Tyler?
In addition to the lack of trust in the market and the people who run it, we always knew that there would be large outflows due to aging boomer demographics. The demographics get a lot worse before they gets better.
Wanna know where a lot of that money is? Check this out:
In Cash Glut, Banks Try to Discourage New DepositsMuch more very interesting reading here:
http://www.nationalmortgagenews.com/nmn_features/banks-discourage-new-de...
Well maybe they should start lending money then. Shoo, freaking banks! They don't want to do what, traditionally, banks were for. Now they want to trade on stock market and rip people off on credit card and checking fees. Har dee har. So hard for me to feel sorry for them. They slit their own throats. Thought they were so smart. Well, they outsmarted themselves. I find it heartening that maybe people aren't as dumb as they think.
They should start lending money? To whom? Those few who qualify under the more stringent guidelines don't need (or want) money.
More in the article:
Their definition of "attractive lending opportunities" usually includes the borrower's ability to repay the loans. Not so easy to do today. I agree with your general analysis of bankers, however.
Small, but this site has been consistent in pointing out since last summer, it has been about $5billion a week. So, 10 weeks worth. It is insightful to watch the CNBC show fast money. Not for their advice, but for their body language. They are hedge fund managers and are starting to suffer redemptions, if my reading of body language is accurate. Today's show was particularly insightful.
Financial sector layoffs right around the corner?
I like my soylent green with favas and a nice Chianti.
Financial sector layoffs of a significant amount will bring out some whistle blowers as well. It'll be good to see some former big hitters going for the 10% gov't fees for squealing!
Would they actually pay if you were ratting out their friends?
They have no friends.
They are all rats that will eat each other... Beside spreading disease and filth... that is what rats do...
Whatever pays the bills...
Everyone's got a mortgage to pay (the Yuppie-Nuremberg defense).
@7:21
http://www.youtube.com/watch?v=bRbe1UxMVrk
The HFTs will start to cannibalize each other. No more retail money to rob. The question is when the feast will begin?
That day will make life worth living.
watch 10/1
When that answer is discovered, anyone with half a brain on ZH will be rich to the point where your toilet paper will be replaced with rolls of $100 bills. Kinda rough on the backside, I'm sure... but I'm sure you can store the excess "toilet paper" next to your gold bar that will be used as a doorstop...
I'm pretty sure you can wipe your ass with gold too.
In a way you are correct. We'll be able to afford to hire you to do it for us.
Coonster, you have caused me to spit my half price Ripple all over my monitor. That is funny.
I'm all about that half price ripple. Try to skip the ones with the broken seals. No telling who pissed in your ripple.
Go long Proctor and Gamble, the new Bureau of Engraving & Printing!
http://www.charmin.com/en_US/images/products/pack_soft_top.jpg
"A range of questionable hidden fees and levies are being deducted from investments, making it difficult for a typical saver to make money from the stock market. Britain’s eight million investors are losing an average of £800 a year each to the hidden levies.
An investor putting £50,000 into a fund providing typical returns over 25 years would lose out on £108,000 because of unnecessary charges, said David Norman, a former chief executive of Credit Suisse Asset Management."
http://www.telegraph.co.uk/finance/personalfinance/savings/7919778/7bill...
The only purpose of the financial services industry is to make money for the people who work in the financial services industry - period.
Much of the money is being re-invested in fixed income funds. From 6/17 WSJ:
Long-term mutual funds had inflows for the latest week due to strength in bond and hybrid funds, which more than offset outflows from stock funds, according to the Investment Company Institute.
Until last month, inflows totaled some $595 billion on an unrevised basis over 60 consecutive weeks.
...fixed income...the next Fed-created bubble about to pop.
Out of the frying pan and into the fire.
The ultimate disaster syndrome could begin if bonds start to fail.
If bonds start to fail people will rush to moneymarkets which invest in real short-term notes. After that no where left to hide, so a run on the banks.
By the way, does your avatar know Mr. Hanky from South Park?
Exactly. And a run on the banks forces the Fed into monetization, which destroys the value of fixed income securities and only leaves the equityholders and PM owners standing.
