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Stocks Surge To Celebrate Unprecedented 19th Sequential Equity Outflow, $10 Billion In September Redemptions
It is beyond a joke now: ICI's latest data discloses that in the week ended September 8, domestic funds saw outflows of $2.2 billion, following last week's massive $7.7 billion. And yes, ETFs experienced outflows as well. So far September has experienced nearly $10 billion in outflows, even as the market has ramped by over 6%. Who is buying this shit? Just ask The New York Fed and Citadel: they may have a few pointers (wink wink). This is the 19th sequential outflow from US stocks, and amounts to $65 billion in redemptions for the year. With the market pretty much unchanged YTD, it means that mutual funds can not resort to capital appreciation as a substitute to outflows, and most are on their last breath (Janus: blink twice if you are still alive please). The kicker: the S&P is at the level it was when the outflows began back during the flash crash. If that doesn't restore all your confidence that Uncle Sam will be so good at managing the market (just like he has done with everything else), nothing else will. Throw in a little HFT, a little subpennying, a little Flash trading, a little DMA trading, a little quote stuffing, a little hedge fund clubbing, a little specialist front running, a little daily flash crash in big caps like Nucor Steel, and you can see why next week we will most certainly have our first inflow in 20 weeks. Or not. It doesn't matter. Nobody that is made of carbon, or who doesn't already have direct access to the Fed for zero cost funding, is trading stocks anymore.
Weekly YTD outflows:
Cumulative YTD outflows:
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Here are a couple which I could have chased up.
They were on the IBD Top 100 list back in February.
Both got shanked.
Oh, yeah, one more thing.
Regardless of how bad the news flow is.
I NEVER short stocks when the Summation Index is in a confirmed uptrend.
http://stockcharts.com/charts/indices/McSumNYSE.html
Thanks for sharing some of your thoughts/strategies Robo... really cool. (I knew you still played for the team! LOL!) Most important, I'm glad you are making $$$. Just be sure to convert some of those fiat gains into physical bro. :)
robo i use to like you, your mean. you offend me with that picture.
Fred on everything.. Psycopathy Legitimized Feminist Marine Gets His Kicks Killing Male ChauvinistsDate
Stocks, charts, this is the real American Dream...
On Anti-War.com, I find a loutish American general, James Mattis, martial feminist, talking about the fun he has killing Afghans. Yes, fun, wheeee-oooo! and ooo-rah! too. He says, “You go into Afghanistan, you got guys who slap women around for five years because they didn’t wear a veil,” adding “guys like that ain’t got no manhood left anyways. So it’s a hell of a lot of fun to shoot them.” What must he do with prisoners?
A joyous killer, possibly orgasmic. Note mandatory flagly background, pickle suit, and stupid colorful gewgaws so he looks like a goddam stamp collecton. Stern gaze is necessary to become a general. From defending the Constitution to the pleasre of watching Afghans die: The military has come a long way.
I’ll guess he fell just shy of graduating from third grade. He sure ain’t much of a general, no ways, I reckon. Just the fellow I want representing me in the world.
Does General Dworkin-Mattis speak of manhood? Odd, since his military is being badly outfought by the unmanly Afghans that are fun to kill. By the Pentagon’s figures the US military outnumbers the resistance several to one. The US has complete control of the air, enjoying F16s, helicopter gun-ships, transport choppers, and Predator drones, as well as armor, body armor, night-vision gear, heavy weaponry, medevac, hospitals, good food, and PXs. The Afghans have only AKs, RPGs, C4, and balls. Yet they are winning, or at least holding their own. How glorous.
Man for man, weapon for weapon, the Taliban are clearly superior. They take far heavier casualties, but keep on fighting. Their politics are not mine, but they are formidable on the ground. If I were General Dworkin, I’d change my name and go into hiding. Maybe he could wear a veil.
Perhaps the US should recognize that it has a second-rate military at phenomenal cost—an enormous, largely useless national codpiece. It is embarrassing. The Pentagon’s preferred enemies are lightly armed, poorly equipped peasants, which makes for a long war and thus hundreds of billions of dollars in juicy contracts for military industries. Yet the greatest military in history (ask it) gets run out of Southeast Asia, blown up and run out of Lebanon, shot down and run out of Somalia, with Afghanistan a disaster in progress and Iraq claimed as an American victory rather than Shiite.Do the aircraft carriers intimidate North Korea? No. Iran? No. China? No. For this, a trilliaon dollars a year?
