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Wondering Why Stocks Are Surging?
Because AUDJPY is soaring, of course...
Never mind: bonds flat, USD strength, earnings weak...
its JPY carry to the moon
This is the 'market' you have your investment funds in...
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I just wrote down on a piece of paper that I ran 20 miles a day for 2 years and I didn’t loose any weight yet.
Can someone tell me what the Australian Dollar has to do with the S&P? Why is there this correlation?
Bad stat researchers. Like the guy who based the mortgage models on 2 years of pricing data.
AUD is a currency that pays a high interest rate (high yield). Traders buy AUD and sell JPY (low yield, interest rates at zero) and pocket the rate differential. This is known as the carry trade. Generally when sentiment is postive, the markets buys more risk (risk on) and that's why you see a correlation with rising equities and a rising AUDJPY.
Thanks!
EURUSD sure is making some big moves today too.
What the fuck is going in at MSFT? Cramer says the new XBOX is driving it higher...thats BS.
"Cramer says"
Well there's your problem. The only time Cramer says anything that makes sense is when he's coming down from a coked up high.
Common. Coke and hookers for these guys.
Positive AUD/CAD also generally associated with positive gold in the absence of highly active coordinated smackdowns.
I never understood this one as interest rate parity should make this trade zero sum in the long run. If you are really convinced the AUD is strong going forward against the JPY due to some type of bullish commodity view or think Abe can push things even lower I guess it's fine but just trying to scalp a 3% spread seems awful, you are looking at a 20% loss if the JPY goes back to where it was six months ago. Almost no doubt that the Sharpe ratio on this trade is awful compared to just buying mining stocks plus it's not exactly a diversifying position as you can see today. To me just seems like another way for these "elite FX strategists" to justify some additional fees and spreads.
The only "carry trade" worth doing is selling fiat TP and carrying home gold and ammo.
QE.
Everyone else is doing it, and we're (AU) not.
Stocks and the Aussie are essentially staying stable in real terms.
Yeah, this is the second time this damn correlation has shown up! Is any more proof needed to see!?
QE is not about your own country (yet). It's about the others.
US does QE, Europe benefits even more than the US.
Japan does QE, US benefits even more than Japan.
The elite have their plan down-pat.
"One for all, all for one." - "United we stand, divided we fall."
All it takes is one vote on a sub comittee of a sub committee to unplug the HFT\algos and the crash will be here...
Hmmm. How long do these carry trades usually last? Don't they usually destroy the countries involved? Iceland, I'm looking at you.
That looks like a rising wedge. But those are bullish in the New Normal, right?
At least they always break the top trend line to the upside before it collapses completely. MUST.... SQUEEZE... THOSE... LAST... SHORTS...
you people want strong PM's. strong PM's increase the AUD. AUD up = stocks up. i guess you're fucked if you do and fucked if you dont.
We don't want PM's up dip shit. What we want is a stable monetary supply that isn't manipulated and destroyed in order to rob us of our hard earned (and saved) wealth. Since we don't have that, we have PM's which is the only medium that allows our wealth to be protected.
Your ignorance is epic.
I hate waking up to a world that makes no sense. (and I get the mechanics of this trade).
The stock, commodity and currency exchanges have been reduced to gambling dens whereby the more powerful traders with deep pockets move the markets to maximize their own profits at the expense of the remaining not so powerful players.
The big boys have enormous money power to move the markets in the direction which results in maximum profits for themselves. They effectively use the media to lure the other players in the market to a position where they would incur maximum loss.
The markets will fall only when the banksters have eliminated all the short positions and only they themselves have positioned themselves to profit when the market falls
OR
When an unexpected world event catches the banksters with their pants down and the softwares they use to rig the markets go berserk beyond their control.
http://www.marketoracle.co.uk/Article35345.html
www.letstalkmoney2012.in
+1 ak_khanna. No one gives a shit until they feel the wallet leaving their back pocket.
Pattern recognition and trend levering will never be illegal, so we're probably just going to have to join them and hedge in gld, slv, and plat.
