• Gold Money
    05/03/2016 - 11:35
    Crude oil time-spreads have completely dislocated from inventories. Historically, such dislocations have proved to be short lived. We expect that either spot prices will sell-off again or the back...

Guest Post: Thoughts On The Long-Term Equity Cycle

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Thu, 12/17/2009 - 15:59 | 167861 AnonymousMonetarist
AnonymousMonetarist's picture

It is the flight of an arrow not the flip of a coin.

Unfortunately we do not know the Assumed Exponent of the HAND.

Thu, 12/17/2009 - 16:04 | 167871 crzyhun
crzyhun's picture

Phew, excellent- will read again and ponder. Good analysis. How to protect and lower risk in this env. proposed is  the question. Short etfs on equities and buy the vix. Anyother ideas? Nix on gold as we see it is nada at this moment with Greece on the precipice.

Thu, 12/17/2009 - 17:47 | 167917 Assetman
Assetman's picture

Not necessarily... but it appears you aren't getting paid much in risk premia for making new bets on the money printing trade.

What it likely means is that if your're in the money printing camp, you might want to hedge to cover yourself for an unexpected, nasty spike in volatility. Becuase if you're wrong, you'll be pureed Alpo.

If you're in the deflation camp, you've lost your shirt over the past 9 months, anyway. You're still sitting in cash wondering "what happened"?

This is an outstanding original post.

Thu, 12/17/2009 - 19:50 | 168188 mannfm11
mannfm11's picture

The door to get out of the inflation trade is about the width of an elephants asshole and there are 50 herds of them that are going to try to get out.  Needless to say, there are going to be a lot of heads up the ass. 

Thu, 12/17/2009 - 16:31 | 167907 I need more asshats
I need more asshats's picture

Credit where credit is due. Finally a good Guest post.

No forced religious or morality views. No guessing or misguided interpretations of facts and figures.

A knowledgeable professional sharing insight in a condensed well thought out manner. Good visuals that are easy to read.

Put him on the short list to step up to the big league.

Thanks CreditTrader.

Thu, 12/17/2009 - 16:33 | 167912 Anonymous
Anonymous's picture

This is outstanding, with enough explicit/implicit material to support many PhD theses in finance. I'd be interested in any comments or insight vis-as-vis second to last paragraph and what the expectations hypothesis might suggest about current curve steepness...

Thu, 12/17/2009 - 16:54 | 167950 Anonymous
Anonymous's picture

great stuff.

Thu, 12/17/2009 - 17:40 | 168032 pivot
pivot's picture

is this the same person as this: http://www.acredittrader.com/  ?

the credit trader blog was great, though there were only a few posts before they stopped blogging.  but each post was very detailed and went to a deeper level than i have seen practically anywhere else.

Thu, 12/17/2009 - 18:17 | 168076 Anonymous
Anonymous's picture

VIX Index, SPX Index, and ...? which index is the Investment Grade Spread?

Thu, 12/17/2009 - 18:38 | 168104 Anonymous
Anonymous's picture

So we are at the beginning of the end rather than the end of the beginning.

Thu, 12/17/2009 - 18:39 | 168105 Anonymous
Anonymous's picture

I like this type of analysis. To bad I'm color blind. :(

Thu, 12/17/2009 - 20:13 | 168216 Anonymous
Anonymous's picture

If this graph was animated it would have been awesome.

Thu, 12/17/2009 - 20:17 | 168222 Squid-puppets a...
Squid-puppets a-go-go's picture

those graphs make awesome abstract art.


Thu, 12/17/2009 - 21:01 | 168261 Anonymous
Anonymous's picture

Thanks Credit for the piece, interesting noting the decision I'm facing being a long-time XTO shareholder (i.e. sell now or take XOM stock). Perhaps THE central theme of Z.H. pertains to the relative risk of different assets as compared to the dollar. About one-third of my net-worth is in dollars, however the notion of owning XOM in the future after my recent D.D. is becoming quite viable.

Thu, 12/17/2009 - 22:15 | 168321 Anonymous
Anonymous's picture

Could some one simplify the presentation. I'd like to benefit from it but it's beyond my knowledge. Thanks.

Fri, 12/18/2009 - 08:13 | 168579 theprofromdover
theprofromdover's picture

Why on earth should anyone expect it to be cyclical?

Maybe people think in 2D.

If you look at it in 3D, you will see we are in a corkscrew pattern (downward spiral). On the Z-axis are all the financial gerry-mandering activites that pumped up the money.

Fri, 12/18/2009 - 10:35 | 168648 Fruffing
Fruffing's picture

Credit curves are pricing in a significant double-dip recession via their steepness


Thoughtful post.   Please explain how above statement conforms with conv. wisdom of negative sloped yield curves signalling pending recession vs. today's epic positive steepness.   

I'm not sniping.    Squaring this circle would be very helpful.


Thanks CreditTrader!



Fri, 12/18/2009 - 17:24 | 169227 ZeroPower
ZeroPower's picture

+1. Yield curve is no longer inverted?

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