Dead Market Exhibit A: January Volume
Presented with little comment except to say that the total lack of volume (and massive concentration of what volume there is at the close) is hardly reflective of a market that is anything other than broken and dying. Last January (2011) the average number of stocks traded on the NYSE per day was 891mm shares vs 661mm for this January (a 26% drop YoY!) and this is down an incredible 59% from January 2008.
Charts: Bloomberg
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What about dark pool volume?
http://www.youtube.com/watch?v=eGPhUr-T6UM
But Uncle Ben is on the way to deliver the dope-right?
why deliver the dope, when all you have to do is say that you stand ready to deliver the dope ...
The junkies only buy into that so many times before they need their fix.
Everything is getting better...
BUY and HOLD FTW, bitchez
FTW? Which exchange is that on?
because that trick has been used too many times, ...and when the printing trick has been used too many times, it will be the harbenger of hyper-inflation.
Great point. Pretty solid proof that most of the casino is now in the back alleys playing craps.
Yes; it looks like volume has been on a steady decline and this Jan is on trend.
Volume is required to indicate a change in the trend or a break to new highs or lows.. The sheep have left this market for dead. They have moved to fixed income--particularly treasuries (not even munis!)--which is your best sign that they are absolutely dead fuking WRONG. The flows to bonds are your indicator. This market can climb higher on the wall of disbelievers for a very long time. The more y'all nay say this move, the more I know I am right to be long this market. Get long, the higher beta the better (IWM at least). When the fed announces QE3 (which, I bellieve, is a foregone conclusion according to the ZH crowd--why not invest accordingly?) the market will absolutely explode higher. Please get long. and buy mortgages BEFORE the FED does. DMO..I have been saying it for a while now. Just do it.
You're probably right: The FED will inflate to infinity, pushing nominal earnings higher and the dollar lower. Gold will outperform the stock market, bonds will continue to yield negative real returns.
Why take the risk? Gold.
Because the market will only rise so high on the hope of QE3 before enough bad news sets in for it pull back. The Fed doesn't need to start QE3 when the market is going up on mixed news. So wait for the fall, then buy in and wait for QE3.
It is easy to levitate with no mass or volume for that matter...
Or even just other exchanges/ECNs.
That old geezer Joe Granville called a top two weeks ago based on low volume and he is right so far:
http://www.bloomberg.com/video/84758540/
Ya, why is ZH so surprised? ZH has been railing against HFT for years, and constantly notes that HFT makes up a big chunk of volume. ZH wants volume down by a lot (i.e. eliminate HFT). Maybe ZH is getting its way; maybe the SEC has actually persuaded HFTers to abandon their oft-cited illegal practices, which makes HFT less profitable overall, and it's being done less. It's impossible to make any sense of volume numbers without some commentary on the sub-trend in HFT volume. Maybe ZH ought to be cheering that dropping volume represents cleaning up the market rather than suggesting darkly that the market is broken.
slippery slope bitchez
Tyler, just saw that ZH made #3 at CNBC alt blog list - http://www.ritholtz.com/blog/2012/01/cnbc-best-alternative-financial-blogs/
Alas, that's it for ZH now.
How the hell did BI get the silver ??...it's the People's magazine of finance blogs. The shallow end of the pool. Go figure.
There's a reason Volker said trust in the markets has vaporized or evaporated or whatever the word of the day is.
Volker should be the Fed Chairman today.
More like Peter Schiff
there shouldn't be a Fed (monopoly on money)
The chance to kill the Fed will come when the dollar index is 60.
Yet another total and complete rejection of the criminal syndicate known as Wall Street. No one wants what they are selling. Folks, who generally live in the real world where the economy is clearly in the tank, have long since figured out that the US equity market is a front running scam best "owned" by high frequency trading computers co located in the room next to where Duncan Niederauer takes his afternoon crap.
