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Wondering What Is Driving Today's Rally?
Presented with little comment, but it's another one of those short-squeeze days...
Though it seems by the chart that the initial squeeze has run its course... and the fake AP Tweet seems to have triggered some reality checks...
Charts: Bloomberg
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Reality checks? Oh no...anything but that. This market is not prepared for reality. In fact, it is four years deep into denial.
Lord, have mercy...
Russell has been rejected from 50 DMA. This could be the sell signal that a lot of people have been waiting for. And we get a shooting star in S&P.
$RUT
http://stockcharts.com/h-sc/ui?s=$RUT&p=D&yr=0&mn=3&dy=0&id=p11966684246
$SPX
http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p36099440953
When has CNBC become the "Home" Shopping Network? They think everyone can afford those million dollar houses!
CNBC saying gold crashed along with the market. I was eating lunch, but I presume they are lying?
Triple-levered ETFs arbitrarily indexed to paper spot price decided by bankers in London is not gold. They can go fuck themselves.
Gold didnt bulge when the Dow had its flash crash...but it is down 15 bucks or so though I wouldnt call that a crash. CNBC didnt even notice the Dow crashed...but I did on my bloomie.
CNBC is a shit show but I have no choice to watch it coz I have the bigscreen in front of my desk.
Yep, its a lie GLD spiked up a bit on modest volumn, but nothing compared to the huge volumn downward spike in SPY.
Get yourself a Bloomerberg terminal! And you can indeed afford one! And don't forget to charter yourself as a bank so that you can borrow from the Fed's discount window.
No kidding ...
What shorts?
Hey, that's my line.
Gartman: " I'd short S&P in USD terms and LONG S&P in Yen terms",
yeah, f* you in any terms :)))))
We need a serious short squeeze in Gold now.
My nutz need a serious short squeeze, but agree with your needs
the hedge funds have never been net longer and retail is gone from the market....so who is short?
I really think the only shorts left (of any relevant size) are just as a hedging tool. You'd have to be a complete fucking moron not to be long on the back of $85 billion a month. Then again, you'd have to be a complete fucking moron to be long or short equities or bonds.
Short squeeze in PMs is technically and politically impossible.
Sadly..., true.
That Tweet Crash tells you what's coming...
Ballistic bitches.
Where are the bond vigilantes?
Found one. http://photoshopcontest.com/view-entry/96930/concrete-shoes.html
+1 PRICELESS!
Mama's got a squeeze box she wears on her chest & when daddy comes home he never get's no rest...
"Is it just me, or does that sound filthy?"
http://www.youtube.com/watch?v=n9WivuyE_PU
She goes 'IN-N-OUT-&-IN-&-OUT-&-IN-&-OUT-&-IN-N-OUT'...
What's driving today's markets? .....Hal 5000 is that's what.
What drove the crash "I know that you and Tyler were planning to disconnect me."
It may some short squeeze there, but it is mostly PANIC from leveraged longs (primary dealers) who can't afford any drop because they're leveraged to the teeth.
Remember Corzine who was obligated to buy all italian bonds in the market because he was leveraged long until..........he ran out of money and the Fed refused to provide money to cover hence he stole from people?
Same it's happening right now. Upon presidential executive order, the Fed can refuse at no notice to stop liquidity, same as for MFG (or Lehman, or Bear stearns)
Swiss gold redemptions being refused too (cash settled). Thats a bad fucking sign.
for who?
A friend of Sinclairs. How nice. You not only lose your physical gold, you get a nice fiat haircut on the engineered price drop and the bank keeps the gold. Lose/lose for the customer and win/win for the bank.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/4/23_Sinclair_-_Swiss_Bank_Just_Refused_To_Give_My_Friend_His_Gold.html
Thanks BOP but this is where I hit the wall mentally. So Sinclair's buddy asked for his gold and they handed him a shit sandwich. As did ABN Amro. So if this is all true then delivery failures are already happening. At this point the comex could start handing out shit sandwiches too. When does anything fundamentally change?
bankruptsy, that's it
NYSE bankrupted also, nobody noticed
That's it? well that's kind of disappointing.
The dry humor is much appreciated.
