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Charting Nine Days Of Short Squeezes And Vapor Volume

Tyler Durden's picture


Still unclear on what drove the policy vehicle known as the stock market straight up, which for some reason speculators still participate in despite relentless warnings that it is broken, manipulated, etc, for nine consecutive days, following the release of the FT rumor of a bank recapitalization on October 4, since refuted? Simple: look at the chart below. The Green is the Russell 3000, while the Red is the Goldman "highest short interest index." Beginning with September 4, and continuing through today, every time the market appeared poised to drop, market makers would mysteriously squeeze shorts, with the Red line consistently leading the overall market (Green). Said otherwise: shorts panic -> weak hands cover -> market follows. Naturally, for this to work, volume has to be well below average, which was indeed the case - the volume has been abysmally low for the duration of the entire melt up which means the second there are no incremental weak hands to short, and the movement flips, most likely on the fully priced in deus ex bail out of Europe which will not happen next week or ever, massive volume will return, and the market will do what it always does in such situations: soar inversely. Until then, and as always, it is best to play in other, less manipulated venues - buy some CDS, arbitrage some shiny rocks, blow some money on Blackjack, just stay away from the frontrunning algos whose only purpose is to sniff out weak shorts and sell stops. There is no market: we would say it is a casino, if only it was even 10% as fun.

Short summary:

ES Volume:


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Fri, 10/14/2011 - 16:27 | 1775139 Libertarians fo...
Libertarians for Prosperity's picture



Short squeeze in everything but MBIA



Fri, 10/14/2011 - 17:16 | 1775347 He_Who Carried ...
He_Who Carried The Sun's picture

...its all a well known bankster-phenomenon: concerted margin calls all across the field... ;-) !!

Fri, 10/14/2011 - 17:19 | 1775362 Precious
Precious's picture

Okay.  Here is the truth.  The insiders whispered / leaked Q3 results to traders who made sure they were frontrunning the earnings announcements.

Just figure it out.  It's right there in front of our faces.  This one week rally was nothing more than frontrunnning the positive earnings announcements.  That's it.  If you had a contact inside these companies, you could make a small fortune.

End of story.  Quit looking for all these BS reasons and irrationality theories.  It's simple greed.  Insiders shared sales information for Q3.  Bye.

Fri, 10/14/2011 - 17:27 | 1775385 LawsofPhysics
LawsofPhysics's picture

No shit, never short the market going into earnings season.  How much of a boost we are going to get is the question.

Sat, 10/15/2011 - 08:02 | 1776659 Mike2756
Mike2756's picture

I don't think earnings will matter, not when the credit markets are locking up,  they might mitigate the downside a bit.

Fri, 10/14/2011 - 17:30 | 1775401 He_Who Carried ...
He_Who Carried The Sun's picture

You talk as if P/E-value were of some importance right now.

While it is true, that I felt things were getting a tad cheap also, one wouldn't go long waiting for Merkozy's axe. There is more at stake here and I need more than a fabricated "beating the earnings by 0.001 cent" to get "all-in" again ... This is called a catapult trade. Sustained by earnings? Sorry, I highly doubt it.

Fri, 10/14/2011 - 17:38 | 1775425 Precious
Precious's picture

We should hook up.  My ring in your nipple.

As far as your comment goes, research GOOG.

Fri, 10/14/2011 - 17:44 | 1775447 He_Who Carried ...
He_Who Carried The Sun's picture

My field is Metals and Comm'ies. No money in Tech...

What is a phone without Spaghetti ...?

Fri, 10/14/2011 - 17:48 | 1775456 Precious
Precious's picture

Aha.  From your profile pic, perhaps everything come down to a "short squeeze".

Fri, 10/14/2011 - 20:00 | 1775794 He_Who Carried ...
He_Who Carried The Sun's picture

*lol* I doubt it would convince me at this point. Try again later....
Seriously, I am riding this volatility with very tight stops, but I am not going all out long again before they've solved Greece. Macro supersedes micro in this and I have a job to lose... Cu then.

Fri, 10/14/2011 - 19:33 | 1775740 J 457
J 457's picture

Just like the last three quarters, earning estimates have been revised so low that most everyone will beat.  The party will be over by next week.  If we open higher on Monday I may buy a few positions and hold into mid week, but most everyone is still too overly cautious knowing a 15%-20% scalp can happen over 2 days, just like on Oct 3-4.  I'm surprised the 1.4 trillion US annual deficit didn't cause a shake-up earlier today.  When people start ignoring numbers that big the end of this fluffed market is near.   Also, nice boobs.

Fri, 10/14/2011 - 22:43 | 1776134 Market Efficien...
Market Efficiency Romantic's picture

you are saying any buy side actor would massively allocate in risk right now based on GS suggestion of - as anticipated - positive Q3 earnings? And they would do so knowing that any news out of Europe could kill the market immediately.

Lets wait and see what stats will tell and how the regulatory body (probably not at all) will react to at the end of the month/quarter. I bet, the extreme market dynamic will not be possibly explained by allocation changes, so only the bias in market making will be able to explain it. But with the volume asscoiated with market making, a newly ermging long-bias will in relative terms not appear to be relevant and easily explained with the then in the course of the upside move required liquidity at the ask.

Thank you and fuck you banksters. As said below, my theory is, it is again all Timmeah with his perceived outsmarting of markets. What is possibly wrong with him that he has become so over-self-confident and show an almost desperate need to demonstrate that he is playing the wild and uncontrollable market beast.

Fri, 10/14/2011 - 17:26 | 1775384 Joeman34
Joeman34's picture

Are those your real nipples??

Fri, 10/14/2011 - 17:31 | 1775407 He_Who Carried ...
He_Who Carried The Sun's picture

Don't ask, you won't sleep anymore!

Fri, 10/14/2011 - 19:04 | 1775652 Yamaha
Yamaha's picture

Can't even see those at home with an expensive dinner with good wine...........

