SPX vs. CLMI

An interesting chart to look at, is the CLMI vs the SPX. If you are not familiar with it, the Capital Link Maritime Index (CLMI) is a composite index of all US listed shipping stocks. 

h/t @noalpha_allbeta

Comments

[AdvancingTime]

The economic recovery that the media and talking heads have been bantering around does not exist and is just a myth. A manipulated stock market distorted by recent economic policy hides and mask the real truth, in many ways it is ground zero in the war to convince us all is well.

The American people and Main Street will tell you they are far from convinced that it is smooth sailing ahead. Huge weakness in the economy has been shown by numbers that barely get by even after record amounts of stimulus. Fact is if QE or the massive government deficit spending that props up our economy is removed it will fold like a cheap umbrella.

Recent changes in how the GDP is figured , which boosted growth thus reducing the debt to growth ratio, and attempts to spin poor numbers regarding employment have been met with skepticism. More on this subject in the article below.

http://brucewilds.blogspot.com/2013/10/myth-of-economic-recovery.html

[The Shootist]

Congrats on the promotion Stalingrad camarade. Looking forward to some satirical posts at keynesian expense.

[asteroids]

There are dozens of charts like this. There WILL one day be a reversion and an overshoot to the downside for the SPY.

[MeelionDollerBogus]

http://imgur.com/Ncrvk8R : scatterplot of this data which I find is much more informative.

http://www.freestockcharts.com : CSV data download available. Relevant time-frame: 4 days per data item, 2007 to today. Tickers: SHX.X , sp-500
also: stockcharts.com overlay graph

A running-window rating of correlation is useless, revealing nothing.
The time periods are too short using 50 and 100 days, and moving windows are nonsense to find correlation.
The windows should be fixed and multi-year. That way you can get a real equation for each trend, or see where no equation could fit & ask yourself why. That way you can use both the equations & the changes to figure out what changed, when and by how much.

I suppose over a brief analysis I'd conclude:

initially shipping didn't vary much with the S&P 500 movement but that price range was fairly restricted from 1600 down to 1200. Then shit got depressed & 1200 down to 700 saw shipping decline steadily (red: 22/511063 x SP500 ^53/28).

I should have made the green segment into 2 parts, too late, image uploaded.

Purple segment: CLMI = 11/480 x SP500 ^520/9) indicating shipping is no longer a useful metric of where the SP500 will go. POSSIBLY a sine-wave could be applied but given how quickly trends change this likely will be an over-fit to the data that predicts nothing.

Further deeper analysis, anyone?

* next day: OK over 130 views of the actual scatterplot image and no reply here. NOTHING? Come on...

[JR]

Great find, S and P. Thanks for the additional insight into this unfolding economic tragedy, obscured by QEing of the nations' wealth into the coffers of a handful of Fed-connected oligarchs and their personal estates.

Jesse on Jesse's Café Américain today provides “a Summer assignment for those of you who wish to have a framework for the unfolding tragedy that is the Anglo-American financial system.” Here it is:

The US Financial Crisis and Currency Wars: A Tragedy in Five Acts

Summer Assignment

Here is a fairly conventional look at Aristotle's analysis of what constitutes a tragedy.

The Greek authors modeled their plays on life and their own legends. Aristotle came afterwards and analyzed those successful tragedies, both in art and in life, to determine what made them so.

I am sure this will take many of you back to high school. It brings back to mind those wonderful afternoons in AP English, with one of the most remarkable teachers I had ever met. 

I think without too much effort, one can fit any number of situations into this framework. I think it is very possible to fit our current financial crisis and the battle to sustain the supremacy of the Dollar into this as well. 

I was going to plot out the rake's progress in this for you, but if I give you the hint to start just after the Bretton Woods agreement, and chart the progress of American capitalism in the world until today.  Remember that events tend to accelerate, and are not evenly spaced out in time. 

