Just 12 WTF Charts

Tyler Durden's picture


Sometimes you just have to sit back, look at some charts, and say WTF...

Carry Trade


2. SPX vs US Treasuries

3. SPX vs US Term Structure

4. SPX vs Fwd EBITDA Expectations (bottom-up)

5. SPX vs US Macro (top-down)

6. SPX vs Jobless Claims (so long held as supportive of the recovery)

7. SPX vs Lumber (the housing pillar is cracking)

Risk Assets
8. SPX vs High Yield Credit

9. SPX vs China's Shanghai Composite Equity Index

10. SPX vs Japan's Nikkei 225 Equity Index

11. SPX vs Emerging Market Bonds

12. SPX vs Emerging Market FX


Of course, there are those who see these charts and through no self-referential cognitive-dissonance of their own (well in fact entirely for that status quo engendering reason) will proclaim... that proves it - US is cleanest dirty shirt and money is flooding back to 'safety' - however - that is entirely disingenuous...

The ironists among market punters will even attempt to construe all this as a reason to buy more developed world stocks on the premise that the money flooding out of such places as Thailand, the Ukraine, Turkey, and Argentina will be parked in the S&P and the DAX (perhaps overlooking the fact that the purchase price of these now-unwanted positions was most likely borrowed, meaning that their liquidation will also extinguish the associated credit, not re-allocate it).


The Goldilocks lovers will also tend to assume that any such disruption will serve to delay the onset of genuine tightening and may even induce further ill-advised stimulus measures on the part of the major central banks. Certainly Madame Christine Defarge – that tax-sheltered tricoteuse who knits beside the guillotine set up for the hated bourgeoisie – has already begun to militate for such a response.


For their part, the biddable are already trying to drown out the noise of the Cacerolazo by making the fatuous argument that the EMs account for such a piffling portion of world GDP that their fate should be a matter of complete indifference to the rest of us. Needless to say this is a touch disingenuous at best. Their share of end consumption-biased GDP may be lower, but they account for an equivalent fraction, if not a small majority, of global industrial production – and they have been responsible for an even bigger proportion of its growth this past decade. Ditto for trade and ditto for resource use.

13. SPX vs The Federal Reserve Balance Sheet - The Truth

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Sat, 02/22/2014 - 14:53 | 4465635 Kirk2NCC1701
Kirk2NCC1701's picture

I love ZH porn charts in the morning.  ;-)

Sat, 02/22/2014 - 14:54 | 4465642 greased up deaf guy
greased up deaf guy's picture


Sat, 02/22/2014 - 15:00 | 4465664 flacon
flacon's picture

So buy SPY calls then? 

Sat, 02/22/2014 - 15:05 | 4465683 James_Cole
James_Cole's picture

SPY be killin', can't fight city hall!

Sat, 02/22/2014 - 15:06 | 4465689 Motorhead
Motorhead's picture

WTF Charts, bitchez!

Sat, 02/22/2014 - 15:10 | 4465701 DoChenRollingBearing
DoChenRollingBearing's picture

Bonus Chart No. 13 was the killer.  But, I would like to see Bonus Chart No. 14: S&P 500 vs. gold.  WTF?!

Sat, 02/22/2014 - 15:17 | 4465714 Motorhead
Motorhead's picture

The US national debt and gold used to have a very nice chart/graph correlation.

Sat, 02/22/2014 - 15:25 | 4465760 mjcOH1
mjcOH1's picture

"The US national debt and gold used to have a very nice chart/graph correlation."

New paradigm!!

Sat, 02/22/2014 - 15:50 | 4465828 max2205
max2205's picture

S&P = Fed....nothing else

Sat, 02/22/2014 - 16:10 | 4465829 mjcOH1
mjcOH1's picture

Clearly....to the moon for USDJPY, 10y yield, UST 10s-5s, forward EBITDA, US macro, jobless claims (ruh-roh), lumber, HY credit, SHCOMP, Nikkei 225, EM bonds, and EM FX.

Buy buy buy.

Sat, 02/22/2014 - 18:56 | 4466380 wallstreetapost...
wallstreetaposteriori's picture

Looks like everything else needs to start catching up the SPX......#fraud?...

Sun, 02/23/2014 - 00:41 | 4467160 Soul Glow
Soul Glow's picture

Ya'll should have bought stocks five years ago and sold them in December.

Just sayin'.

Sun, 02/23/2014 - 03:52 | 4467344 old naughty
old naughty's picture

and the winner?



