"Great Rotation", Over

Tyler Durden's picture

It would appear that the hopes and commissions of each and every talking head wealth manager and/or central banker has been dashed on the rocks of 'fiscal cliff' tax-hike front-running and a citizenry who remain far more cognizant of the unreality of the real world than the reality being preached by the market. There were some fund flows this week into equity funds (the lowest in six weeks) but, as Reuters notes, it was all into international funds as domestic funds saw outflows and domestic bond funds once again saw inflows. As Goldman Sachs' funds flow and positioning monitor shows - Rotation, Over.


Source: Goldman Sachs

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pitz's picture

As opposed to what?  Bonds and cash, both of which are in the line of fire for devaluation? 

DonutBoy's picture

Yes - that's the model and you are the target audience.  You'll get next to nothing for a bond investment because the Fed is buying all bonds.  You'll get next to nothing - or even less than nothing for cash as they seek to end money-market funds - you'll have to pay to be in them.  In search of some return, any return, you're pushed into stocks.  Stocks boom.  You feel the wealth and buy a new Chevy Volt and a house.  That's the model the Fed has hung its hat on.  It's either true, or - the fourth quarter GDP decline was not a fluke, the jobs picture is not improving, gasoline will stay over $4 a gallon and approach $5 with a now inevitable flare-up in the middle east, the combined effects of increased energy costs, increased payroll taxes, and increased health-care premiums suck the wind out oif discretionary consumer spending, and the Nasdaq loses 20% or more in 2013 as tech stocks crater.  One of these scenarios is right.  You have to choose which you believe.


disabledvet's picture

If we're going "full on Japanese" ... financially speaking... then a move in the ten year from 2% to 1% is a HUGE increase in one's principal position. at the same time gold and silver are deflating!!! amazingly "and a war is going on." these people are called INDUSTRIALISTS. http://www.youtube.com/watch?v=W3c9wtbQTZ4 strange customs and visages with these ones indeed. "and for next to nothing they can have anything made." http://en.wikipedia.org/wiki/Military_production_during_World_War_II hell they can probably manufacture the soldiers if you want them to. i will say this "the greatest vehicles ever made for the consumer are being made right now." soon you might be able to make one in you're own garage using OEM software and a 3d printer! don't take this "no growth recovery" for no growth period. innovation is FERMENTING in a big way right now. those States that have properly managed their public sector stand to gain ENORMOUSLY in an environment such as this. (as this is where the craftsmen and artisans will start flocking to.) My "top picks" have in fact been expanding (from just North Dakota to now include Texas, Alabama, Pennsylvania and Wisconsin. California is a tough call "cuz it's really weird out there." Of course i hear "a little weird and a lot of money" can smooth things out as well. http://www.youtube.com/watch?v=rMbATaj7Il8

ebworthen's picture

As opposed to being a sucker.

PM's, land, and cash if you care to not be their Yo-Yo.

BlueStreet's picture

Maria is probably reading this saying, shit, now what am I gonna talk about this week.  



Yen Cross's picture

 Ben Dover, is visiting the markets next week.

  Call me ]quimsical[?    When you work for {  Peer Acceptance } you have missed the boat... Some vivid " cantankerous" person made that statement?  

trendybull459's picture

I do not know what writing the Obama media,but i see that money leaving Russia,Israel,EU and USA,what ever they are pumping the can the real money leaving in blns $

we got new Forum in russia and in russian,but you can talk english(as most russians speaking it),to leave comments in translite or russian,what is good is that Russia absolutly free country if it apply to critics of their enemies,it takes some few minutes to be free from Big Brother watching being registred in Mail.ru


GFORCE's picture

That chart dates back to 2010. The great rotation is built on the idea that retail and corporates no longer trust sovereign bonds and will invest in stocks. Great rotation, not over!

smart girl's picture

I love you Tyler Durden!

smart girl's picture

I love you Tyler Durden!