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Bonds Best, Bullion Battered, But Protection Well Bid...

Tyler Durden's picture




 

For the 3rd day in a row, traders in credit and equity markets bid for protection. VIX rose 1 vol to 13.5% (diverging notably from stocks) and High-yield and investment-grade credit protection is back at 1-week wides (again diverging notably from stocks). USD weakened back to pre-FOMC levels (-0.4% on the day) led by EUR liquidity needs by the look of it, was ignored by the commodity markets which saw silver and gold tank (gold < $1200) and WTI crude back under $100. Treasuries rallied modestly (yields -3bps) as stocks wriggled sideways on super-low volumes (with NASDAQ underperforming and Dow outperforming to break the new record-high 16,500 level). Homebuilders outperformed even after the dismal home sales data with Energy worst on the day.

Today's S&P 500 futures range was the lowest in 6.5 years...

 

The Dow closed above 16,500  at another record high but note that high-beta Russell 2000 dumped into the close...

 

Managers are protecting gains in stocks...

 

and credit...

 

Commodities - especially precious metals - were hammered... (despite news of the China gold imports dropping 12 hours ago, when it hit Bloomberg headlines it seemed to trigger more selling this afternoon)...

 

The USD fell once again back at FOMC levels...(notice any pattern post-taper? sell European session, buy US session?)

As an aside, while correlation with JPY crosses remains - it is clearly fading (and only in sync during US session today).

 

Treasuries rallied on the day - though most of the strength was during the European session...

 

Charts: Bloomberg

Bonus Chart: Gas Prices have never been higher for this time of year and are at 2-month highs...

 

Bonus Bonus Chart: The TWTR BTFD'ers were out en masse - but had an ugly close as the stock-du-jour closed close to bear market territory...

 

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Mon, 12/30/2013 - 17:12 | 4286434 idea_hamster
idea_hamster's picture
"Bullion Battered"

... and then deep fried?!  Mmmm -- you CAN eat it!

Mon, 12/30/2013 - 17:25 | 4286457 nope-1004
nope-1004's picture

Diabolical ponzi we have here.  The desperation is overt, the stench of insolvency real, and the threat of bankruptcy since 2008 obvious.  Bernocchio, the banking LIAR from hell, knows that if he pulls the plug on bank liquidity, the ponzi crumbles.

Such a sorry state we live in now.  Can't believe society let the money men run it into the ground.

When they finally admit the truth due to an inability to lie further about the truth, then things get ugly.

Bernocchio should be ashamed for how he led America down the road to ruin.  When a stupid person does something stupid, you can say that the shoe fits.  But what if a smart, Princeton educated individual does something stupid?  What's that called?  AFAIC, Ben fits right in with the stupid crowd.

 

Mon, 12/30/2013 - 17:29 | 4286476 DoChenRollingBearing
DoChenRollingBearing's picture

Lemme take a quick look, back in a sec...

 

 

Yes, the gold reserves are still there at the Chentral Bank of DoChenRollingBearing!

Mon, 12/30/2013 - 19:01 | 4286715 Clint Liquor
Clint Liquor's picture

They had to wait until after the close to beat Gold down, so it don't count.

Mon, 12/30/2013 - 17:43 | 4286491 TaperProof
TaperProof's picture

It's all fake, everybody needs to realize it and not take it seriously any more.

Mon, 12/30/2013 - 17:58 | 4286540 Exponere Mendaces
Exponere Mendaces's picture

I'm with you on the narrative, I'd just like the damn thing to start doing whatever its going to do, instead of hanging over the cliff Wile E. Coyote style - before the actual drop.

 

Mon, 12/30/2013 - 18:50 | 4286681 ZerOhead
ZerOhead's picture

Whatever you do just...  DON"T   LOOK   DOWN   !!!

(And we'll all be fine for a little while longer... )

Mon, 12/30/2013 - 17:26 | 4286465 Papasmurf
Papasmurf's picture

"Bullion Battered"

... and then deep fried?!  Mmmm -- you CAN eat it!

Golden brown.

Mon, 12/30/2013 - 17:39 | 4286495 fooshorter
fooshorter's picture

BONUS BONUS CHART!!!!111110011011

Mon, 12/30/2013 - 17:15 | 4286444 Hongcha
Hongcha's picture

Happy New Year to the ZH :0)  Bring it in highly and peacefully, lads; and with thanks as applicable!

