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Crude Carnage Contagion: Biggest Stock Bloodbath In 3 Years, Credit Crashes
We leave it to Jack to explain what happened this week...
Quite a week!!
- WTI's 2nd worst week in over 3 years (down 10 of last 11 weeks)
- Dow's worst worst week in 3 years
- Financials worst week in 2 months
- Materials worst week since Sept 2011
- VIX's Biggest week since Sept 2011
- Gold's best week in 6 months
- Silver's last 2 weeks are best in 6 months
- HY Credit's worst 2 weeks since May 2012
- IG Credit's worst week in 2 months
- 10Y Yield's best week since June 2012
- US Oil Rig Count worst week in 2 years
- The USDollar's worst week since July 2013
- USDJPY's worst week since June 2013
- Portugal Bonds worst week since July 2011
- Greek stocks worst week since 1987
Some serious intraday volatility this week as hope kept shining through but in the end, reality won. Despite spiking euphoria among US Consumers, concerns over Greek elections, Japanese elections, the GDP-plunge-driven collapse in oil prices (with neither OPEC nor non-OPEC willing to blink yet on cutting production), and contagion to high-yield finallly caught up with stocks after they blindly followed the mainstream media narrative that low oil prices are unequivocally good for every muppet.
First things first... 2014 so far... "why would you buy a Treasury bond when you can buy stocks with dividends?"
Here's why crude matters...
ES trading vs. Crude for the week pic.twitter.com/Dv5yweu5aZ
— Not Jim Cramer (@Not_Jim_Cramer) December 12, 2014
No Hindenburg Omen today but it appears the Dow & S&P are pressing down to test their 50DMAs...
On the week, The Dow was the laggard... NOT OFF THE LOWS
And Energy sector the worst...
The Russell 2000 closed the week negative year-to-date...
VIX surged this week (ignore the excitement over percentage moves)...
Treasury yields collapsed...
Leaving the decoupling at epic levels... between bonds and stocks..
and between credit and stocks...
The Dollar slipped a little today to end the week down over 1%
Gold and Silver had great weeks - very stable as the rest of the markets turmoiled - while oil prices
Crude is now down 25% from the initial OPEC leaks...back below $58!!
Makes you wonder eh? The decoupling began when QE3 was hinted at...
and energy credit is near 1000bps now... and is starting to spread to rest of the HY markets...
notably worse than stocks (for now)...
* * *
But it's all about the fundamentals!! Great Jobs Data, Great Retail Sales Data, and Great Consumer Confidence Data - unless that's all totally manipulated bullshit?
Charts: Bloomberg
Bonus Chart: How much longer can this go on?
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+10 for the "Jim Cramer" tag on the article.
Not to worry muppets...the Santa Claus rally begins Monday morning!
Unfortunately it will be in Shenzhen China this year due to his complete offshoring of toy production.
Fed Operator - "Yes, Lloyd. Uh huh... yep. Okay. So I heard. Uh huh. Sure thing. You got it. QE4... comin' up!" *click*
The final high has taken place - it's all downhill from here ;)
It's beginning to look a lot like Christmas! La la la la la
Yeah, but how about that new iPhone watch!!!! MUST HAVE
Gosh. Now you're getting me complacent. And I was thinkin' there was something wrong. Damn good thing there're a buncha optimists around this joint.
And that don't even factor in some of them collateral calls we're gonna see with this market(s) action.
Somewhere, some people are having hemorrhagic embolisms.
Pull the Cord Jamie! PULL THE DAMNED CORD!!!
nahh.....this is just foreplay.....the real SHTF scenario will occur out of nowhere, just when you think you're safe.........
I miss the deer in headlights pic
And was all this presaged by the high consumer confidence polls?
Welcome to peak stupid.
Unfortunately it will be in Shenzhen China this year due to his complete offshoring of toy production.
With a stop over in Russia for a little ...R&R. (wink wink)
The margin calls etc won't mean any losses for the banks any longer - the derivatives are all covered now, Congress just voted on it which means you did too. OOOps? You didn't call your Congressperson to object??? Tough fucking shit.
That isn't funny. It's pure evil. Why would anybody stay invested in this market after today's news?
TO ALL PASSIVE INVESTORS: PLEASE SAVE YOURSELVES AND YOUR LOVED ONES. DON'T BE A BAGHOLDER. GET YOUR MONEY OUT OF THESE PSYCHOPATH-CONTROLLED MARKETS AND INSTITUTIONS. COLLAPSE HAS JUST BEEN TELEGRAPHED. TAKE THE ADVICE OF THE EXPERTS WHO HAVE FORETOLD THIS FOR YEARS, WARNING YOU TO GET OUT.
