The Eight Scariest Charts For Equity Bulls

Tyler Durden's picture

It would appear Mark Twain's infamous quote that "history does not repeat, but it does rhyme" has never been so apt. The following eight charts suggest the rhythm is getting louder and louder. How is it possible? It's nonsense? Well at the heart of the markets, it is still us humans and our endearing greed, fear, and heuristic biases that drive the flows... trade accordingly.


The current price action in the S&P 500 is eerily similar to the movement leading up to the collapse in 1987... (via Bloomberg)


The Dow is also tracking this move almost perfectly over the last two years...(via Citi)


The next three charts are particularly concerning...

Here is the Dow leading up to the 1987 drop - showing its distance from the 55-week average and the collapse once it crossed... (via Citi)


here is an unnamed stock's price action (percentage change) over the past three years...(via Citi)


and AAPL's price appreciation from the lows in 2009 and its 55-week average...(via Bloomberg)


It's not just 1987... Here is the Dow analog again the 1977-78 period and 1905-1910 period... (via Citi)


and the Dow Transports are playing out a very similar pattern to the 1960s-70s... (via Citi)


And a Bonus Chart - for those who prefer to look at Bond Analogs... Here is the current move in 10Y US Treasury yields overlaid on 1992's movement... spooky no? and somewhat fits with a view of weakness into year-end, downgrade on debt-ceiling and collapse... (via Citi)


Machiavelli accounts for this 'repetitive' oscillation by arguing that virtù (valor and political effectiveness) produces peace, peace brings idleness (ozio), idleness disorder, and disorder rovina (ruin). In turn, from rovina springs order, from order virtù, and from this, glory and good fortune.

Machiavelli, as had the ancient Greek historian Thucydides, saw human nature as remarkably stable - steady enough for the formulation of rules of political behavior. Machiavelli wrote in his Discorsi:

Whoever considers the past and the present will readily observe that all cities and all peoples... ever have been animated by the same desires and the same passions; so that it is easy, by diligent study of the past, to foresee what is likely to happen in the future in any republic, and to apply those remedies that were used by the ancients, or not finding any that were employed by them, to devise new ones from the similarity of events.


“Everything that needs to be said has already been said. But since no one was listening, everything must be said again.” — André Gide

Charts: Citi and Bloomberg (as marked above for clarification - not all charts are sourced from Tom Fitzpatrick of Citi)

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Rathmullan's picture

I'd die one happy son of a bitch!

CommunityStandard's picture

It happened a week ago, though everyone waited until after the election to disclose it.

Zadok's picture

That's a lot of cooperation from an 'enemy' (Iran).

no taste's picture

Those charts are nothing compared to Karl Rove's influence.  The comment on the youtube video is for you, Karl.  



Karl Rove, this is free fall:

ACP's picture

How many times are you going to post that, Huffington Troll?

no taste's picture

Karl Rove's defeat is one of the few bright spots of the recent election.  We all need something to celebrate.

TeamDepends's picture

ACP, you have to admit Rove is el dousche supremo...

TeamDepends's picture

Turd Blossom, is that you?

Supernova Born's picture

Yes, but 1987 was clearly a buying opportunity and "nothing" has changed since then. sarc/

EnslavethechildrenforBen's picture

Name one stock that will keep up with the coming rate of devaluation...


That's what I thought

TruthInSunshine's picture

Bullard is citing research and claiming that Fed Monetary Policy may be considerably looser than they had thought, with a -5% NIRP, essentially (gee, really Bullard....couldn't be...The Bernank says all is right with policy, even as that policy is suffocating the economy).

This appears to be consistent with the move the BOE made in calling off QE, as they concluded it was ineffective.

Shit's going to get real, really fast, bitchez.

Fed's Bullard: Current Monetary Policy May Be Easier Than Thought

New thinking on monetary policy suggests the Federal Reserve's current stance may be even more aggressive than many now understand, a U.S. central bank official said Thursday.

Recent academic work suggests the policies now being pursued by the Fed "may currently be easier than the recommendations" suggested by traditional rules of thumb like the Taylor rule, Federal Reserve Bank of St. Louis President James Bullard said.

