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UST Curve And Dollar Back To Post Fed Announcement Levels, As Stocks Blissfully Pretend Nothing Happened
After some gyrations in both the 2s10s and the dollar, both are trading at the levels hit post the Fed announcement.
The one outlier, of course, is stocks, which are trading oblivious of not only the Fed announcement, but everything that is happening in bonds and FX. Does it mean volume is horrendous and a few algos have again hijacked the market? Yes it does. Welcome to OpEx insanity.
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Goldman Sucks W.O.P.R. :
Do you want to play a game?
Fed's move is to stop the train wreck in UST. It looks that no one really bought their posure. They can use the AH to ramp up the ES, but hard to manipulate the bond market.
1+
Everybody by now has understood, that this was just posturing with a "stronger" DXY before entering into the UST auctions next week.
China doesnt want them, and the Japanese being bullied to fill up more of the gap in demand. Therefore Toyta is the hostage now.
ITS SO OBVIOUS & DISGUSTING whats coming out of the US !
This recklessness of the US Fed, that will not be respected and it will not pay off.
Every action finds a counter action.
Nobody trusts in anything coming from the US government anymore. The Fed stinks, the government covers it.
I buy physical GOLD and take delivery.
Exactly.
Now here's an Anon who knows his ass from a hole in the ground.
It's like watching a soap opera.
all the USD china is holding have gained what % over the past 2 months? and just to think a few months ago everyone was convinced middle east and china were going to sell all their $'s and buy gold. (not everyone, just gold bugs)
Of course it's not going to happen overnight. That would destroy the value of their investments. Foreigners such as China want to diversify out of the US dollar of course in a way that would do the least harm to their current holdings. In other words considering that the sheer debt issuance by the US government is much greater than any foreign nations can cover the dollar is fixed in a long-term downtrend.
Note to the PPT: The legendary stock market analyst, Charles Biderman and me, know what your doing. You look like fools. When the dim-witted market players like the mutual fund managers and Barry Ritholz figure out that your illegal activities are the only thing holding this market up, there's going to be a giant crash. Then you'll look even more stupid than you already do.
Nothing did happen...non-event. If there were to be panic again, it would be reduced.
Patience, young jedis, patience.
Yes, patience is the name of this game. Did anyone really expect a big sell off on that news? Now we just have lousy earnings today and last night and Japan-like CPI to rally on today.
News doesn't matter. We will sell off next week.
just tagged 61.8% retrace off the 1044 low.
do or die time arriving
Do it. I dare you.
I know the paypa stacks are eating part of the pie, but people are still hungry. I think the correction is over. I think inflation is already a problem.
I think people are seriously questioning holding paper gold, but how many? I mean, with Soros hawking it and all, maybe there are some fools left. I think people start piling into the rothschild silver now. I see a very slow move higher to $18 by ealy April. Then it is either inflation or deflation time big.
But Ben has his press primed. They will flood IOUs to every man woman and child in Khali et al. The doelarr will be officially on the Xross by then.
Well, I kinda did. And the Nikkei fell 2.05% and the Hang Seng fell 2.59%. Those are pretty big moves.
The S&P is down 0.4% so far this morning.
Why Europe is defying gravity, I have no idea.
Nothing did happen really. It's like a really fat guy went for a jog one day out of the whole year. Big whoop. Stocks won't even retrace yesterday's gains by the end of Friday. Not a market to short since Bernanke WANTS inflation, he wants the lower and middle class to be ruined.
What's a few trillion between friends? ;)
hmm. there seems to be too much expected of this post, for example BB and other FRB govs have made it clear there was going to be an exit at some point. Raising the discount rate isn't the same as raising the ff rate which would decrease yeild curve steepness. Additionally this move only costs banks ~200mln per year? not exactly a game changer from a policy point of view, but it does have undertones of a change in policy...slow moving... glacially slow moving policy changes. BB is fed chairman for another 4 years afterall.
after options exp, there will be no reason to continue to prop up stocks. this happens all the time when a bullish options weeks happens
Not trying to single you out and say you're going to be wrong, but I have heard this EVERY month since last March.
Ditto. Every month, I've heard the same thing. Don't anticipate the market, just move with it. If it clears the 50 dma today, time to go long SPY. If it turns the other way, consider a short. Roll with it.
opex aside, i believe the fed is looking to have a market sell off next week to support the record level of gov't issuance for that same week.
its like clock work - huge issuance weeks, markets down. did someone say efficient markets? is anyone graphing the correlation of gov't issuance and equity market up/down days?
Nothing serious happened indeed. Please see how much excess reserves US Banks have in the system, so they really do need this discount window. The Fed needs to show it is doing something and they earn hard their salaries....
http://www.businessinsider.com/banks-cash-hoarding-could-halve-and-still...
Yep Bylinka and for those who understand the dynamics of the last Great Depression in relation to that article, will realize where this is gonna go eventually.
UST Curve And Dollar Back To Post Fed Announcement Levels, As Stocks Blissfully Pretend Nothing Happened
Nothing happened because REALLY nothing happened. The FED's announcement was what it was.......a big nothingburger.