Fri, 10/14/2011 - 19:29 | 1775727 Roscoe
Roscoe's picture


I laughed so hard beer came out of my nose. I nominate your comment as Word of the Day.

Thanks for a good chuckle at the end of a tough week.


Fri, 10/14/2011 - 22:39 | 1776125 caerus
caerus's picture


Fri, 10/14/2011 - 18:49 | 1775617 Don Birnam
Don Birnam's picture

Volume is truly running on fumes. High-liquidity blue chips are simply falling asleep: JNJ traded 6.6 million shares this session; average volume, 15.2 million. Of course, the stock was up a bit less than one percent.

A low conviction market, to say the least.

Fri, 10/14/2011 - 22:08 | 1776078 covert
covert's picture

keep shorting the dollar


Fri, 10/14/2011 - 22:30 | 1776111 caerus
caerus's picture

the ES since august has been absurd...vacillation on vapor volume (except on the down days) stuck in a range for more than two months now...nothing of any import being solved or even considered...shorts getting squeezed despite the fact that they are entirely justified and correct in their positions...ES will NOT hold the neckline...

Fri, 10/14/2011 - 22:41 | 1776131 caerus
caerus's picture

oh yeah...check out the large traders vs small traders/hedgers on ES COT

Fri, 10/14/2011 - 16:28 | 1775140 ghostfaceinvestah
ghostfaceinvestah's picture

Get used to it, this is the same thing that happened all through the second half of '09.  Seems like it is on someone's agenda to keep the stock markets from crashing.

Fri, 10/14/2011 - 16:31 | 1775154 jdelano
jdelano's picture

they can't, and it will crash.  The minute you're sure we're ramping into the end of the year.  They're driving it up for greek default so crash will only bring us to 950. 

Fri, 10/14/2011 - 17:04 | 1775307 devilsindetails
devilsindetails's picture

It WILL crash... eventually. Not now.

Fri, 10/14/2011 - 17:28 | 1775388 jdelano
jdelano's picture

Should we start a betting pool on who calls closest to the date? I'll put up the prize--ZH t shirt to the winner. But I want November 14th, and we have to define crash. First circuit breaker trip on the Dow?

Fri, 10/14/2011 - 18:03 | 1775494 eurusdog
eurusdog's picture

Ill take November 18 2011. Agreed on first circuit breaker!

Sun, 10/16/2011 - 03:44 | 1778428 lano1106
lano1106's picture

anything special backing this prediction or this is just a gut feeling?


Fri, 10/14/2011 - 16:34 | 1775180 SheepDog-One
SheepDog-One's picture

1220 is the top of this channel and theres no further benefit to pump it higher on fumes, just wash, rinse, repeat. WTF look at the long range chart we're right where we were months ago, and going further back 1999 market levels. Big deal.

Fri, 10/14/2011 - 16:38 | 1775201 ghostfaceinvestah
ghostfaceinvestah's picture

It's a big deal we are at 1225 today and not 925, a very big deal, and Bernanke knows it.

Fri, 10/14/2011 - 16:50 | 1775255 SheepDog-One
SheepDog-One's picture

How is 1225 a big deal over 925? Its a dead empty market the numbers mean nothing! 

I guess if I had an old rusty VW bug for sale at $10,000 and raised the price to $15,000, I'd suddenly be richer?

Fri, 10/14/2011 - 17:42 | 1775442 TheLooza
TheLooza's picture

You would be, according to JP Morgan.


Also, can I get a ride to the mall?

Fri, 10/14/2011 - 18:19 | 1775538 ghostfaceinvestah
ghostfaceinvestah's picture

300 S&P points means a lot to corporate, state, and local pension plans, it means a lot to university endowments, it means a lot to charitable foundations, not to mention individual 401ks, etc.

You seem helplessly naive of the impact the equity markets on our modern society.  Forget all those statistics like "the top x% own y% of the stock market", the truth of the matter is our society is highly leveraged to equity valuations.

Bernanke understands this, apparently you don't.  Enjoy your grumbling though.

Fri, 10/14/2011 - 22:53 | 1776165 Market Efficien...
Market Efficiency Romantic's picture

That's exactly what I realized and I am beginning to realize that it appears wishful to the money and power elites to involve the system into its game at the top. But from an incentive-theoretical point of view, the control over the regulation of a market by a government, whose legitimization and support is directly correlated with the fate of the market, makes the potential and incentive for market making instead of EMH rather likely. Such welfare involvement prohibits EMH effects to one side and by that either creates an endless bubble or convinces capital to move to a more reliable and transparent playing field. Even with the US being the largest equity market, I would in the medium term argue for the ladder outcome.

Sat, 10/15/2011 - 06:45 | 1776612 DollarDive
DollarDive's picture

The points do mean something.  I think that the meaning gets more watered down - the longer the recession persists.  The longer that it continues - the higher the probability is that people are spending down assets - thereby reducing the significance of the financial markets to the middle class.  With more than 50% of the households earning less than 50k, there's not a lot of savings going on.  Assets are being spent down.  

The middle class is less enamored with wall st each day.  Check out the protesters.  They're not exactly future Warren Buffets.... right ?  

The money of the wealthiest is being managed and gamed by the hedge funds.  Ultimately it may be 10 or 20 of the largest and most sucessful hedgefunds fighting it out for supremacy.

Sat, 10/15/2011 - 04:15 | 1776504 mjk0259
mjk0259's picture

Yes and then issue bonds on the rusty VW and lower the price back to $10,000 and book the reduced value of the bonds and you have income as well. Buy the bonds back. Repeat. Spokesman on CNBS in between steps to hype in desired direction the value of rusty VW's.

Fri, 10/14/2011 - 17:08 | 1775319 LawsofPhysics
LawsofPhysics's picture

Yes it is, now about tomorrow, the rest of earnings season and the new year.  With 400 billion more entering the system I am pretty sure who is squeezing the shorts.

