Dow Closes Over 14,000 - Highest Close Since October 2007

Tyler Durden's picture

While the close was not exactly bullish (just look at HY credit, volatility, and homebuilders), the only thing that matters is - Dow 14,000. The highest close since 10/12/2007. Since that time, 10Y Treasury yields have dropped from 4.68% to today's 2.03% - the first close above 2.00% since early April 2012. Risk-assets spent the day catching up to equity's early lead and recoupled into the close. Some modest after-hours weakness to the shine off an otherwise exuberant day as Treasuries snapped lower in yield on NFP and spent the rest of the day surging higher in yield to end the week +6 to 8bps. Silver gained 2% on the week - beating stocks, as the USD dropped 0.7% (almost equal to Gold's gain). With stocks unch from Oct 07, perhaps it is worth reflecting on Gas prices being up 58% since then... but that would spoil the party...


A little context for today's exuberance - cross-asset class performance from 10/12/2007...Bonds +28.5%, Stocks Unch.


Since October 2007...'wealth' has changed...






and the rest...


and today...


and the sectors...(homebuilders ugly but Utes winning?)


Now that was a crazy day in Treasuries!!!


Stocks led the risk-off move as the rest of risk-assets in general did not play along initially - but mysteriously perfectly recoupled into the close...


Gold and Silver had a good week - outperforming stocks - as the USD lost 0.7%...


Source: Bloomberg and Capital Context

Capital Context (@CapitalContext) LLC is the leader in integrating credit-market data to actively trade equity markets. From our world-renowned intraday 'CONTEXT' and 'SPY Arb' models to the daily long-short equity portfolio, sector-weight updates and tactical asset-allocation strategies, Capital Context offers sophisticated hedge-fund strategies to the active trading community.

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Say What Again's picture

Don't worry about inflation

Whenever one talks about "inflation," it should be noted that the fed/gov has a leg up on the problem.  They call it the "Hedonic Quality Adjustment."  The use of "hedonism" is really creative.  So when a new computer is more powerful -and- more expensive than the previous version, they will say it actually costs less because it makes you more productive and presumably more hedonistic.

So the bottom line is that even though prices are going UP, the fed will tell you that consumer prices are going DOWN.  So those big expensive "smart" phones are actually making inflation go DOWN!!!

A nice little book that talks about this is;


King_of_simpletons's picture

Okay what next ?

Bernanke has achieved a number after so much QE and waste.

Lohn Jocke's picture

Next, Ben Diocletian Bernanke sets a price ceilint to solve that pesky inflation problem.

Say What Again's picture

Also -- I like the way they usually exclude fuel prices from their calculations, because they are considered "transitory."

All I know is that if fuel prices to go UP, I'll be a lot more "stationary."


Dre4dwolf's picture

Everything is transitory because when we all die we wont need to eat, thats why food prices are transitory, people "transit" through life and go to heaven where Ben Bernanke gives then Monopoly Money to buy stocks with and gamble / party.



GOSPLAN HERO's picture

Say What Again,

You look like George Obama.

How goes life in your hut?

Has Barry sent you any coin?

Say What Again's picture

"George Obama?"

Who dat?

I *WAS* thinkin bout moving into dat big house in D.C.

Lohn Jocke's picture

That's the wonderful thing about economic measurement. I could say I have a 14 inch penis, but you're just measuring it the wrong way.

Say What Again's picture

Can your girlfriend be heard all through the neighborhood?

That's all that matters!

mkhs's picture

If she could, it would probably wake my wife.

Bindar Dundat's picture

If it does that it will still be down when measured against gold since 2007.

buzzsaw99's picture

Greedscam only had to cut rates to near zero.

the bernank had to do bailouts and qe infinity

the next time they will????

kliguy38's picture

the next time they will????  Just imagine what pale green glass stretching as far as the eye can see 

Dre4dwolf's picture

They will Jay Wilson it and Double it.

Shizzmoney's picture

Employment stagnant, wages falling, growth contracting, institutions failing....... and markets booming.

I give up.

