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Equities Back To Tracking The Zombie Dollar Tick For Tick
A day after several failed attempts at killing the dollar did not work, what is a Fed chairman to do but try, try again. The market now tracking the JPY-EUR carry trade tick for tick.
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Managed markets are awesome - no worries.
Stock markets in flight, afternoon delight!
Where's Burton Malkiel? I need to ask him about that efficient market theory....
lol +1
+10
He's busy day trading.
Blast off!
What a friggen bear trap (it sure got me). Down 130 points this morning and HAL9000 guns it back to just over 20 up at this point. Holy crap that hurt.
Same. My ass is sore.
No wonder people leave trading up to HAL9000 and his ilk; they can take a reaming like that with no lube and come out smiling.
Yeah, wow, that parabolic ramp is some scary shit.
I can't believe there is so little transparency with the market. We need to know who is out there pulling the strings, and in concert with who.
Clearly they are using 19 year olds as the lackeys, because they have nothing to lose, everything to gain, and feel invincible.
So what we need is to isolate one of these 19 year olds, and introduce him to a good old fashioned trail attorney. Watch his friends are all sold out within the hour, as well as the firms they (think they) work for.
Ginormous bid under the futures.
Why am I not long this bulls**t? Why was I born with common sense? If no material collapse by end of October, I'm cautiously coming back into the market. The Fed can stay irrational and omnipotent longer than I can stay solvent.
I smell desperation. Chicago PMI not good, so the depression management team sinks the dollar, ramps oil (which is easy, since everyone was short), and trots out a 5B "healthcare jobs" program just as the DOW sinks 133 pts. It isn't a depression, folks. It's a managed depression. A much better quality depression, as it lasts much longer.
i'm depressed
Memo from the B-Team, the O-Team and the GS-Team:
"There will not be an ugly end to the quarter, and if the USD has to take yet another one for the team, then so be it."
The "US has a strong dollar policy", correction: the US has a strong stock market policy
If the stock market goes up then the people who have been irrationally scared (everything is fine, come on in) will start to losen up. If we can get people confident then they'll shop and buy more stocks and that will pump up companies and stocks and we'll get a self sustaining virtuous cycle. If the economy picks up because of people spending because the rising stock market gave them confidence then that will strengthen the dollar.
Like our overlords have told us many times the best way to strengthen the dollar (or reduce the debt, or cover deficits, or help the unemployed, etc) is to strengthen the economy.
So you see, silly boots, our strong stock market policy is in fact a strong dollar policy. If you continue along this line of questioning then you'll clearly be in need of reeducation. You for one will welcome our financial overlords, whether you want to or not.
They have a very strong dollar policy. That policy just happens to be devaluation. Can't say they are hesitant about it.
Ron Paul on Jon Stewart, good watch.
http://www.youtube.com/watch?v=jrsWXlSzyF0
Ghost, scary how Ron's message of FED fail is getting on MSM comedy channel to the dopey mashbrained masses.
Three goals of FED p
1. Price stability - FAIL - 1913 dollar is worth 4 cents
2. Stable interest rates - FAIL - rates have been almost 20% to 0%
3. Maintain high employment - FAIL - real UE is approaching 15-20%
Ghost I love your posts on MBS and mortgage market you have great insight.
Cheers,
Pigpen
Like I keep on saying,they will do whatever it takes to keep the market up,even if takes using all the savings in the banks. Another blood bath,and Wall St. loses all its crediblity(they like to think they have some left). And then the problem becomes:what are they going to do with all the "talent" that is going to be out of work?Even Nassim Taleb dosn't know what they are able to work as..........
Given the PMI today, the last thing they would want is a big move up in crude. Ooops.
What do you think is the transmission mechanism from dollar weakening to equity market strengthening? Rising commodity prices.
Sorry when I said they I meant the manufacturers.
Predictable.
New market rules just put in place.
1. You are NOT allowed to sell any shares if you have any.
2. If you think you can, you will be shot.
3. If you need the money, just shoot yourself.
4. If you want to short, you need not bother with a grave as there won't be any pieces of you left.
For anyone looking for an update on the Bloomberg FOIA request here it is....
Federal Reserve Appeals Order to Disclose Emergency Bank Loans
http://www.bloomberg.com/apps/news?pid=20601087&sid=arpi9R5g1p9w
Thanks. No surprise there, guess Obama gave them the A-OK to appeal.
After the absolutely absurd ramp up today, with bad news to boot (Chicago PMI, ADP Employment report, Mortgage Applications, Corporate Profits), I am being quite disillusioned with how actually "efficient" the market is and wonder if actually doing your homework is worth anything anymore... Good News was a better GDP reading (isn't that backward looking?), and Oil inventories (a 5% charge on lower than expected inventories?) ......
Come on!! Look at the chart and tell me if that rise in the market on very little good news looks natural to you and all the way to unchanged to boot.
