This page has been archived and commenting is disabled.

Where Do Stocks 'Belong'?

Tyler Durden's picture




 

Twice this year we have seen the US equity market become enamored of its own hope-holding, momentum-trapping, liquidity-driven, success while the bond markets (Treasury and High Yield) have remained a little less sanguine. This lack of exuberance among all but the equity players perhaps better reflects the sad reality of fundamentals (as we noted here) or perhaps this time it is different. To wit, the following two charts as a gentle reminder that gravity still exists and where the short-term floors might be...

 

S&P 500 vs Treasuries...

 

S&P 500 vs High Yield Credit...

 

Charts: Bloomberg

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 10/23/2012 - 10:26 | 2912608 tocointhephrase
tocointhephrase's picture

On the floor?

Tue, 10/23/2012 - 10:40 | 2912670 Kaiser Sousa
Kaiser Sousa's picture

on the ass of seniors instead of Depends????

Tue, 10/23/2012 - 10:49 | 2912711 Dr. Richard Head
Dr. Richard Head's picture

In the toilet?

Tue, 10/23/2012 - 11:17 | 2912815 LiesAreTheOnlyTruth
LiesAreTheOnlyTruth's picture

Down the tubes?  As George Castanza would say, "It's ALL PIPES!"

Tue, 10/23/2012 - 12:28 | 2913024 nofluer
nofluer's picture

Where do stocks belong?

P/E Bitchez!!!

Tue, 10/23/2012 - 10:27 | 2912610 Calidreaming
Calidreaming's picture

Stocks belong at dow 7k ish right now .  I thought thats where they were after waking up from a four year sleep.  Then I looked- wow  thank you Plunge protection team - you guys are swell!

Tue, 10/23/2012 - 10:28 | 2912616 Conman
Conman's picture

Too bad you used deerinheadlights.jpg yesterday. Why the reversion to reality all of a sudden. We need a QeRooomer to put us back in a unicorn infested stupor.

Tue, 10/23/2012 - 10:29 | 2912623 John McCloy
John McCloy's picture

Wait..so Ben cannot have low rates and everyone in bonds AND stocks?

 

Tue, 10/23/2012 - 10:52 | 2912721 Dr. Richard Head
Dr. Richard Head's picture

It's transitory, temporary, provisionary, changeable, momentary, passing, and can be fixed in 15 minutes.

Tue, 10/23/2012 - 11:39 | 2912877 gmrpeabody
gmrpeabody's picture

Just wait till the fourth quarter..., earnings will be great..., you'll see...

It's like Charlie Brown's Great Pumpkin!

Tue, 10/23/2012 - 11:10 | 2912793 TheGameIsRigged
TheGameIsRigged's picture

Just buy the dip already

Tue, 10/23/2012 - 10:30 | 2912624 LongSoupLine
LongSoupLine's picture

SPY a reasonable buy at 0.01

Tue, 10/23/2012 - 10:32 | 2912637 fuu
fuu's picture

There is some serious support around $0.

Tue, 10/23/2012 - 11:30 | 2912844 Zero Govt
Zero Govt's picture

not sure about that... the long term trendline support for 2017 is -$47 Trillion

..it's amazin what parasites can suck out of a nation before their game is up and it collapses

Tue, 10/23/2012 - 10:32 | 2912638 XtraBullish
XtraBullish's picture

Ka-ching ! The $VIX is now finally gapping higher and about to go right back to 50 where it belongs...

Long from under 14.00 and looking to shove it up Jamie Dimon's ring.

Tue, 10/23/2012 - 11:23 | 2912833 helping_friendl...
helping_friendly_book's picture

I haven't looked at the VIX for a month. Thx for reminding me. What a nice suprise. I used to check the vix and dow transports daily when it mattered. Looks like it might be relevant again?

triple short the SPY using SPXU!

I have been waiting for this. I think the FRBNY is crowding my trade shorting the market to bury Bo Bo.

Tue, 10/23/2012 - 10:40 | 2912667 Village Smithy
Village Smithy's picture

Stocks belong in the back of my pick-up with all the other junk I'm taking to the dump this afternnon.

