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Relentless Equity Fund Outflows: ICI Reports Another $1.2 Billion Redeemed, 8th Straight Week Of Outflows
Crunchtime for mutual funds has arrived. On one hand they are getting slammed with the S&P now almost -8% YTD causing a collapse in the funds' own equity values. On the other hand, investors have now withdrawn $30 billion in cash, forcing a feedback loop where selling begets selling, and even more redemptions. Ah, the beauty of a Keynesian system falling apart. And let's not forget that fund cash levels are at all near record lows to begin with. If the market slide can not be contained, and if consumers who already have zero faith in the market retrench even more, it could be the beginning of the end for the fund industry. More relevantly, ICI has just reported $1,248 million in outflows from domestic equity mutual funds: this is the eighth sequential week of outflows since the Flash Crash, and a period during which $32 billion has been redeemed.
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Jokes aside, what is left?
no or now? 3rd line, 3rd sentence.
For the middle class, it isn't bad enough that the tax money goes to TBTF, but it seems like our investment funds are basically a private tax to keep the corporations going.
well put
Anyone see where S&P news telling Moody's : We may downgrade you! LOL Epic!!
They are all turning on each other like rabid dogs in a cage match.
http://finance.yahoo.com/news/SP-Warns-Rival-Moodys-We-cnbc-4178316918.h...
Everything is priced too high. Stocks, bonds, everything ... not worth the current price.
They buyers are gone because they are unemployed, or because they are smarter than the central planners trying to hold together a side show.
But...but...it just means there's that much more in "sideline cash" ready to come in.
Thus, mutual fund outflows are bullish because they add to "sideline cash".
There. I feel much better now.
Yeah, that's what the subprime guys said aswell...
"Thus, mutual fund outflows are bullish because they add to "sideline cash"..."
Wow...
Go to Home Depot... buy a sledge hammer... the biggest one they have... go home and destroy your teevee...
Because that post sounded just like Steve Lies-man pontificating on CNBC while starring at Caruso-Cabrera's rack...
Great post, and that would be true.....
If that money wasn't already spent on new iPads and iPhones.
ROTFL bam guy!! Simply rolling!! rat bastards and treason season soon!!
"May the shorts be with you..."
Famous quote by a rich Jedi..
+++1
I thought it was the Schwartz.
The ones you refer to weren't rich Jedis.. just clueless.
You people that believe in decoupling are going to be getting another smack of reality in your face in time.
http://stockcharts.com/def/servlet/SC.pnf?c=$SSEC,P&listNum=
The chinese are not coming to save you, they are going to have to save themselves by going back to the villages.
It's almost like the Chinese are leading, right down to the pit.
"Join the insanity
Or die as you fall
Into the pit!
The mass production
And the killing of all
Into the pit!
The future screams for help
Are fading away
Into the pit!
The world tomorrow
Will it die for today?
Into the pit!"
http://www.youtube.com/watch?v=ePEFBxDGRw8 (for all the Bay Area thrash fans out there)
Tic-tac-toe for the Mensa crowd?
"it could be the beginning of the end for the fund industry."
It seems like at least 10% of the adult men that I know work as financial advisors in the fund industry. Lots of Merrill Lynch, Lincoln Financial, Wachovia, Regions, Morgan Keegan, A.G. Edwards advisors. I often tell my wife that most these people will be looking for a job soon.
Why? Aren't those outfits making decent money peddling muni bonds and bond funds to their clients? The "fund" industry isn't 'just' stocks ya know...
Don't forget about those sweet precious annuities. Trust me, you can't lose. ;-)
Disclaimer: Please don't read the 700 page prospectus written in Farsi, or you might actually figure out you're going to take an ass raping on the 4%+ in hidden fees, so that I, your trusted financial advisor (who coincidentally used to be a car salesman) can keep making my boat payments.
Munis? I wouldn't buy munis with YOUR money. Let me elaborate. We are in a deflationary death spiral and leverage is being withdrawn from the system. Real returns are heading lower regardless of the type of security. Cash and PMs are king. AUM is declining, ergo, the financial advisory industry will get smaller. Much smaller.
Wells Fargo bought Wachovia which had previously bought A G Edwards. They're all Wells Fargo Securities these days, and the brokers are now falling all over themselves trying to drum up business in an effort to avoid getting laid off.