Mon, 12/30/2013 - 17:19 | 4286452 TeamDepends
TeamDepends's picture

A Bonus Bonus chart!  Maybe there is hope...

Mon, 12/30/2013 - 17:23 | 4286468 seek
seek's picture

Remember that TPTB need gold to look as bad as possible for all those year-on-year stories. I expect it to keep getting slammed until the ball drops tomorrow. (It'll get slammed after that, too, but the motives are less immediate.)

Mon, 12/30/2013 - 17:48 | 4286500 TaperProof
TaperProof's picture

Nah it's because the economic recovery is STRONG and the dollar is going to be STRONG because the fed is going to taper and raise rates to 5% , and that won't cause any problems at all.  Everything is great.

Gold is going to $100, because America is on the uptrend and going to remain the superpower of the world forever, with the reserve currency forever. 

/sarcasm

So yeah, it's really the complete opposite of all that,

Mon, 12/30/2013 - 17:59 | 4286545 seek
seek's picture

Yeah, total QE issuance since gold's high in 2011: ~ $704B. And that's just the US.

M2 in April, 2011 at the gold high: $8.9T. We're at $11T. So of course gold should go down with the dollar being diluted by 23.6%.

When the economy/financial system/gold price/reality reverts to the mean... It's going to be epic. They'll be writing history about this for hundreds of years, if not millenia.

 

 

Mon, 12/30/2013 - 17:42 | 4286498 thismarketisrigged
thismarketisrigged's picture

2 down days in a row for the s&p.

 

u know how many pts combined were lost in those 2 days? not even a full point. what a fucking joke.

 

but msm will say '' thats 2 down days in a row for the s&p, lol

 

Mon, 12/30/2013 - 17:58 | 4286538 russwinter
russwinter's picture

Gold Banker Participation Report and CoT:

http://winteractionables.com/?p=8458

Mon, 12/30/2013 - 17:59 | 4286550 Mugatu
Mugatu's picture

How dare gold go down after 10 years of gains.  It has to be a conspiracy for something to go down after 10 years and a 600% gain!  

Funny how people lose their perspective. Gold is going down because too many bulls locked on to it - just like any other asset does. Gold will rise again, but only after all the screams of diehard goldbugs get more faint.  

I'm waiting for that big cry towel to be thrown in before I buy! 

 

Mon, 12/30/2013 - 19:12 | 4286756 fijisailor
fijisailor's picture

So I guess you plan to outwit 3 billion Asians.

Mon, 12/30/2013 - 20:54 | 4287013 goldflows
goldflows's picture

LOL...

YES!

WHY WOULD TPTB LET EM BUY ALL THAT GOLD??

Mon, 12/30/2013 - 21:10 | 4287052 fijisailor
fijisailor's picture

TPTB are rotten with corruption.  That's why the Asians are able to buy so much.

Mon, 12/30/2013 - 22:13 | 4287181 Mugatu
Mugatu's picture

If they were so smart they would not have been buying since $1800.  They would have waited until the price was cheaper.  The price is always right!

Mon, 12/30/2013 - 20:50 | 4287011 goldflows
goldflows's picture

Ah , I knew those gold bugs were somewhere.. voting you down I guess.. +1 for truth

Mon, 12/30/2013 - 23:49 | 4287395 Godisanhftbot
Godisanhftbot's picture

 gold barely above where  it was 40 years ago.

Mon, 12/30/2013 - 18:02 | 4286551 chump666
chump666's picture

DXY sitting above the Feds 80 draw-the-line, smells like a deflation trade with gold being smashed.  If a big liquidation takes gold to 1000. It's all about Asia/China.  Risky calling tops with POMO (increased post taper), but anything could blow this market out.

Mon, 12/30/2013 - 18:05 | 4286569 Seasmoke
Seasmoke's picture

Who the fuck would sell their physical Gold for 1100 fucking Close to worthless $USD. 

Mon, 12/30/2013 - 18:09 | 4286577 negative rates
negative rates's picture

You didn't make those worthless dollars, or maybe you did.

Tue, 12/31/2013 - 09:09 | 4287863 Jungle Jim
Jungle Jim's picture

Seasmoke asked: "Who the fuck would sell their physical Gold for 1100 fucking Close to worthless $USD?"