I'm heading out on the ocean in my leaky boat now...
Sir, LAKES are the preferred place to lose one's shiny stuff. FYI.
It won't matter, unless primary dealers or others have leveraged their gold and have to do panic selling to cover bankruptsy.
hence, again, will the Fed cover or pull an MFG upon orders?
"Swiss gold redemptions being refused too (cash settled). Thats a bad fucking sign."
i am sure that's what's gonna happen to paper gold accounts all around the world.
I truly want to know how it could be a short squeeze. I respectfully call bs on short squeeze.
Short squeeze can't occur if there are no other players left except for primary dealers.
They are the buyers, they are the sellers, they are the money on the sidelines = They are nothing.
This is going to sound convoluted, but you actually answered the "how" on the short squeeze.
Account A: short
Account B: long
If the purpose is to slosh ZIRP money around in order to fuck over what's left of any other participating entities, and you control both accounts, this becomes a relatively easy transaction.
thank you
But Corzine was forced to support a falling market (in peripheral Euro bonds). The leveraged longs in US equities, if they are leveraged and long, should be under no such pressure, just raking it in, unjustified though it may be. So I don't see the parallel, really.
It was falling because there was no Fed to buy italian bonds same as they buy stocks via NY Fed and primary dealers or even buying US treasuries.
Can the US treasuries have this low yield if the Fed doesn't buy?
"Can the US treasuries have this low yield if the Fed doesn't buy?"
The "why" behind the Fed never stopping QE, ever.
The Fed has no say in anything. They advise but make no decisions.
I'll go short when the pumpsters are done with cock-stuffing.
And the real answer is....the FED's balance sheet!!!!
Aye,its fucking horrible being syldexics.
I thought this headline was about some bloke driving a lorry??
I just wonder WHO injects 30 times average volume into a falling knife like IWM...
maybe somebody who does not get a bloody finger
"What's driving the market?"
Print money out of thin air and buy ($85B each month) stocks and bonds with it.
We have a winner!!!
The markets in the U.S. would have already crashed but for the endless printing of monopoly money these last few years.
Not really wondering. 85 billion a month pretty much says it all.
Reckon we've got 1-2 months before we see minor decline and 3-5 months before it obviously deteriorates to the point Ben steps 85 up to 150 / month.
"While the attention of investors is focused on the short-run market outlook in what is already a mature bull market advance, it’s crucial to understand the endgame to this overvalued, overbought, overbullish, overleveraged episode of market history. That endgame will be forced liquidation, as declining prices force leveraged investors to sell – voluntarily or otherwise." Dr. John Hussman
“On Wall Street, urgent stupidity has one terminal symptom, and it is the belief that money is free. Investors have turned the market into the carnival, where everybody ‘knows’ that the new rides are the good rides, where the carnival barkers seem to hand out free money just for showing up. Unfortunately, this business is not that kind – it has always been true that in every pyramid, in every easy-money sure-thing, the first ones to get out are the only ones to get out.” Dr. John Hussman
March 2000 (S&P 1400)
And, "Fiscal Policy: creates a deficit that must emerge elsewhere as a surplus – specifically, as elevated corporate profit margins, creating the illusion of “yield” that is not, in fact, durable." (John Hussman)
How the fuck could it be YET ANOTHER short squeeze? Who the fuck would short this rigged market for longer than 15 minutes?
Who?? Those that are not privy to Uncle Ben's Converted BS..
..and those that cant believe the wheels are still attached to this wile e coyote economy..
There is only so much duct tape and tie wire..........
I always wonder so I quit wondering.
I am also waiting for a nice shorting setup. Downmoves are usually sharp and fast so one must act quick. I usually short indices with leverage, using a CFD.
According to Stifel Nicolaus:
http://www.scribd.com/doc/137594149/Financial-Repression-Beneficiaries-Stifel-Nicolaus
Financial Repression Beneficiaries
Energy, Materials, Information Technology and Industrials benefit from periods of financial repression vis-à-vis Consumer Discretionary, Consumer Staples and Health Care which benefit from an end to financial repression. This supports a pair trade opportunity, in our view. We see a mid-year U.S. jobs lull and uncomfortably low inflation, as well as sluggish mid-2013 GDP causing deficient Federal revenue which impedes fiscal deficit % GDP progress this year. In total, we think this leads the Fed to continue the full $85 billion/month QE3/3.5 to year-end and possibly 2014. Low P/E & high margin financial repression beneficiaries may outperform high P/E multiple & high profit margin groups that do well when financial repression ends.