It's getting really ugly out there. Yeah, manufacturing employment ticked up a bit in order to rebuild inventories, but the buildup is done, and manufacturing is only a little more than 10% of the economy.
We are in for an intractable depression that will last for years, regardless of which political party holds power.
What we need more than ever is millions upon millions of manly jobs, jobs that match humans that possess certain chromosomes, with jobs that use those chromosomes.
Suiting and tieing up every day to go to an office is pansy pussy work. Men need to get out of their suits, throw on some manly clothes and do manly work. That'll get this quadrant of the globe moving again. Nothing could be better for this economy than for the financial sector to shrink by 3/4, mostly staffed by femininely wimmin.
"I'm a lumberjack and I'm okay. I sleep all night and I work all day..."
http://www.youtube.com/watch?v=5zey8567bcg
Oh wait...never mind.
I'm suprised you haven't been junked. Mostly because your comment makes too much sense.
@anony
Yes, that is the remedy.
Too late for that anony.
Look around you and you will notice that men are hardly men anymore. Neither are women, well, women.
Everyone (mostly, broad-brush) is left a pale shadow of their core beingness, man/woman or masculine/feminine.
Metrosexuality, gay pride... all well as they are, but propagandized as they have been, they take on a different hue.
Yup, Mr. Manicure or waxed-back cannot swing a hoe (!) and Ms. body conscious is too busy getting all those hair removed or losing that last inch of fat to know much about much.
It really is as if the sexes too are melting back into the mix, slowly losing their identity.
Probably just as planned or just as well.
ORI
http://aadivaahan.wordpress.com
Is this how Mr.Ponzi felt in Boston when his enterprise started to unravel?
And as far as "Financial Advisors" I will take a ZH'er over one anyday of the week.
amen to that!! I know advisors...all they say is GLD. ha!!
Only a small chunk of the population can get 'rich' from the stock market, hence, the stock market will not rise meteorically until only a small number of people are invested in it.
You want to buy when there's blood in the streets (ie: now). You want to sell when the newspaper headlines are boasting of taxicab drivers getting rich buying stocks with no earnings and dysfunctional business models.
There isnt blood in the streets yet.... I have not heard one word aboout the stockmarket at the water cooler, wherease in 2008, everybody was talking about it... (i dont work for a financial company).
Do they really still have water coolers in offices?
yup exactly. When detroit is renamed as "the shot heard round the world" then you might start looking at buying...until then buckle up it's gonna be a doozie!!
Thank you TD
I appreciated the post.
"buy when there is blood in the streets" there is no blood to bleed, maybe embalmer's fluid.
Zerohedge has some of the greatest commentors/tormentors of rat bastards around!! Side splitting juan!!
Other's have commented on previous threads that the PPT is letting this happen. Everyone is questioning their motives, plot, plans. Perhaps common sense should prevail, with the reported billions in out flow at what point can the PPT continue to prop up the market whilst foreigners, fat cats cash out? Perhaps the PPT has finally realized that they can not afford to own the entire market.
But, but, but....Benny claimed on national television that he was not intervening in the stock market at all, never. So how can they be involved? LOL
Nother great rat bastard tormentor!! Thx for another side splitter jk!!
One of the few certainties in the world today is that one should never believe a single word that comes out of General Bernokio's mouth...
Just like 50% of the women I know were real estate agents. Were.
There is nothing left to do in this country anymore.
"We'll soon find out whether an organism the size of the United States can run an economy based on one family selling the contents of its garage to the family next door."
Jim Kunstler
For as perspica.....percperka....perci....as astute as Kunstler was in making that observation, you would think he already knows the answer to circular garage sales already stone cold.
you can always trade!!
Honest question...are we finally starting to see the inevitable impact of the Baby Boomer generation pulling funds out of the market to protect their retirement assets?
You gotta think people remember the drop to 6000 and remember not selling the market because a broker told them the market will bounce back. In recent weeks they've seen the drop, heard the bad news, and now they don't want to be the last one out the door.
In 2006 the GAO did a study out of the concern that the BB generation could collapse the market if they pulled their money out. BB's controlled at that time $7.6 Trillion in assets. They determined that the BB's would slowly pull their money out over a 19 year period which would prevent a collapse...but of course 2006 was a lifetime ago before the housing bust and market collapse.
