This page has been archived and commenting is disabled.
The new "paranormal"...
Makes perfect sense...
Now where have we seen this before?
Charts:Bloomberg
- advertisements -
Contact Information:
Tips: tips [ at ] zerohedge.com
General: info [ at ] zerohedge.com
Legal: legal [ at ] zerohedge.com
Advertising: ads [ at ] zerohedge.com
Abuse/Complaints: abuse [ at ] zerohedge.com
Suggested Reading:
Make sure to read our "How To [Read/Tip Off] Zero Hedge Without Attracting The Interest Of [Human Resources/The Treasury/Black Helicopters]" Guide
It would be very wise of you to study our disclaimer, our privacy policy and our (non)policy on conflicts / full disclosure. Here's our Cookie Policy.
Goldman.. recommending "Buy stocks which derive profits from domestic operations" .. hmm energy producers? or wiget makers?
http://hedgeaccordingly.com/2015/03/goldman-strengthening-dollar-means-b...
Quite simple really, their operating costs are going down. It's now cheaper for them to buy instead of drilling. Think of the labor savings!!!
You see, the lower the oil price, the greater the potential for price rise, and since stock is priced on expectation of the future, hence oil stock goes up as oil price goes down!
COnsumer stocks in the sights, except P&G which derives 80% of profit abroad. Ooops.
Best way to make money in any of these markets is
to do just the OPPOSITE of whatever makes sense
"Makes perfect sense..."
If you're a refiner it does, I think (lower near term input costs).
Umm, I got news for you, energy stocks are not the only stocks that are soaring. DOW going to cross 18k today.
BOK & Cullen Frost also up?
it's different this time.
since oil cant go any lower because it is so cheap, you need to frontrun the coming surge in oil by buying energy stocks
lol - buy all stocks - who cares what they do
check XLE - all day buying
Look at all the markets. They're up more than 1% across the board. Looks like everyone expects QE4, or at least no rate hikes in the near future. Expect the FED to remain "Patient".
Watch the reversal
These are funds betting again...this time they're gambling the oil price "correction" will be short-lived.
May they lose their shirts and have to go back to the Fed for more.
Fortunately there are a couple of good ways to slaughter these punters: rising bond yields (unlikely) or a long-term low oil price (more likely)...
Good point, Kreditanstalt. Bakken data, though, may suggest that, while maybe not a good bet, it's a possibility.
This is exactly why I'm hedged up the wazoo. Half stocks and half cash in the ol' 401k. By all economic measures, we should be heading into a re-recession, which should hammer stocks. BUT, GrannyJanet and company can't let the markets fall, so, they'll outright buy stocks. Pity those investors that didn't buy the latest BTFD. It's fucking crazy. Don't invest based on expected earnings. Invest based on anticipated FED printing.
That is not investing. That is just gambling and throwing money away. And when the music stops, all hell will break out. Is it really worth it to try for another 3 or 4% to lose 30 or 40%.
Not for me. This is all so absurd. Energy stocks at day high. LMAO!
What is there to "Invest" in that hasn't been horribly twisted by the FED's actions? Bonds? those have been massively manipulated. Feel free to buy bonds, but you could get your faced ripped off if they or the vigilantes raise rates.
Stocks? Everyone has been forced into risky assets looking for yield. Stocks should be headed lower.
Cash? they're doing their damnedest to create inflation. (and hiding the real rate of inflation).
PM's have been twerked too.
Everything is risky. I don't think you can safely invest in anything. That's why i'm split 50-50 between bonds/cash and stocks. I'm just trying to avoid a 50% loss.
I couldn't agree more. Never thought I would see the day when the dollar was risky from the standpoint of a large, fast decline, but as we have seen throughout history and with latin american currencies, the ruble, the yen and the euro as of late, currencies can be a disaster if they are not backed by anything and governments willfully and relentlessly dilute them. One day the dutch boy runs out of fingers and the dyke breaks.
When they look back at the Fed, they will realize that they failed miserably in their mandate of protecting the purchasing power of the dollar. Trying to debase it by 2% a year on purpose is more likley to succeed in debasing it by 10% a year.