JMO, DYODD, etc.
"Why would anybody stay invested in this market after today's news?"
When "today's news" was Crimea, it only mattered for a few days, as far as the markets were concerned.
Ditto when "today's news" was the Ukraine and the airliner that was downed.
When it was Ebola and Isis in October, it mattered for about 10 days until Bullard said to stop worrying, because QE would be brought back, if needed.
Now it's the drop in oil. It mattered for a week. Next week we are going to have to endure Yellen's ugly face all over the financial media as all attention will be on the Fed, and surprise - surprise they will say something dovish and the markets will rally yet again.
Rinse and repeat. At some point it's not gonna work anymore, but we are not there yet.
agreed, get your hand out of your pocket! ha ...
Don't be ignorant.
I'm talking about socialization of derivatives trading risk. Godforsaken psychopaths are about to drive the herd over the cliff.
I just know that fed rate hike is coming,... any day now...
yeah once the 10 yr breaks below 1 percent! stocks are done for.
Hah ha ha ha ha ha
The 10 year WILL break below 1%.
Just for the wrong reasons that so many here speculate about.
When the going gets tough the tough get treasuries.
time to trot out the experts: buy the fucking dip you dumb muther fucker...
Can't right now....Judge Wapner is on.
I'm an excellent driver.
Doesn't even matter how many of the dollars are printed, there is an insatiable demand...until there isn't.
Where's Bruce Krasting???
For a sec Tylers, I thought I got ripped off on the Bonus Chart, but it's a different time scale...;) Soldier on!
hahaha yea... right.... that was the last hight before the next 30 + up days in a row to new all time highs.
It's 11 am Saturday morning, last night's 8 ball is gone except for that last line on the mirror. There are 4 of you sitting there, staring at it -- jonesing.
Who gets it?
Cocaine. It's a hell of a drug.
time to make a call...
i said months ago oil is fundimentally a 35 dollar a barrel proposition and now im gloating. that is all
Gloater!
Spiking the ball over here boss.
Re avatar: Nice gloaters!
Them are floaters
So tell what to invest in next month. Do share.
long
walrus flippers....
Lotto scratch-offs....
Any day now.....
https://www.youtube.com/watch?v=L9JP0oy5M2c
body bags
fundimentally, below $55, many oil wells would be capped.
Four chan
Oil “fundamentally” at $35 dollars is total nonsense.
I have a drink bet that oil wouldn’t go below $53.48. Looks like I am going to lose the bet.
Anyway, oil at $53 dollars is also “fundamentally” nonsense.
By the way, I would change your avatar. Looks like she has breast cancer; and she is anorexic. You can do better, honey!
When the fuck are you going to kill yourself?
Me, doing anything to give pleasures to idiots like you?
I don’t think so.
Id happily settle for you just finding another website to post on...
Look at it this way; if you can deal with me, you can deal with anyone.
Whenever he does it won't be soon enough.
Saudi oil is driving the price and U.S. oil companies going out of business, Saudi's come in and buy them, oil price goes up again and Saudi's get richer off of U.S. for selling it's oil companies to them so they can sell the U.S. oil back to the U.S.. Hide the bean under the Shell.
Sorry, but Saudi alone cannot do it.
I did post a comment by Dubaibanker about Saudi being the instigator of this price war.
Anyway, went back in the 80’s and Saudi did not do it alone.
Below is one of the links. Check it yourself.
http://history.stackexchange.com/questions/1070/did-reagan-really-conspire-to-drop-oil-prices
I had that same thought today.
oh, yea let's call the oil suppliers hotline and get all 397 producers on line at once and agree to 10 percent cuts by everyone asap. what was that number? ha, ...
"Oil “fundamentally” at $35 dollars is total nonsense."
Not if there's more oil above ground than there are buyers. To me, this looks like over supply (driven by years of cheap credit) meets serious lack of demand, as global economic activity takes a nose dive. In this scenario, the cost of production isn't as much a factor as the need to clear inventories and pay down debt, a process that feeds on itself as the price falls. Frankly, I think people will be surprised by how low this goes, and how long it takes to come back.
ebear
Nate Hagens
Twenty (Important) Concepts I Wasn’t Taught in Business School – Part I
17. Cheap energy, not technology, has been the main driver of wealth and productivity
One barrel of oil, priced at just over $100 boasts 5,700,000 BTUs or work potential of 1700kWhs.
