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Market Update: Easy Come, Immediately Go
It would appear the cleanest dirty shirt is losing its appeal as both bonds and stocks are being sold this morning and the JPY and EUR are rallying as the liquidity washes back home. The USD Index is back at its 10DMA again but it seems the building tension in Europe (Turkey and now the potential for a collapse in the Greek coalition over the ERT closure - which we warned about yesterday) and Abenomics hangover is leading to an unwind of these levered carry trades everywhere around the world.
everywhere...
The potential catalyst this morning (via ekathimerini):
Earlier, PASOK issued a statement saying that Samaras had raised the possibility of closing down ERT during a meeting with Kouvelis and Venizelos on Sunday. Samaras, PASOK, claimed said this was the only way Greece would meet its commitment to the troika to fire 2,000 civil servants this summer so it could qualify for more bailout loans.PASOK claims that Kouvelis and Venizelos voiced their objections. The legislative act has not been signed by any of their ministers. Sources at Democratic Left told Kathimerini that if the government collapses as a result of ERT’s closure, it would be Samaras’s fault.
Greek bonds are now -17% from their highs 2 weeks ago and Greek stocks -25%!!
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The insanity of a computer's mind.
Virtually no context.
Just trendlines in thin air, breaking, holding and being reset anew.
Stick save coming soon..... watch... nothing up my sleeve..be amazed! I can do this all day.
Signed Benzy Bernaked
Interest rates on a wide swath of instruments apparently want to see Bernanke's Poker Face, and are looking for any of Helicopter Ben's "tells."
Kuroda-san is a HORRIBLE poker player. I'm not sure Draghi even knows how to play.
- Ben "Yogi" Bernankeocletian
p.s. - It's actually a fun exercise to try and pin precise yields on treasury notes AND bonds that would concern ***cough***-warrant aggressive intervention-***cough*** Commodus Bernankioletian.
What used to be a month's worth of volatility is now packed in a single day's trading. Thanks Ben and Kevin.
"The Fed saves you time"
It would be so much fun to see the 10yr auction bomb today.
Seriously. Long terms are starting to look a bit scary.
Taper my ass. QE is going to $150B/mo soon. Very.
The charts I have been looking at, thanks to the Turd Ferguson, shows the 10 rate increased by more than 50% in just 8 months. I think the question Turd posed on his recent post is a good one. http://www.tfmetalsreport.com/blog/4774/taper-talk
Which is it?
I believe it to be overwhelming selling by all of ther market participants leaving Benny to mop it all up. Wheelbarrels and helicopters bitchez.
I think some are speculating whether GLD is a sell based on the same 2 alternatives.
I'm betting on 2), that the Fed will increase QE in H2... But I've been very wrong in the past year.
I know what you mean. A "friend of mine" put in a $250K order to AMPEX around the January 24 time-frame. Take about getting donkey punched, in terms of fiat at least. It is amazing to see them hold this sinking ship up for as long as they have. Sigh.....
Has Turd ever heard of Japan?
Once again we have a market whose trajectory resembles the flight path of a punctured balloon. Daneric's 'boys' have ceased attacking each other with spoons and have taken up sporks against each other. Oh, the humanity.
It's over Sloane. Someone just walked over and pissed all over the stock/bond sandcastle. The only thing you can do now is sit back and watch this bar room brawl while the bouncer (Bernanke) ducks under a table.
"oh-oh say can you seeee" what happens when the markets are completely corrupted by outside pressure not seen since the toppling Soviet Politburo? The only shameful difference in our case is our markets begged for it. While people argue about whether or not the trading channel is upward or downward bound, or whether or not we are down in an upward channel so all is good, we are all, as a society, going to lose. True price discovery will be the final slash, and we are marching ever closer to that now.
PS I agree with the watercress-munching Kito, we are in the seventh inning stretch. We have a few "outs" to go.
Oh, say can you see the printing press works all night
What an ink cartridge he has but the stock ramps are fleeing
Whose stock market and bonds give a perilous fight,
O'er the ramp jobs we watched were so blatantly proceeding
And the 10yr yields there, interest rates bursting in air,
Gave proof through the night that our fiat was still there.
Oh, say does that Federal Reserve Note yet wave
O'er the land of the thief and the home of the slave.
This is one of those times that I wish we had an emoticon of vigorous clapping. Thanks, Dr RH, that was great.
I have to run out for a bit if you guys see Kito please give him this link. Thanks.
http://www.youtube.com/watch?v=mc-1msYF8Xo
I will Fonz. You take care.
I disagree Fonz. It's not over yet, we are still trading, and I simply don't believe that they are going to turn their back on the whole "wealth effect" meme that they have based this "recovery" on. At least not until they are ready to pull the plug on the whole system, or they are ready to force people with retirement plans to buy U.S debt.
I think they already are, Doc. Fonz had some information about that earlier this week or last week.
The U.S treasury is currently dipping into pension plans to cover expenses and bi-pass the debt ceiling right now, but they aren't forcing retirment plans into treasuries...yet.
My bad Doc, I got it wrong then. I thought they were already doing that.