As Ned Davis Research describes (Chart 1), Consumer Discretionary, Consumer Staples and Health Care relish the end of “financial repression” and their surges have been met with QE. Conversely, Energy, Materials, (Chart 2) as well as Information Technology and Industrials benefit from periods of financial repression. We are not so sure reflationary efforts and financial repression are coming to an end (QE dates are on Charts). Deflation is calling, Ben…pick up the phone. Investors are listening, they "sold the rumor" of weaker cyclical EPS, but appear to be "buying the fact."
The financial repression trades faded (and anti-repression trades surged) in 1Q13 when the Fed's self-doubt (foolishly, in our view) hinted at premature withdrawal of QE3/3.5. But we see evidence of a mid-year U.S. jobs lull, core inflation that is too low for comfort, and evidence that sluggish mid-quarter 2013 GDP may cause CBO 2013 estimates of Federal deficit reduction to fall short by ~100bps as a percent of GDP (Charts 3-4). As a result, we expect the Fed to signal that the full $85 billion QE3/3.5 continues through year-end, possibly well into 2014, a boost to financial repression. Along with overseas growth initiatives, we believe this helps financial repression beneficiaries with depressed P/E ratios as confidence grows that high margins may be sustained (Chart 5). In contrast, beneficiaries of the anticipated end of financial repression may see P/E ratios fall given high valuations coupled with high margins (Chart 6).
We have held the view that the S&P 500 is in the “Late Bull” stage of a “Cyclical” Bull within a “Secular” Bear market. Given the large share of S&P EPS in the cyclical groups (Chart 10), P/E convergence may enable the S&P 500 index to hit our 1,700 year-end view. We doubt the S&P 500 can climb much higher on defensive leadership, but we expect growth confidence overseas, coupled with QE, to lift economy-sensitive stocks and the market index.
Don't overthink it. Market is going up because the rich are tired of getting 0% from Uncle Ben.
So for every rich person investing in the market, profits come from a greater fool?
What happens when we run out of greater fools, then?
It's a wonder that anyone still wonders about these seeming market wonders.
They're getting short squeezes confused with blobbing up...
They are confusing that with the other thing, when the mattering thing is very much something.
Driving?...maybe its a flight pattern for Bens 'coptor
Total Dollar Amount of All U.S. Treasury and Mortgage-Backed Securities Held by the Federal Reserve:
http://www.scribd.com/doc/137574040/Total-Dollar-Amount-of-All-U-S-Treasury-and-Mortgage-Backed-Securities-Held-by-the-Federal-Reserve
Just got my tax refund ..... buying NFLX ....... woohoo!
buy the gold and silver sale...
That would go against my buy high sell low philosophy
i was listening to the closing bell exchange on cnbc, and one guy was asked why the market is so fragile to every little comment or event, and the douchebag responds '' the market is looking for excuses to sell into anything''
really? were the 2 latest pmi misses in china, or the contraction in germany, or the tons of missed data in the u.s not enough of an '' excuse'' to sell?
what a jackass
i hope aapl fucking misses badly, but with expectations so fucking low, i only see it going up no matter what. hope i am wrong
i think aapl is going to suck wind. no one is buying ishit, its all samsung and kindle it seems. they may release the ihelmet though, all you see are your security cams, facebook newsline, and a map locator of where you are with Mayhem giving you directions on how to walk home/work/school.
In the absence of a major event (a terrorist attack and immenent threat of WWIII/nuclear war are apparently not major events), there is no meaningful down episode on the horizon here.
http://finance.yahoo.com/blogs/breakout/fed-firing-blanks-qe-whalen-120610493.html
Fed Is Firing Blanks With QE: Whalen
Hollywood is bringing back the man of steel, and one thing we can count on (other than a new body-sculpted suit), is that kryptonite will still be the only thing that zaps him of his power. While the comic geeks have Superman, investors have Helicopter Ben and the Federal Reserve that's pumping $85 billion a month into the economy. But could it be the Fed has its own version of kryptonite that’s sapping its strength? Christopher Whalen of Carrington Investment Services seems to think so.