At an average of .60 kWh per work day, to generate this amount of ‘labor’, an average human would have to work 2833 days, or 11 working years.
At the average hourly US wage rate, this is almost $500,000 of labor can be substituted by the latent energy in one barrel of oil that costs us $100.
Unbeknownst to most stock and bond researchers on Wall Street, this is the real ‘Trade’.
http://www.themonkeytrap.us/twenty-important-concepts-i-wasnt-taught-in-business-school-part-i
OIL IS GOING TO ZERO!
PERIOD.
Natural gas and coal are more than supporting the energy complex right now. There simply is almost zero need for the product in the USA. Mark my words we will find a way to still get twelve million barrels a day out of the ground. And yes...we'll still be importing ten million a day if not more as we become "the refinery to the world."
We'll be making the best and cheapest tires in world history (probably good for a million miles.). We'll be mass producing the best cars at the cheapest prices in human history (say hello to the new Chevy "and the other thing" in one month.). You be creating your own power grid just by having a solar generator. Your meter is going to start going backwards soon.
NASA better get some giddy up in their SLS because the private sector will be "space invading" perhaps quite aggressively next year. Launch costs have completely collapsed.
No I would not be long copper which is going to five cents a pound.
No I would not be long steel which will basically be heading to free here soon.
Looks good for rebuilding every bridge in the country.
I think the US Army is about to make the biggest comeback ever. "They'll be hiring" if we start seeing regime changes popping up all over the place.
Pigs in Space, bitchez. Get with the phucking program....
Such piercing irrationality. If i were an optimist, i'd already be convinced.
"There simply is almost zero need for the product in the USA."
Ummmm, no.
Actually were gonna invade another nation for its oil Israel will pile on and Saudi arabia and the towel head club will get so pissed off they'll halt U.S. exports..
So oil will then go to 180 a barrel
Regulators will block back feed solar because it's a threat to the power grid then link your water to your power so there is no way to go off grid without being completely expunged from any utility services
Central banks will dribble snot on themselves while they do quantitve easing 4 5 6 6.3 7, banks will charge your account 1 percent interest for the 'privilege' of doing 'business with them...
Stock markets will start adorning their displays with casino lights and treasury bills will pay 0.01 percent. Inflation will hang like herpes off society while the White House will tell everyone the inflation is so low it's not even worth reporting
Washington reps will be getting company blow jobs in the parking lots (blow gate)...
There fixed it a little more realistic for you ????
Yeah, but what's gonna happen to Bieber & Selena Gomez?
They already get the blow jobs in the back of limos.
Is Krugman there?
That is where you and Tyle Durden diverge on your paths. Tyler was creating an army of Space Monkeys.....you have an army of space pigs. Plus, all of your other comments are complete garbage, unless you left of the /s tag....
come on man..."We'll be mass producing the best cars at the cheapest prices in human history" is golden sarc
What drivel. We passed the 2nd industrial revolution at the beginning of the last century and we're even passed modernity now. Energy vs. Manual Labour is about as relevant today as the price of a pair of clogs. Suggest you go back to business school whilst we gaze at our navels pondering the scam of money as a fiat credit as the only tool of mass enslavemnent that keeps the frogs in the consomme.
Fed Operator - "Yes, Lloyd."
"That's mister Blankfein to you, son."
You forgot that line in your telephone call. Otherwise pretty accurate.
Yes that is a given. The question is what vehicle will they use to bring the juice to market? Same old QE, tax rebates, shale bailouts, combo platter?
to avoid political spillover, just a silent partner buying treas., markets will adjust accordingly, so just BTMFDip!!
"Not to worry muppets...the Santa Claus rally begins Monday morning!"
You just need to BELIEVE. Dontju know?
p.s. Note the irony that the in the cast of voices from Polar Express, the voice of the Boy and of Santa are played by the same actor. Oh the irony, the irony!
Kirk what the fuck, you're back?
I think many voices from the past will be rejoining us for a few final, parting words. Exchanging pleasantries before the fireworks.
Tick tock.
if i may add: tick, fucking tock...
Meteor shower tonight.
http://www.wired.com/2014/12/watch-live-geminid-meteor-shower-peaks-toni...
Wonder what Canned-tan Laguarde would make of all this...
“Now, the flip side of it is there are some black folks and maybe some white folks who really like me and give me the benefit of the doubt precisely because I’m a black president.”
some folks went crazy
The real muppets of the rich muppets will get a lot of benefit from the oil / gasoline price decline.