Tue, 10/23/2012 - 10:44 | 2912685 scatterbrains
scatterbrains's picture

If the CFTC doesn't lower  /ES margins after the close today then that tells me Berstanky tapped out (ufc style) on the news that Germany wants to see their gold.  Has the fed pulled all their manipulation games suddenly ?

Tue, 10/23/2012 - 11:10 | 2912789 helping_friendl...
helping_friendly_book's picture

Very intuitive!

+1

Tue, 10/23/2012 - 11:16 | 2912810 LiesAreTheOnlyTruth
LiesAreTheOnlyTruth's picture

You can count on some kind of statement or words.  They're so all-in, with unlimited reserves, they will never let this go where it should.  With unlimited buying power (100 trillion if necessary) ... they can win if they just do more!

That's the fantasy they live in of course. 

Tue, 10/23/2012 - 10:44 | 2912691 icanhasbailout
icanhasbailout's picture

PPT looks to be defending Dow at -250 psychological level

Tue, 10/23/2012 - 10:45 | 2912695 adr
adr's picture

Stocks belong at the point before the fantasy began.

Sadly for most longs, that would be around March 15th 2009 when myth to market allowed companies like Diedriech Coffee to suddenly explode 3000% in a couple days.

$.88 to a buyout of $35 by Green Mountain in less than a month. I'm sure there were real fundamentals driving that move.

Or Select Comfort going from a hundred million dollar loss to a mutli-million dollar gain in one quarter. Which led to what, a 5000% surge in the stock over a year?

The miracle of Myth to Market. Obama's great gift to The Squid.

Tue, 10/23/2012 - 10:46 | 2912697 101 years and c...
101 years and counting's picture

E for 2012 will come in at ~$88.  slap a 12P on this and 1050 is about right.

but, during earnings recessions, P drops to 10.  ok, 880.

Tue, 10/23/2012 - 10:53 | 2912730 DeadFred
DeadFred's picture

Thanks. Now that trend support has a stake through its heart I was wondering where things are headed. Heading toward the end-world support at 1360ish looks good. Conclusion: don't sell VXX yet.

Tue, 10/23/2012 - 11:14 | 2912806 LiesAreTheOnlyTruth
LiesAreTheOnlyTruth's picture

I'm feeling the same ... especially since there's few if any shorts to cover quickly :)  Shorting has been destroyed by the Fed, so no covering would mean little or no bounces in the future and a lower floor.

These are the times when shorts are nice to have out there covering ... too bad the Fed shot them all in the back ;)

Tue, 10/23/2012 - 11:11 | 2912797 LiesAreTheOnlyTruth
LiesAreTheOnlyTruth's picture

Well ... if it's inflation you want, it's inflation you got!  Don't bet we fall too far ...

Check this out...

http://www.ritholtz.com/blog/wp-content/uploads/2012/10/Chart1.png

Almost FOUR times as many $100 bills being printed than $1 and up to 20x as many as other notes.

Just a matter of time until they bring the $500 back into circulation so you can pay for dinner with a single bill again!

Tue, 10/23/2012 - 11:44 | 2912896 gmrpeabody
gmrpeabody's picture

ROFLMAO..... pay for dinner...

Tue, 10/23/2012 - 11:57 | 2912930 icanhasbailout
icanhasbailout's picture

I'm guessing he's not an Obama voter.

Tue, 10/23/2012 - 12:35 | 2913044 nofluer
nofluer's picture

The Powers That Be will need all those hundreds when they convert everything to cash and run for Argentina...

... where Kirchner waits to take them away from them so she can get her Tall ship out of hock.

Tue, 10/23/2012 - 11:27 | 2912842 Nobody For President
Nobody For President's picture

PPT, report to the flight deck NOW!

Tue, 10/23/2012 - 11:38 | 2912886 Grand Supercycle
Grand Supercycle's picture

SP500 impending sell off...

Despite recurring short squeezes, SPX etc daily charts continue to break down.

DOW 8 hour chart shows H+S (bearish pattern)

http://trader618.com
http://www.zerohedge.com/news/2012-12-24/market-analysis

Do NOT follow this link or you will be banned from the site!