Converting to fixed income, which is the real bubble (not stocks, not PMs), is the huge mistake here. Pre-Weimar Germany hyperinflation, for instance, the entire Daimler-Benz company was worth only a few hundreds cars because of a pervasive belief that hyperdeflation was just around the corner.
Adding to bankster woes is Benny's attempt to push those Maiden Lane stinkers totalling $69B back on the banks.
It's hot potato time .
Lol ...He has no intention of pushing Maiden Lane on his owners unless it will be good for the banks. What would be the point? The Fed can create and destroy money at will. The banks can be open to scrutiny. The Fed has no supervision, other than from its owners (including the BIS and foreign banks).
I've mentioned recently that I have not made a trade in nearly a month. The only positions I hold are in precious metals and various bonds. Lots of cash sitting around.
However, I don't think the younger folk, I'm 48, in the low 30's and below have a clue or even care about losing money in the market. They're all piling into 401k's, hiring PM's etc. We need another bomb before that group is out. Right now, they mostly follow the company line.
Don't be so sure. We're 31 and completely out of the market. We know quite a few people our same age who are putting in the absolute minimum they can for their companies' 401k matches and holding the rest of their savings in cash and PMs.
I don't agree, at all, that people in their 30s (I'm 37) are piling into 401k's. There is no match and the 'crisis' showed us that there is no exit door.
I believe that 401k is basically a shell of what it once was. It's the roach motel of investing (ahem...I wouldn't even use that word) for retirement. There's nothing like hoping like hell that the stock market cycle is up when you happen to reach retirement.
Do you have any evidence that 401k contributions are up?
If the company doesn't have a match, then the 401K is completely worthless. 401K was build on the premise that when you retire, your tax burden will be lower. Considering our budget deficit and our national debt, that is not going to be the case anymore.
Most people I know are piling all their assets into real estate. Real estate doesn't fail in Canada I reckon ("because it's different here")
RE is now collapsing in Canada, which is actually good for the stock market.
Only do the co. match, which is 100% @ 6%, but nothing more.
to all future 401k investors - check out how the markets have done since the programs started in 1982!!
Us young guys (30 and less) and not universally retarded, just mostly. I'm putting 0% in the 401k (employer puts in 5% no matter what), and my savings go into my credit union to pay bills and roll into PMs.
My best friend makes really solid money is in the 30s and also out of the market. Him being LDS means he is already pretty prepped out for a bad time. Helped him move and he has boxes and boxes of silver that he bought around 14 (cashed his 401k out).
Wish I could say the same about most of my other friends, but they mostly are unemployed. And besides us young people are broke, as a rule we are not savers anyway so we were not putting a lot in the 401ks to start with. Costs a lot to afford a rock and roll lifestyle...
That's a very heartening story. Thanks. There is hope yet that all the young folks won't be a burden on us old retirees.
We will do our best to not fuck your generation like you've fucked ours. Thanks.
Our generation is the most disgustingly self absorbed bunch of naval grazers ever. Sad thing is, we birthed (generally speaking) an even worse crew, and it is not their fault.
That said, we are all going to be seriously screwed as we age. Because, well we televised via Terri Schiavo that life is only worth living if and when we say so. Might makes right, and what a monster we have created. Hope all you libs who endorsed abortion and in particular defended a woman's right to choose under any circumstances have fun getting your palliative care pills at 75!!! No need for hip replacements when you are no longer hip!!!
Personally, I have raised my kids to be right to life. But, I warned them: you all, your generation? You made it out alive by your mother's choice. Now, you'll be the ones pushing our butts into the government furnaces.
I had no idea how prescient I was.
(Tyler, thank you for the easy captch ? I did eeeny meeny on the Math SATS so...)
dipstick
The under 40 crowd is nearly entirely bankrupt. That group is not only not 'in', they never were, as they were the ones chasing the insanely overpriced houses and are now being foreclosed on.
US firms mostly haven't hired any Americans for the past decade, so most people 30 and under are also unemployed at the moment.