Relying on the work of Leo Krippner of the central bank of New Zealand, Mr. Bullard said this new thinking suggests the policies now being pursued by the Fed leave the funds rate as equivalent to a negative-5% rate.

"This value is considerably more negative than values recommended by common monetary policy rules," Mr. Bullard said. This so called "shadow rate," the official said, is "currently more than 300 basis points lower than the rate recommended by the Taylor rule."

Half_A_Billion_Hollow_Points's picture


Richard Chesler's picture

Equity bulls.

Making retards feel better about themselves. Everyday.


AldousHuxley's picture

fed is going to make sure retards have a good time until 2015.



Muppet of the Universe's picture








samcontrol's picture


I live in Argentina.

The protest are mainly for thee reasons.
1) half the country hates Christina
2) they/we DO NOT want to change the constitution for a THIRD TERM.
3) people have held US dollars as capital preservation in Argentina for decades. It is nearly impossible to get your hands on dollars...housing market has topped and stopped.....people do not want to own a currency that cannot be sold ANYWHERE. Very hard to buy pms..hint...people buy LAND..still cheap...

Christina will not achieve third term, and a new mother fucker will come in. sorry but ARGENTINES have HAD IT with REVOLUTIONs. ALL they want is anything that looks a little like democracy...

no taste's picture

News flash: Karl Rove's organization short on cash.  Rovian trolls desperately seeking employment elsewhere.

Rogue Trooper's picture

No-taste... you have only been on hear for about 20 weeks?  What you should have noticed was that the prevailing argument hear on ZH is that there is little discernible difference between either Team Blue or Team Red.  Another theme is that NOTHING can or will be done by TPTB (add the current Prez/Puppet/Pet) to mitigate the exponential rise to the eventual day of reckoning.  So you should make whatever preparations you can.

I used to feel kind of sorry for useful idiots like you.  You so passionately volunteer your time to promote your idol.  Now, all I can see is a vision of you enjoying your cat food (reserved for the privileged card members like you) in the FEMA camp when the time comes......and that time is coming.


Lord Koos's picture

Who is the democratic party's equivalent to Karl Rove?

 I read on Zh recently that

(a) it doesn't matter who is elected, it is all the same.

(b) but it's all Obama's fault

(c) and Obama won, so we're fucked





SmallerGovNow2's picture

In that light, here's a classic rant from Judge Napolitano, must read for ZH'ers...

ACP's picture

He's a douche, but not stupid. Getting the 2nd worst President in history re-elected is not an easy task.

TeamDepends's picture

Totally with you, brother.  And the way he kneecapped Ron Paul earlier this year would make Tanya Harding proud.

johnjkiii's picture

How old are you ? 12? Try Johnson, Nixon & Carter on. Those three fucks were: a stupid crook; a weirdo crook and a stupid weirdo? Then we have the shit-for-brains in the WH now. Come to think of it Georgie looks a little better now. Just how long will some of the blow-jobbers on here continue to blame him? I know, I know, he caused the dot.splat fiasco and the 9/11 shindig was his idea too and of course, he sent the Navy out to heat up the Gulf so Katrina could flood out the intellectuals in NO but really, what is it you are blaming him for? Really?

Flakmeister's picture


Everybody knows Dick Cheney was the president...

no taste's picture

Looking at all the down arrows, it sure seems like Turd Blossom has many ZH accounts and nothing much to do.

TeamDepends's picture

Well, he's looking for a job and there aren't many opportunities out there.

Rogue Trooper's picture

With that CV?.. he should at least get to through the online selection phase for Wal-Mart.  Will need to fine tune his LinkedIn profile to get the Recruitment Algos to find him.

Perhaps the Prez (what his name?) could give him an entry cleaning gig at the WH, work up from there. A bipartisan gesture?

Just trying to help.

Flakmeister's picture

I do not doubt for a moment that there are people that are employed by CrossRoads GPS paid to post here...

Lord Koos's picture

two wars off the books?

dugorama's picture

W looks good?  really/  lying liar starts wars, ruins economy, lets guard down and gets 9/11 (or did 9/11 - either way he's scum), preens on aircraft carriers in flight suit and you think he looks better than Obamy?  you are blind to facts

Overfed's picture

2nd worst? You'll be singing a different tune by 2016, if not sooner.