Too many falling, no one heard...

Sun, 02/23/2014 - 05:50 | 4467422 The Dunce
The Dunce's picture

The final analysis?  We're all screwed.  You bitches.

Sun, 02/23/2014 - 08:24 | 4467510 BringOnTheAsteroid
BringOnTheAsteroid's picture

Um, where on those charts are all those Hindenburg Omens?

Sun, 02/23/2014 - 18:35 | 4468858 janus
janus's picture

in the gaps

Sun, 02/23/2014 - 09:23 | 4467549 Bendromeda Strain
Bendromeda Strain's picture

Hey Vineyard, I mean Dunce, how many sock puppet names are you using to pimp your navel gazing blog anyway? Here's a newsflash, I checked it out - I won't be back.

Sun, 02/23/2014 - 09:48 | 4467573 new game
new game's picture

now you are educated. move on to a higher plane of understanding-thanks ZH...

Sun, 02/23/2014 - 18:34 | 4468853 janus
janus's picture

el dunce-o,

if that's your blog, i want to congratulate you...i really enjoyed what i read.

i'd also like to commend you on your nine down-votes; these philistines like their social commentary in sit-coms and heavy-laden with gobs & gobs of greasy sentimentality.  put a little more bob sagget into your stuff, and then the up-votes will come gushing forth like so many guffaws on a laugh track.

sorry to fuck up your perfect record, but i'm up-voting...and keep up with the blog; i think i'm going to bookmark it.

fuck em,


Sat, 02/22/2014 - 17:34 | 4466155 TheRideNeverEnds
TheRideNeverEnds's picture



Bonus chart: the only chart that matters. 

Sat, 02/22/2014 - 18:14 | 4466262 ebworthen
ebworthen's picture

Yup - can't believe that anyone can deny that clear fact.

Propagandists love to ignore reality and grasp at straws.

Sun, 02/23/2014 - 13:56 | 4466776 scrappy
scrappy's picture


New territory?


Yes (for this cycle) and no.

The human race has been here before, but never at this scale.

Big problems everywhere.

It will take the effort of all of our generations to survive this.


This read explains the concept.


Sat, 02/22/2014 - 18:44 | 4465930 LMAOLORI
LMAOLORI's picture




"The US national debt and gold used to have a very nice chart/graph correlation."

Reminds me of an old song....

Yesterday's Gone 


Sat, 02/22/2014 - 21:26 | 4466746 Mike in GA
Mike in GA's picture

Thanks for the song...listening to it was a journey back into an innocent time.

Sat, 02/22/2014 - 14:57 | 4465650 XenoFrog
XenoFrog's picture

Hold onto your butts.

Sat, 02/22/2014 - 15:06 | 4465691 Ignatius
Ignatius's picture

Tells me which ever way it goes the 'buyers' want equity.

It does look insane, however.

Sat, 02/22/2014 - 18:21 | 4466286 disabledvet
disabledvet's picture

looks insane? It IS insane.

Facebook buys "whatsupdoc?" for 25 billion?
Ali Babba Bunny alright.

The "scariest chart" actually was not presented...namely the US dollar versus the S&P. Contrary to popular opinion:
a: the dollar has soared in value and
b: i can't think of a single instance where this is bullish for stocks.

SOME equities...but equities in general?
Part of the "beauty" of buying in 2008 was that the dollar had collapsed (once QE was announced.)

Part of the oddity now is that the dollar has soared.
Great if you're a foreign investor or want to flood the US market with cheap imports (including gold apparently) but not so good when trying to bid every asset on earth up to the moon.

Sat, 02/22/2014 - 15:07 | 4465695 Bay of Pigs
Bay of Pigs's picture

Or grab your ankles?

"Bend over America, you're getting driven to Cleveland"

(Title of BoP's latest book)

Sat, 02/22/2014 - 15:33 | 4465783 Headbanger
Headbanger's picture

No.. I'm grabbing some nice young babe's butt instead!

Sat, 02/22/2014 - 15:55 | 4465840 Sabibaby
Sabibaby's picture

Hold onto your butts."

Not When I'm looking at Porn thank you very much!

Sun, 02/23/2014 - 02:32 | 4467288 Colonel Klink
Colonel Klink's picture

So you work for the SEC huh?

Sun, 02/23/2014 - 09:25 | 4467552 Bendromeda Strain
Bendromeda Strain's picture

Hold onto your butts.