I'm 32 and have made no trades and have contributed nothing to my 401k in 2010. I have about $25-30K in 401k's all earning 0.000001% in money market funds. All that will get pulled out sometime in the next year when I buy a house. My trading account has less than fifty bucks in it. It's still open just in case wall st. gets reformed. HA!
This is agonizing to me as trading has been my favorite hobby since the mid-90's when I would use numbers from a paper edition of the wall st. journal do draw my own charts on graph paper. I still remember my first trade. On the phone with some idiot at schwab I said, "50 shares of SLB." He replied, "50 shares of Slum Burger." I looked at my phone and realized that I probably already knew more about the market than the tie-wearing cokehead on the other end of the line. I loved it for years, but I now refuse to support such a corrupt industry.
You might think that I quit because I got burned, but that's not the case. I'm sickened by the excesses of wall st and refuse to contribute to them.
as soon as QE ended on March 31, the banks stopped making $$$ trading?
puzzling, but i think i get it: once Banks could no longer front-run the Fed on the $trillion+ scale, there was noone left to front-run! (all retail investors with any remaining $$ quit playing this game months ago.)
So, it's either going to be QE 2.0, or all the "good work" done by Paulson, Geithner and Bernanke will go to waste....
This brought a smile to my face. Thanks!
Maybe the top execs should consider not making 100 times what the people that they will fire make; then they could spare a few employees.
Bubble in actors, rockstars athletes, execs at major companies, and college tuition
10011 00101 01100 01100
10011 00101 01100 01100
10011 00101 01100 01100
(Hals programming in a nutshell for Q3,Q4)
+1
I believe that represented the entire volume from today's trading.
The public is bearish..Stocks will go higher. When the public is bullish time to be a-sellin'
Sounds like an old Ozark Mountain Daredevils song.....Chicken Train, I believe.
If there was no-one left on earth prices would still be going up,damned computers ...........................................
if the market only goes up there IS no market. its rigged. there will be less volume and less interest by eh...traders
and profits eventually go nil as all sides are playing same side
a casino in which the same side always wins eventually loses all customers
Only a small chunk of the population can get, and remain rich from 'the stock market'. So the more people that sell, the better. Leaves more earnings and profits for the rest of us.
Can boomers afford to not be in the stock market? What's fixed income paying these days? Practically nothing, and as inflation ticks higher, those 1% coupons are certain to result in a massive confiscation of wealth by the issuers.
The under 35-year-old crowd has a generational opportunity to leverage to the hilt and buy stock dirt cheap, especially of commodity producers and non-US companies. And everyone else would be insane to lock their losses in at this point.
And THAT's the strategic plan from the crooked bankers and the crooked traders? You have to be kidding ... lol.
Another year and the banks and traders will be eating each other out from the inside ... the smell of decay will be everywhere.
Greed kills ... in this case, it WILL kill Wall Street and the banks. Fear and greed can only take you so far. At some point the lack of trust and belief in the system kills it. No one wants to deal with crooks except other crooks.
Have fun with your game ... maybe you don't deserve what is coming your way. But, maybe you do.
None of those junks is mine, but I thought I'd drop in just to say that what you have written is really strange. I'll assume you forgot to mention the sarcasm mode.
He who takes a path different from that of his peers, is destined to have a different outcome.
How many 20 or 30-something-year-olds do you know of that have leveraged themselves to the hilt to buy stocks? I've never heard of even one.
I do know plenty of 20 to 30-something-year-olds who leveraged themselves to the hilt to buy interest-rate sensitive assets (ie: houses), who got their heads ripped off though.
Go buy some real-estate! Start your own company. You go you go getter. LOL.
Real mature guys, flagging my comments as "junk". Respond to me, debate with me if you want, the Reply button is right infront of you.
Nah. I'd rather tussle with Johnny Bravo.
I did not junk your comment, got better things to do. Like weed my garden.
stocks are only worth the cash flow to equity they produce and return to shareholders. Wake me up when the SPX dividend yield is > 5% and the P/E is a proper bear market bottom < 10x. In addition, I'll be more inclined to load up on stocks when I have more than 3 minutes to execute, and when the buffons at CNBC are off the air due to lack of interest.
