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Wildebeest Herd Running Back to Deflation
Yet another "Wash, Rinse, Repeat" cycle, as the Treasury Dept. attempts to hock out another $100+ billion, stocks are sold, de-risking returns, and investors lap up U.S. Dollars and Treasuries with a vengeance. It's getting way too easy.
It's getting to the point to where a lab rat or a circus monkey can program the Robot Trading platforms at the largest, most sophisticated hedge funds.
Just follow the Goldman Sachs Helicopter hovering over the herd and wait and see which direction the air horns are blasted to spook the herd.
Now treasury yields will plummet for a few days, stocks will sell off, and once again, zero interest margin borrowing will prove to be too irresistable and the "Animal Spirits" will eventually return.
Meanwhile, trench warfare is now in full force amongst the hedge funds battling each other on the floor.
Take note how U.S. Steel and Nucor were down 7% today, yet short sellers in PCX were torched with a flamethrower when that stock was up 18% at once point in the day.
How about the short sellers in BIDU who had to endure the non-stop meltup off the lows for most of the day?
And of course there were the usual and assorted breakouts and shank jobs. All because one too many hedge funds decided to "throw in the towel" on portfolio diversification and put its entire fund into one stock.
By the way, anybody see this hooker get sent back to rehab??
Well, if they cannot get a bid under the bank stocks within the next day or so, we'll have to see if Bernanke, Geithner, LLP has any new tricks up their sleeve to rejuvenate this sector.
Perhaps Meredith Whitney is now being entertained by a pack of Chippendales, fine wine, and a blank check to shop at Nordstrom's. Tab picked up by Goldman, of course.
Maybe tomorrow she'll upgrade a few key stocks at the absolute worst time for the short sellers.
Who knows??
If some sleazy trick isn't pulled off soon, then its back to the "Great Deflationary Collapse", and the poor Federal Reserve will see its toxic assets vaporized into a black hole.
Let's see what happens tomorrow....
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classic: "Meredith Whitney is now being entertained by a pack of Chippendales"
Goldman is probably on the short side of the trade at this point. Everyone knows for crying out loud, that there NEEDS to be a decent pullback before new investors are going to jump into the cold water from a 50ft tower, both feet first.
Unless QE 2.0 gets announced, this sucker is not coming back. Even if it does for a few days, the trend is now downwards.
Note to Ben. Give us more cash. We need more paper cash!
Free for all!
There are no new investors. The whole thing has been Wall Street and hedge funds and they won't have an exit.
Right but eventually they need new suckers for deadbeat stocks. The promo cycle based on "green shoots" and "recover around the corner" is done for now. Wait for the new slogans and the new promo before buying.
Betcha main street increases redemption pressure on mutual funds as rally staggers; get their personal p&ls all spiffed up
Main street missed the collapse last year and is lucky to have recovered some or even all of it. Some may have come out ahead.
How many times do you get lucky like that?
Any investor that held during 2008 and 2009 is now at least looking at options.
There are winners and there are bag holders.
No they don't lead but they are slow to turn - after a handsome drubbing the thirties investors stayed away from stock peddlers for a long time - once burned twice shy - they are going to buy cheap farm and timber land this time. They'll make it through - China needs them - Chinese are getting old need this last push.
I think Meredith will downgrade the banks any day now. They are weak. The regs are changing not in their favor. She could tip the stocks over the edge and be the legend that called the top.
Whitney's credibility must remain in question after the meeting with Sheila Bair and the half ass redaction attempt.
I've been a fan of yours Meredith but that meeting and the attempt to cover it up by the FDIC must remain in the forefront.
I wonder if zh will be putting up some of mw's stuff again?????
We can do it. We just need to get every GenXer back into a 401K. To do that, we need to let him (or her) know two things. First, that somebody (not us) ALREADY took his Social Security and Pension Fund. Second, that his 401K will be bigger (through the miracle of compound interest, which was perfectly demonstrated last year) if he maximizes his contributions during a Bear Market. NOT that we are in a Bear Market, because Bear Market got extinct, just like Passenger Pigeon, Depression, and Tyrannosaurus Rex, which was around 6,000 years ago but then, one day, went out and got extinct. We are not sure about Deflation. If Deflation helps bring in his 401K, then Deflation did not get extinct.
Why not arm every Gen Xer, split them up into platoon's and give them 2 or 3 weeks of small arms training and marksmanship practice?
The Gen-X'ers are unemployed or working at Starbucks because that political science degree just isn't drumming up any job offers. They have no 401K's to raid and nothing to contribute even if they do have one.
As a GenXer I can assure you that most of us have squat in our 401Ks. When you're working as freelance consultants for companies that have the half-life of thrice-cloned may-flies, 401K investments are more often the punchline to a bad joke.