GeezerGeek's picture

Karl Rove, like much of the RINO/Republican establishment, exists, apparently, to prevent a true conservative from gaining ascendancy in the Republican Party. It's almost as if the RINOs are the PLAN B to the Democrats' PLAN A. TPTB seem to prefer NWO/internationalist types from the Democrat party (PLAN A), and the fallback position is to get some NWO/internationalist type from the RINO pool (PLAN B). True conservative/small government/constitutional government types need not apply. Any that are get visciously attacked by the likes of Rove, complementing the similar activities of the Democrats. Look at the effect Rove had on conservatives/libertarians like Ron Paul, Palin, Bachmann, etc. Look at what the Republican establishment did to Allen West, using redistricting to remove him from Congress. (No snarky comments about those persons mentioned, please, I'm not evaluating their credentials or ideas per se, just using them as illustrations of conservatives attacked by the Republican establishment.)

Indeed, the meme common on ZH that there is really no ideological distinction between establishment Rs and Ds seems to be illustrated by the actions of Rove and Friends.


overmedicatedundersexed's picture

Geeser it is so obvious..that no one in media will talk about party two heads both controlled by NWO..papa bush was so bold to state it yet many refuse to see it..R or D dr rd RRRRDDDDD, why did 15 million voters not vote this go round for R OR D?? some of us are waking up. Fuck Rove bush and mccain and mitt..obuma is one of them,democrats are the most clueless of all.

AldousHuxley's picture

it is not who the president is, it is who the voters are.

In iceland voters took action.

In America, voters watch TV.

Offthebeach's picture

An island far from anyone, surrounded by ice cold water, plainly educates that there is reality, and it will kill you.
Blivotting you way past the 300lb mark in your section 8, you don't notice anything until Dommino's rejects your for delivery pizza and breadsticks for 5 with 2 2-liter diet Coke because the EBT card be no damn good. Only then.

sessinpo's picture

I hardly think Rove or anyone on either side of the political football that is set for life, considers him/herself defeated. Until one is sitting in a hard labor prison, they all go to bed smile on their face and wake up the same way.


On the other hand, their are millions of citizens that might fit that description, from both or neither party - you know, the citizens that get screwed no matter who is in power.

macholatte's picture


voting machines hacked?

why isn't anybody talking about the fraud?


CA Prop 37 GMO food labeling initiative defeated



GeezerGeek's picture

Why talk about hacked voting machines when there are so many other things of more importance to discuss. Like Americans abandoned and killed in Benghazi, or aid to Al Qaeda in Syria, or Mexicans killed as a result of Fast and Furious, or billions of dollars stolen by Obama bundlers (think MF Global/Corzine). Those are much more important issues than mere voting irregularities.

What's that? We're not talking about those important issues, either? Well, then, I guess that they're not so important after all. At least we got to repeatedly see Christie give Obama a hug recently, that sure was important. (Not that I'm minimizing the tragedy in NJ, the state in which I grew up.)

If something is important the MSM will let us know, as soon as they get the marching orders from their political handlers.

Ivanovich's picture

If you were Iran, who would YOU want in the White House?

Rogue Trooper's picture

Epic FAIL.  The Iranian's would be praying for Bush III and the sheeple to say NO MORE WAR - at least they have a sporting chance!

However, now they completed fucked.  When President "O" say's  " My fellow Amerikans, as I promised to you, those EYE-RAIN-NEYONS will NOT be allowed to get a Nu-cu-lar weapon... the sheeple will cry YES let's turn 'em ALL into GLASS with our Nu-cu-lar arsenal of PEACE!

WTF this will not end well... I scared the shit outta myself.

Overfed's picture

If I wanted to be left alone and traded with fairly and freely? Ron Paul. If I wanted to be bombed? Anybody else.

vast-dom's picture

There's only ONE LITTLE ISSUE with all of the above: where the fuck was the Bernanke variable in any of that??????? Listen, great charts and good intentions I'm sure, but these days the central planning has perverted everything and charts, well, they're nice to look at and think you've got something figured out there. But in reality we have no fucking idea. This market could tank harder and faster than anything ever witnessed or it could slow burn levitate a la Japan for a thousand years....