Fri, 10/14/2011 - 17:18 | 1775357 jdelano
jdelano's picture

Come on--you really missed the part about 400bil leaving the system first?

Fri, 10/14/2011 - 17:29 | 1775393 LawsofPhysics
LawsofPhysics's picture

Okay fine, the coming and going really doesn't matter does it, just stay ahead of it.  Personally, I am more short than long, not as much as I was in June, but still short, just the same.

Sat, 10/15/2011 - 10:42 | 1776809 unununium
unununium's picture

Methinks the reaction to QE 1 and 2 would have been a tad different if Fed had announced it was buying $900B of 30yr bonds.

Fri, 10/14/2011 - 16:29 | 1775145 jdelano
jdelano's picture

Nope.  I still say range, range, range.  horsey go back down soon.

Fri, 10/14/2011 - 16:51 | 1775259 SheepDog-One
SheepDog-One's picture

Wash, rinse, repeat. This is only a crowd control show, but theyll be happy to take as much long and short money in the meantime as they can.

Fri, 10/14/2011 - 17:19 | 1775361 Manthong
Manthong's picture

“we would say it is a casino, if only it was even 10% as fun.”

 - And we don't even get free drinks, a nearby cheap buffet or lobby hookers.

Fri, 10/14/2011 - 16:29 | 1775146 Hansel
Hansel's picture

Crack-up Boom!

Fri, 10/14/2011 - 16:30 | 1775147 danger close
danger close's picture

Short covering rally, lmao. This bipolar website is as bad as the market; dangerous for your health. One day nothing but doom and then blame on short covering. Fear mongering would be more appropriate for you. Past two years market exploded and entire time nothing but crying here. This site pimped this bullsht Short covering rally last month only to see another low. Nice call! Sick fking clowns.

Fri, 10/14/2011 - 16:31 | 1775158 SheepDog-One
SheepDog-One's picture

Well what are you saying IS causing a run up on no volume then? Bulls buying hand over fist? No thats obviously not it.

Fri, 10/14/2011 - 16:32 | 1775169 jdelano
jdelano's picture

um...short covering rally would hardly preclude new lows.  dumb ass.  

Fri, 10/14/2011 - 16:36 | 1775187 HedgeAccordingly
HedgeAccordingly's picture

thats how short covering works you fucking idiot. tyler is simply highlighting how wallstreet gets everyone short and squeezes them until they puke. then crashes back down.. the market has exploded higher by QE easing and spin. This website gets record traffic and grows every month. Somone is listening, if this sit was a bunch of bullshit i dobut it would get over a million pageviews a day. you can actually make money by getting long when tyler posts short interest at record highs because you know a squeeze is coming.. 

Fri, 10/14/2011 - 16:53 | 1775265 SheepDog-One
SheepDog-One's picture

I dont even believe this line that we have world record shorts available to squeeze daily....this is the FED short. They do it for free, its your money they pile in short and then squeeze.

Fri, 10/14/2011 - 17:46 | 1775451 oldman
oldman's picture

That is a pretty smart thing you wrote   green for sure

How do I get my fucking money back from the Fed?

Don´t tell me I have to take it because I will.

You´re a smart dude Sheep      om

Fri, 10/14/2011 - 17:10 | 1775327 LawsofPhysics
LawsofPhysics's picture

Yep, and  by the way, if you havn't already, its too late.  Time to get back ahead of the next "flip that bond" episode.  Wash, rinse, repeat.

Fri, 10/14/2011 - 17:23 | 1775372 CPL
CPL's picture


Sat, 10/15/2011 - 10:45 | 1776815 unununium
unununium's picture

> you can actually make money by getting long when tyler posts short interest at record highs because you know a squeeze is coming..

Best thing about an anonymous site is you don't need all those pesky disclaimers "not investment advice, past results, blah blah"

Fri, 10/14/2011 - 16:39 | 1775204 d00daa
d00daa's picture

there were two smaller short covering rallies last month you fucking retard.

Fri, 10/14/2011 - 16:41 | 1775209 HedgeAccordingly
HedgeAccordingly's picture

yes and you could have profited from them. when the market gets below 1100 you get long. its been playing out like this since the US downgrade. simple technical analysis.. 

Fri, 10/14/2011 - 16:44 | 1775230 d00daa
d00daa's picture

uhhh, i did "profit" from them, thanks.

Fri, 10/14/2011 - 17:31 | 1775408 LawsofPhysics
LawsofPhysics's picture

Who's crying, this website has helped me front-run all the QE, flip that bond shit and my portfolio is up 24% Y0Y.  Guess I missed the memo.

Fri, 10/14/2011 - 20:15 | 1775824 He_Who Carried ...
He_Who Carried The Sun's picture

"Short covering rally, lmao. This bipolar website is as bad as the market; dangerous for your health. One day nothing but doom and then blame on short covering. Fear mongering would be more appropriate for you. Past two years market exploded and entire time nothing but crying here. This site pimped this bullsht Short covering rally last month only to see another low. Nice call! Sick fking clowns"


Come to the land of milk and honey and we shall pump you up with some basics, boy...

Sat, 10/15/2011 - 10:49 | 1776821 unununium
unununium's picture

> Past two years market exploded and entire time nothing but crying here.

Actually, the prevailing sentiment here at ZH for the rise in '10 was don't touch this phoney market with a 100 foot pole.  I know very well because I was one of the few advocating being short.

Fri, 10/14/2011 - 20:43 | 1775887 Everybodys All ...
Everybodys All American's picture

Care to make a prediction? Careful or the Bear will get ya.

