Trannies Gone Wild

Tyler Durden's picture


Volume remains 'average' but there is one corner of this market that has gone full retard today. Despite rising energy costs, the Dow Transports has surged 3% - thanks in large part to Kansas City Southern, JB Hunt, and Union Pacific which account for more than half the TRAN gains. Presented for your visual adoration, Trannies gone wild...

February performance of the major US equity indices...

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Wed, 02/27/2013 - 13:00 | 3282156 nofluer
nofluer's picture

Krugman (or whoever you are), I have never done this before - but you are in a class by yourself. You have therefore earned an automatic down vote - whenever I see your name as writer of a post it will get a downcheck. Enjoy your popularity.

Wed, 02/27/2013 - 13:05 | 3282177 Pareto
Pareto's picture

Its this kind of thinking that pretends that behaviour doesn't change and that incentives "don't matta".  Bernake has completely destroyed the only price mechanism in the market that really matters - INTEREST RATES!  That's the point.  He's creating capital dislocations (distortions) in every corner of the market by QEing a zero cost of capital paradigm.  I don't care what anybody says, asset prices are too fucking high relative to what they would be absent a FED suppressing rates.

Lucas (1976) made short work of this crap 36 years ago, but, we're still doing it, thinking all along that this time it will be different.  There is nothing productive about what Bernanke is doing.  he is creating Non Wealth generating behaviour, plain and simple, and he is enabling the continued profligacy of the Federal government.  He will never unwind this position.  The debt will be monetized, and that will be that, because, at the end of the day, thee isn't, nor can there ever be, a free lunch.

Wed, 02/27/2013 - 20:27 | 3283882 WhiteNight123129
WhiteNight123129's picture

Well you contradict yourself now, because everyone knows since Fullarton 1844 that any money printing of base money (if base money is Gold or fiat ) will depress interest rates, push up land prices, push up the prices of interest bearing securities, and finally in fine commodities.

Bernanke is diguising the ~borrowing~ operation the Gov. In fact since those bonds on teh Fed balance sheet will never result in shrinkage of hte monetary base. If hte monetary base is not shrunk backwards, it is not a loan, it is just printed new green bills giving them to the gov and the gov spends. Period. Whatever is on teh balance of the FEd should be substracted from total Gov debt.


Wed, 02/27/2013 - 12:01 | 3281870 dick cheneys ghost
dick cheneys ghost's picture

Lindsey Graham is a cocksuker

Wed, 02/27/2013 - 12:01 | 3281872 MFLTucson
MFLTucson's picture

Sucker bet!  PMI down to all time low and the trannies are up, so this means they are building inventorties because nothing on a retail basis is selling.  Fraudulkent manipulated markets

Wed, 02/27/2013 - 12:12 | 3281918 nofluer
nofluer's picture

"Quick, Ma! Execute a stoploss on the PM and get on them Trans futures!!! We'lll get RICH!!! And if we make enough, we can go to the Hedge Fundies Ball this year!!!"

Wed, 02/27/2013 - 12:03 | 3281873 ekm
ekm's picture

There's quite of a difference between VOLUME AND LIQUIDITY (DEPTH).


If I have 1 share and sell it to you and you sell it back to me instantly and we do this infinitely, then volume is infinite but liquidity (depth) is just 1 share.


Hence, if primary dealers bounce around the same batch of stocks but a lot more frequently, volume could get higher, but not much is being traded.


Volume per se is very misleading.

Wed, 02/27/2013 - 12:04 | 3281890 Dr Paul Krugman
Dr Paul Krugman's picture

As Tyler just showed, technological developement is increasing oil production.  This means we can keep cost down, since supply is coming online.  This flies in the face of your recent posts - that higher oil prices will kill the recovery - because we will be able to keep oil prices down while we increase productivity.

Wed, 02/27/2013 - 12:13 | 3281921 ekm
ekm's picture

I never said there's no oil available, actually it has been me shouting out that there's plenty of oil.


What I've said is that oil is being bought and STORED, as opposed to released into the CONSUMPTION MARKET.


This is still the case. Normal supply/demand price is at about $40-50 WTI, hence oil is in hyperinflation....until oil in storage is DUMPED into the consumption market, same as in 2008.


That's why there was recovery from 2009 at oil 35, that's why recovery stopped at oil 80, that why we are in a contraction right now at oil 95.

Wed, 02/27/2013 - 12:15 | 3281929 ekm
ekm's picture

Rule of thumb:


Oil at $35 = Economic Growth

Oil at $70 = Economic Stall

Oil at $95 = Economic Contraction.