I don't know Dude. Entire 401k's may be seized. Broke countries are all targeting their pension funds. And we broke.
Reality is being bent and we are up to pretzel stage and soon we'll go full origami but as long as they can successfully manipulated things the right way, they win....
Exactly. Unless you were smart enough to be 150% invested since 2009 and can figure out when the music stops to go short, it seems sane to hedge with a mix of stocks and cash. As you pointed out, even when we get a smackdown, Janet will quickly prove that the Fed put is alive and well. They say there is no put, but everytime things get rocky, they threaten to, or actually do, exercise the put.
Basically, we have years more of government directed capital misallocation to look forward to as Central banks continue to override the not perfect, but much better, alternative of free market capital allocation.
...and what will happen later today or tomorrow when 'oil prices' actually rise?
Stocks rise.
As Hillary Clinton said, "At this point, what does it matter???"
I just read goat entrails to help me pick stocks. Forget charts and stuff.
I think this is a positive for the bulls. Divergences often occurs before a change in direction.
I'm just learning how to invest and would like to ask a question.
Why is it that any kind of news that has a negative effect on people's lives is great news for stocks?
It's pretty simple, really:
WAR IS PEACE
FREEDOM IS SLAVERY
IGNORANCE IS STRENGTH
When countries that can never pay of their debt get to borrow money CHEAPER what would one expect. Try doing that as an individual. If countries were individuals, 90% of Europe couldn't get a PayDay loan.
Shit things are so upside down maybe its time to buy oil in anticipation of QE4eva.
I thought they already did the QE4eva last time?
http://www.businessinsider.com/us-department-of-energy-adding-5-million-...
6.2 hours of American consumption. Big move.
You can always tell stuff is gonna happen because before stuff happens, other stuff happens.
FUCK YA!!!!!!!!!!!!!!!!!
"Crude Plunge Sends Energy Stocks Soaring"
Has Freudian overtones.
WE ARE BABYLON THE GREAT!!WHAT THE PROPHETS SAID ABOUT BABYLON
I am pretty sure the "prophets" were talking about Babylon 5. Besides, the hidden messages in Mother Goose's Fairy Tales have a much better track record when it comes to accuracy.
So that would be er..London ?
When the central banks buy S&P futures to prop up the market, it doesn't matter what your actual business is, as long as you're an S&P 500 club member you go up.
Why would anyone think this is going to end any way other than badly?
First State to eliminate gas taxes wins. Oil is worthless but not refined product. With your feedstock (natural gas) collapsing in price again the ability to mass produce end product (diesel, propane, gasoline, kerosene) for next to nothing is now off the charts.
That makes oil integrated oil companies...and their transportation divisions...very valuable. This is especially true of railroads and actual ships (and barges.). I would not be long the trucking business if oil heads to 20 bucks a barrel though.
A one ton pickup can handle pretty much any transportation need otr now especially since growth is now negative.
No need for diesel locomotives either should the rail line want to eliminate the use of fossil fuels entirely.
Not saying buy equities mind you...just sayin'...
Very few emphasize enough that core of the issue is utter collapse of demand for anything throughout the world due to massive over-leveraging of business of all sizes and households often in US dollars/Euro/Yen not in domestic currencies leaving CBs helpless.
People simply paying off their loans and obligations and have nothing left for consumption or investment. This catastrophic collapse of world demand (pointed out by Russia and China) for most goods including food and oil causes, continuing for almost a decade now, dramatic flight of capital resulting in recalling massive amounts of speculative capital back to US. Japan and Europe refused to accept returning yen and euro assets desperately seeking shelter in panic. They are trying to accomplish it via QEs and NegIRP. They are trying to erect barrier to capital inflows in order to avoid surging of their currencies and killing their economies, meaning reminder of industries capable to export since domestic demand is dead.