+ 1 Waaaay back right out of college, I posed that BB question to a financial advisor.... he gave me a goofy look like it couldnt happen. Poor guy.
But pulling out of 'the market' is impossible. There's a market in all asset classes and fiat claims. Cash is just another asset class and those who pull out are just market timers. The trade towards cash and bonds is awfully crowded these days. The sheep move together at their own peril.
But some markets are more liquid than others, with cash being the most liquid. I can buy bread with cash.
I can buy bread with most stocks, with gold, etc. What's your point? FRN's are just another form of currency, like stocks, like bonds, etc.
Well then you are lucky. My local food mart does not accept stock certificates. They only accept cash or digital money (for the time being).
Also, the Federal gov only accepts FRN as payment for tax bills. This is a strong force in maintaing FRNs as the most marketable commodity.
The IRS would mail back an envelope of gold if you sent it to them as payment for a tax bill?
Come on.... I wasn't born yesterday.
I would expect yes, along with a late penalty. Unless you paid in $50 gold eagles, then I would expect them to credit you $50 per coin. But I am not an accountant, but I know a little about bureaucracy and if it isnt allowed on the form, you aint doing it.
Think we are arguing semantics. I am referring to the article and outflows from Mutual funds.
Link to GAO Article:
Retirement of Baby Boomers is Unlikely to Precipitate Dramatic Decline in Market Returns...
http://www.gao.gov/new.items/d06718.pdf
Interesting quote from the paper:
"One of the studies, for example, predicted that the baby boom’s retirement would at worst lower stock prices below what they would otherwise be by roughly 16 percent over a 20-year period starting around 2012.39 "
You raise a very good point. I honestly think it goes beyond the BB's though...nobody (who invests in long-only strategies at least) wants to ride the market down again.
To your point though, the BB's control a lot of the cash and have more to lose with retirement just around the corner.
***** not selling the market because a broker told them the market will bounce back*****
yeah and this time the BB don't have time to wait for a "bounce back"...they are retiring now (heck that was the whole point they had their money in this gig in the first place). Honestly with Social Security looking the way it does on top of the USA's state in general PLUS the stock market...dudes we could become USSR meets Germany of the 1920's before any of us know what the fuck hit us. I sure as hell hope not...but of course the Fed just "didn't see it coming" I mean honestly guys who can predict this stuff?!?!?!
Er, that is why it was crashed by the Power eLite before 2010 BB liquidation that was predicted in the early 90s. Anyone getting out of the stock market now is just too late.
Anyone in cash will now have to wait for the hyperinflation wave that is coming. So they had better get into PMs now, before gold = $10,000+.
I will be looking into RRSP (or 401K if in the USSA) physical gold held in somewhat trustworthy Kitco friendly vaults, so it can be redeemed as best I can before the flood.
But hey, what do I Noah? Not much.
The biggest threat to baby boomer middle class is the loss in real estate equity. Traditionally this is their largest investment, and they need to cash out and downsize for retirement.
With Real estate on track to drop perhaps another 30% from today, their biggest asset could be non-performing. The assumption was there would always be buyers.
Mark Beck
dead head fed goon reserve; jiffy lube bendover burnokio, rat basturd has covert payoff agreement with mutual funds to hide reverse repos from the public eye; liquidity drains!! Most certain of that with another drain report on the weeklymutual fund burnokio dialing for dollars under the public radar; cloaked in fed goon secrecy!! rat basturds do fabulous work in the dark!! According to my rat bastard calculations of risk spread to the innocent; distribution is nearly complete!! Don't think I'd want to hold long or short over the 4th flag wavering weekend!! Paper ponzi being what it is I'd wait to make sure you're certain when electronic trading reopens!!??? rat basturd lawless got vermin curbs in just in time for the broke goon 20 nations not to be able to get liquid while selling US markets; says tax paying citizens alert!!??? Low vol/new curbs; C tested a to big to fail breaker the other day; yep! rat bastards want all the public monies for goon use and abuse!!!!! As certain as papers intrinsic value is zerooooooooooo!!
Anecdotally I'm hearing middle class people starting to pull their money from the market. Middle class chatter is as good as it gets as far as sentiment indicators go.
The Flash Crash really freaked people out.