Good comment and good strategy IMHO. I can't understand why you were junked.
Charted sind Jan 2007
http://www.scribd.com/doc/35382893/Money-Flows-7-31-2010
Hm, and in other ZH news GS supposedly spinning off its supposedly most profitable operation- its prop desk ?
They must know prop is over and tryin to unload while there are still suckers to pay for it ?
There are a bazillion ways that Goldman can still profit from a company they spin off.
- Fees
- Royalties
- Ownership
So does anyone want to hazard a guess when QE2 will happen?
Within two weeks of the next downdraft of the stock market.
retail investors still represent only the top 10% of the country. so if the market crashed or went to dow 36k a whole bunch of the country wouldn't be impacted except to the extent they worked for a firm that lost heavily in the market, and was forced to shutter.
in my extended family nobody is in the market. everybody pulled out 4 years ago after the first big breakdown. so we missed the final leg up (chard, you're a moron) to 1576. but also missed (chard, we all saw it coming) the huge move down.
Will they get back in on time for a big move up? That's the big question. Or will they stubbornly stick to rapidly devaluing fixed income "investments" on the theory that they'll continue to outperform equities as they have for much of the past 15-20 years?
One problem is that the equities of today are not the equities of yesteryear. Most of the biggest equities have terrible balance sheets loaded with debt and goodwill ... even though they may have cash. It is the Ponzi financing and acquisition game that does not look at the return on their investments and paying them off. Rather, they only look at whether the monstrous debt owed to the banks can be serviced. The banks get their pound of flesh ahead of everyone else.
Company leverage increases earning when rates are low, but in a rising market the debt can kill the company.
If you think "Corporate America" is bad (which it is), then the US government is even worse than that (because the US government can only collect tax revenue if "Corporate America" can keep itself going).
If one believes that fixed income securities are going to have any value, then they also must believe in the ability of US businesses to generate profits, on which, the government can levy taxes. If not, then fixed income securities are utterly worthless, just like the equities that people claim are also worthless.
Hey, people are voting with their pocket books. That's what capitalism is supposed to be about. Milton Friedman would be proud.
For all of the reason everyone is out o9f the market I think there will be a qe two. How can the oligarchy fake things otherwise. the job of the federal reserve is to ensure banking profits.
if you want to do a real good thing take your deposits our of the big banks and use the huffington post to find a good community bank, find a credit union, avoid your credit or debit card. force these folks out of business for the good of the country.
I wish some you you wrote on krugman's blog. The guy needs a course of how the market works. yes the market will go up until the retail investor joins in.
I think another alternative is to be in the market the 6 weeks after reporting periods. the banks will have to window dress so I figure qa market peak this time about the third week of august (same as third week in april)
I'm 59 and Ameritrade lowered my trade cost today, so now I know they must be hurting. ($7) I have about $400K there, but been switching some to Fidelity, just thought I'd ask them since I've been trading more, mostly the short ETFs, as hedge. Bad idea. Hasn't worked, too hard. There have been PLENTY of good corporate high yield bonds to buy paying 7.5%, Fidelity is best selection. CEFs are out there at discounts. You have to develop a strategy, like I'm up on COP 11%+dividend, I'm gone, leave the last 2-3%, keep Ka-chinging profits, so when you go to sleep you are not vulnerable to down 300 in the moaning.
There are great buys for yield, it takes work, many CEFs get whacked by the hedgefunds/marketmaker, you must follow the charts, wait for them to slam it.
Be careful of those "great buys for yield".
The Biggest Lie About U.S. Companies (Marketwatch)
http://tinyurl.com/32vpj2o
So debt is bad? IBM just got a 3 years debt @1%. You take that money and use it to pay off the old expensive debt or use it to expand. If you can get it at 1%, why is it bad?
Because it's DEBT. Period.