Fri, 10/14/2011 - 23:11 | 1776196 Market Efficien...
Market Efficiency Romantic's picture

Ok, I think most aggressive critics do not realize that ZH is not supposed to be a herd instrument, calling a trend, once it materializes and be a little late in calling it off after it has run out. Any reflective and intellectually capable reader should have noticed that. In the long term, playing the market like a dumb herd sheeple has not worked so well. The more reflective people have realized that it needs a fundamental short, medium and long-term assessment of market dynamics and forces. To me, ZH is the ideal platform to critically develop that assessment, with new insights, but also denial of some lines of argument. Establishing such a three-fold thesis and deriving trading patterns from it will eventually play out for those intellectually capable of fulfilling this task in a logical way.

I don't mind, some stupid herd sheeple laughing at us, as we see the guillotine, sharpened and ready to break their freakin neck, as the macro-game evolves. You will silently admit, you tried to chase the market up and down and would have argued for the opposite side two weeks ago.

Feel free to enter into that cosy box stuffed with food, when the door closes behind you, that will be the last thing you notice before the curtain falls. Poor sheeple!

Sat, 10/15/2011 - 01:27 | 1776401 He_Who Carried ...
He_Who Carried The Sun's picture

I second this and I want to add, if I may, that a blatant lack of patience is often at the very core of these problems people have. Trading is not a game of Roulette, its not a casino of sorts! If one wants to hit, one must get oneself in a position and wait... It takes a lot of effort and hard work. Filtrate through zillions of lines of information for many hours and sometimes weeks, of code if you will, to find that position that suits you and your plan... to question this position or state of mind or "insight" of yours every minute in the face of reality unfolding around you until that moment comes when you make your move when "reality" and your assessment start to match... Then one has to get very busy and very fast and also be very prepared to modify everything in seconds because you might have been wrong about some detail or timing is off and you need to exit your plan and start all over again without any remorse or pity. That is when you gain experience and get better.

ZH is one of the places for good questions. The answers you have to find yourself. That's the fun of it!

Fri, 10/14/2011 - 16:30 | 1775150 SheepDog-One
SheepDog-One's picture

I hope shorts are severely burned enough this time to stay the hell away now.

Fri, 10/14/2011 - 16:33 | 1775172 jdelano
jdelano's picture

nope.  adding.

Fri, 10/14/2011 - 16:38 | 1775202 SheepDog-One
SheepDog-One's picture

Yea, Im kinda annoyed at shorts....every time the market is in danger of going under there they are providing fuel for the next squeeze! A bit of a pisser!

Fri, 10/14/2011 - 17:10 | 1775331 Jean
Jean's picture

Where is the cash coming from/going to support the short volume?  If you look at the shorts broadly, it is nice chunk of short term cash behind that action.

Fri, 10/14/2011 - 19:31 | 1775733 maxw3st
maxw3st's picture

If you trade forex the term "short" is somewhat misleading. You are never really short in the forex market. You are just exchanging one currency for another. If you are trading securities then you have other problems and I can't help you with that. The securities markets move on insider information and market manipulation by large players. Fundamentals mean very little in that environment.

Fri, 10/14/2011 - 23:18 | 1776210 Market Efficien...
Market Efficiency Romantic's picture

well, transfer it to the equity markets and you lend cash for equity. I am so not convinced by the intuitive argument that the ability to short creates downside volatilty. Negative market anticipation can be played in otions without equity shorting ability and guess what happened to markets if heavily exposed parties could not hedge by shorting.

It's a pretty easy way to make shorts responsible for downside momentum, kust recognize that from a risk/incentive perspective, taking a short position has always been considered more risky, so a short is probably more committed to his position than a long.

Fri, 10/14/2011 - 17:33 | 1775340 jdelano
jdelano's picture

Yeah i hear you but you could make the distinction "weak shorts". I for one haVe contributed not one single share buy to this rally so don't consider myself part of the problem. Down lower yeah, there will come a point where I cover, but don't worry I'll wait long enough that my "buys" will be like doing CPR on a three days dead horse...

Addendum for clarification--partial cover

Fri, 10/14/2011 - 16:46 | 1775219 maxw3st
maxw3st's picture

ditto jdelano, looking at the weekly chart for EURUSD this is but a small spur on a long trip down. Loved adding to my short position though. Hope we see the 61.8% retracement so I can short some more. Fundamentals haven't changed. Which makes all this a 9 session correction. Typical really since the same pair routinely goes on 3-4 week runs when it's on trend.

Fri, 10/14/2011 - 17:02 | 1775294 spiral galaxy
spiral galaxy's picture

Bingo! "Fundamentals haven't changed"!  If anything, they've gotten worse.  For my 2 cents, the market is the only asset class left that you can make a reasonable return with smart, timely left to the pros.  That said, I'm parked in cash as it's better to lose only to inflation that be robbed blind in the market casino.  .......and it affords a more restful nights sleep :-) 

Fri, 10/14/2011 - 17:13 | 1775338 Divided States ...
Divided States of America's picture

Where is the 61.8% retracement at in terms of the SP500? and the Dow? Since those dumbfucks on CNBC seems to focus more on the Dow nowadays

Fri, 10/14/2011 - 19:27 | 1775714 maxw3st
maxw3st's picture

11850 would be a 61.8% retrace for the DOW (but I don't trade stocks/indexes or anything but forex). Current close on the DOW is right at the 50% retracement line which is 11570. Looks like we closed just 8 pips below that.

S&P looks like a reflection of the DOW the numbers are just on a different scale.

Give some serious thought to forex. I used to be a broker and options principle. I don't trade either any more. Goldman can't manipulate the forex market. Not for more than a few minutes anyway.

Sat, 10/15/2011 - 06:50 | 1776617 DollarDive
DollarDive's picture

adding +++

Fri, 10/14/2011 - 16:31 | 1775157 GeneMarchbanks
GeneMarchbanks's picture

Something somewhere will break, it has to.

Fri, 10/14/2011 - 16:43 | 1775173 hambone
hambone's picture

Just happened...I'm broke.