All I know is I'm a baby boomer with nothing but monetary stores of value salted around fuzzy math & voodoo economics!! Lots will have their sense of humor intact when goons pull the plug on paper ponzi soon but will they have sufficient stores of value to survive the 4th reich!! Doubtful as lil scamBO keeps shuvillin chit; in concert with CONgress & SINate!!!!
Israel, how about you quit lying to the people of this country and tell them what is really going on? Judging the content of articles, and amount of comments recently, it is only a matter of time before they figure out your 'adsense' scheme.
Ya'all see YHOO buying back 3 bil of stock? If that isn't a contra indicator, I don't know what is.
I'm cash heavy and loving this. Keep selling folks, I'm buying.
Regarding the BB thing: I've been wondering about this. How much market value is attributable to a growing population investing in retirement? I'm talking about values above fundimentals (which already account for consumption) - p/e multiples. How much excess value (any?) is a result of default investment styles like age-in-bonds/rest-in-stock. In other words, how much default malinvestment is there?
The entire system, not just the stock market, depends on growing population. SS, pensions. At least increases in effienciency (and cheaper energy) can help weakening consumption.
Anyone seen Leo lately? He got slapped by Mish the other day.
http://globaleconomicanalysis.blogspot.com/2010/06/yet-another-keynesian...
LOL. Maybe Leo is still busy looking through the May unemployment report before he comes here to "man up". That's a pretty big rebuke from Mish and I agree completely with his analysis. We need to completely repudiate Keynesian policies.
Mish is may get banged by a union thug soon, way too mouthy. The truth hurts (hopefully not him, though). He needs to ease up a little, as he is messing with concrete shoe salesmen.
"Ah, the beauty of a Keynesian system falling apart."
Where is this Keynesia of which you speak?
Liberty ave, cant miss it.
RIP S&P
On May 4th I called the end of the March 2009 bear market rally.
The proprietary indicators I use in my technical analysis can identify trend changes before they occur.
http://stockmarket618.wordpress.com/about
Personally, I was not expecting equities to have a sustained drop without crisis.
So what economic news brought us to this point? In my experience the recent "bad" news was not of a magnitude to warrent the market trends.
More plausible for me are trends in preparation for Q2 reporting.
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I thought that the large banks may break ranks and take profits to help Q2 reporting. So with the recent turn of events it will be intersting to see the Financial sector Q2 results.
We should see some sell side pressure if the market continues to drop. The filings should be fun, but I am really looking forward to what managment has to say. I expect my bullshit meter to be nearly pegged for most of these calls.
For the BHCs the reliance on equities for quarterly performance was very risky, and for a bank, non-traditional. I would expect some market strength if equity manipulation is truely coordinated. We shall see.
If you pull away Q1 equity performance, big bank balance sheets should be toast.
Time to buy SKF??
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Question for ZH;
Is the average consumer invested in mutual funds during this de-leverage cycle?
Perhaps the last hangers on are the fund managers themselves.
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The most recent economic event, which I do not think the market cares about, is the fact that the states Medicaid infusion of cash did not pass. This is significant because economically, now is not the time to stop aid to the states in meeting their budgets.
To me the biggest economic threat to the Administration is municiple default. The reason being that you cannot separate state credit ratings from the central government. The foundation of US credit is state health. Any bad press at the state level for meeting budgets will reflect on the US credit rating. The rating agencies may not downgrade the US on state default, but foreign buyers of our debt will.
Mark Beck
Don't proclaim how much money has been taken out, please instead; tell us how much money is LEFT in the system and is it enough to pay all future redeemers should they too, choose to take thier money out.
Hungry,
That post gets the prize for most rhetorical post of the day.
Of course the answers are
a. Nothing (actually negative, a giant sucking sound)
b. No
ORI
http://aadivaahan.wordpress.com
Don't know the scale of the numbers involved but $30Bn sounds like a lot for a market in the aftermath of '08 '09. If the bulk of the selling has already been done will it continue to fall as aggressively as before? On the flip side, gold and CAD have had significant gains, if there's any de-risking to be done, maybe that's where it will be concentrated.
EURUSD buying support detected for some time now, has returned again and the daily chart is now neutral to bullish.
http://stockmarket618.wordpress.com/about
Certainly a lot of details like that to take into consideration. Thanks windows vps | cheap vps | cheap hosting | forex vps