Average Joe's everywhere...selling stocks at every chance, putting them back to criminal Wall Street firms now absolutely bloated with them here...in a vacuum. Perfect.
Yep.
The Baby Boomers are out -- they've recovered a bit of what they lost in '08, and they are now done and on the sidelines.
The 20/30-somethings are having enough trouble just making student loan payments -- assuming they have a job. There is nothing left to "invest" in the stock market even if they wanted to (and they DON'T want to).
Well, at least the institutionals are hanging tough....per Bernank wink/nods to keep them in the game. If those herds move, look out.
Agree @bdc63. Boomers are out not just because of losses, not just because of income/job insecurity, but they also lost the desire to put money at risk in this environment. And then there's the trust issue. Suddenly nobody believes they can get something for nothing anymore
Maybe the Boomers aren't that stupid and realize when Bernanke says he's going to limit growth to 2% that means 2% growth in the S&P or he'll raise interest rates to ensure it slows down to 2% if it goes higher.
I was wondering who were the byers. They must hope for AAPL to be 750, IBM 500, AMZN 1000, JPM 200.
baltic fright index! wheeeeeeee buy em!
They need to get the MOMO machines to sync faster to create a better illusion of market volumes...
So there are more buyers than sellers vis-a-vie market movement but nobody is really trading much of anything.
So here is the question: "Where is all the money going?"
Apple Stores
TLT
Muni bonds for the moment. Hint: think like you're 65 and don't want to pay taxes.
Zombie markets for Zombie sheeple.
Stands to reason really
what happens at the end of the glide path?
Concrete barrier.
The market is simply taking a little "me" time. A hot cup of tea, some light reading with it's feet up, a little classical music playing softly in the background...a nap maybe - everything is going to be fine.
Of course, there could economic and societal collapse on a scale not yet seen - exacerbated by politicians and central bankers only concerned with saving the very richest of the rich - but hey, spilled milk right?
Stocks crash, everyone runs to the already bloated bond market, inflation ticks up slightly, everyone heads for the door... I feel sick.
when was the last time the volume was this light in January?
tomorrow will be heavy , facebook is filing for IPO.. will be fun to watch.
guess euro will do few 200 pips rounds from now till friday
Think about what the volume would look like if we didn't have HFT machines. 78% lower than now, or something like that.
It only took a complete obliteration of retails' wealth, and repetitive rectal intrusion, but the simultaneous 'ah ha' moment by retail coinciding with the 'uh oh' moment by the syndicate, is now upon us.
at what point does volume spark a selloff? cause I've been waiting....
Ask the Fed.
Right on.
As soon as the Plunge Protection Team runs out of money.
I believe it would be safe to forecast that the Biggest volume trading day of the year (still to come) will coincide with the biggest DOW/SPX/NAS point decline day of the year.
Call me crazy...but that's my story and I'm stickin to it.
"will coincide with the biggest DOW/SPX/NAS point decline day of the year."
IF, and I stress the if... it is the big one we are not talking decline day of the year. We are talking unprecidented, unmatched, globally significant, tragically predictable, unimaginably huge... volume.
I need to build that fence this spring.
Don't worry when that day comes they'll announce interest rates will stay low till 2015 and the market will rally for days.
What volume?
FACEBOOK will save the world....I can feel it
Lets see, facebook IPO or precious metals. Facebook where you get contacted by people you hoped would never contact you again. They should really call it ASSBINDER.
hahahahaha
FB is typical, typical "suckers" game. Current shareholders that are billionaires will sell shares to mesmerised idiots in order to double their billions. And of course, they will never, ever give a dividend.
Dark pools: indeed, lots goes on in them - great for the owners who can rip off the orders in relative privacy. Amazingly though there is still enough cash business going on to provide good livings for lots of boutique cash desks in London - perhaps they are just a link in the endless chain of re hypothecation and repo deals?
