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Winter Cross-Currents Chartporn

Tyler Durden's picture





 

Just shy of the new year, financial markets continue to be dominated by the extent of monetary accommodation. Especially in major advanced economies, bonds and stocks have shrugged off the summer sell-off and posted gains on the view that low policy rates and large-scale asset purchases would persist longer. Much attention has been given to the hope of a strengthening in the U.S. economy.

In Abe Gulkowitz' latest The PunchLine letter, he highlights the key elements from a very slowly improving labor market to the amazing moves in asset markets with 'all the charts you can eat' in between. The unnatural easing stance, though necessary, spurred an aberrant demand for assets in the riskier end of the spectrum. By and large, such assets have so far lived up to their promise. The new year may again challenge that assumption as the likelihood of unlikely events rises.

Markets took in stride a two-week US government shutdown and uncertainty over a US technical default. By contrast, a wide range of country-specific strains weighed on several large emerging market economies, preventing a full recovery of local asset valuations and capital flows. Much attention has been given to the hope of a strengthening in the U.S. economy.

Real estate values and equity market valuations have bolstered both business and household wealth -- and the outlook for spending in 2014. The perceived postponement of Fed tapering gave rise to significant gains in global bond and equity markets. Indeed, some have questioned whether the recovery in home prices in some areas has moved too quickly. Any move to normalcy, however gradual, will test markets.

The dreaded tapering will remain a key focus of markets... As the accommodative monetary policy stance persisted in all major currency areas, so did investors’ desperate search for yield. The unnatural easing stance, though necessary, spurred an aberrant demand for assets in the riskier end of the spectrum. By and large, such assets have so far lived up to their promise.

The new year may again challenge that assumption.

 

 

TPL Dec 16 13

 


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Sun, 12/22/2013 - 21:42 | Link to Comment Leonardo Fibonacci2
Leonardo Fibonacci2's picture

Punch drunk markets.......when the alcohol is no more, people will sober up and then the hangover.  A massive headache is coming and no tylenols will be available.

 

Shut the fucking lights cause i have a headache!!!!!!

Sun, 12/22/2013 - 23:14 | Link to Comment markmotive
markmotive's picture

So is the gold pattern still down? 2014--> Gold $2000? Silver $50?

Eric Sprott comments:

http://www.planbeconomics.com/2013/12/eric-sprott-2014-sends-gold-north-...

Sun, 12/22/2013 - 21:43 | Link to Comment FieldingMellish
FieldingMellish's picture

Gold rolling over and waiting for that Sunday night thin market smackdown. I predict another "once in a billion years" move which will make that twice in one year. Well done TPTB and their TBTF friends.

Sun, 12/22/2013 - 21:56 | Link to Comment Obchelli
Obchelli's picture

Futures are already up like Crazy - based on f**g what?

Sun, 12/22/2013 - 21:56 | Link to Comment FieldingMellish
FieldingMellish's picture

Monetary expectations. ZIRP 4EVA. Cash, baby, cash. Infinite digital greenbacks with no inflation. Its a Christmas miracle.

Sun, 12/22/2013 - 23:08 | Link to Comment TheRideNeverEnds
TheRideNeverEnds's picture

Based on the fact that we have reached a new paradigm where we can print our way to prosperity and nothing bad will ever happen again. 

 

Rather than picking stocks you can just buy one of or all of the indexes because its a given that they will keep going up for the foreseeable future, you may get less return on a percentage basis of the underlying but you can leverage up more than you can just outright buying the bellwethers of the market like twitter, facebook and netflix. 

 

There are so many people calling a top right now that you can rest assured this is definately not even close to the top.  I am thinking about another 100% or so on the upside, stay long till at or around the 2016 election.

 

Goldman, JPM and the like would not be buying them with both hands if something bad was brewing.  

 

 

 

Sun, 12/22/2013 - 23:14 | Link to Comment FieldingMellish
FieldingMellish's picture

Use margin for even greater returns!

Sun, 12/22/2013 - 22:15 | Link to Comment NIHILIST CIPHER
NIHILIST CIPHER's picture

All markets are manipulated. So, all market indicators are complete BS............ that is all.

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