The HYG underlying problem is that the energy sector holdings are large enough to create a big price decline by themselves. That will lead to ETF withdrawals = need to sell and raise cash. Once the easy stuff is sold, the illiquid loans will really have to take a hit to liquidate. Some of the losses on even pretty good quality will bring tears to the sellers eyes. That means more liquidations or redemptions of the ETFs. It could be a pretty deep spiral down.
If the Saudis were smart they could have been front running all of this. Markets are big enough that they could actually be making money from the havoc they induced. Will the SEC check that out for state controlled insider trading?
"back to green by nine fifteen"
west creek operations center policy directive
Time to see again the 1973 horror movie
". . And Now the Screaming Starts!"I prefer
The Fall of the House of Usher
All bad things come to an end.
I certainly hope so!!!!! My prediction was that things would really start to crack in january and to get really short....and to get long UVXY at the end of December. Well, UVXY has just shot up to 30 from 17 in no time. Been making a killing on shorting shale oil stocks though and found a new gem, the greatest short on the planet right now......... BOKF....... bank that is going to get forked with oil crashing. Brings me back to the FED and DSL days. This fall will be epic and my current project!!!
Not to worry Santa Claus ...the muppet rally begins Monday morning!
can't wait until one of the poor slobs he lured into a high beta E&P or energy MLP sticks a pitchfork in his bald head... he can't be that hard to track down
Let it flow.
Go north Pilgrim.....to the Dakotas.....and the promised land.
Just stop before you hit Alaska....tis forbodden.
"We devalued some folks..."
"But if you want your devalued markets, you can keep your devalued markets."
"+10 for the "Jim Cramer" tag on the article."
Is it time for the speed round?
Buy Buy Buy!!!! Waaaqaahhh hah ahha hahh..
lightnin' round! cuz I know everything about every industry, you dumb fuks
Nice charts. Pretty colours.
SAYs to me that everything is a lie.
So beyond getting an econ degree what to do?
I say quit shopping. Quit buying, Quit thinking an I phone is "needed". Who needs one? Who needs to run up credit for suff? Do not shop. Period. STOP Shopping.
Get your money out of banks (that are now going to back derivatives before they honour your paychecks).
Do not buy the crap. Get your money out. ONLY way. Courts are not willing to confront fraud. Pensions will be raped. Gov. programs will be cut. GET out of the system. Your 401K or Roth is not safe.
Quit shopping. Quit giving money to Wall St. Get your money out of banks.
Better define what "money" is as well.
"Get your money out of banks (that are now going to back derivatives before they honour your paychecks).
Do not buy the crap. Get your money out. ONLY way. Courts are not willing to confront fraud. Pensions will be raped. Gov. programs will be cut. GET out of the system. Your 401K or Roth is not safe.
Quit shopping. Quit giving money to Wall St. Get your money out of banks. "
Worth repeating...
Fuck the Congrassholes that voted to subordinate Paycheck Deposits to Bankser Derivative Bets.
Your so-called 'Representative Democracy' sucks balls.
dude, i've been de-thinging and withdrawing for about 18 months and i still have too much crap. :-/
Xmas crash sounds really festive!
Margin call. With a bow on it
Festive Indeed. It'll all be fun and games until "Santa Broker" shows up with a handgun and wants his job back:
https://www.youtube.com/watch?v=V4705kE44Jc
Ho-Ho-Ho!
We ho-ho-ho-ed some folks!
We Mortimer'd & Randolph'd some folks.
We reindeered some folks
We grinched some folks
We Scrooged some folks?
We Kwanza'd some folks.
We Charlie Browned some folks.
We reindeered in the headlights some folks.
....MOAR Ho Ho Ho
Camel-Toed Nation..
at 1st earing, it sounds fun, but.. hey wait a second !
I just bet Yellen is camel-toed.
Yellen meant to say Xmas "Bash" not "Crash" !!!
Remember Obummer said he would change our traditions and nothing says Merry Christmas like a falling stock market. The sheeple keep spending like nothing is happen g but ad I watch even the local news it is in the air and only a fool dosnt see we are here and for those who say where COLLAPSE
While the dollar has risen as of late, with the price of oil plummeting, is it not true that with the decline of oil that the need for green backs by foreign nations to buy oil has decreased considerably. Couple that with the Brics and others trying their damndest to avoid use of Satans debt certificates, perhaps overseas dollars are going to accelerate their repatriation to the U.S.A. There may be a tsunami of greenbaks heading our way. Seems like a good time to be in hard assets.