Seriously - I really don't know if there is anything neccessarily that will break - I'd think many things may warp, many things may crack, but it may just all be deemed "settling" into a lower standard of living...a printing press seems a pretty incredible tool and so long as nothing gets in the way of it's operation, not sure this doesn't go on for years, a decade, or decades??? 

Makes me quesy reading my own words but in all honesty, I don't think OWS or the Tea Party or the people in general are strong enuf to force (or endure) the change.

Fri, 10/14/2011 - 16:48 | 1775249 GeneMarchbanks
GeneMarchbanks's picture


Maybe years, not a decade. No way. If you're alluding to the Japan comparison, forget it. Japan is socially much different, more cohesive and violent and more introverted. While I think #occupy is a minor threat, I think more serious spin-offs are coming in the near future. Expect violence.

Fri, 10/14/2011 - 17:16 | 1775325 hambone
hambone's picture

Certainly the Japanese example would seem a welcome relief compared to some of the options on the table.  However, be neither an exporter or creditorer are we and far flung empire is something the Japanese gave up on after '45.  Don't know what to "expect" any longer but I certainly didn't "expect" what has played out from '08 til now, already 4 years running faster on the treadwheel and right back where we started...and worse for wear in so many ways.  But absent a trigger, a mechanism, and left to "the people" I fear it could be a long, sad slog.  No blow up, no reset, just debt slaves working for monopoly money in a system where laws are conditional dependent on your monetary worth.

Fri, 10/14/2011 - 17:25 | 1775378 topcallingtroll
topcallingtroll's picture

If you had just ignored the market and dollar cost average these last ten years and rebalanced annually, then spent the rest of your time at the beach, you might do just as well and had more fun.

Fri, 10/14/2011 - 17:34 | 1775415 hambone
hambone's picture

TCT - aMerica took your advice and did just might want to ask them how it's worked out.

Fri, 10/14/2011 - 20:39 | 1775873 IndicaTive
IndicaTive's picture

Fucking right. That's why I'm here. ...swooshing back into lurk and learn.

Fri, 10/14/2011 - 17:03 | 1775299 baby_BLYTHE
baby_BLYTHE's picture

the expiration of the FED charter in 2013 and mainstream Neo-Cons even calling Bernanke treasonous is enough for me to think 'the printing press' won't be as magical as many think over the next year or two. I still predict all-out QE3 before the elections to prevent a systematic collapse, after that- Lights out!

Fri, 10/14/2011 - 18:02 | 1775493 centerline
centerline's picture

Not that it matters, but I happen to agree. And when the QE lever is pulled, the Fed will make sure that the politicians hand is clearly visible. But, as it is, even the Fed was designed to eventually fail. It's owners move on. But not without the smokescreen and appropriate scapegoats.

Fri, 10/14/2011 - 18:22 | 1775544 ghostfaceinvestah
ghostfaceinvestah's picture

The Fed charter doesn't expire in 2013, the original Fed act has an expiration, but that was repealed a long time ago.

Fri, 10/14/2011 - 19:16 | 1775591 baby_BLYTHE
baby_BLYTHE's picture

If you have further details on that, put the link up here. I have done a bit of research and consistently hear it both ways. The ones that say the FED charter has no expiration date mention some amendment during the 70s/80s that removed it, I cannot seem to find it myself.

Fri, 10/14/2011 - 16:33 | 1775163 HD
HD's picture

The "market" is completely unprepared for a real world solution in the EU. The belief is that it will be magically resolved and we'll all move on.  Many a perma bull may be surprised.

You can squeeze shorts - you can't squeeze sellers.



Fri, 10/14/2011 - 17:14 | 1775342 LawsofPhysics
LawsofPhysics's picture

And, I might add, the CME can only increase margins as high as 100%.



Fri, 10/14/2011 - 23:42 | 1776251 Market Efficien...
Market Efficiency Romantic's picture

The two-year kicking of the can has only brought one serious realization. Promises won't do it, why neither guarantees nor maturity extensions will do. Everyone has by now realized that total debt burden has much exceeded the capability of the Eu nations. So, the only three things that will relax the situation:

* Print an astronimical amount that in relative terms deprives the general public of any values that believed to own

* Buy in by BRIC with real capital, which is not available in free cash. What everyone seemed to omit in recent statements is, either BRIC countries guaratee, which is a promise crashing any USD and treasury future, or it is real money being reallocated from treasurues and USD allocation. The ladder would practically unfeasible as the amount needed and the pre-announcent would drive prices down to a level where BRICs paid about 1.25 on every rescue dollar.

* Accept large haircuts, which hit the retirement financing in several major developed countries to a level, where civil war appers looming. That would occur even if the banks were recapitalized to withstand haircuts. Besides, the banking system would fail immediately and thereby pull the central columns of the cash-dependent economies.

To put it in very simple terms: The developed world is indepted at a level, unsovable without pain. Right, it is about to be decided who will suffer the pain. But it is telegraphed that some mysterious n-th degree derivative solution could outsmart logic and avoid pain. It won't, as it is logically impossible and realization of this will let markets take a deadly hit. Deadly, as the logical chain of such an event would impöy many more valuation adjustments, in the end leaving equity worthless, as the senior status of credit grabs what is left of the pumped up, leveraged and unfortunately no longer growing economy.

Sat, 10/15/2011 - 08:10 | 1776664 Mike2756
Mike2756's picture

I'm going with option 3.

Sat, 10/15/2011 - 08:08 | 1776662 Mike2756
Mike2756's picture

This seems like subprime part II, they've stroked everyone until the game is up.

Fri, 10/14/2011 - 16:32 | 1775164 Id fight Gandhi
Id fight Gandhi's picture

If it was that easy we would all pile into stocks and enjoy the ride up.

But the avg person can't trade this fast or get out when shtf.