Insert admiral Akbar "it's a trap!" clip here.
Dosent anybody get it? The stock market and the economy is corrupt. The numbers on the indexes are nothing but a few keys controled by GS. They control the market. They can wipe out any short ( or long ) with the stroke of a key on the keypad. I hate it when people try to figure out the fundementals of a market that is controlled by Hal the monolith.
Thanks for your post. Now I get it. Thank you.
So stocks are now on the rise and it's yet another day that makes no sense. Discount rate increases, potentially putting pressure on bank's profit margin via a flattening of the yield curve. And then core CPI comes out negative. Someone please explain to me how can a declining core CPI accompanied by a slightly growing producer price index be good for stocks. Bonds I can understand. But stocks.... wouldn't the higher costs of inputs and a declining revenue be BAD BAD BAD for corporate profits??? And if yes, exactly what news is pushing the stocks up? Walmart's super-exciting revenue forecast?
Robot market indeed.
Very good my fine pupil, you get an A+
So stocks are now on the rise and it's yet another day that makes no sense. Discount rate increases, potentially putting pressure on bank's profit margin via a flattening of the yield curve. And then core CPI comes out negative. Someone please explain to me how can a declining core CPI accompanied by a slightly growing producer price index be good for stocks. Bonds I can understand. But stocks.... wouldn't the higher costs of inputs and a declining revenue be BAD BAD BAD for corporate profits??? And if yes, exactly what news is pushing the stocks up? Walmart's super-exciting revenue forecast?
Robot market indeed.
Yo Neo, you know the CPI basket is always adjusted with cheaper foods as costs go up. So, the current basket includes, Spam, Hot Dogs, Spray Cheese, Canned Peas, Hostess Snow Balls and Fried Ice-Cream.
Inflation is a process, not an event. It's already here, so , prepare now.
Note to self: Hire a 15 year old PM who has never read an economics book and would not now FCF if it hit him. Performance would drastically improve if I actually knew less...
Indeed, NN Taleb explained that if you simply traded every day based on the previous day's performance, you would do better than average.
I'm liquidating most of my portfolio. Watching paint dry is more exciting. Fed increase yesterday was a warning call. Liquidity is getting drained and volume today is very bearish for stocks. SPX 1100 op/ex on top.
Just my 2C.
Feels too much like August '08.
Warrent auctions have to be a success. Market will move down next week for bond auctions and then back up through Feb for the warrent sales next month. After the big banks warrants are sold, watch out below.
Also, March will be lots of fun as Dubai annouces their debt plan, income tax receipts start to hit states (lots of states hold back on taxes - tax advice - apply last year's return to this year and stop all taxes to the states until you go over your return from last year), eruo starts to unravel due to Greece, Spain, Italy, Portugal, etc.
As they say in Asia: May you live in interesting times. But it is not a blessing but a curse.
The Games Bankers Play—to fool the sheeple while giving a nod and knowing wink to the boyz in the back room… From Fortune:
The Fed said late Thursday it is raising its discounting rate by a quarter percentage point, or 25 basis points, to 0.75%. The central bank said in a statement it made the move in response to improving financial market conditions.
The move is largely symbolic, because banks do little borrowing at the discount window.
The unanimous decision to boost the discount rate also has no effect on the more widely watched federal funds rate, which measures the rate banks charge each other for overnight loans. That rate is expected to remain between 0% and 0.25% for the foreseeable future, given the slack in the labor market and the still fragile state of the economy…
Doelarr to spin its wheels @81-83 until Kali/NY/N.C./Florida/Mich fail this spring/summer...again.
Equities to move marginally higher. Commodities to move substantially higher. Doelarr to recede from this plateau in mid-late march.
By april the doelarr will be Double Xrossed. the death rattle will be heard world wide. You have 6 weeks left.
There is little relationship between policy actions and market performance anymore. Soon, it won't matter at all what the Fed says or does. What will be will be. HAL has now become self-aware.
Tim Geitner is on the telephone right now with Ben Bernanke saying; "What the fuck is going on? Where is the equity pull-back that you promised?! How the hell do you expect us to move $126 billion worth of paper at low rates next week when stocks are rallying? Nobody is going to show up! We are going to get killed!!! Ben, you had better get you shadow bidders in line next week or we are toast."
So, here's what you do: Deploy a 25% currency bond allocation to a USD based portfolio, with 25% to precious metals, commodity stocks (hold some dry powder & agra funds. With the other 50%, you deploy a major leveraged short equity position along with a mix of long dated treasury puts, play some TBT, buy and hold TBF. Anything left over you pu some money in telecom and utility (defensive equity plays) (10-15%), a defensive hedge fund allocation, some US income funds (LQD & AGG). Then go play golf every day because watching this is bullshit!.
Oh, the other thing you do is play the USD long side as conditions develop via outright FX. Bingo!
How many calories are there in physical gold? And btw, if I had food and no one around me did, I ain't selling for yellow metal.
hyuk hyuk, yee haw.
O campaigning for Harry Nevada Bob Reid today
The DOW / SP500 / EURO / COPPER counter trend rally continues.
http://www.zerohedge.com/forum/market-outlook-0
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