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Un-De-Escalation Fears Spike Gold And Oil, Stocks Don't Care (Yet)

Tyler Durden's picture




 

Since the headlines hit this morning of further escalation in Ukraine, no troop withdrawals and more building takeovers, gold and oil prices have surged higher as it is clear that any hope for de-escalation is just that - hope. Treasury yields remain up but notably less than equity markets would imply by their move as safe haven demand is confused with rate-locks for the massive AAPL new issue (and are misread by stocks as being bullish). Equity markets, of course, don't care, JPY leads the way and there are stops to run and it's Tuesday...

 

 

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Tue, 04/29/2014 - 09:58 | 4707483 Max Damage
Max Damage's picture

Stocks are just a penny chip gamble as the regulators don't give a fuck and joined in the farse a long time ago

Tue, 04/29/2014 - 10:01 | 4707490 RevRex
RevRex's picture

Bush's fault?

 

IF both parties are the same, why does the Socialist Semite democrat media treat both parties so differently

Tue, 04/29/2014 - 10:04 | 4707512 Al Huxley
Al Huxley's picture

The Republicans have Fox - where more Americans get their news than any other source, or something like that.  If you still believe there are 2 teams in this game, this is probably the wrong site for you.

Tue, 04/29/2014 - 10:12 | 4707531 Edward1290
Edward1290's picture

I think Hillary and Jeb should just run on the same ticket in 2016...........because really, what difference does it make.....

Tue, 04/29/2014 - 10:19 | 4707561 BandGap
BandGap's picture

Ed, I'm hoping for some sort of cage match with all candidates taking part. We'll see what sort of man Hillary is.

Tue, 04/29/2014 - 10:20 | 4707569 samex157
samex157's picture

hey guys calm down, I just watched former NATO commander interview on daily ticker and and, and he said to not worry about Russia / Ukraine conflict, it will have absolutely no affect on US stocks. 

So I twit him asking where did he buy his crystal ball from? , he twit back: he found it at DC strip club

Tue, 04/29/2014 - 10:34 | 4707628 astoriajoe
Tue, 04/29/2014 - 10:42 | 4707670 john39
Tue, 04/29/2014 - 11:12 | 4707786 Pinto Currency
Pinto Currency's picture

 

There was a similar gold price spike on the close in London on Apr 24.

Today, Deutsche is on the run from the LBMA.

Tue, 04/29/2014 - 10:42 | 4707673 Edward1290
Edward1290's picture

Its all by design..........and Putin is in on it.......they are all in on it.....iceberg (global monetary reset) right ahead.....

Tue, 04/29/2014 - 10:07 | 4707521 RafterManFMJ
RafterManFMJ's picture

Part of the good cop, bad cop routine - that's all.

Tue, 04/29/2014 - 10:26 | 4707589 lordylord
lordylord's picture

Who is the good cop and who is the bad is a matter of perspective depending if you are an idiot democrat or an idiot republican.  Anyone with the intelligence level above that of a monkey knows both parties are bad.  It is really just a divide and conquer strategy for the ignorant masses. Working to perfection.

Tue, 04/29/2014 - 10:15 | 4707543 Dr. Engali
Dr. Engali's picture

Seriously? You believe there is a difference? look at how Boner and the repukes have rolled over on every single issue in front of them. Now they are talking about Zerocare being a permanent fixture in our lives as well as amnesty for anybody who wants to enter. There is no fucking difference between the two parties. 

Tue, 04/29/2014 - 10:22 | 4707576 lordylord
lordylord's picture

The fool doesn't recognize the divide and conquer strategy.

Tue, 04/29/2014 - 10:31 | 4707614 gcjohns1971
gcjohns1971's picture

"There is no fucking difference between the two parties."

 

There is a difference in WHICH LIES they tell and TO WHOM they tell them.

Their policies are identical.

Tue, 04/29/2014 - 10:39 | 4707653 lordylord
lordylord's picture

You know that and ~1% of the voting population knows that.  Now convince at least half of the other 99%.

Tue, 04/29/2014 - 14:21 | 4708804 claus
claus's picture

There is a big differene mathematically.  100% commie in the dem side and 50% commie in the GOP.  The only thing we can do is to vote out all the commies in both parties short of going civil war.  It's the only way we can take back this country and our culture and language.

Tue, 04/29/2014 - 09:59 | 4707484 The worst trader
The worst trader's picture

Pump Pump Pump Dump Dump Dump Rince and repeat.

Tue, 04/29/2014 - 09:59 | 4707485 kliguy38
kliguy38's picture

all noise .....technicals showing miners and PMs forming intermediate bottom now.......enjoy

Tue, 04/29/2014 - 10:33 | 4707621 lordylord
lordylord's picture

The liberal dystopia is worse than you can imagine. 

Tue, 04/29/2014 - 10:00 | 4707493 Al Huxley
Al Huxley's picture

Tuesdays are down days for gold, and today's last notice day for Comex April gold, and the miners aren't playing along at all. I have a funny feeling the price of gold is going nowhere today.

Tue, 04/29/2014 - 10:01 | 4707496 Dr. Engali
Dr. Engali's picture

Tuesday, the day to take profits on the pump to help insiders get out.

Tue, 04/29/2014 - 10:03 | 4707505 monopoly
monopoly's picture

Same old boring shit. At some point it will be our turn.....Not yet.

Tue, 04/29/2014 - 10:05 | 4707516 IridiumRebel
IridiumRebel's picture

NO HUMANS TRADE THIS MARKET

Tue, 04/29/2014 - 10:10 | 4707529 The worst trader
The worst trader's picture

Completely fake market just look at yesterdays S&P chart, not even possible.