This leaves, commodity driven, emerging markets in conundrum. Their currency is weak vs. dollar but they do not trade that much with US to take any significant advantage (US is a significant exporter of commodities itself), but if currency of a country to which they sell is weaker than their currency vs. dollar, their sales collapse. And that’s really the case throughout the world. So they fight a currency war indirectly among themselves, through FX dollar, by collapsing their CB interest rates while facing collapse of their own currencies vs. dollar due to capital flight. All that against common wisdom, which would suggest rate hikes instead.
That’s why while 75% of world currencies lost to dollar, 75% of all worlds CBs lowered interest rate within in last 12 months and they keep lowering to out-export each other giving up on domestic demand and growth or even preventing any significant growth in first place to avoid their currency surge. Even China accepts much lower growth, to talk yuan down, and Russia lowered the interest rates twice while under FX attack and massive capital outflows, happy with rubel half of its value 12 months ago.
To defend themselves many countries, also in the west, abandon FX market monopoly and set up huge currency swap lines, or join newly created independent of Washington and dollar, international financial institutions to limit this spiral of death. Ironically swap lines actually boosts dollar since in addition to non-US$ denominated capital flight into US$ assets, there is shortage of FX dollar funding since nobody needs to sell dollars to buy other currencies if they have swap lines, with “fixed” exchange rate, open.
In strange ways globalization makes de-dollarization inevitable one way or another. Dollar strength is in part result of dollar shortage at FX but not because everybody wants dollars but because nobody needs it any more as intermediary in FX exchange because it is overpriced to its value. It is classical FX market failure, similar to that of 2008 when FED open massive swap lines with worlds CBs to squash dramatic raise in dollar.
See post and my comment at:
http://www.zerohedge.com/news/2015-03-08/global-dollar-funding-shortage-...
But why? What’s going on?
The general answer is that national economies and sovereign states (with few exception) are illusions. Their domestic markets are illusions, their economic and social policies are illusions maintained for domestic political audience. Global integration has been accomplished. Only global economy exists now. And unified global capital rules the world.
Production is distributed so much all over the world that no country controls production of nothing but some small subsystem, one of thousands parts from all over the world assembled in final product with no true ownership and no country of production. Just few multinationals are richer than GDP of at least bottom 120 countries in the world and have no national allegiance of any kind.
This serves purpose of practically eliminating any political leverage that country may have over world production. But now with ZIRP nobody has any leverage over global elites who print their profits. In other words countries (with few partial exceptions) cannot reestablish control over their economies and social policies by imposing tariffs, trade barriers, capital, labor controls, specific social, economic, military, foreign policies or whatever in any way that would not result in collapse of their “hollow” economies and painful political turmoil at least during transition.
Even countries at war cannot stop cooperating economically, close borders or limit civilian trade, thing unheard off 50 years ago. The unimpeded and even increasing cross border trade and people movement between Russia and Ukraine continues, Poroshenko candy factories in Russia are making profit while they are on war footing. US increased exports to Russia in last 12 months while spewing apocalyptic rhetoric of WWIII. German own factories in Russia dramatically increased investment of their profits in Russia to avoid losses of manipulated currency play. These are examples of global integration paralyzing the policies.
This has most corruptive influence of national politics. That’s why all politicians that promised economic growth, betrayed the people as soon as they got in power since they knew the only way to the growth in global economy is to export if not it they have to cut expenses, collapsing governmental and private social programs and dismantling democratic institutions that still left, to pretend to pay un-payable debt.
The fallacy of debt based global economic system is only too apparent.
There is no way out of world pauperization and death spiral except to break through globalism in very painful ways. Unfortunately, people rather believe in illusion than face pain of reality and turn around to stop this genocidal system of alien class of global oligarchy directed towards human extermination, all other priorities rescinded.
For some more background on Japan economic situation:
https://contrarianopinion.wordpress.com/2015/02/20/japan-miracle-that-wasnt/
On illusion of market:
https://contrarianopinion.wordpress.com/2015/01/29/invisible-hand-and-ot...
On US economy and wage slavery:
https://contrarianopinion.wordpress.com/2015/01/28/slaves-of-wage/
BINGO! This post hits the nail on the head.
Forming a bottom. Buy, buy, buy!!!