• Knave Dave
    05/23/2016 - 18:16
    This past Thursday marked the one-year anniversary of the US stock market’s death when stocks saw their last high. Market bulls have spent a year looking like the walking dead. They’ve...

NYSE Short Interest Nears Record, Pre-Lehman Level

Tyler Durden's picture




 

In the last two months, NYSE Short Interest has risen 4.5%, back over 18 billion shares near the historical record highs of July 2008 (and up 7 of the last 9 months).

 

There are two very different perspectives on could take when looking at this data...

  • Either a central bank intervenes, or a massive forced buy-in event occurs, and unleashes the mother of all short squeezes, sending the S&P500 to new all time highs, or
  • Just as the record short interest in July 2008 correctly predicted the biggest financial crisis in history and all those shorts covered at a huge profit, so another historic market collapse is just around the corner.

The correct answer will be revealed in the coming weeks or months... but we know what happened last time...

 

Charts: Bloomberg

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Sun, 02/21/2016 - 22:04 | 7217272 BullyBearish
BullyBearish's picture

Pull it!

Sun, 02/21/2016 - 22:06 | 7217281 Croesus
Croesus's picture

This means it must a "great time to buy stawks", eh Goldman? 

Sun, 02/21/2016 - 22:14 | 7217317 Squid-puppets a...
Squid-puppets a-go-go's picture

or a great time to buy goldman, eh stawx?

Sun, 02/21/2016 - 22:54 | 7217456 Sanity Bear
Sanity Bear's picture

great time for a short squeeze because fuck you for trading on fundamentals

Sun, 02/21/2016 - 22:04 | 7217274 Mr Pink
Mr Pink's picture

This can't be good

Sun, 02/21/2016 - 22:19 | 7217333 california chrome
california chrome's picture

"NYSE Short Interest has risen 4.5%, back over 18 billion shares near the historical record highs of July 2008..."

 

Incredible that less than 5% were on the right side of the trade during an historic market collapse.  Goes to show you 95% of the financial population are jackasses. 

 

For the record, I'm short the phonebook.

Sun, 02/21/2016 - 22:18 | 7217336 lester1
lester1's picture

No worries the NY Fed will continue covertly buying stocks so the wealthy elites can cash out.

Sun, 02/21/2016 - 22:20 | 7217345 CAPT DRAKE
CAPT DRAKE's picture

You are correct.  Nothing else explains this madness.

Sun, 02/21/2016 - 22:47 | 7217377 BullyBearish
BullyBearish's picture

Like the Weimar Bankers who boycotted Germany (1933) then emigrated to the UK/US knowing what was coming and knowing that their brothers and sisters were going to pay for their sins...

 

New York Supreme Court Justice Joseph M. Proskauer and James N. Rosenberg spoke out against a proposed boycott of German goods that had been introduced by J. George Freedman of the Jewish War Veterans. Proskauer expressed his concerns against "causing more trouble for the Jews in Germany by unintelligent action", protesting against plans for mass meetings and reading a letter from Judge Irving Lehman that warned that "the meeting may add to the terrible dangers of the Jews in Germany"

Sun, 02/21/2016 - 22:20 | 7217344 bnkrs vs Humanity
bnkrs vs Humanity's picture

Oh this is very good! bring it on already.

Sun, 02/21/2016 - 22:25 | 7217352 delete entry
delete entry's picture

fun fact:

millions possibly billions of shares wer

never mind, forget it, we're doomed probably going to see 2400 s&p soon

Sun, 02/21/2016 - 22:24 | 7217359 rickowens
rickowens's picture

nothing to see here, there's just more shares to be short.

Sun, 02/21/2016 - 22:25 | 7217360 bnkrs vs Humanity
bnkrs vs Humanity's picture

we're not doomed, the elite bnkrs are. In FED they trust.

Sun, 02/21/2016 - 22:31 | 7217379 delete entry
delete entry's picture

i cant even bet on the event, they have most my money

Sun, 02/21/2016 - 22:56 | 7217460 Sanity Bear
Sanity Bear's picture

can one still bet the farm if it's in foreclosure?

Sun, 02/21/2016 - 22:29 | 7217370 Catullus
Catullus's picture

Just push that short interest up against the margin on the NYSE. Longs have a lot more to lose right now.

Sun, 02/21/2016 - 22:32 | 7217381 Osmium
Osmium's picture

well, QE4 is on deck, so that would indicate the mother of all short squeezes. 

Sun, 02/21/2016 - 22:37 | 7217398 delete entry
delete entry's picture

the only question is, how long do you think they wait?

Sun, 02/21/2016 - 23:22 | 7217535 nevadan
nevadan's picture

hmmm....blow off top?