Fri, 10/14/2011 - 16:32 | 1775166 HedgeAccordingly
HedgeAccordingly's picture

 just ride the wave.. she is .. a different kind of wave. 

Fri, 10/14/2011 - 16:35 | 1775175 Waterfallsparkles
Waterfallsparkles's picture

Feels like Bernanke is back in the Market.  Especially with the last 1/2 hour rocket up. 

Plus, almost all of the Mo Mo stocks are rallying and at their high.  The same thing happened with QE2.

Is this operation Twist? 

Fri, 10/14/2011 - 16:36 | 1775186 SheepDog-One
SheepDog-One's picture

What are you saying, that at some point Bernank had LEFT controlling the markets? When was that?

Fri, 10/14/2011 - 16:48 | 1775252 Waterfallsparkles
Waterfallsparkles's picture

Actually, I think Bernanke did leave the Market in August and September.  I bet he could not stand it.

It was easy to trade again.  Stocks would hit a high Sell off and then rise again.  You could  Buy and then Sell and wait to Buy again.  A couple of times a day.  Now the Stocks gap up and there is a slow pump all day without a pull back.  The same as with QE2.

With Bernanke back in the Market it is better to stay away.  The minute you buy at a 52 week high the bottom will drop out.

Fri, 10/14/2011 - 17:33 | 1775397 topcallingtroll
topcallingtroll's picture

Ouch! I suppose 52 week highs are technical breakouts, but the best i have seen through the years is buy and sell when the index goes above, or below the 200 dma respectively.

Of course that only works in a long term secular bull interspersed with cyclical bears, but any long strategy works in a secular bull, so what i just said is probably meaningless and no I am not giving you back that last thirty seconds of your life.

Fri, 10/14/2011 - 18:53 | 1775624 disabledvet
disabledvet's picture

Leaving aside the fact that this is The Bernank's job...let us look more closely at his methodology so that if we decide to be on the other side of "Bear Killer Berank" we can at least learn to duck or something!
Looks like a tough guy. We're gonna need back-up!

Fri, 10/14/2011 - 16:36 | 1775195 ghostfaceinvestah
ghostfaceinvestah's picture

Yeah, that is what I was implying above - still no question in my mind that Bernanke pumped the stock market in '09, and it feels like he is again.

Fri, 10/14/2011 - 16:34 | 1775181 Belarus
Belarus's picture

Well said, ZH. The greatest way to show your strength is to not play with the casino at all. It's a really a simple solution, yet I know not enough people will ever go along, but if no one goes into a casino can the casino stay in business?

Righty-O. And see? The very very best short and the very very best way to show your civil disobeince is to simply stop playing. Yet, I know this will never happen. And so, expect the casino to contineu to fuck and rape you.

Fri, 10/14/2011 - 16:36 | 1775190 Lone Mad Minute...
Lone Mad Minute Medic's picture

I'm telling you the powers that be are reading Zerohedge and they know everybody is short and they will squeeze your balls until you give up. So why don't we all talk long and fool their asses? This is water board time. The man knows everything about us. Everybody keeps saying shit like 1220 is the line in the sand and TPTB take it to 1222. Next someone say 1230 is the line and you can bet your sweet ass they take it up to 1230 in a heart beat. Everybody here just keeps telegraphing.

Fri, 10/14/2011 - 16:41 | 1775212 SheepDog-One
SheepDog-One's picture

Then when no ones expecting it, a carrier gets sunk in the Straits and oil is $200 overnite and sleeper cells are carrying out bombings in major US cities....and ZH and the rest of the internet is down.

THATS how this all goes down one morning. The entire market is fake, just a crowd control tool.

Fri, 10/14/2011 - 16:46 | 1775239 Tsar Pointless
Tsar Pointless's picture


It will be the sudden stop that kills us.

Fri, 10/14/2011 - 18:15 | 1775529 centerline
centerline's picture

Yup.  Anyone who has run a business knows that you can operate in a deficit for some time... taking from one place to pay another.  It is cash flow that is a bitch.  When cash flow catches up, it is game over in an instant.  The fiscal equivalent of hitting a brick wall.  I expect the same thing to occur on smaller scales... maybe munis, maybe nations, creating a domino effect that will take a very short period of time to power over the global economy like a tsunami.  We probably wont know what the real trigger technically was.

Fri, 10/14/2011 - 16:53 | 1775263 SilverRhino
SilverRhino's picture

The ultimate death of the dollar will ramp up in 15 minutes IMO based on money velocity at this point.   One minute you sit down for lunch, as you get the bill you'll start seeing NO CC / DEBIT accepted.   It will take a little bit longer for the populace to realize that paper money is worthless.


Fri, 10/14/2011 - 16:43 | 1775223 SheepDog-One
SheepDog-One's picture

Hell theres probably not even $1 million bucks combined in the markets by all of us on ZH. I dont believe for a minute 'TPTB' are peering in here wondering what to do daily...they already know, theyve had this planned for years.

Fri, 10/14/2011 - 17:11 | 1775335 topcallingtroll
topcallingtroll's picture

I am pretty sure there are some heavy hitters who peruse this blog. Nonetheless most of us are the classic retail investor that we also unanimously despise.

Dog get yourself up to wall street and conduct some general mayhem. Everybody needs to get up there for at least a couple of days.

I was on TV working the food service line with a couple of gal pals from food not bombs. I is famous now!

Fri, 10/14/2011 - 19:45 | 1775771 Sunshine n Lollipops
Sunshine n Lollipops's picture

I is famous now!

So when ya gonna take off your bag?

Fri, 10/14/2011 - 19:12 | 1775674 Rainman
Rainman's picture

define markets

Fri, 10/14/2011 - 19:13 | 1775677 LongBallsShortBrains
LongBallsShortBrains's picture

More than 30 billion


Fri, 10/14/2011 - 16:45 | 1775235 junkyardjack
junkyardjack's picture

Dow 12,000, Yea!