What did the cops say to the Ferguson protesters with their hands in the air?
Answer: Pants up, Don't loot
festivus for the rest of us
'N bread and circuses. Without the bread.
"Why are we inside the Coliseum instead of being in the seats?!??..."
We've had any number of times when it looked like the whole shithouse was going up in flames. I probably won't believe it's actually happening until my ass is on fire.
Keep some rectal hydration handy.
If a market crashes but one's rectum is fully hydrated, does it make a sound?
/DeepThoughtOfTheDay
only a great and noble nation would keep it's enemies rectally hydrated...
Enemies...Enema???
Yeah. Got it...I understand that now.
We enema-ed some folks....er...enemy folks.
If you can get Krugman to come and listen close, I will guarantee more than a sound!
>>Keep some rectal hydration handy.
Rectal hydrations on the house, Rectals for everyone
We rectally hydrated some folks.
Too sad.
Paging William Banzai7, are you receiving...
Standard Disclaimer: I am already convinced I will need eye bleach in the handy oil 40 gallon drum size even before seeing what he comes up with.
we fed some folks through the wrong end
I guess that there is a new meaning, now, to "Shove it up your ass."
Does that still make the enema of my enema my friend?
Thin Christian holiday markets are the BEST. So much 'run' for so little capital committed. And the fun-fun-fun of ruining everyone's year. Crank up, Emmy Lou Harris' "Christmastime's a'Comin'" and sing along everyone.
Festivus for the rest of us
BABA back to $60
That would be an absolutely amazing christmas present!
"So long mother fuckers..."
Platoon
General Yellen will be giving the troops a pep talk.
The Fed, in all of its altruistic splendor, will just start buying stocks directly...for the children. The sheeple are fast asleep and won't even notice.
and for visual effect of todays action...
https://www.youtube.com/watch?v=GmQ5VJIQekc
Bring it down.
I quit my job today and am trying to get my 401k money out. This bitch needs to hold together for a few more weeks!
"It's my money and I need it now!"
It's funny you say that, Mac. When they asked why I'm quitting I told them it's because they won't let me have MY 401k money.
Another reason is, thanks to all of the brilliant ZH commenters, I have been able to achieve the first key to unplugging from the Matrix, quitting my job and not paying into the system. The next step is using the money to buy productive land and grow my own food.
Why do we work like slaves to earn money to buy food, when we could work like men to feed ourselves?
I'm not trying to brag Hedgeless Horseman-style...just very thankful for all of the help and I hope you all get to unplug at some point.
Freedom, bitches.
buy yourself a little hacienda in centro americana did you? Hmm? may the force be with you.
Nope, just looking at a few acres in the middle of nowhere. We kept enough dry powder to pay the $100/year property taxes until we're dead, then my kids can do what they want with it.
Bravo Mr Hammer!
You know you're doing something right when you get an atta-boy from Mrs. Cog. Thank you! You and Mr. Cog are definitley an inspiration.
Always available for unplugging confirmation endorphins. :-) Please keep us all posted.
Right there too Hammer.
Independence ...to have a choice to say yes or no..is awesome.
Have Fun!
RIPS
This "Hammer Thread" is awesome. I'm working myself to this end, but we have more to go; a little different, but freedom via drop out.
A story:
My last days in Kansas were spent taking care of a large farm. The guy was the former ambassador to Thailand and had a sweet setup. Ponds, rolling grass, trails, and nobody for miles. It was awesome. I was drinking and drugging at the time so I was fucking stoned for most of it, but the experience of being all alone was amazing. At night I'd get jacked up and strip to nothing. I'd walk in the grass bare ass naked under moonlight. It was my first taste of true liberty. Congratulations. Follow your heart and do what feels best. Be free.
This bitch needs to hold together for a few more weeks!
Weeks?
Oh crap....is JT Marlin your broker?
nice avatar Mrs.cog.... The Peratt plasma instability diagram is a perspective reminder that in days of yore things were a lot worse....
Squatter man.
Check out what this guy did with a few acres. He did everything himself and saved a ton of money.
http://littlehouseonthehill.weebly.com/
Awesome blog with tons of pictures from start to finish. I know he joined zero hedge but he keeps quiet.
I need all the help I can get. Thanks, chunga!
Everyone is congratulating you, so I'll rain on your parade. Liquidating a 401k while you're working is nuts. It's taxed at normal income PLUS 10% penalty off the top. I don't know your age, but waiting to 59.5 years old is worth it. At least wait until you have no labor income for that year.