Bots algo: #define ULTRASPARC void HFT(billion TaxpayerCash) throws FlashCrash { __if (foundOtherBot()==true){ ____connect(OtherBot()); ____supportPumping(HIGHER, TaxpayerCash); __} __else { ____frontRun(people, TaxpayerCash); ____getRebate(); __} }
ULTRASPARC;
I was monitoring my parent's funds and realized over time that this was a fleecing operation. Never was in the market during the noughts. Relatives wondered how much we lost in the downturn. Partner said "nothing", we weren't in the market.
They stopped asking. I have saved so much by doing nothing, that I can't wait to do some more.
Look, don't dump on the boomers. For you see, we were meant to be ASTRONAUTS!!!, not millionaires.
Stupid question. I think.
Who's funding the retail exit?
The FED? Just printing money?
Who's the buyer.
Institutions and pension funds who are now more than 68% in equities. Like a gambler on a big losing streak, they are doubling down, hoping to "make up" for their huge losses and unfunded liabilities. As anyone who's traded at all understands this is the worse possible approach to losses. And to think they are considered "smart money". Hedging is an entirely alien concept to them as they proved in 2008.
Thanks for that.
Is there any evidence that asset allocations are moving to equities?
Certain of the funds offered by institutions are mandated by investment objectives to invest in equities (or bonds or cash or what ever).
For the non-mandated funds the manager could choose the asset allocation.
However much of that allocation should follow asset/liability matching.
Perhaps you're right.
"Hedging is an entirely alien concept to them"
If that's the case all I can say to the policy holders is look out below.
The trouble with "hedging" is they see all your orders! They frontrun the bear ETFs, knowing exactly how to burn the most people. The marketmaker sees all the sellstops, that's why almost every open is gap up & SELLOFF, or SELLOFF, that's wiping out the "hedging using sellstops". Certainly, mutual fund managers can't deal with this.
I spent weeks trading the SDS, TWM, to balance my 3-4 longs, it's a loser's game. I got lucky after the flashcrash, to be long both, and they didn't get canceled, but mostly had bad results but for scalping $1.00 intraday, as holding a short ETF overnight is financial suicide.
I've found, take profits, often. Even putting in a sellstop to sell at resistance on low volume stocks, the marketmaker has already accumulated enough shares at the lows and he will step in front of your sellstop every time.
Nick Leeson doubled-down, and we all know how that turned out.
Still waiting for the "reality-correction" to manifest itself in the market, though. I'm fully aware it may outlast my financial ability to place any bets in that direction.
You guys don't get it and I am surprised. Given the high end market brain trust that post here it obvious even to a back woods log splitter like me.
This is all about a confidence game. Build confidence in the inevitability of a rising market and sooner or later the lemmings will come. In the end its all about greed and fear. Destroy fear with scary selloffs and heart pound reversal higher and the die is cast. Failed the 1st time, the 2nd time? Whats that you all say "wash, rinse. repeat." Repeat and repeat so that even the can and bottle collectors turn over there dimes and quarters to the Wall St turbo-screw machine.
Ah, human nature. There's no collapse so large that can erase its predictability. People cling to hope even when its futility is obvious. That smart money KNOWS you and knows what you want. More optimism crack in the form of fictitious paper gains. Happy now!
It's only a confidence game if all the algo HFT Primary dealers go along with it. Once one decides time to cash in, there is no liquidity, if they pull bids, slam-crash again. Too many think it can't go down again, lots of BS. 42K jobs in a nation of how many workers? 150mil? Minus 145K Census into Friday's number, the birth-death will need to be at least that to net positive.
I do NOT believe they will succeed in more Grandmas jumping off the bond/CD fence. It's not going to happen. Boomers who played and bought crap and didn't save(opposite of us) are donefor, and I hope they are telling their kids they were a shitty example.
They're liquidating to pay expenses and trying to go on Soc Sec early, only problem is medical til Medicare age for many.
The market is not that stupid. There is no confidence. There is only an attempt to stave off a repeat of the forced liquidations of the last crash. But they cannot be staved off. It doesn't have to start here. One way or another, this perfect egg is going to become an omlette.