Wed, 02/27/2013 - 12:23 | 3281972 the grateful un...
the grateful unemployed's picture

that's why POTUS tried to sell oil from SPR on the world market at a price well above those, to maintain HIGHER oil prices. but maybe the time has come to let asset prices find their own level. that means economic growth.

Wed, 02/27/2013 - 12:33 | 3282026 John McCloy
John McCloy's picture

Oil at $145 = Hold onto your potatoes Docca Jones!!

Wed, 02/27/2013 - 12:40 | 3282066 ekm
ekm's picture

That is literally war, no exaggeration.

Wed, 02/27/2013 - 12:37 | 3282051 Dr Paul Krugman
Dr Paul Krugman's picture

I doubt there is enough oil in tankers to bring the price of crude down substantially.  Oil demand is around 70 million b/d, which means for any long term benefit there would need to be a lot of tankers....

Sorry but I do not think your theory is logical.

Wed, 02/27/2013 - 12:39 | 3282061 ekm
ekm's picture

A looooooot of them, on shore and offshore.

Wed, 02/27/2013 - 12:45 | 3282100 Dr Paul Krugman
Dr Paul Krugman's picture

Enough to put a dent in 70m b/d?  I doubt that.  Technology is our best friend in how oil's price will ove lower from here.

I haven't even started on technological advances in green energy yet, either!

Wed, 02/27/2013 - 12:52 | 3282132 fuu
fuu's picture

You already covered that as MDB.

Wed, 02/27/2013 - 15:45 | 3282875 nofluer
nofluer's picture

on technological advances in green energy yet, either!

At the risk of repeating myself, "JEVON'S PARADOX" moron.

Wed, 02/27/2013 - 13:20 | 3282224 Toolshed
Toolshed's picture

Hey genie ass butt plug, put on your keynesian tin foil hat and explain this......there has been no shortage of oil for some time now and demand is declining, yet prices are higher for this time of year than they ever have been, why? You, in fact, state there is increasing production, yet prices are higher, why? Can't be dollar devaluation I know, because you keynesians have banished debasement fueled inflation to the nether realm. Shortage of fairy farts maybe? Unicorn tears have all dried up?

Please explain.

Wed, 02/27/2013 - 20:28 | 3283885 WhiteNight123129
WhiteNight123129's picture

What is the marginal cost. What is the cost with externalities?

Wed, 02/27/2013 - 12:06 | 3281892 TrustWho
TrustWho's picture

Since the Fed is forcing investors into the Great Rotation, all equities should go full retard. When you divide by 0, you get infinity. As long as any equity is below infinity, people do not understand Daddy Bernanke's wishes.

Wed, 02/27/2013 - 12:07 | 3281894 mirac
mirac's picture

Take a look at an intraday chart of Amazon...that goose was on a bad news day for Amazon re new Kindle update is flawed and may delete one's library

Wed, 02/27/2013 - 12:16 | 3281936 nofluer
nofluer's picture

Serves 'em all right. The "customers" are not buying my book so screw 'em.

Wed, 02/27/2013 - 12:16 | 3281938 firstdivision
firstdivision's picture

Damnit!  You tricked us.


Wed, 02/27/2013 - 12:17 | 3281945 farmerjohn2112
farmerjohn2112's picture

The headline made me think it was an ad for a new video...

Wed, 02/27/2013 - 12:24 | 3281979 orangedrinkandchips
orangedrinkandchips's picture

why is KSU up 10%????


pray tell....

Wed, 02/27/2013 - 13:35 | 3282273 El Hosel
El Hosel's picture

The Federallies Like trains, today.

Wed, 02/27/2013 - 12:39 | 3282065 mdtrader
mdtrader's picture

I guess the dummies on Wall Street need three outside day reversals before they take any notice.

Wed, 02/27/2013 - 13:27 | 3282250 thismarketisrigged
thismarketisrigged's picture

so it took till noon wed to wipe out all the losses for the week.


what a fucking comedy this market is.

Wed, 02/27/2013 - 14:31 | 3282499 U4 eee aaa
U4 eee aaa's picture

I don't like looking at these ones either

Wed, 02/27/2013 - 14:36 | 3282524 bugs_
bugs_'s picture

Sitting here in the Deflationists Lounge asking the older guys if they remember horses being part of the transports.  Since horses are getting back into the news lately this could be the reason for transports strength.

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