"The markets will fall only when the banksters have eliminated all the short positions and only they themselves have positioned themselves to profit when the market falls"....?
Like all the other times banks have profited spectacularly from a crash? The point is that they usually don't. They are staffed to the gills with momo optimists and bearsih positioning or viewpoints are frowned on...
Can't we get some fucking kids from the Caucus to take out some appropriate targets, like the Fed, ECB, BOJ, IMF?
The ones smart enough to recognize the correct targets aren't interested in dead-end strategies.
So are you saying they are like roaches (correct targets)? I guess all evil is (are).
Apparently these kids from the Caucus aren't interested in becoming popular among 93% of Americans.
Too bad they can't see the banker-zionism connection. If Israel is really what it is all about.
That connection is paying them. Why would they fight it?
Stop playing.
All this while the CBOE is broken. No VIX trading today so far. http://www.tradingvix.com/2013/04/cboe-delayed-vix-spx.html
The S&P goes up... but I can't get out of my 1580 Puts... The ultimate short squeeze... It must be near the top if they resort to this...
http://www.youtube.com/watch?v=TJvX0Z8TlyU
According to Credit Suisse:
Money Matters: FOMC Preview - Tapering versus Tightening
- The FOMC next meets on April 30-May 1, and we expect no significant policy changes to be announced at that time. Even if the Committee had been entertaining notions at its March 19-20 meeting of slowing its asset purchases anytime soon, the disappointing economic data released since then probably have shelved such plans for several months.
- In our view, an opportunity to scale back the asset buying may not come until later this year perhaps in September. For now, we expect the size of the Fed's monthly purchases to remain at $85bn ($40bn MBS, $45bn Treasuries).
- Looking forward, we maintain that any future decrease in the size of QE3 purchases would not be a monetary policy tightening, although the markets may initially react as though it were.
- Moreover, even if the Fed were to eventually end QE3 sometime in 2014 and start hiking interest rates in 2015 (or later), we believe monetary policy still will remain very accommodative for many years.
- The risk is that even if business cycle conditions were to allow the Fed eventually to firm up its policy stance, subsequent economic performance (or budgetary strains or financial fragilities) would force renewed easing long before the Fed reached an elusive "longer run" neutral funds rate target.
- Monetary Policy Review/Preview
- Beige Book (released on April 17).
- Fed Balance Sheet Update
- The Fed's MBS portfolio surged $55bn to $1.1tr in the week ended April 17.
- Excess reserves total $1.8tr, $159bn above their previous peak in July 2011.
- Money Supply Update
- M1 posted its largest weekly decline since just after the 2001 terrorist attacks.
- A $63bn pop in savings accounts at commercial banks limited M2's decline.
- Bank Balance Sheet Update
- Adjusted for a 2010 accounting change, commercial bank loans outstanding yesterday (April 23) are still some 5% below the Q4 2008 average.
- Cash assets held by domestically chartered banks have jumped by more so far this year than have cash assets at branches of foreign banks in the US.
Tightening into a global economic collapse.... Maybe that's what the Boston drill was all about.
DAMN!!!
I BOUGHT THIS "RECOVERY DETECTOR" ON EBAY AND IT'S NOT WORKING!!
damned Ebay scammers....
Stocks are surging because buyers out weigh sellers.
And the MSM is pumping "the buy" as hard as they can so suckers can get in at the top like they always do.
And insiders are selling like mad.
how does the JPY currency manipulation translate into stocks? I don't understand how this works exactly. not saying it isn't happening just would like to understand the mechanism...
Last thread to post this on, just looking for responses:
Not real sure how to put this...
If the USD burns, then would that not leave the TB's in a jam and rates INCREASE, and Gold would also debase?
I would think what is going to happen is ALL currencies would tank, therefore, Gold and all commodities priced in a currency would follow suit and tank. The difference is Gold would at least have some value, and currency would be completely worthless. All paper investments would trend to zero, in that case. Lastly, the world would become barter town. Problem being how do you value the PM's henceforth? In other commodities?
When the SHTF, it will be skills and real things (water, food, nails, hammers, booze, tobacco, etc) that would have the ultimate value, no?
