"Capitulation": Longest Streak Of Equity Outflows Since 2008; Biggest Gold Inflows Since 2010

Tyler Durden's picture

The latest Lipper fund flow data is an and it is not pretty: in the latest week, there was $12.2 billion in equity outflows, the largest weekly redemption in 5 months...

... and more importantly, this represents 7 straight weeks of outflows: the longest streak since 2008.

 

Concurrent with the flight from US equities, we have seen the biggest European equity redemptions since October 14:

 

This was offset by an inverse 7 consecutive weeks of government bond inflows, with $1.69bn in fund deposits in the last week up from $0.98 billion, and explains who has been buying all those Treasurys that SWFs, EMs and China have been selling.

And the punchline: we just had the biggest 2-week gold inflow ($3.2bn) since May’10, which according to BofA is a "hedge against “risk-off” & “dollar-off”

Michael Hartnett's summary:

Equity outflows closer to “capitulation” levels: $53bn equity outflows past 7 weeks (0.8% of AUM) exceeds $36bn outflows during Aug’15 sell-off; approaching prior bear market levels of Aug’11 debt ceiling outflows ($90bn), '08 GFC outflows ($85bn) & '02 bear market outflows ($65bn); note BofAML Feb FMS also showed big reduction in equity exposure, albeit not yet to the UW position in equities that coincided with 2002/2009/2011 lows.

The only problem is that while this capitulation shoudl have led to buying at the 1812 bottom, the surge in stocks had nothing to do with bulls buying, and everything to do with shorts covering. And now that shorts have largely covered, even as buybacks continue, all those who have delevered and unwound position, have a choice: buy at ridiculously high valuations at a time when the S&P is facing 7 consecutive quarters of negative annual earnings...  or wait for the market to once again crash before stepping in.

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TheBoyPlunger's picture

Even cramer was pumping gold this week. You know a smackdown is right around the corner...

philipat's picture

Like now. Inflation up, so interest rates up, so stawks down, Dollar up and Gold down.

Perhaps in 3--2--1-, no wait, inflation is good for Gold especially if the Fed is NIRPing and QEing into it? What a shit show....

knukles's picture

See... the sheeple aren't a dumb as many think they are.  They all know that something's terribly wrong. 
They're trying to shrug off the Establishment, don't believe the promises, financial markets are rigged and that PM's might make some sense.
Awakening is slowly talking place

El Oregonian's picture

Yes, you can awake slowly, or you can awake suddenly. Either way you will be awake.

The difference is, the sooner you awake, the sooner you can get into the kitchen before the others, and maybe you'll get breakfast before it is all gone.

Your choice. Plan accordingly.

unrulian's picture

Inflow...outflow...My PMs are covered by an ice flow

Insurrexion's picture

 

 

Question:

Was the outflow carbon-based, or silicon-based?

gaoptimize's picture

Re: Your photo icon.  I would be in heaven having a woman like that nursing a baby by me.

Bill of Rights's picture
Advice From a Criminal Bankster: Just print the damn money.

https://www.youtube.com/watch?v=milb-uLbngE

 

 

OutaTime43's picture

Looks like a solid GLD short.

LawsofPhysics's picture

Paper gold or physical gold?  Big difference.

Keyser's picture

3.2bn inflows to gold... My bet is it's all Comex paper gold, so on worth 1/500 of physical... 

GRDguy's picture

Thin-air paper money flows into thin-air paper gold. The financial sociopaths are lucky their muppets don't understand.

actionjacksonbrownie's picture

Exactly! Because where would they be able to find $3.2 billion worth of Gold in just 2 weeks? Answer: Unpossible!

E.F. Mutton's picture

Good thing I believed my own lying eyes over the media.

wildbad's picture

skipping and dancing and singing...we've got the longest streak we've got the longest streak

 

we WIN

Racer's picture

That's the problem with attacking the short stops when they are the main buyers! After that, who is left to buy when you want to sell?

yogibear's picture

LOL, Fed will be forced to reduce rates and be doing QE4 in an inflationary environment 

Gold and silver will shine!

NihilistZero's picture

I doubt it. Today's manipulated CPI number gives them some cover for another raise. They've gotta control the bust as best they can. Only when a bottom is reached that will sufficiently satisfy the crony capitalists will they unleash more QE. They also HAVE to pop Housing Bubble 2.0. Fixed housing costs in all the metros are destroying retail and hospitality profits and that's the only place their is job growth. They'll find some way to justify raising up to 2.5% and mortgages will move closer to 6%. Foreign capital is about to pay for their money laundering by selling their SFHs and condos for some sizable losses. Cost of doing business I guess...

Vlad the Inhaler's picture

Foreign capital will not sell, where else will they put the money, a zombie bank?

NihilistZero's picture

They'll rotate their money right into bonds. Why would you hold a depreciating asset with a negative cap rate (and maintenance costs) when you could cut your losses and enjoy the rising bond interest rates. There's a reason SFHs were never seen as a buy/hold/cash-flow investment until this bullshit started with Housing Bubble 1.0. The math doesn't work vis-a-vis so many other investment options. Even the slightest return to normalcy in the credit markets breaks the business model.

gaoptimize's picture

Can we get an update on the COMDEX physical to paper ratio?  Have we breached 500-to-1 yet?  With some new players entering the gold market as things go south, there might be someone who recognizes the implications of the situations and the opportunities implied.

nidaar's picture

I'd say fuck the COMDEX, what difference does it make any more...

Monetas's picture
Monetas (not verified) Feb 19, 2016 10:58 AM

Kaputitilation ?

two hoots's picture

This is not capitulation.  A sign of troubling, but reasonable, change but not capitulation.

Quebecguy's picture

Capitukapitalism