The equity derivative crew have a new game (anything to fill the gap left by plunging vanilla and exotic structure volumes) The div swap option. Now boldly trading in size for all major indexes. The only question is, who will be the next UBS/socGen blowup who has made a slightly wrong assumption about the durability of their deta hedge.
Might be a prelude to volatlaity, over bidded market from momo/HFTs, over speculated trades, tight ranges and low to nothing volume. Book closing end mth should throw this market into some wild swings.
I'm not sure that the market is broke and dying since you are comparing the present trading to the old casino days. Perhaps the volume now is where it should be. And as a result, with less people in the casino, you may not get a spike in volume to cause the momentum shift down that some of you are looking for.
We may have low volume markets for years now that we have less day/hour/minute traders. Think of how many people here including myself hardly trade anymore in this market.
It's broken, because in the old momo days, you could track volume and momentum. That correlation doesn't exist anymore. What was weird about Jan is it looked like a momo market, but there was no volume. The meltups were all HFTs.
With volumes as low/gone as they were, hardly anyone is trading this market. Very hard to make money unless you leverage up.
Also in this environment we are due for one of these:
http://bsr.london.edu/blog/post-50/index.html
A market is at least two parties coming together and agreeing on an items price. If fewer and fewer are in that market how is it not dying?
You see the glide path. We are no longer airborn. It's just the rollout.
Sombody call the shop. I can't reset the altimiter.
Good thing it was VFR cause if not the techiical tools would have crashed us.
HAH IFR LONG GONE VFR NON EXISTENT BUBBA WE ARE ON BLIND APPROACH HERE. YEEEEHHHHHAAAAAAA!!!!!! :)))))
''...where did volume go?''
...what a forgetful drunk Grave Digger said before the trigger pull
(Qinfinity)
...at the bottom of the pit.
http://www.youtube.com/watch?v=xB-xjZQy_4M&lc=qSggfg677bb2OHzKbE3Ei0i-ylvLW1nAJFISKcHIXgI&context=C3dfaf41ADOEgsToPDskLjgxQMvQumALCU8A1VMkST
Up until May 2011, the daily volume in C made me crazy, it was so out of whack.
Citi had a 1-for-10 reverse split last May. Until that time, they were far and away the highest volume issue on the NYSE. Sometimes their volume was as much as the next nine or so issues combined. Any ordinary stock could have a reverse split and not affect volume statistics. But to reduce the volume in C by 90% was to take A WHOLE LOTTA VOLUME out of the numbers.
As I remember, C was regularly trading over 1 billion shares daily. The reverse split made 900 million shares of that vanish. It amazes me that this could happen with such little comment.
Doesn't this explain most of the volume decline?
I had posted, where approprate, asking how statisticians were compensating for this unusual volume wrinkle. I haven't seen any reply. If I have this wrong, please refute this.
IIRC , the volume drop post split was predicted by TD. Something to do with it no longer being such an easy way for the HFT bots to suck in huge exchange fee 'rebates'
Look at the demographics: Why would Boomers/retired folks be flipping stocks around? They need to sleep at night, pay their bills and taxes with money they can count on. That's where a good deal of your individual investor volume went and it ain't comin' back as far as they're concerned. Like it or lump it, might as well go with the money flow and "invest" along with 'em in REITs, bonds, etc.
Most of the volume on the NYSE, of course, is institutional investing and unless they're trading in the first or last hour of the day they have to use the dark pools so as not to skew the market on themselves.
Joe Granville at 89 years old calls for 4,000 point drop in Dow this year. http://www.bloomberg.com/video/84758540/
Better he should check in with the Fed.
This supports my thesis that unemployed people do not trade stocks.
Corollary: They don't buy houses either.