The benefits of the Fed’s quantitative easing (QE) program are being offset by regulation promulgated from Washington, Whalen says, and therefore nullifying its stimulative ability. “When you look at all the constraints on banks in terms of lending, it's just not being effective in terms of growing jobs, and the key thing is that even with say housing up 10% last year, there’s no credit growth,” Whalen notes. “In terms of a classical economic recovery, we’re not having that.”
The Fed’s plan of reflating assets like home prices in order to stimulate the economy (and thus job growth) is admirable, but according to Whalen regulations like Basel III and Dodd-Frank are stifling lending. This is because reform legislation discourages banks from making all but the least risky mortgage loans.
In fact, Whalen notes that estimates for new loan originations in the U.S. mortgage market are in a precipitous decline; falling from $1.7 trillion in 2012 to $1.4 trillion in 2013, and perhaps below $1 trillion next year. Major home mortgage originators like JPMorgan Chase (JPM) and Wells Fargo (WFC) will likely take a hit from this decreased volume.
To make matters worse, the Fed’s extended ultra low rate policy is hurting savers, as “QE is actually driving deflation now because we’ve gotten past the point where cheap funds are net-net helpful… because we’re constraining consumption,” Whalen says. “There was a time when QE in terms of the net effects early on was a benefit… but now we're at the point where QE is really starting to hurt savers particularly, and I think that’s a drag on the economy.”
Since regulation is here to stay, Whalen advocates that the Fed hike rates up a bit in the short term in order to get assets repriced from such low rates, which would help banks, investors and retirees who depend on interest income. It will take time to get housing, and thus the economy, back to normal, though.
“We’ve put so much friction in the system, to expect a classical recovery is almost unreasonable," Whalen concludes.
http://www.pionline.com/article/20130422/REG/130429982/feds-policy-jeopardizes-achievement-of-its-goals-and-risks-upending-markets
Since the global financial crisis, central banks around the world have been forced to take dramatic and unprecedented actions to stabilize markets and shore up faltering economies. As a result, a high degree of global monetary policy accommodation has been part of our economic landscape for years, and likely will remain so for some time.
That said, a wide variety of asset classes are beginning to show signs of disconnect from fundamental valuation underpinnings as a result of these policies, and it's increasingly clear that policy actions are starting to distort fixed-income markets in particular. Moreover, in the U.S., the Federal Reserve is unlikely to achieve its stated labor market goal of 6.5% unemployment any time soon, largely due to structural trends that hamper rapid employment recovery. Therefore, and perhaps ironically, the Fed's policy goals might be better served over the medium term if the central bank were to slowly begin reducing its quantitative easing program and allow interest rate markets to begin a process of normalization.
There is little question that in the aftermath of the financial crisis the Fed's zero-interest-rate policy, its alphabet soup of emergency liquidity programs and its early rounds of quantitative easing combined to help stave off an economic disaster much worse than that experienced. Also, in the absence of fiscal support due to political paralysis in Washington, the Fed's asset purchases have bolstered markets through the eurozone crisis and other troubles.
Nevertheless, we have now arrived at a point in which household debt levels in the U.S. are moving closer to historic norms, nominal gross domestic product is growing, household net worth has dramatically recovered from crisis lows, and corporate earnings and margins are strong. Further, the original site of financial crisis trouble, the housing sector, appears to be staging a legitimate rebound, and indeed median home price affordability has come back to its longer term, or 1981-2000, average. From this standpoint, the Fed's desire for a continued wealth effect might prove counterproductive, as it risks excessively distorting markets through asset price inflation and it hampers true price discovery mechanisms.