The reasons for the mediocrity are clear enough. First, the Pentagon has become a contracting agency for buying gorgeous and elaborate arms of little relevance to the wars the US fights. (If the Martians attack, we’ll be ready.)
Second, the US is no longer a nation of hardy country boys who grow up shooting and loading hay bales into pick-ups for spare change. (For the uninitiated, hay bales are heavy.) I often see headlines such as “More than two-thirds of Texas schoolchildren flunked the state's physical fitness test this year…” If Texas has gone all soft and rubbery, you can forget about Massassachusetts. The American pool of hardy, manipulable kids without too much schoolin' isn't what it was. The lack of troops of course pushes the Pentagon toward more pricey gadgetry and greater imbalance.
Now, it is regarded as treasonous to question that Our Boys are the best trained, best armed, toughest troops in the world, and I’ll probably get punched out in bars for pointing out the awful truth. Let’s imagine an experiment. We take Killing-is-Fun General Mattis-Abzug, and a thousand GIs, and a thousand Taliban, and let them fight it out in any patch of wretched barren mountains of your choosing. On equal terms. What you think? Same weapons..
Good idea, General? You et what they eat, wear what they wear, They have no medical care, and neither do you. If they get lung-shot and die the hard way, you do too. It will come down to guts and motivation.
Motivation: It counts, general. I believe it was Bedford Forrest who said of some of his troops, “Them cane-brake boys jest plain likes to fight.” I guess there must be just a whole lot of cane in Afghanistan. The Taliban will go to any length to cut your freaking throat because you have been killing their wives and children ,fathers and brothers, and you will fight for…for…well. Uh. Big oil, AIPAC, Ann Coulter. Or a promotion for General Mathis-Abzug. Anybody want to put odds on the outcome?
Or what if they had the air power, the gun ships…?
And General, killing them might be a tad less fun when you couldn’t do it from the safety of a gunship. Just a thought, General.
A digression here. Bear with me. It’s just that General Mattis-Steinem makes killing sound like so much fun. And I guess it is, for some. You’ve seen the YouTube video of GIs machine-gunning people walking around a city street from a helicopter gunship. A hoot. But—can I offer a second opinion?
I went off to Viet Nam because I was young and dumb and adventurous and they told me that I was fighting for Apple Pie, and Mom, and White Christian Motherhood (which I spent my high-school days dreading, but never mind). Actually I was just another sucker from the small-town South. The Pentagon depends, utterly, on small-town suckers. They are brave, trainable, not real thoughtful.
Funny how things look if you think about them. Patriots talk about the tragic deaths of young Americans in Afghanistan. Well, ok. Other things being equal, young guys getting shot to death in a pointless war is not a swell idea. I’m against it. In fact, the more you see of it, and I’ve seen a lot, the worse an idea it seems. Of course, a logician might point out that if you didn’t send them to Afghanistan, they wouldn’t die there—would they?
The dead are not the only casualties. Go to aVeterans Hospital, and watch the left-overs come in. You might be surprised how much fun they didn't think it was. Or what they think of General Mattis-Firmstare. You might be very surprised.
But tell me: why is a GI’s life, mine or anyone else’s, worth more than the life of an Afghan child of three? Especially if you pretend to be a Christian, tell me. (I love this part. Military Christians are wonderfully funny frauds.)
A pretty good rule of thumb is that the attacking army is in the wrong, which would have made a Vietnamese kid’s life worth more than mine. I'll buy that, though I'm happy it didn't work out that way. But the attacking countries always believe that Their Boys are sacred.
When the Japanese attacked Pearl, they figured a Japanese pilot’s life was worth more than that of an American sailor. The Germans thought the same, mutatis mutandis, when the Wehrmacht went into Poland, as of course do Americans when they invade country after country. But why is the aggressor’s life sacred, prithee? If I leap out of a dark alley and attack your daughter with a butcher knife, is my life worth more than hers?
But it is just so much fun to kill Afghans. Excuse me, I need to
Stocks WTF,,,It's over folks..America is stuffed with maniacs...And we let them run this asylum..