Tue, 04/29/2014 - 10:12 | 4707535 The worst trader
The worst trader's picture

Someone should pull the plug on the machines........................

Tue, 04/29/2014 - 10:13 | 4707537 Rainman
Rainman's picture

The machines are not programmed to cypher this thing called ' hope '.

Tue, 04/29/2014 - 10:18 | 4707556 atomp
atomp's picture

I know I'm going out on a limb here, but I'm calling a top on headline prefixes for the day.

Tue, 04/29/2014 - 10:22 | 4707574 Spungo
Spungo's picture

I'm all in on Twitter because people will tweet from the front when WW3 starts. Think of how many eyeballs and clicks per dollar that would be.

Tue, 04/29/2014 - 10:24 | 4707583 intelectualForeigner
intelectualForeigner's picture

Considering the rally this morning ( based on ?! ), do you still expect to get another one at the 3:30 mark?

 

Tue, 04/29/2014 - 10:27 | 4707598 intelectualForeigner
intelectualForeigner's picture

I'm seeing a slide in the good ole sp500 right as we speak, curious if that will be the base off which we may see another last-30minute-rally later on....

Tue, 04/29/2014 - 10:48 | 4707695 Flux
Flux's picture

You can count on it. Things should hit the red sometime today, then an amazing rally.

BTFD.

Tue, 04/29/2014 - 10:49 | 4707701 Flux
Flux's picture

Oh, yes, and ignore anything to do with the Ukraine.

That's just fluff.

Tue, 04/29/2014 - 10:51 | 4707710 jubber
jubber's picture

looks to me like another sell off swiftly reversed, stocks like NFLX LNKD trading like yoyo's, everytime we start to move down a sudden spate of buying comes in to check it, as someone else mentioned todays close has already been programmed in...or it certainly feels like it is, if IBM comes off then quickly GS or Chevron suddenly move to counteract it...RIGGED

Tue, 04/29/2014 - 11:00 | 4707722 Hongcha
Hongcha's picture

A small spike, since burned off.  Ag continues weak.  If SLV can't mount an offense against $19 say hello to the 17's I am afraid.  That's why I sold my USLV last week and moved to another table.

Tue, 04/29/2014 - 11:18 | 4707818 put_peter
put_peter's picture

Have you seen Mr Schröder lately?

Tue, 04/29/2014 - 11:21 | 4707839 JPMorgan
JPMorgan's picture

Patiently waiting it out for some kind of confirmation on direction.

In my opinion a completely fucked up, bullshit take down is just as likely as a move higher.

Tue, 04/29/2014 - 12:00 | 4708024 crazybob369
crazybob369's picture

Hey, what happens when the machines figure out they don't need humans to pull this off and make trillions of $'s for themselves.  OH CRAP!  Sarah Connor where are you?

Tue, 04/29/2014 - 12:05 | 4708052 RealityCheque
RealityCheque's picture

Why would stocks care about reality?

ITS MOTHERFUCKING TUESDAY BITCHES!!!!

Tue, 04/29/2014 - 13:24 | 4708506 polo007
polo007's picture

http://www.safehaven.com/article/33588/dont-look-now-but-the-wealth-effect-is-over

The government's "ingenious" solution to end the Great Recession was to recreate the same wealth effect that engendered the credit crisis to begin with: The definition of the wealth effect is an increase in spending that comes from an increase in the perception of wealth generated from equities and real estate.

Our Treasury and Federal Reserve figured the best way to accomplish this was to rescue the banking system by; taking interest rates to zero percent, buying banks' troubled assets, and recapitalizing the financial system. Most importantly, our government loaded banks with excess reserves. This process, known as quantitative easing (QE), pushed lower long-term interest rates through the buying of Treasury Notes, Bonds and Agency MBS.

It is imperative to understand the QE process in order to fully understand why the tapering of asset purchases will lead to a collapse in asset prices and a severe recession.

The QE scheme forces banks to sell much higher-yielding assets (Treasuries and MBS) to the Fed, and in return the banks receive something know as Fed Credit, which pays just one quarter of one percent. For example, the Five-year Note currently yields 1.75 percent and the Seven-year Note offers a yield of 2.30 percent. The Fed is currently buying $30 billion worth of such Treasuries per month and $25 billion of higher-yielding MBS.

In fact, the Fed has purchased a total of $3.5 trillion worth of MBS and Treasuries since 2009 in a direct attempt to boost equity and real estate prices. QE escalated in intensity as the years progressed. The year 2013 began with the Fed promising to purchase over a trillion dollars' worth of bank debt--without any indication of when the QE scheme would end...if ever.

Therefore, financial institutions did exactly what rational would dictate. These banks bought bonds, stocks and real estate assets with the Fed's credit because not only were the yields higher, but they also understood there would be a huge buyer behind them-one that was indifferent to price and had an unlimited balance sheet. Since these assets offered a yield that was much greater than the 25 basis points provided by the Fed and were nearly guaranteed to increase in price, it was nearly a riskless transaction for banks to make. This QE process also sent money supply growth rates back up towards 10% per annum, as opposed to the contractionary rates experienced in 2009 and 2010.

Of course, most on Wall Street fail to understand or refuse to acknowledge that ending QE will cause asset prices to undergo a necessary, but nevertheless healthy correction. However, looking at the evidence since the tapering of asset purchases began, it is clear that the Fed's wealth effect has ended.

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