Fed policy has had a distorting effect on capital allocation decisions of all kinds at virtually every level of the economy, from corporate treasury departments and pension funds, which have either had to take greater risks to meet their return targets or risk facing negative returns after inflation in purportedly safe assets, to households attempting to save for future liabilities. Beyond capital flow distortions, I have long argued that Fed policy is having a significant impact on bond market supply-and-demand dynamics. This impact is most obvious in sectors such as U.S. agency mortgage-backed securities, where Fed purchasing in recent months has comprised between 40% and 60% of the gross issuance in that segment of the market, but dislocations can also be seen in a variety of other sectors. Generally speaking, demand for fixed-income assets has continued to be strong, but net supply remains relatively low, particularly when accounting for Fed purchases. Moreover, a greater degree of interest-rate risk has crept into commonly tracked bond market benchmarks, adding risks to portfolios in exchange for meager compensation.
Still, what is the ultimate payoff for the price of potentially distorted markets? Will the Fed's stated goal of improving labor market conditions be met as a result of its policies?
Unfortunately, I do not believe current policy will aid in resolving job market struggles more than at the margin. The U.S. labor market recovery suffers not merely from uncertainty, or from lack of sufficient aggregate demand, as contended by many, but rather it faces an array of structural headwinds that are likely to be overcome only in time. For example, most of the payroll gains witnessed since the beginning of the labor market recovery have come in sectors not directly affected by the financial crisis, whereas the sectors of the economy most directly disrupted have struggled to adjust to the new environment. And while the economy grows and labor markets slowly improve, the labor force should also expand at a clip that might keep the unemployment rate unusually high and the Fed accommodative for too long.
"... the Fed's policy goals might be better served over the medium term if the central bank were to slowly begin reducing its quantitative easing program and allow interest rate markets to begin a process of normalization."
No can do.
The minute that the Fed lets the interest rates go to market the bond market collapses.
Then the Fed will buy all sellers releasing over $10 TRILLION LOOKING FOR A PLACE TO PARK.
VOILA HYPERINFLATION.
''wondering what is driving todays rally''?
same thing as always, the fucking fed led by benny and his fucking friends.
fuck them all.
incredible how we have basically recovered all of last weeks losses in 2 days of trading this week. that on shitty data as well. remarkable and fucking laughable at the same time
http://blogs.marketwatch.com/election/2013/04/23/fed-withholding-exit-documents-republican-lawmaker-says/
INTERESTING NEWS.
The fed is withholding the documents because it can't exit. Not unless the feds grab people's 401ks and force them into treasuries.
I wouldn't be surprised if the Gubmint did that - take over all the 401K's and IRA's (for the good of the people) and 'invest' them is some type of 'safe' government annuity. Oh, and if you want to remove any cash or opt out, don't forget to leave a big chunk behind as a penalty.
bob pissani. just said he feels confident about this market because how some of the big important multinational companies that reported, reported well and that is a good sign for the market.
really? do caterpillar and ibm, both we lots of exposure overseas no mean shit to this market?
He's a freaking idiot. Even in today's mark to fantasy accounting world the multi-nationals can't hit the numbers.
charles schwab----complete trading system crash cant acces accts
cac 40 :+3.5% today...
Something is looking blue skies !
Left the casino several months ago and now I sit on a mix of PMs and cash. I don't worry about flash crashes, short squeezes, or checking prices overnight. Silver premiums seem too high right now, but I added more gold to the stacks last week. The only way to win in the casino is to not pull the handle.
Of course I wasn't trading in this "market", but before the close my Schwab platform shut down and as of now, it hasn't come back up. A call into Schwab says all Schwab customers are locked out of trading during the last hour and in the after-market.
Question:
Why won't the longs in PM Comex just ask for delivery now?
They know that the shorts can't deliver at today's prices.
Maybe they like the game the way it is.
Driving Miss Daisy...round and round she goes, where she'll end up nobody knows!
Do we need to ask what is the sudden surge? Not honest market forces but likely the same folks that slammed gold a week ago. Their central planning manipulations are getting less and less subtle, and less lasting. None of the fundamental problems are fixed, but I think theyhave know that for over a year now. They are buying time, they have a plan, but it is for their benifit not yours.
After the shenanigans in gold last week who is dumb enough to short the equities?
Are we there yet said it better than me. Only the dumb play along and I detect an uneasiness in these markets that is not good.
Restiance is futile....they will just print more and buy all stocks, all bonds, all houses....they don't give a shit...it is your money they are doing it with!