IridiumRebel's picture

Just loaded up on Herbalies, Netfux and COCAINE! Me and Menendez are jetting down to drop loads on 16 yr. old hookers in the DR!

Dr. Engali's picture

Now that Jobs is dead will Apple please settle their dispute wit Adobe? Fuck I hate when I can only watch half of what's on the web!

buzzsaw99's picture

they settled. view this [pdf] [/just kidding]

edit: why settle? they could buy adobe for a measly $20B.

Say What Again's picture

And when will ORCL fix the F*~k$ng JAVA bug?

Wait -- It just dawned on me why ORCL isn't fixing that bug!  It helps their biggest customer monitor the web.

buzzsaw99's picture

Java and their thrice daily updates. I hate those bastidges. They are the biggest security breach on the interwebz.

ToNYC's picture

Steve may be dead, but Apple only has Steve's entitled children following. Like you were saying, they stay DENIED. How cool is that?

SmallerGovNow2's picture

Thanks for that, Schiff is the bomb...

Bon Hagar's picture

Folks that ignore history are always enamored with how shiny 'new' objects are.

Tango in the Blight's picture

History is pisstory..


/6th graders and Fed board members

Shizzmoney's picture
Millennial Jobs Report: Youth Unemployment Reaches 13.1 Percent as U.S. Economy Shrinks

“President Obama says America should be ‘investing in the generation that will build its future,’ yet four years of his government-driven economic policies have left us with record youth unemployment and an economy that is literally shrinking. My generation is suffering disproportionately,” said Terence Grado, Director of National and State Policy at Generation Opportunity. “Instead of staying the course and doubling down on failure, we need a new strategy that encourages the private sector to grow, invest, and provide real opportunities for the millions of young people who have great skills, are ready to contribute, and have waited long enough.”

Read more:
goldenbuddha454's picture

The youth in Europe would give their nuts to be an American youth right now.  Try 52% in Greece!  Crazy times we're living through.  Glad I got that vasectomy.

Motorhead's picture

Charts over 14,000, bitchez!

Tsar Pointless's picture

Record highs coming by months-end.

That's about all the little people will care.

Dre4dwolf's picture

Markets will Rally Forever

Markets will crash


Which one is it more likely to be?

Someone remind me what happened last time we were here... o yea right didn't a financial disaster happen or something? my memmory is short, but I remember the markets were all high as a kite and oblivious and then KASPLAT "everyone print money so we don't go to jail, JOHNSON WHERE THE FUCK IS JOHNSON (two sec. later they hear Johnson hit the curb at terminal velocity).


Yea... not gona end-well.

IridiumRebel's picture

DOW <----26,000 by 1/1/14

DOW <----8,500 by 1/1/14

Dre4dwolf's picture

8,500? i know we are supposed to stay optimistic but really man?

IridiumRebel's picture

I was gonna say 1500, but I thought I should account for Bernank's toilet paper printing

edifice's picture

I'm really waiting for DOW/Gold 1:1 and DOW/Silver 1:30

Motorhead's picture

I can see it now...a phony economic system runs up (to say nothing of all the newly "printed" fiat currency) the stock markets...people (maybe) begin to jump back into the market...people believe all is well...people (nominally) get rich...big gum'ment likes capital gains taxes.  There are way too many bozos on this bus.

LongSoupLine's picture

congratulations Bernanke you fucking shit eating bank fuck.  Die painfully you fucking walking economic piece of retarded shit.

IridiumRebel's picture

tell us how you really feel

Motorhead's picture

He must not be feeling well today...that's rather mellow!

falak pema's picture

Big Oil and its in refining...says it all. All the while they junked Euro refining.

ExxonMobil affiche des bénéfices mirobolants pour 2012 grâce au raffinage

45 bliion AT; 480 B Sales. Whats new pussy cat! 

Dre4dwolf's picture

"Zimbabwe's stock market was the best performer this decade - but your entire portfolio now buys you 3 eggs"



Lol the bankers are lucky the public can't tell the difference between "nominal growth" and "actual growth".



toomanyfakeconservatives's picture

Music to distract passengers as the Titanic goes down.