So that explains those photos...

Sat, 02/22/2014 - 15:15 | 4465729 RSloane
RSloane's picture

LMAO!! Those charts are some of the best ecoporn I've seen on ZH so far this year. "Divorced from reality" takes on a whole new different meaning.

Sat, 02/22/2014 - 16:50 | 4466011 Crash Overide
Crash Overide's picture

So according to that last chart the FED is the market?  lol



Sun, 02/23/2014 - 01:32 | 4467224 DaveyJones
DaveyJones's picture

no, col

Sat, 02/22/2014 - 20:14 | 4466545 skwid vacuous
skwid vacuous's picture

let me guess - Yellen's stubby little claws keep pressing the "buy ES" button?

Sat, 02/22/2014 - 20:33 | 4466603 aldousd
aldousd's picture

Just 'decoupling from reality' not quite divorced, since they do mimic the inflection still (most of them.)

Sat, 02/22/2014 - 21:03 | 4466688 Being Free
Being Free's picture

Indeed RS, and the punchline (bonus) was set up so well.  Pure dopamine rush!

Sat, 02/22/2014 - 15:23 | 4465739 Future Jim
Future Jim's picture

Why do these charts only go back to various points in 2013 in most cases, with one going back to 2012 and starting in 2014, given how the crash/bailouts/QE/ZIRP started in 2008/2009?

Sat, 02/22/2014 - 15:30 | 4465776 Schmuck Raker
Schmuck Raker's picture

"Dramatic license"

Sun, 02/23/2014 - 06:57 | 4467457 GetZeeGold
GetZeeGold's picture



Probably just didn't want to create a panic.

Sun, 02/23/2014 - 09:30 | 4467558 Bendromeda Strain
Bendromeda Strain's picture

In context, I would say it shows that the Fed was getting away with it for awhile. Now the tide is going out.

Sun, 02/23/2014 - 09:30 | 4467557 Bendromeda Strain
Bendromeda Strain's picture


Sat, 02/22/2014 - 16:00 | 4465856 Dubaibanker
Dubaibanker's picture

Although I understand what the charts are supposed to mean, but I dont believe they are entirely accurate, especially when displayed on a very short run of 3-6 months.

We can see here that S&P is no where close to the entire adjusted monetary base including the Fed balance sheet although it is grinding higher lately.


Second point, with the QE taper and expected to end by end 2014 or latest early 2015, will the S&P get worse or remain same, is yet to be seen though is it is betting on the higher side.

It is quite likely that with the number of bonds issued (cash on balance sheets), lack of capex spending/international expansion, massive lay offs leading to savings on expenses, major losses already booked, higher exports, No. FDI in the world, revival of oil/gas/car exports, protectionism of US corporates, cheaper $ compared to EUR/GBP and more innovation/productivity over the past 5 years are indeed providing very high stability to all balance sheets which is leading to S&P grinding higher, IMHO.

Sun, 02/23/2014 - 02:28 | 4467285 Squid-puppets a...
Squid-puppets a-go-go's picture

Sarc off? Then Farc off...

Sun, 02/23/2014 - 02:54 | 4467299 Johnny Cocknballs
Johnny Cocknballs's picture

the jobless claims one stuck out to me - when you have, I forget, but its well over a million people who ran out of unemployment, which Congress didn't extend [and even if you think that's great, it's pretty fucked up that they also slashed veterans benefits while sending new cheap weapons and hundreds of millions to that shitty little country on the eastern med - I'd rather keep it in country and help out someone than that] the claims don't tell you much.


I'm not sure what you think the monetary base chart means as against Tyler's charts - which tracks against the fed's balance sheet...not m //  How much of the QE money is in European banks, by the way?


I'm not sure about your final para, and while s+P could go higher in the short term, and for that matter we could see deflation in the short term, possibly, I can't see that in the mid term {I mean say a year out} but admit I'm just going by gut feel.

 . well sorta...

The monetary base in your chart shows the nearly straight up trend starting 2010.  A lot of that is on foreign shores, of course, but recall that this also represents a growth in DEBT in the system.


The trouble is how compound interest works.  The fundamentals are deteriorating, and this can not be sustained.  But sure, the doom porn has begun to grow tedious - still it's hard to know what the tipping point will be anyway, but especially when everything is so manipulated and rigged.


Tough to see, all else aside, why money would flow into either equities or bonds when Yellen and Fischer start slowing the flow, which is the de facto monetization of the US debt, of course... 

why buy at bubble prices /  why buy with so much risk coming due? 