A controlled demolition of the stawk market would make sense, since the shit is hitting the fan Nixonian-style and the Obama administration needs some cover and misdirection.
I think RSloane summed it up well and I actually agree with you Doc. The fact that this market has fought tooth and nail up till now, and even as I speak, shows that they are not ready to pull the plug, but are putting the plans in place (money markets etc). What I am saying is the easy money has been made. Unfortunately for the most part, I fought it the whole way. I am not saying we crash and the world ends right now. My belief is that we have entered a new phase where virtually everyone gets their ass kicked. People getting their ass kicked in bonds flee to stocks. Only to get their ass kicked in stocks. Bonds sell off bigtime and then rally when people least expect it. Bonds do the same. At the end of the day looking at the markets it may not seem too bad, but a lot of people will have caught a beating along the way.
That will last until the next phase, which will make this phase look like a picnic.
We are both in complete agreement on that.
wait a minute. i thought that money was suppose to rotate into equities when interest rates ramped? lol.
i bet there is a lot of "oh, shit" going around lately.
I really do think recent technicals in the DOW now confirm the past double-top. All downhill from here?
do you remember how greenspan popped the internet bubble by lowering interest rates signalling the beginning of a rotation back into bonds? i believe the bernank thought he could achieve the opposite. increasing interest rates when the market was mostly real was the best indication to put money back into equities because the economy was beginning to heat up. wasn't qe meant to keep interest rates low to force investors to chase yield by investing back into equities and (hopefully) real estate?
qe has nothing to do with the reality of the market forces and everything to do with a very visible hand manipulating variables. it has backfired. reality has caught up. the invisible hand has now reasserted itself in a very ironic way. rising interest rates are now interpreted as an early indicator of real trouble, not a sign of recovery. the equity markets, especially indicated by the topix, will drop like a rock if the interest rate surge continues.
my point is technical indicators will reflect the new normal and the equity market will crash as a function of rising interest rates. the double top in the dow is a confirmation of the new paradigm.
Get to work Mr. Chairman.
It's going to be great to watch them say "Get to work Mr. Chairman" to an empty chair at Jackson hole.
<-- hear my train a-comin!
http://www.youtube.com/watch?v=16AyLjXMN98
;-)
So basically this is the Fed #1 mandate 'price stabilitee'?
Hmmmm, working out a little better than the second mandate
Where is the chart of gold going up? It would at least give me the warm fuzzies for another 20 minutes.
I'm sure you can find something aesthetically pleasing from 2011! ^^
"There was no bullshit-bitchez."- J. Dimon.
Come on guys don't be jerks.. btfd! besides Goldman said they'd let us know when to stop buying.
Are we now really getting to the point where bad news is.... well, bad news!?
http://nipponmarketblog.wordpress.com/
MO POMO, but NO MO Rampapalooza.
Today's Fed Reserve menu today is offering between 0.75B-1.0B - with a nice chianti.
Tommorrow, the Fed is pumping $275B-$3.5B - now this could be the rampapalooza we are missing today.
I love technical analysis - check the Fed schedule and place my roulette wheel bets.
Bernanke's name will echo in eternity as the biggest fuckwit of them ("economists") all!
Will he be the one to discredit the beard as a fashion accessory forever?
Will anyone that wears a beard from then on be called a "Bernanke", as a personal insult?
I would love to see his face when this shitstorm finally hits!
Bwahahahahahahahahaha!
PS Fuck you Ben...
Computer games for computer players. Where is the Humanity?????
The least dirty shirt is a wrong metaphore. The US is in the first class section of a crashing plane. We get better service with drinks and all, but we are all on the Fiat plane and it is crashing!!!!
Could it be some Tapering going on this week?
http://www.ny.frb.org/markets/tot_operation_schedule.html
Tentative Outright Treasury Operation Schedule Operation Date1 Settlement Date Operation Type Maturity Range Expected Purchase Size Mon, Jun 03, 2013 Tue, Jun 04, 2013 Outright Treasury Coupon Purchases 02/15/2036 - 05/15/2043 $1.25 - $1.75 billion Tue, Jun 04, 2013 Wed, Jun 05, 2013 Outright Treasury Coupon Purchases 08/15/2020 - 05/15/2023 $2.75 - $3.50 billion Wed, Jun 05, 2013 Thu, Jun 06, 2013 Outright Treasury Coupon Purchases 02/15/2036 - 05/15/2043 $1.25 - $1.75 billion Thu, Jun 06, 2013 Fri, Jun 07, 2013 Outright Treasury Coupon Purchases 03/31/2019 - 05/31/2020 $3.00 - $3.75 billion Mon, Jun 10, 2013 Tue, Jun 11, 2013 Outright TIPS Purchases 07/15/2017 - 02/15/2043 $1.00 - $1.50 billion Tue, Jun 11, 2013 Wed, Jun 12, 2013 Outright Treasury Coupon Purchases 02/15/2036 - 05/15/2043 $1.25 - $1.75 billion Wed, Jun 12, 2013 Thu, Jun 13, 2013 Outright Treasury Coupon Purchases 08/15/2023 - 02/15/2031$0.75 - $1.00 billion