Fri, 10/14/2011 - 16:47 | 1775244 SheepDog-One
SheepDog-One's picture

WOW yea DOW 12,000! You mean, right where we were a few weeks ago?

Fri, 10/14/2011 - 17:17 | 1775354 LawsofPhysics
LawsofPhysics's picture

I think I still have a hat around here somewhere.

Fri, 10/14/2011 - 17:16 | 1775350 LawsofPhysics
LawsofPhysics's picture

Fine, let them ramp it.  They can squeeze shorts and I'll enjoy the ride.  Either way, they can't stop sellers.

Fri, 10/14/2011 - 18:07 | 1775509 centerline
centerline's picture

They dont need ZH for this.  This isn't a trading site either.  These guys have all the tools they need to front-run anyone.  Telegraphic concepts apply to kung fu, not markets anymore.

Fri, 10/14/2011 - 16:36 | 1775194 economessed
economessed's picture

It's not a market.  It's a crime scene.

Fri, 10/14/2011 - 16:43 | 1775225 Tsar Pointless
Tsar Pointless's picture


And all of the cops are out on Wall Street beating defenseless non-criminals.

What a country!

Fri, 10/14/2011 - 16:46 | 1775241 junkyardjack
junkyardjack's picture

Don't just sit there and complain, grab yourself a flatscreen

Fri, 10/14/2011 - 18:09 | 1775512 centerline
centerline's picture

Well done!  Love it.

Fri, 10/14/2011 - 16:41 | 1775210 Father Lucifer
Father Lucifer's picture

It's the drugees

Fri, 10/14/2011 - 16:42 | 1775213 Waterfallsparkles
Waterfallsparkles's picture

No short squeeze where the real shorts are.

No short squeeze in the Banks, Fitch saw to that. 

No short squeeze in Materials like AA, X, Aks, Fcx.

Fri, 10/14/2011 - 16:47 | 1775247 SheepDog-One
SheepDog-One's picture

Its Bernank short.

Fri, 10/14/2011 - 16:42 | 1775216 Belarus
Belarus's picture

If the Merkel and Sarkozy plan is to print money and send it out on an as needed basis.......shorts will be truly fucked. 

Fri, 10/14/2011 - 16:45 | 1775234 maxw3st
maxw3st's picture

If there is even a hint of them printing money shorts will win big. It's called devaluation.

Fri, 10/14/2011 - 17:30 | 1775399 jarboejl
jarboejl's picture

Uh...if by "shorts" you mean folks long PMs, Aggie commodities, and oil...then yes they will win big.

Money printing devalues the currency, not the assets' nominal price in the currency.  It has the opposite effect.  Ergo it will inflate nominal prices and kill stock shorts...i.e. the effect of QE2

Am I really still explaining this!?!?

Fri, 10/14/2011 - 16:45 | 1775237 SheepDog-One
SheepDog-One's picture

Well that would be OK with me, chase the last of the shorts out, then theyve got no one left to squeeze.

Actually I dont even believe the story from the start that theres this massive army of shorts lining up every day like Charlie Brown on a football to get repeatedly raped...its the FED short!

Fri, 10/14/2011 - 17:09 | 1775323 Hedge Fund of One
Hedge Fund of One's picture

That would be an interesting method of pumping the markets: knowing that they would tend to be sold down by longs, Fed could short along with the longs who are selling, then at the appropriate time, cover with an increasing bid, and propel the market higher. If done right, could get out with some profit or just break-even, having accomplished the purpose.


Fri, 10/14/2011 - 16:44 | 1775228 Cdad
Cdad's picture

Roach Motel [SPY] crime wave continuing in the after hours...repeatedly printing trades beneath the LOD...but I'm sure, any minute now, Mary Schapiro of the SEC is finally going to stop taking notes during her meetings with criminal syndicate Wall Street bankers about all the SEC regulations that should just be ignored so that the kleptocracy can continue its asset pumping BS....any minute now...holding my freakin' breath.


Fri, 10/14/2011 - 16:53 | 1775264 GeneMarchbanks
GeneMarchbanks's picture

Cdad this pumping has me now believing that we're in the beginning stages of a hyperinflation, no joke. I think we might just keep going from here, no restructuring, no unemployment fix, no default just pure elevation into the stratosphere.

Fri, 10/14/2011 - 17:05 | 1775309 Hedge Fund of One
Hedge Fund of One's picture

I see those "bad prints" way outside current bid-ask all the time, too. My broker doesn't know. As I can tell, they don't affect anything unless one has an auto-stop based solely on trade price during market hours. A friend and I have speculated about what they really are. It appears that there is sometimes a correlation of the SPY bad print x 10 with the value of the ES futures. 

Fri, 10/14/2011 - 18:35 | 1775578 Cdad
Cdad's picture

Oh, your broker knows.  Instead, your broker does not want to say is probably your broker that is responsible for the prints.

As for them being "bad prints"...bullshit.  And these are not roll up quotes, either.  This is the market being ripped off by brokers and market makers...period.

But I'm sure Mary Schapiro is on it.

Fri, 10/14/2011 - 20:56 | 1775915 Dulcinea
Dulcinea's picture

Miss very much reading your posts.... and others....

Fri, 10/14/2011 - 16:44 | 1775232 Fish Gone Bad
Fish Gone Bad's picture

I am still waiting for the Dow to get to 14,000 for Warren Buffett can get out of his $5 billion bet.  Then I will short the market.  Until then it is a sharkfest.