I'm thinking real assets, realty, pms, and in my own view certain commodities and equities become magnetic. 


punchline:  gold and silver {physical}, bitches.

Sun, 02/23/2014 - 05:26 | 4467391 Dubaibanker
Dubaibanker's picture

All I am saying that in today's dog eat dog world...every corporation is on their own. And, because their balance sheets are stronger than they were 5-6 years, they really do not have much of a downside. Imagine how many banks or shipping companies or oil companies or hotels or other medium sector companies have shut down or merged or been sold in the last few years.

If you think that every seller has a buyer, then the money supply must remain the same. When one seller books a loss, he/she leaves the capitalist system but someone else replaces him/her and life goes on...

Aside from the social impact due to job losses and changes required in skill sets, impact of bankruptcies etc, US has received on an average USD 150bn-USD 200bn per annum in FDI from abroad since 2006 which has entered the US onshore financial system. This does not include all the money that the US Govt is bringing back from Switzerland and hurting the foreign banks while helping the US banks and saving thousands of job losses (protectionism?). This number also is in billions if not a trillion or higher and goes to support the US banking system.


Over the past decade alone, US has received more than USD 2 trillion in the past 8-9 years. In 2008 it exceeded USD 300bn and in 2012, it was close to USD 150bn. This money helps US stabilize its economy. For every seller, there has to be a buyer. This growth in the past decade of FDI entering US is higher than the previous decade when it remained an average below USD 100bn pa.

With more money supply, usually there is inflation, but since there were large holes to be filled due to massive losses in balance sheets, the market remained turbulent. Since the past 3-4 years, despite the volatility, markets including S&P are grinding higher.

It appears that downside is limited - due to lower costs, higher Govt support, more money entering the system, more cash on balance sheets etc. Upside may also be limited but the numbers have shown since the collpase of Lehman in Sep 2008, that markets will remain skewed towards a higher valuation. The biggest impact this year in 2014 remains of the QE taper, but please, do not underestimate the 'smartness' of ANY Govt. They must have some plans to navigate the markets when the QE ends and not allow an entire collapse! They know about the high debt and there are not many options. But that debt belongs to the public through the Govt, who knows what they will do for the public debt. As far as the private debt of corporations is concerned, I do not believe that Apple, Microsoft or Goldman or Citibank can default, not only because they make paper profits but they themsleves have a lot to lose, should they default, than otherwise. All such giant corporations, anyways, go into oblivion, despite their own best efforts of survival, think of Sony, Panasonic, Toshiba, Sharp, top Japanese, Cypriot or Spanish and Irish banks, BB, Merrill, Bear Stearns, Ericsson, Motorola, Enron, Arthur Andersen, AOL, Netscape, OGX etc. The open markets system does allow for a organised demise of a corporation as well as an organised rise of a corporation. 


Sun, 02/23/2014 - 07:24 | 4467467 EuropeanBankster
EuropeanBankster's picture

"If you think that every seller has a buyer, then the money supply must remain the same. When one seller books a loss, he/she leaves the capitalist system but someone else replaces him/her and life goes on..."

I think it's incorrect. An equity sell off results in destruction of value. A daily turnover of about 3 % of market cap with a drop of say 5 % in share price.. 3 % of the shareholders manages to cash in @ vwap but the 97 % loses 5 % of their equity value. Applying to the entire equity market results in a reduction in the monetary base.. exactly like the housing market after 2007. Remember the leverage in the equity market is somewhat similar to the housing market although not to the same extent . The expansion of FED's balance sheet frees capital to the financial institutions who buys corp. bonds and equity. So A Decline in asset value results in a decline in the monetary base? Or am I wrong?

Sun, 02/23/2014 - 10:18 | 4467604 css1971
css1971's picture

Nope. It results in a reduction in price. The price is what you pay for something, value is what you get. The value remains the same... I.E You still have N shares in stock XYZ.

And you are thinking about the wrong side of the transaction if you want to understand the monetary side... Most of the money invested in the markets (~97%) is borrowed into existence. I.e. a banker created credit, loaned it out and the recipient bought stocks or bonds or property.

So, when that credit money is repaid, it vanishes. Say when the margin calls are flying thick and fast, you have to dump the stocks to pay back the loan, which causes the money to disappear.

It isn't when the stock trades at a discount to someone that the level of money changes. It's when the loans are repaid that the level of money changes.

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