Much more than the stock market is "broken and dying". A stark warning was issued by the fourth President of the United States, father of the Constitution and Bill of Rights
“Of all the enemies to public liberty war is, perhaps, the most to be dreaded, because it comprises and develops the germ of every other. War is the parent of armies; from these proceed debts and taxes; and armies, and debts, and taxes are the known instruments for bringing the many under the domination of the few. In war, too, the discretionary power of the Executive is extended; its influence in dealing out offices, honors, and emoluments is multiplied; and all the means of seducing the minds, are added to those of subduing the force, of the people. The same malignant aspect in republicanism may be traced in the inequality of fortunes, and the opportunities of fraud, growing out of a state of war, and in the degeneracy of manners and of morals engendered by both. No nation could preserve its freedom in the midst of continual warfare.”
Nor its prosperity.
Quote of the year -- this gets as many "+"'s as we will see QE-n.
Isn't this a good sign that we might be returning to the days when individuals are actually doing the trading?
The Austrian index ISHARES ETF EWO traded 1.1M shares today when the average is only 78K and was only up 17c can someone explain that...
This market just won't have a meaningful selloff. It's just suspended. It dismisses bad news and is holding out for good news. Just wait for the earth shattering Facebook IPO. I said in another post that they should nuke Iran the day Facebook IPO's because it would be secondary news. I think we've far outpaced ourselves in terms of technology. Yep, the service sector sure saved our asses in the US. Yep, all the automation sure helped us out. Digital zeros are worth more than gold currently And let's not forgot about all the glorious nukes in which the US alone has the firepower to blow up the entire planet 25,000 times. And now we we have exactly 23 people who own and control everything(and are crazy to boot) because of all this and millions out of work and/or starving. This is a technologically advanced society? Sounds more like a train wreck waiting to happen.
I'm currently vaporizing what brain cells I have left since my 20 years of hard work were vaporized in this massive economic recovery. Yeah sure...ill just start over when everything's going downhill? No thanks. I'll just be keeping my head above water as long as possible I just don't see any sense in trying. Not saying I'm not going to be doing anything but as far as jobs/careers go fuck that nonsense.
I'd like to conclude that the human race is just doomed. We never learn.
Good post rsnoble. Hang in there. Never give up hope in the common man's ability to prevail. Google "1948 Dewey/Truman election". That was a hoot.....wish I had been there.
Yeah I hear ya. The current "plus" side of the depression.........getting to spend more time with your family and eating fresh vegetables and how to be happy on just dollars a day.........just isn't cutting it for me. I'm fkn pissed.
rats in a cage fer sure. At the very least you're awake and aware and can watch it all fall, vs. being caught off guard like most people. A little extra food, water, supplies...PMs, etc., I think are worthwhile. I'm in a similar boat and trading as much fiat now as I can for things that have truer value. Have no idea if it will make a bit of difference, but its better than nothing -- and at least I get to watch it all crash, for awhile anyway.
China PMI fudge due Asian markets next few hrs.
Does anyone else smell gas?
Now I know why they are trying to merge with the German markets...........but then maybe I don´t...
Volume and price are the same level as '99.
Going the other direction of course.
There is plenty of volume when the market sells off, back in August then again in October. The team comes in at a critical support area to push it back to where it "belongs", the volume and volatility evaporate after a day or two of rabbid short covering.
The Teams signature market rally gaps and wedges higher in a skinny little channel with every story from every "fix"across the pond. Then the volume comes back with the next watefall decline. Perfect bear market action with a giant twist of blatant fraud and manipuation, welcome to the grand illusion... bought and paid for with Trillions in debt for the people and billions in profit for the Bankers in charge.
You got that right. The machines are locked and loaded and the timers are set.
Hm, I don't know. If Plunge Protection Team has managed to sell the holdings at the top (which I doubt), they may put the bottom at 1100 as they did 6 freaking times so far since May 2011. Basically, once/6weeks. But, if I what I think has happened is true, which is PPT is loaded with stocks and has almost run out of money, theeeeeeeeeen, we'll find out whether they can put a floor at 1100 this time. It looks like this time will be 900 S&P.