I wonder when all the hedge fund managers that are getting burned by this BS are actually going to set up some type of legal attack to find out who's actually doing this....I mean this type of absurdity must be costing them all dearly. It clearly needs to get investigated.
They will only take action if the market is falling too much and they will be so quick the shorts will get yet another pasting.
As long as it goes up, they won't bother, forever blowing bubbles is what they are best at and taking no action until it bursts in their face and too late is their normal course
The assholes behind this computer program that manipulates the entire market need to be exposed and jailed. (I'm looking at you Turbo Timmay)
Isn't this the best quarterly performance by the markets ever, or something like that? You would think there would be some managers who want to hit bank button before the end of the quarter. Especially as the economic data has clearly started to deteriorate again.
They have all got the 'greed' sign in sight and think this is the 'new' market that will only ever go up because they can do what they like now the Fed will bale out any mistakes anyway, so who cares, just buy any old junk.
Heads they win, tales they win.
the market, if controlled by a computer as it clearly is, has been hijacked and, my God, shouldn't a situation like this be the SEC's and the Fed's number one job to remedy?
It is OBVIOUS yet they do NOTHING.
END THE FED DAMMIT
PROSECUTE THE SEC
Looking for the crude rally to fail in the 70.30-70.90 zone.
Japan must be getting really really sick of all this, after all they have been through years of problems, but the US wants to get away with a tiny fraction in comparison at their expense?
The Nikkei has fallen 700 points from the high a few weeks ago and has been one of the worse performing markets recently.
The NIK used to be about 1100 points higher than the Dow, not any longer!
so now that the USD is on the rebound, is it going to get together with Mr Market. Does that mean USD is gonna take Mr. Market down with her like a third world country? Robo trader i need a picture for Miss USD. the new biatch in the carry trade.
WOPR tubes must have need a reverse cleanse.
Reminds me of back in the day when the commercials on the top step in the S&P pit would be chatting with the Big Locals on the step in front of them before the open.... "Whatdya think?" "Looks like a big day and we close unch." "What do you think? I think there's a lot of paper to move, but we'll probably finish unchanged." "Really? What do you think?" etc. etc.
would give a one fity to see the FED currency related war room. Just imagine all of those priceless maps, graphs and game outcome scenarios: Japanese dumped their ponzi by .2%, should we dump ours by .2, .4 or .6%. What's the potential outcomes, Nash equilibrium, dominant strategy and how much of inflationary pressure will it add.
Room won't be enough, they probably have the whole department dedicated to currency exchange - dollar liquidity supply and related emergency trading desk hidden somewhere (my guess would be JPM.)
What's with all the C shares being bought after hours? I am seeing many > 1M blocks.
can someone explain in layman's terms why the mkt would track the JPY-Euro carry trade? looking to understand this. a link would be fine.
thx!
EUR/JPY carry trade is the benchmark for 'risk' (arguably 'was,' in light of EUR/USD now). If you believe the global economy is going to improve, then you can collect a very nice spread in the difference in those rates while also pocketing the coming appreciation in the Euro itself . EUR will be quick to raise rates in the face of decent growth, while JPY has held theirs low forever now and has little prospects of having to raise substantially. When you factor in the extreme leverage available in FX, you can start to calculate the possible returns.
Given the size of the FX market, that trade is used as a primary sentiment indicator for equities. There are other, more intricate ways to take this further into the relationship with the markets and how fungible it can be.
Some of those points can be argued, especially if you don't believe in meaningful global recovery. Also, the masses are starting to bail on JPY as the funding currency in FX trades; the USD faces stronger headwinds and has considerably more room on the downside in the medium-to-long-term. This can take a long period of time to 'unwind,' and might be why you see more focus on the EUR/USD, AUD/USD, et al as the indicator (JPY has to be bought back by a lot of people still if this funding shift is widely accepted in the FX market, and would belie risk sentiment while it happens).
In the short run, the shorter the run, maybe a big player can game the market. But in the longer run, I'll bet on Malkiel's random walk--even if we're all dead as zero hedge says. If the markets being gamed, a massive correct will eventually come. Maybe some younger folk do not recall what happened when the Bass brothers tried to corner the silver market. Old man Graham commented to be short required nerves of steel. deep pockets also.
For you NY traders, cld it be massive SPDY trading driving the market? On light volume is that a partly plausible explanation for this odd\contrived market behavior?
Yes, it is massive trading of SPY. It is the only thing liquid enough for us. You have other suggestions for cash? A really large mattress?
End of quarter ramp.
Although the last quarter has been a record setter (at least for the FTSE in the UK) the 19 year old traders will still want the last day of the quarter to be as good as they can get it, even with bad news.
DavidC
DOW / SP500:
Daily trend - ongoing topping action is now bearish to neutral
Weekly trend - neutral to bullish
Monthly trend - bearish (since early 2008)
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