You may wish to avoid that Desdemona's handkerchief and other such nonsense about the nanny state and creeping socialism spoiling and dragging down the American heroic spirit, which are fogs to avoid the truth. It is much the same to say that the disabled and the Untermenschen were burdens and parasites, like rats, to the thousand year reign of the Ayrans, who never really existed in the first place.  If so you may be able to figure it all out very well for yourselves. 

Extra credit will be given for those who are able to identify the major figures of sometimes unintended comic relief, our modern day fools, Falstaffs, and Calibans of mischief.  Hint:  Alan Greenspan and His Merry Pranksters.

One further hint. The US' hamartia is bound up in what became the notion of American exceptionalism. And Wall Street and the City of London are its Iago.

Enjoy the Summer. Bueller? Bueller? lol. 

Traditionally, a tragedy is divided into five acts.

The first act introduces the characters in a state of happiness, or at the height of their power, influence, or fame. 

The second act typically introduces a problem or dilemma, which reaches a point of crisis in the third act, but which can still be successfully averted.

In the fourth act, the main characters fail to avert or avoid the impending crisis or catastrophe, and disaster occurs. 

The fifth act traditionally reveals the grim consequences of that failure.

According to Aristotle, tragedy necessarily involves: hamartia, catastrophe, hubris, anagnorisis, peripeteia, and catharsis. 

Hamartia: A term from Greek tragedy that literally means "missing the mark." Hamartia came to signify a tragic flaw, especially a misperception, a lack of some important insight, or some willful blindness that ironically results from one's own strengths and abilities. In Greek tragedy, the protagonist frequently possesses some sort of fatal flaw that causes catastrophic results after he fails to recognize some fact or truth that could have saved him if he recognized it earlier.

Catastrophe: The "turning downward" or the beginning of a decline in fortunes in the plot in a classical tragedy. One might also refer to is as a spiral of decline.

Hubris: It is a negative term implying both arrogant, excessive self-pride or self-confidence, and also a hamartia, a lack of some important perception or insight and self-awareness due to pride in one's abilities.

“He who climbs upon the highest mountains laughs at all tragedies, real or imaginary.”

Friedrich Nietzsche

It is the opposite of the Greek term arête, which implies a humble and constant striving for perfection and self-improvement combined with a realistic awareness that such perfection cannot be reached. As long as an individual strives to do and be the best, that individual has arête. 

Anagorisis: Greek for "recognition" to describe the moment of tragic recognition in which the protagonist realizes some important fact or insight, especially a truth about themselves, human nature, or their personal situation.

Peripeteia: Greek for "sudden change" it is a sudden reversal of fortune in a story, play, or any narrative in which there is an observable change in direction. In tragedy, this is often a change from stability and happiness toward the destruction or downfall of the protagonist.

Catharsis: An emotional discharge that brings about a moral or spiritual renewal or welcome relief from tension and anxiety.

http://jessescrossroadscafe.blogspot.com/

[orangegeek]

Baltic Dry Index is 850.  Was 11600 in 2008.

So no one is using ships anymore.

That's because we now use Star Trek transporters to ship product.

Dinner on Mars.  Have to run now.

[Savyindallas]

Is there some kind of secret subterranean railway system under the ocean that we just don't know about? maybe  businesses are using UPS to transport their international goods.   

[tom a taxpayer]

Virtual shipping is next disruptive technology that takes shipping to a whole 'nother level. Whatever needless crap the consumer wants will be delivered instantly to the consumer's virtual reality headset. 

Speaking of ships, why do cruise ships have so many outbreaks of passenger-sickening viruses, while naval ships do not appear to have such frequent outbreaks of similar viruses.

[Comte d'herblay]

Buncha squiggly lines on a white field. 

Chartists are themselves in a half decade bear market.

[BandGap]

Etch-a-Sketch addictions are no laughing matter, sir.

[NotApplicable]

LOL

[MeelionDollerBogus]

http://imgur.com/Ncrvk8R
CLMI vs SP500 aka SHX.X

Less squigglies, more math. Colour-coded to make understanding the transitions easier.