The term you are thumbing around for is hyper trader. Yes I still make money, regardless of the majority of idiot sticks belief systems. If you want I have students that now do very well and are looking for partners to trade with them.
The trick is capital and fooling an HFT into a dumb mistake.
Right now what you are seeing is the intelligence of an ant trading and it's wiping most traders across the road with road rash. Want to fight fire with fire. Become anonymous. Become invisible...the Japanese idea of a keiretsu. Many being large and pretending to offer a HUGE service.
It's trading, it's always been a game and an easy one at that.
One of the key aspects of the equity markets, of course, is their spectacular unpredictability. It is particularly true when markets are manipulated and not based on logic. This was written in the NY Times in 1928:
“If a man saves $15 a week and invests it in good common stocks and allows the dividends and rights to accumulate, at the end of 20 years, he will have at least $80,000. He will have an income from investments of around $400 a month. He will be rich. And because income can do that, I am firm in my belief that anyone not only can be rich but ought to be rich.” -- John J. Raskob (a financial executive and businessman for DuPont and General Motors, and the builder of the Empire State Building)
To me, this quote says it all. That was 1928, written by a man using his logic during the Roaring Twenties. If everybody thought then, wow, I’m really missing out, all I need to do is stay with this market, he obviously would have been wiped out.
“Since 1900, the 20-year average real total return on the stock market fell to about zero three times -- from 1901 to 1921, from 1928 to 1948, and from 1962 to 1982. Of course, the returns were substantially negative after paying taxes on interest and dividends. In between were periods in which 20-year average stock market returns peaked at rates ranging from 6% to 10%. This meant that some people earned a negative real return from investing in the stock market, while others received a real pretax return as high as 10%.” – “Three New Papers On ‘Privatizing’ Social Security, One Conclusion: Bad Idea” by John Mueller, The National Press Club, October 14, 1997
http://www.globalaging.org/pension/us/socialsec/mueller.htm
Though inflation was low, even negative for 7 years, during the 1928-1939 period, from 1940 to 1948 it was high, 0.7, 5.0, 10.9, 6.1, 1.7, 2.3, 8.3, 14.4, 8.1, respectively.
http://www.usinflationcalculator.com/inflation/historical-inflation-rates/
My point is, this is the lure of the gamble, the Wall Street line: the market is the American economy, just buy some good stocks and keep putting your money in and they’ll begin giving you returns and you’ll be rich. And people think that this is investment and that they can predict Bernanke’s and Goldman’s and the PPT’s moves and ride up alongside the predatory insiders who get the information first and use it to play them like a cat plays a mouse. It takes a brave and perhaps foolish man (I am talking here about the average working Joe who can't spend his days market watching, not the RobotTraders), IMO, to have a lot of money in this market.
Tyler,
Can you show what the data looked like at the end of 2007?
Correctamundo.
There is nothing new in this ZH! you keep saying its bizarro? do some research, its been always like that, Retail investors always get it wrong, look at bear market bottoms, when they end and after the rebound, flows tend to go negative, then become positive after some 12-18months, market keeps going up, and then its the end of the cycle... If you showed a longer historical chart, this would be easily visible.
rsi1, it sounds like you have data going back a long time.
I have only found the ICI data going back to 2007.
Can you post the monthly ICI going back to 1990? Or, provide a link to where it can be found?
Thanks.
To add, according to the limited data I have, from 2007, it contradicts your statement.
You see, in 2007, domestic equity funds had substantial withdrawal. Additionally, prior to 2008 market correction, domestic equity funds had very significant withdrawals.
Would you like to comment on that?
Why is it that I always hear in the financial industry, past performance is not a guarantee of future returns? We as a society are entering the largest demographic change in modern financial history.
Ben Bernanke was quoted saying "We’ve never had a decline in house prices on a nationwide basis"
What do you think of that statement?
OK I am not doing the math everday.
But if this is such a run on equity by retail, the mutual funds are low on cash and dark pools are only a small % of trades?
Where is the volume? Low volume melt up, but where is all the selling volume happening?
Annuities, both variable and fixed, have experienced massive inflows of late. I know that much of the equity fund outflows is either A) delevering, or, B) repositioning to fixed income funds, but I bet annuity contract inflows is greater than both.
I found lots of interesting information here. I love zerohedge.
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