 

 Someone who needs to pay his rent and utility bills in the same month he has to pay two big tax bills and a big insurance bill, and is just about $1,100 short of being able to pay it all, and who has no other income, and who has already sold everything else he had that anyone would buy, for pitiful fractions of its value. Oh, and his car's in real bad shape, and needs a lot of work and at least one new tire. And he needs medical attention that's been put off for years. That's who.

Mon, 12/30/2013 - 18:05 | 4286570 disabledvet
disabledvet's picture

can't say i understand what a COMBINATION of both ending QE and "reverse repo's" means...but it sure sounds like the Great Unwind to me. Daddy Warbucks (the Fed) is telling any and all who listen (and that includes the Government(s) and Wall Street) "get to work." Basically my "back of the napkin" view of the Fed is that they're the only hedge fund to have made money since the crisis...and the amounts are truly staggering...and now they're closing shop and returning their money to their investors (meaning the taxpayers) "and now it's your turn." If anyone wants to pay for pretty much anything now going forward they're going to have to find a way to raise the funds (taxes, capital) themselves...using what they determine to be the risk not what they feel can be offloaded to the Fed. And what is a reverse repo but telling Wall Street "all earnings you receive from the zero bound rate policy" (which is to be maintained i believe and thus gained from taking said risk)) meaning "you need to pay us back the 4 trillion dollars into the future." if this view is true then simply put insofar as "high heat" goes it doesn't getting any closer to the chin. http://www.berkshirehathaway.com/letters/2006ltr.pdf "down to the last cuff link" as they say.

Mon, 12/30/2013 - 20:14 | 4286911 fuu
fuu's picture

"can't say i understand what a COMBINATION of both ending QE and "reverse repo's" means"

 

My take was that the Fed handed out $180,000,000,000 in the month of December.

"Enter the Fed's recently announced (read more here) Fixed-Rate Reverse Repo facility, which earlier today saw its greatest use to date in history, when a record $95 billion in Treasury paper was repoed out to the street for a 3 day term, at an 0.03% annual rate."

 

Unless only the rate counts as QE. 

 

Another one today, $102,573,000,000:

Deal Date: Monday, December 30, 2013
Delivery Date: Monday, December 30, 2013
Maturity Date: Tuesday, December 31, 2013
Type of Operation1Reverse Repo
Auction Method: Fixed-Rate
Settlement: Same Day
Term of Operation21 Day
Operation Close Time: 11:45 AM

Results Amount ($B) Rate (%) Collateral Type   Submitted Accepted Stop-Out3 Weighted
Average4 High Low Treasury 102.573 102.573    0.03       0.030       0.03       0.03  
Mon, 12/30/2013 - 18:54 | 4286693 Wilcox1
Wilcox1's picture

Lotsa oppty to BTFD today lookin at the MW charts (jus hope that guy doesn't sell his 15 shares of twitter tomorrow while I'm tryin to BTFATH)

Mon, 12/30/2013 - 19:09 | 4286751 kill switch
kill switch's picture

I have an announcement to make,,,,,,,,,,I don't give a fuck about the SPOTED price of PM's.....it has no value as a price discovery mechanism...KEEP FUCKING STAKING AND IT WILL KILL THE ELITES..........GET IT? This USSA is tiring me out …..FUCK THEM,,,are you on board yet??? At your own peril you are not on the escape train...good luck to you low information cretins..

Mon, 12/30/2013 - 19:23 | 4286782 22winmag
22winmag's picture

Got a 100oz brick of silver today for $2027.

 

This must be what it feels like to rob a bank... and get away with it.

Mon, 12/30/2013 - 21:02 | 4287029 goldflows
goldflows's picture

Uh the price is $19.64/oz.. 

How exactly do you feel you robbed the bank?

Mon, 12/30/2013 - 20:49 | 4287005 goldflows
goldflows's picture

Paging all gold bugs...

 

Cmon where are you guys, really?

Not more than 3 days ago everyone and their mothers was buying.

Mon, 12/30/2013 - 21:16 | 4287063 fijisailor
fijisailor's picture

Still am and still will be all the way down to $800 or however low it goes and until it's not available.  It's called dollar cost averaging.  Ask Warren Buffet about dollar cost averaging.  There's blood in the streets in PMs right now and any respectable billionaire will tell you that is the time to buy.

Mon, 12/30/2013 - 23:48 | 4287389 Godisanhftbot
Godisanhftbot's picture

 I called gold a fetish most of the way up, and am calling it that all the way down.

 

 Fess up goldiot, you wish you sold the barbaric 700 USD ago, dont' ya?

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