Reason I say this, and it may be simplistic, as I am no high financier, but once the currency burns, there will be worldwide panic/chaos, and the govts will have no power to institue a 'replacement' currency, as they will be fighting for their very lives, so will we. It wont be until the chaos dies down, how long that will take is anyone's guess, for some rule to go into effect. My guess is currency based on LAND??? After all land is the most productive resource, along with water...so land with water will be the highest premium, which brings me to Agenda 21...NDAA, etc...strip rights and guns first, then the PTB can just TAKE OVER. Fuedalsim all over again, and the darkest of ages, as so many skills have been lost since the industrial revolution came about. Manual skills, growing skills, LIFE SKILLS...sans a select few who practice it now!
Just my two common cents is all...out! Please let me know what you think, inquiring minds would like to know.
Love and regards from Sgt. Unix Crust
Stop taking financial advice from people trying to sell you underground bunkers.
Bloomberg article..."Central Banks Loading Up on Equities"...trillions from central banks have/are gone into equities....from around the globe....and plan to do so for years to come....the shorts are hopeless now...can't fight that!
I've applied for a ZH name change
Is this still a game of 'frontrun Mrs. Watanabe and sell back to her'? That's the theme this year?
Japanese data showed overnight there was actually net selling of foreign bonds last week, amount of Y862 bln vs. Y331 bln the week before, so that looks more like they were lightening up on the big surge instead of the great scrambling for yield.
Sure enough, soundbytes from Kuroda and Abe came out right after the data.
Otherwise Mrs. Watanabe must be the most pro trader in the whole market, selling her foreign risk assets with one hand and staying up for the NY session to buy them and also lift the stock market with the other.
I'm seeing SPY coming in for a re-test of resistance that goes back 14 years or so on the weekly charts. Will be interesting if we get a key-reversal type of day today after testing, puncturing and then collapsing back below on volume...
http://fiatflaws.blogspot.com/
Stocks are soaring because of money printing. Get used to it. It is always does that.
The signal to sell is when the church of safety is losing its cohort and moving in the stock market while the Fed is moderating printing.
Inflation goes up, stock prices go up. Right? Muppets love it.
I wish I had my money long in this market. Instead I keep scalping short positions just to stay even. I wish I could close my eyes and hide in Imaginationland but I can't get myself to do it.
https://www.youtube.com/watch?v=XoxYjjnE4jk
Are there any expiries on anything today? I know there's no POMO.
DavidC
Its probably more like the CBOE is shut down for some reason...no options sold or bought today?????
Even ZH is trying to explain things rationally.
It's got nothing to do with anything, nothing is correlated any longer.
It is simply pure and simple panic, hence sudden moves up with the forever hope of luring suckers. That's it.
Hope of luring more and more resembles agressively forcing though as the masks are falling off.
So why are two of my biggest losers are RJA and DBA?
I don't understand the disconect between comodities and stocks? Of course I am thinking that the market is somewhat rational.
DBA/RJA, essentially the same. very low to negative correlation to spx, a good piece of a divrssd portfolio. for pur specultaion....there is a seasonality for sure...maybe due to drought....which despite the floods is ongoing. they planted a lot of corn this year.....decent heat wave at the wrong time (which given the large 'test' that appears to be occuring, is due). to much heat, no good, too much rain early= too much mud= late planting= out in the heat too long or summer rain in aug= too muddy to harvest, rot in the fields. a lot can go wrong and weather patterns are getting whipped around. barely a hurricane in FL in 6 years, prior to this FL had 4-5 major storms make landfall in two years. its quite until its not. buying low is half the battle.
Because AUDJPY is soaring, of course... http://www.investmentcontrarians.com/recession/more-signs-of-economic-weakness-where-to-place-your-money/1908/
http://www.bloomberg.com/news/2013-04-25/fed-debate-moves-from-tapering-to-extending-bond-buying.html
Fed Debate Moves From Tapering to Extending Bond Buying
By Steve Matthews & Jeff Kearns - Apr 25, 2013 10:21 AM ET.