Banksterhater, do you mean like this:
http://www.youtube.com/watch?v=PQtDTdDr8vs&feature=related
Here is an anecdotal evidence of collapsing trading volume
http://www.ise.com/WebForm/options_industry_growth.aspx?categoryId=485
So ISE's option trading is 10% of 2009/2008 after more than 7 months.
There is air below this bid, it's a game of chicken. I posted this before but give jesse credit here again, showing mutual fund cash lowest on record.
PPT can't replace all this, the scam will end.
http://jessescrossroadscafe.blogspot.com/2010/08/mutual-fund-cash-levels...
Primary 3 down started at spx 1219.
Minor 3 is about to kick in.
We'll see spx in the 800s in the not too distant future.
personally, i hope to see March 09 lows just so the lies, corruption, collusion, cheating, etc can be exposed, once again, to an even larger group. any individual long US stocks right now is really taking a chance with their money.
that's all i've got for now.
Look at the SPX flagpole gapup, all that churning flag at the top, the more weight gets added the faster it sells off at least to that gap is obvious the computers are churning this but I'll say 1000 has to be revisited soon.
Jobs will be +100K max, that's if they lie birth-death +200K cuz Census minus 142K.
If they run this casino on bad job number, we fall even harder next week.
I am 60, moved most investments to cash 6 months ago. An uninteded consequence of essentially zero short rates is that people are hoarding cash. What, for 0.25% or 0.3% I should trust those thieves? Those bankers must think we are bonkers.
Think: you give them $100 for a year and they pay you a shiny new quarter in interest.
My 401K is a small portion of what I have. There is no company match, but I essentially use it to sock away cash w/o paying taxes on the W2. What irks me most is Fidelity charges 1 f-ing % just to keep it in cash. Short of quitting this job, I am kinda screwed with paying that such is the scam of 401K.
Until then, just waiting to give Fidelity the finger and roll it into my self-managed accounts.
We are waiting each day and watching our 401k like a buzzard circling overhead. When that day finally comes when the money drops, we will quit that one job that has the 401k before they get a chance to roll it into some other fancy dancy annuity based company savings plan.
Edit....
We just learned via handbook from Admin that they made changes to vest staff at 20% 2 years 40% 4 years and so on up to 6 years for 100% lump sum payout under 5000.00 Only Effective a few days ago. They have managed to effectively slam the funds shut, kick the payout can down the road, claw back the payouts made after the holidays which we wont see for 6 more years despite being fully vested.
No one saw it coming. So. Screw it. We keep plugging away 6 more frigging years.
They managed to dispose of the previous fund management of the 401k's and bring it all over to thier own private administrator who is paid a salary now of 54,500 dollars and just sit on that mountain of money. All under the banner of change that is good for the employer.
They did say in one sentance buried in 16 wonderful glossy pages that they wanted to stop the outflow of payouts.
Anything over 5 thosuand dollars? Automatic annuity to start at 65 years of age or on your retirement whichever is earlier.
Anything over 5 thosuand dollars? Automatic annuity to start at 65 years of age or on your retirement whichever is earlier.
This means they are awaiting the arrival of currency destruction and intend to pay you back with worthless future dollars. What else can it mean?
Dan- there are many yield opportunities out there in the closed end funds. Also ,Fidelity has an extensive list of junk secondary corporates. My latest buy was 2 weeks ago they had Smithfield Foods 7.75% 2013 bonds, @$99, pork prices are way up, herds down, exports being reinstated (bogus "swine" flu)...
I only see the 2017 8%s now, too far for me, but there are many that come on there.
Got Ford bonds 3 months ago 8%, @$98, now they're $106.
Good luck.
This is really troubling data and speaks volumes about consumers. The bottom line is this: people are still massively in debt, still levering up. They've lost their jobs. They look around and the only thing left to liquidate is the brokerage account with those swell mutual funds their advisor sold them. Non-qual, IRA...it don't matter home boy, cash that fucker in. People are liquidating absolutely everything....
401 K was just a way for US corporations to get rid of the traditional pensions they used to offer all employees at the company's expense. Notice once 401 K's became legal how high the executives salaries rose in the past three decades. No coincidence my friends.