Fri, 10/14/2011 - 16:50 | 1775254 5peculator
5peculator's picture

People who use terms like 'short squeeze' are people who have no idea how to manage risk or money and have no business looking at charts or trading on any platforms, be it retail or institutional. Front Running Algos??? All that BS about computer models that other people use as a trading 'Edge', mean nothing to a Speculator who has a solid trading plan which is executed with Disipline & Consistency. My strategies allowed me to take advantage of the market strength today and I made money, again, as a retail investor. Quit blaming your losing trades on algos, and market makers who do nothing but provide liquidity so that you may actually Exit out of your shitty positions. If your holding a losing position, its your fault, not Wall Street, or any Algos. if anybody wants to find out how a real speculator makes money without blaming losses to outside conditions while turning a profit consistently just check out my site.

Fri, 10/14/2011 - 16:56 | 1775276 SheepDog-One
SheepDog-One's picture

LOL! Yea suuuuure spambot.

Sat, 10/15/2011 - 01:12 | 1776380 5peculator
5peculator's picture

if you idiots would check the site you would see there is nothing for sale. my site is strictly a journal of my trading activities. but go ahead and blame life for all of youre problems. blame wall street you dont have a job, blame your representative for not giving you a welfare check, go occupy wall street, and i guess I will continue to stay on the correct side of your so called "short Squeeze"... im the front running algo that takes your retirement fund. the algo is my brain. have a nice life losers.

Fri, 10/14/2011 - 17:08 | 1775318 SMG
SMG's picture

Oh and your "strategies" have made you so much money that you have to spam on more popluar websites for business.  I would think you'd have better things to do.

Sat, 10/15/2011 - 01:10 | 1776379 5peculator
5peculator's picture

if you idiots would check the site you would see there is nothing for sale. my site is strictly a journal of my trading activities. but go ahead and blame life for all of youre problems. blame wall street you dont have a job, blame your representative for not giving you a welfare check, go occupy wall street, and i guess I will continue to stay on the correct site of all of your so called "short Squeez"... im the front running algo that takes your retirement fund. the algo is my brain. have a nice life losers.

Fri, 10/14/2011 - 17:21 | 1775366 prains
prains's picture

check out my


no check out my site it's way cooler and somewhat aggressive.

Fri, 10/14/2011 - 17:34 | 1775414 CPL
CPL's picture



fuck off Alex


   Lopez, Alex       PO Box 459    Drums, PA 18222    US    Phone: 570-708-8780
Sat, 10/15/2011 - 01:12 | 1776381 5peculator
5peculator's picture

lol nice try

Sat, 10/15/2011 - 01:40 | 1776415 5peculator
5peculator's picture

its so funny to see you take out your losing frustrations on sites like these. how many jobs and personal retirement funds have you burned through blaming your losing decisions on front running algos and "short squeezes"? you're a loser "Che" and thats why you ended up DEAD in a Bolivian jungle with no support for your so called "revolution"... now you got a bunch of dusche bags standing on a street corner beging for free food stamps... i hunt for my own food bitch.

Sat, 10/15/2011 - 10:06 | 1776761 5peculator
5peculator's picture

hey dumbfuck. if you had the brains to do real research you would have seen my phone number on my website. feel free to give me a call anytime so i can tell you how i really feel about you filthy communists. you stupid cocksucker.

Fri, 10/14/2011 - 17:45 | 1775450 TheLooza
TheLooza's picture

My advice to you is to do what your parent did...get a job sir....

Sat, 10/15/2011 - 01:50 | 1776423 5peculator
5peculator's picture

hey "Looza" take youre own advice and fullfill the destiny of that screen name of yours and keep trading on the wrong side of your 'short squeezes" and ill keep trading on the right side of them and well just all keep calling you the loser... oops i mean "theLooza"...

Youre right everyone, me and all of my Cohorts today we got together early this morning at Dunkin Doughnuts and single handedly coordinated a global short squeeze on all of the global equity markets to ensure that all of you would have held onto your losing positions...not because of a lack of discipline on your part, or a lack of a committment in actually teaching yourself a skill, a skill to trade the markets consistently, but rather a global conspiracy by me and all of the big bad speculators to "Shake" the "weak" positions out of the market today...

i dont know why i even try. i give all of my information to the public for free. people charge thousands of dollars for what i publish...and i give it to you retards for free... its no wonder 98% of the people lose their money attempting to try their hands at the market... have fun keeping up the tradition.


go teach yourself a skill "Looza", one that doesnt involve picking up a welfare check.

Sat, 10/15/2011 - 04:31 | 1776520 mjk0259
mjk0259's picture

Do you run this on your phone? It's greater than 2 minutes to search a ticker, gave up after that.

Sat, 10/15/2011 - 10:09 | 1776766 5peculator
5peculator's picture

i dont know why you are searching for tickers on my website when i dont have a search function on my website. my website is nothing more than a journal where i record trades on a retail account so i can prove to the world that consistently profitable trading in a retail account is very possible only if you have the right mindset about what the markets really are. markets go up, they go down, they go sideways. youre job is to do nothing more than to position yourself in a way that will allow you to participate in the market moves that measure our combined psychologies by recording each and every one of our buy and sell decisions. if your thinking 'short squeeze' you have already lost the war.

Sat, 10/15/2011 - 04:34 | 1776523 mjk0259
mjk0259's picture

"" - At least you are honest about what would happen to  investors following this advice. I want to keep my profits myself.

Sat, 10/15/2011 - 14:37 | 1777267 5peculator
5peculator's picture

if you dont participate you can't take profits for yourself.

Fri, 10/14/2011 - 16:53 | 1775262 Comay Mierda
Comay Mierda's picture

the house always wins

Fri, 10/14/2011 - 17:03 | 1775298 Belarus
Belarus's picture

How many people truly participated in the run-up? How many people truly decided to go very long last week when it looked like the market was ready to free-fall?

Right. Generally, the only group in the entire country besides tehe 1% that benefited were all the buy-and-holders that saw their money come back a little bit again. The same folks that are almost ready to throw in the towel and head out to their local OWS venture.

This market ramp was nothing but a manufactored short squeeze to try to make the plebs happy. Shorts are the weakest link in every hand. Thus, ZH article, spot on. 



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