Debate among Federal Reserve policy makers is shifting away from the timing of a reduction in bond buying to the need to extend record stimulus as inflation cools and 11.7 million Americans remain jobless.
At their meeting last month, several members of the Federal Open Market Committee advocated slowing purchases and stopping them by year-end. Since then, seven have voiced support for maintaining the current pace, including five who vote on the policy making panel: Governor Daniel Tarullo, New York Fed President William C. Dudley, James Bullard of St. Louis, Chicago’s Charles Evans and Boston’s Eric Rosengren.
“We heard a lot of discussion earlier in the year on the timing of tapering,” Ward McCarthy, chief financial economist at Jefferies Group LLC. in New York and a former Richmond Fed economist, said in a Bloomberg Radio interview yesterday. “Some of the more recent developments -- the slowdown in the economy, the somewhat disquieting inflation data -- has taken that off the table for now.”
With the Fed far from meeting its mandates for stable prices and full employment, policy makers next week will probably affirm a pledge to keep buying bonds until the job market improves “significantly,” said Joseph Gagnon, a senior fellow at the Peterson Institute for International Economics in Washington and a former Fed economist.
‘Full Throttle’
“It’s going to be full throttle until the end of this year,” said Gagnon, referring to the purchases that have pushed the Fed’s balance sheet to a record $3.3 trillion. The FOMC plans to meet April 30-May 1.
Short of a meteor strike or Benny kicking the bucket, DOW 36,000 is in the bag.
Care for a game of Risk?
According to Industrial Alliance Securities:
http://www.scribd.com/doc/137944549/As-World-Growth-Dims-Quantitative-Easing-Shines-Industrial-Alliance-Securities
Gold May Find Support from an Old Friend:
“Not so fast with that QE end game”!
As World Growth Dims Quantitative Easing Shines Key Fed Indicator Signals QE May Gain Shelf Life - Lending Some Luster to the Besieged Gold Bull Case?
EVENT
As 2013 unfolded, most investors were confident that the U.S. had sufficient forward economic momentum (“escape velocity”) to cyclically recover from sub-par economic growth. And that after record low interest rates and monetary stimulus. Despite the rally in the DOW & S&P 500 indices, the U.S. and other economic expansions have recently been called into question. Most recently, leading economies China and Germany posted sub-consensus, the latter contracting, PMI. Amidst European recessions, the President of the E.U., Jose Barroso, this week said: "…austerity…has reached its limit."
The worldwide sub-par economic, and related inflationary pressure slowdown, has caused the 5-yr US Treasury Bond to whither to 0.70%. What remains is why we pose the situation – for the last few years the “stimulus of last resort” has been QE (“TWIST”, or some variant thereof).
DETAILS:
Perhaps the Q1 U.S. across the board 2% “Payroll Tax” (FICA) increase combined with worldwide slowing is overwhelming the modest economic momentum that the U.S. had? Tired of failed conventional stimulation, Japan recently began an astounding 50%/year money supply growth target.
In the U.S. we note a key Fed indicator recently flashed caution that the Fed may revisit, rather than reduce, its QE program. While the inevitable QE repercussions are unknowable, the Global Financial Crisis (GFC) QE has been good for both gold and financial asset prices. On January 25, 2013 the U.S. Federal Reserve took the historic step of “explicitly targeting a 2% inflation rate”. We point out a common proxy for the Fed’s interpretation of market expectations of future inflation is the “5-year Treasury/TIPs bond breakeven rate”. Since the GFC, yield contractions in this proxy have often been a precursor to Fed action.
CONCLUSION: For gold bulls, all this is Manna for the case against currency debasement.
Better odds than the pony track.
5-Year US Treasury/TIPS Bond Breakeven Rate - Federal Reserve
http://www.scribd.com/doc/137956352/5-Year-US-Treasury-TIPS-Bond-Breakeven-Rate-Federal-Reserve
I've got some puts that are going to potentially make me a fortune if this thing starts sinking. COME ONNNNNNNNNNNN.
Correction, stock are rising, because central banks can print money are they are buying stocks!