Moreover, a significant number of us have been watching this cluster-f**k coming down the road for years and basically just steered clear, knowing full well that we were about to see a revisit of the tech nuclear winter of the early part of the decade that most Boomers snoozed through.
On the other hand, yeah, we're arming ourselves. However it's not going to be in defense of the Boomers ... we're the lean, hungry ones that have to deal with the mess that you guys left behind.
Back in the Great Depression, municipal bonds and some corporates were sold in $100 denominations called baby bonds. So Citi takes a couple of trillion of CDOs and CREs and other crud, and reterritories them into $100 baby caca charging each of their grateful credit card owners $49.95 for three installments to cover shipping and handling, caca is free.
Hey RobotTrader, just love your comments, right down to the point. As a trader living on the "old continet", I think it might be worthwhile checking out the sudden spikes in WTI we are experiencing recently., its just happening too often to be accidental, especially during european closing times.
My point is, Forget all the illiquid small stuff, where the big boys are slowly loosing control is in the liquid and globally traded things.
One thing I just cant understand is why the US still thinks they are the only trading nation existing and why every body else will dance to their tune...WAKE UP!!!
Well said Anon.
Exactly why it is that the US is so ego-centric and self absorbed by their 'perceived' importance is but a mystery to me. Dont get me wrong, I fully appreciate why the US has been, and remains (to a greater or lesser extent) important. But, what too many people fail to understand is the bigger picture behind all the noise - specifically in light of the BoE and ECB management of the last 2 years -- there is no comparison, I'm sorry -- on one hand you have a blatantly reckless FED bludgeoning the almight shit out of free market capitalism while on the other you have 2 prudent, and intelligent institutions who are showing infinite wisdom (comparatively, at least..) in their actions.
Say what you will about sterling and the euro and the state of the underlying nations, BUT, the management of the broader economies by these 2 central banks show considered, diligent and far more prudent management strategies.
The US (read FED/US dollar), is an effective subsidiary of the Bank of England, always has been, always will (sorry to piss on your party candle... It has been (very effectively used as) a political buffer (read military clout/global enforcement agency) and equity markets proxy (read US dollar and US stock markets. The sad truth here is simply that both are expendable.
Let me say that again: both the US dollar and US politics IS expendable!
The US markets have been leading the way of the world for decades now, but this is primarily in for form of capitalims riskiest asset - EQUITIES. London, for instance is infiniately more important! it houses elements of western capitalism of significantly greater importance than that of risky equities, namely that of the Bond Market, the physical Gold market (comex paper gold -- WTF??)and lest we forget, the FX market. Oh, and it just so happpens we have the Euro next door as well, hmmmm..imagine that.
The US is (becoming 'was') an experiment! - kicked off by a little document called "Modern Money Mechanics". The experiment is drawing to a close.
Result: success; with minor collateral damage.
On a brighter note, the US always do the right thing! Afte exhausting every other possibility first!
This is not coincidence, or bad luck folks.
Speaking of deflation, I picked up corn on the cob today - 8 for a buck!
yankee, that's not deflation, that's government intervention via massive subsidy.
next time at the store, price a mango.
oh my precious bears, how quickly we have become cocky:
thursdays fake GDP data is going to break bear backs.
becareful.
agreed, the best bear trap is the last...and vice versa...
Love the robo posts! The term Wildebeest rocks! Not a lot of animals in this one though, just one foxy lady..
Robo,
good market commentary, but your pic is not up to the usual standard.
To help out on this:
http://www.axellauer.de/aktfotografie/aktfotografie-7.htm
and for the gals:
http://www.angelika-lehner.de/home/galerie/akt/j10.html
Maybe them ACC lifing college students, resplendent in NILE -2.35 jewlery, lounging around the POOL -10.84% in their BGFV -7.3% team wear won't be renting the latest Toyota FX from DTG.
Right on with Meredith. That skunk started this bs with her early JUly call on GS. Exactly right, Robo.
When the last short is burned. The balloon cools rapidly and falls.
Deflation (Negative Inflation) Graph Eurozone http://www.ecb.int/mopo/html/index.en.html
FCF might be in trouble here real soon if it can't get over 6.45
Something strange about CE too... I wouldn't go there if I were a bull...
http://today.msnbc.msn.com/id/33445823/ns/technology_and_science-picture...
I couldn't figure out how to weave these pics into a story, but they are some amazing pics non the less...
Those SPDRs are found on state street,they fly after auction. Good pics.I especilly like the one that looked like the dung beetle.BD
all this means is we end up paying the same for less at the grocery store. I noticed the qty's are smaller and discount sizes are off the shelf during deflationary cycles. The average non-investor never catches a break.
http://secmal.blogspot.com/2009/10/correlation-update.html
The price action in gold has highlighted the speculative bubble for all it is.
The bounce in the dollar has seen no underlying support for gold.
Where are the Wildebeest pictures? I love the Wildebeest stampede scenes.