As far as the market, use it for trading only, try and squeeze the big boys like they have been squeezing you for the past 40+ years. Play their game against them.
Not that it needs to be said on this site, don't listen to any of the financial advisers/salespeople on CNBS and Bloomie.
Could be Boomers converting their 401k's to a Roth IRA while they still can. Everyone will want to do it this year because the Bush Tax cuts are about to expire so they would rather pay the 2010 rates. This option expires at teh end of 2011 I believe. Unintended consequences are a bitch, Ben Bernanke. lol
Correct! We converted to Roths about 6 months ago. If you have assets you have to stay 6 months ahead of the Feds, thankfully, my wife is a financial genius.
I do the trading, and there ARE many good yields out there. I'm accumulating SRV, fyi, they slammed it to 8.61 yesterday in typical hedgecon whackjob after dividend confirmation news was posted, that's what I wait for. Buy near 8.50 if you can.
You don't need to be all in cash, here's an inflation hedge if I ever saw it, .225/quarter while you wait and they already did a share offering at 8.10.
http://www.cefconnect.com/Details/Summary.aspx?ticker=SRV
GLTA-
I'm 27. I had $20,000 even in my 401k. Stopped conributing a year ago, fidelity let me pull $4,000. Went and bought 100oz of silver, shotgun, and ammo. I took my bonus and bought another 400oz. Work all the overtime available, 1 year food supply for me and my mom.
Renting but found a nice cabin on two acres, real secluded middle of nowhere. Waiting on another job, an old buddy recommended me to his boss, if I get I'm gonna pull the rest of the 401k, and paydown.
roll out of it now, I'd say, then it is more so in your control -
Feel the hate. Wow, we're all beginning to finally capitulate as one. That is a beautiful thing. Get the fuck out and stay away. I did not go thru all comments, but cash at home is a sound idea as well. Lord knows if you put it in a bank a) you'll not be able to get it back and B) if you do you'll get less than you deposited. Guns, ammo, fuel and seeds are my investments of choice. Gold Bitches? Who the hell is gonna be able to afford the $50k/oz to buy it from you at the end game? It is still better than any other alternative. That is if they don't conficate it. Ok, so we need shovels to hide the guns and gold as well.
If anybody's driving up the market its the Fed, not the HFT's. They have unlimited funds, or at least whatever the electronic printing press can churn out. I bet they have massive rolling futures positions on their balance sheet that they are hoping to unload someday and reclaim the cash.
+1
Fed does not understand dollars are a "representation"of wealth; not wealth itself. Wealth should include assets that enable the creation of surplus value; sic wealth.
My father lived through WWII and his advice was to always avoid the money renters; he called them the mafia.
Retail Mutual fund flows serve as a good contrary indicator. The plebs always get screwed. When retail starts buying again as the market trudges higher, that will be the time to sell.
Exactly. But what if there's a kind of money even dumber than the dumb money? HFTs and prop desks make their livings by trading. They cannot simply sit it out. So perhaps they're the dumbest money of all.
I don't understand...
Shouldn't the big ibanks still be the ones making money? Don't they partially own or in some cases operate the HFT machines/companies? If hedge funds are losing, and banks are losing and obviously retail investors are losing than who exactly is making all the money?
Are HFT companies small, unknown and soon to become the next multi billion dollar companies? Someone is making money...
Not all banks have prop trading/HFTdesks, it's a fraction of them, you can count on 2 hands probably. Tyler had the list periodically of top HFT houses, it's mainly 6-8 as I remember churning the entire game.
Thanks for the feedback. I'll keep a lookout for the list.
RR- shoulda put my <sarcasm> on the "lending" comment. However, the Banksters got free or low cost loans from gov and had shitty "credit scores"- money supplied by the same taxpayers they won't lend to now. And a lot of folks would still be good loan risks and have good credit scores if the banks hadn't raised interest rates to usurious levels and upped minimum payments and cut credit lines.
My point was - banks aren't doing what banks used to be used for. Savings and loans. Investing in communities and people.