Thousands of investors with stop-loss orders on their ETFs saw those positions crushed in the first 30 minutes of trading last Monday, August 24th. Seeing a price blow right through your stop is perhaps the worst experience in all of investing because it seems like such a betrayal. “Hey, isn’t this what a smart investor is supposed to do? What do you mean there was no liquidity at my stop? What do you mean I got filled $5 below my stop? Wait… now the price is back above my stop! Is this for real?” Welcome to the Big Leagues of Investing Pain.
Since the start of the Second Great Depression, the US economy has lost 1.4 million manufacturing workers, but has more than made up for this with the addition ff 1.5 million waiters and bartenders.
Moments ago Challenger reported August job cuts, which at 41,186 were a 60% drop from the 115,730 reported last month (the highest since September 2011), which however was driven by a one-time mass layoffs last month in military staffing. Putting August in its correct perspective, the number was 2.9% higher than the same month a year ago, when 40,010 planned job cuts were announced. So far in 2015 employers have announced 434,554 job cuts: that is up 31 percent from the 332,931 planned layoffs in the first eight months of 2014. What is worst, and what reveals the true picture of the economy, is that with monthly totals averaging 54,319, 2015 job cuts are on track to exceed 650,000 for the yeajesusr, which would be the highest year-end tally since 2009 (1,272,030).
All eyes will be on Mario Draghi on Thursday as expectations for something big from the former Goldmanite have grown over the past two weeks. More specifically, some now think the odds of QE expansion have increased considerably in light of collapsing eurozone inflation expectations, the incipient threat of some $1 trillion in QE-offsetting EM FX reserve draw downs, turmoil in China's financial markets, heightened volatility across the globe, and chaos in emerging markets from LatAm to AsiaPac.
This nation has become a land where character and integrity are secondary to profits for the few and self serving interests of the powerful. And as we are seeing already for the third time in this millennium’s infancy, stability and prosperity can be but short lived for even the highest paid CEO’s in such a world.
Something is afoot as de-dollarization escalates around the world. With CNY/RUB trading volumes up a stunning 400% year-over-year to record highs, and hot on the heels of China's (and much of EM Asia) dumping dollar assets, Russian President Vladimir Putin has just unleashed a new bill aiming to completely eliminate the US dollar from the trade of goods.
“If the freedom of speech be taken away, then dumb and silent we may be led, like sheep to the slaughter.” - George Washington
A President Trump may be able to make small changes here or there, “But the setting of the bureau’s activities is determined by rules and regulations which are beyond his reach.” Presidents come and go, but the unelected bureaucracy always remains. For all his simpleton bluster, even the mighty Trump is no match for the leviathan.
The discussion of why "this time is not like the last time" is largely irrelevant. Whatever gains that investors have garnered during the recent bull market advance will be wiped away in a swift and brutal downdraft. However, this is the sad history of individual investors in the financial markets as they are always "told to buy" but never "when to sell."
As QE3 came to an end, World Stocks plunged back to economic reality before The Fed's Jim Bullard promised 'moar QE' if things get really bad. Well things have got really bad... JPMorgan's Global Manufacturing PMI just dropped to its lowest since July 2013.. and the 'wedge' between economic reality and market perception is closing rapidly.
It doesn’t make sense to you. And it shouldn’t to anyone. Unless – they first go directly to the ‘house bar and media entertainment center’ that is always open and always free with spiked Kool-Aid™. It works better and is cheaper than actual liquor. It’s not actually a drink per se. It’s just hoopla and endless propaganda for the masses. That’s why it’s free and encouraged. It keeps everyone happy within the walls and enhances the experience, while simultaneously acting as one non-stop running commercial to entice anyone foolish to think they too can get rich quick. All legal by the way. The laws were adapted to fit the criteria.
Construction spending grew at 13.7% YoY in July. It has only grown at a faster pace than that once - at the very peak of the idiocy in Q1 2006. So that got us wondering... how is it that Construction Spending is surging as Lumber Prices are collapsing? (unless homes are now made of Twitter share certficates). The answer is simple - lag... and we have seen this picture before...