 

Sun, 02/21/2016 - 22:40 | 7217412 earleflorida
earleflorida's picture

the average joe sixpack is/are into the 'options casino'... and not into equities

notice they're (most) all taking the straddle position with near-term expirations @ the money but, buying moar contracts on the put side

i've noticed for months these poor bastards don't know when to get out, but rather wait til the tyme premium is exhausted, and as usual you will notice 90% of the tyme the 'manipulators of said equity's' will keep the price near or at the  money.

 the new market for fast money

and i mean fast!

cboe is making out like a bandid on both sides of the trade where the open interest is greatest -- the vig always wins

Sun, 02/21/2016 - 23:40 | 7217585 The Real Tony
The Real Tony's picture

Out of the money puts on the indexes is the best way to play it. Some day the FED and bankers might be caught on a holiday or daydreaming and the entire markets implode while catching them off-guard.

Sun, 02/21/2016 - 23:42 | 7217596 user2011
user2011's picture

Oh no, it means short squeeze to the moon before it crashes down to the canyon... Doesn't matter you long or short, you hold, you lose....

Sun, 02/21/2016 - 23:50 | 7217620 gm_general
gm_general's picture

Are the Rydex bears as smart as they piled on 20% more shorts since the 1810 SP500 recent bottom, like they did in October last year? I guess we will see.

Mon, 02/22/2016 - 00:34 | 7217769 Sorry_about_Dresden
Sorry_about_Dresden's picture

I am infecting all links with reality

http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20160218a1.pdf

 

 effective on January 1, 2016, all member banks.........stockholders with more than $10 billion in total consolidated assets shall receive a dividend on paid-in capital stock equal to the lesser of six percent and “the rate equal to the high yield of the 10-year Treasury note auctioned at the last auction held prior to the payment of such dividend  on paid-in capital stock each year.....on the last business days of June and December.... at a new rate for larger institutions.

INTEREST RATES WILL GO TO 6%. 

The Feral Reserve Bank has spoken. You think Jamie and Lloyd are going to take a pay cut? Not a chance!

All this talk about NIRP is UTTER NONSENSE!!!!

Yield on the 10-year UST note is going to 6% by June 30th, 2016, the date of the next dividend calculation. Notice how they made this effective the day AFTER the last dividend calculation?

Yield on the 10-year UST note was ~1.75% last Friday. It will go to 6% so the stockholders, of the Feral Reserve Bank, can maximize the dividend payout. Why would it be any other way?

Mon, 02/22/2016 - 05:09 | 7218217 hendrik1730
hendrik1730's picture

Don't you believe it. The USA cannot service 19 trillion in debt at a 6% rate. AND the bond markets will crash. For the rest, all is fine.

Mon, 02/22/2016 - 09:57 | 7218606 Sorry_about_Dresden
Sorry_about_Dresden's picture

What do ya' mean "don't believe it."?

There is $30 billion in capital paid in to the Feral Reserve Bank: http://www.federalreserve.gov/releases/h41/current/

The dividend is calculated on, at new LOWER rate, June 30th, 2016 which is just 4 months away.

away. http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20160218a1.pdf

Since there are 2 dividend payments per annum the change in dividend payment will be ((1/2) *.06)-(1/2*yield 10-year UST note))*$30 billion=$600 million. calculated at 1.75% yield on 10 year UST note as of last Friday.

1/3 of paid-in capital stock is from NYFRB. That's a $200 million dollar haircut for Lloyd, Jamie and the gang. Do you think it is realistic to say they will just give that money up, rather than get the yield of the 10 year UST note to 6%?

There is $10 billion in excess reserves and I don't think they get a dividend on that but, I could be mistaken.

They don't care about service the debt. They only care about creating MOAR.

 

Mon, 02/22/2016 - 08:15 | 7218431 gmak
gmak's picture

Ummmmm. They've been getting 1 - 3% for about 10  - 15 years now, with one or two minor exceptions.

Mon, 02/22/2016 - 01:22 | 7217907 badger10
badger10's picture

High debt doesn't  give you sustainable growth. Unemployment should trend higher. If central banks try QE it tells you how bad the economy is and will not work. Rallies should be sold as the market has topped out. Technically we put in a triple bottom not a double bottom.Good trading all.

 

Mon, 02/22/2016 - 03:34 | 7218130 Yen Cross
Yen Cross's picture

  Who's buying those 1o year JGB's?

 I realize it's only three basis points. How fucking pathetic is it, when the curve on your long dated debt, is three basis points off the short end.

It's no surprise Kuroda, doesn't have any soverign Japanese debt to buy.

Mon, 02/22/2016 - 07:59 | 7218385 razorthin
razorthin's picture

This morning, the squeeze is on and a hammer on gold.  Always Monday morning.

Mon, 02/22/2016 - 08:14 | 7218423 gmak
gmak's picture

And on Thursday. Oh, and Tuesday PM. Friday, into the close. Wednesday's around noon.  

 

This article is probably so out-dated iwth the short squeeze of the last 2 weeks....

Mon, 02/22/2016 - 08:05 | 7218386 razorthin
razorthin's picture

dupe

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