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Market Shorts At 4 Year Lows, In Hibernation For Second Straight Month

Tyler Durden's picture




 

Following the unleashing of $2.5 trillion in central bank liquidity, market shorts have predictably gone into hibernation, and as the just released NYSE short interest update confirms, the total number of outstanding shorts is at the lowest it has been in the past 4 years for the second month running, at 12.6 billion. Once the realization that central banks are limited from pumping incremental liquidity in the market is strictly limited by $9/gallon gas in Europe, and the inflection point in risk is reached, look for there to be almost no natural buying buffer to the downside. Then again with central planners out there with their CTRL+P willing to micromanage every downtick of the stock market, does anyone even care any more? Certainly not the retail investor.

 

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Mon, 03/12/2012 - 09:49 | 2246948 rsnoble
rsnoble's picture

SP 1400 the day before bombs drop on Iran. Take the heat of the precious banks. LOL. I wouldn't doubt it for a minute.  We have a week till the Enterprise shows up.

Mon, 03/12/2012 - 09:54 | 2246966 uno
uno's picture

is the Enterprise the 'sacrificial lamb' false flag?

Mon, 03/12/2012 - 10:20 | 2247037 rsnoble
rsnoble's picture

Oh I wouldn't doubt it. Start ww3, kill off the planet, hope to save your own sorry ass. They are completely capable of doing that.

Mon, 03/12/2012 - 10:41 | 2247120 Harlequin001
Harlequin001's picture

Some days you just can't find ANY shorts other than the plethora of precious metals by HSBC/JP Morgan. Why is that?

Mon, 03/12/2012 - 10:25 | 2247056 SMG
SMG's picture

Until one of the aliens comes up to me and licks me, I consider any articles trying to link the our Oligarchs and Aliens as an attempt to discredit any opposition to the Oligarchy and it's ruling families, and should be ignored.

Mon, 03/12/2012 - 11:46 | 2247315 Death and Gravity
Death and Gravity's picture

Yay, UFO nutters.

Mon, 03/12/2012 - 12:03 | 2247383 SwingForce
SwingForce's picture

Hard to believe Obie AND The GOP are playing straight into Ron Paul's nomination.....

Mon, 03/12/2012 - 09:49 | 2246950 LongSoupLine
LongSoupLine's picture

Hence why I'm short...

Mon, 03/12/2012 - 09:59 | 2246979 tallen
tallen's picture

Same, been short for the last week. This melt-up has gone on too long.

Mon, 03/12/2012 - 10:03 | 2246993 kito
kito's picture

there is no melt up....only a prop up.....and you will get burned fighting the fed in an election year.................

Mon, 03/12/2012 - 10:05 | 2246997 Jason T
Jason T's picture

Our aggragate demand is collapsing as is our economy.  There is no power great enough to stop our economic disintigration.  

Mon, 03/12/2012 - 10:07 | 2246999 kito
kito's picture

longer term you are correct, but the fed will hold course this year.....

Mon, 03/12/2012 - 10:19 | 2247032 kridkrid
kridkrid's picture

You seem to assume that the bankers want or need Obama in office.  I see no reason why this has to be true.  The winner of the election will serve their interests.

American support for our wars in the middle east begins to fall... what to do... what to do... run a big anti-war candidate... get him elected, give him a peace prize and continue on the same (or even heigtened) military trajectory.  The anti-war crowd is not only silenced, they are actually "converted".

Mon, 03/12/2012 - 10:33 | 2247029 Dr. Engali
Dr. Engali's picture

I disagree. I went short last week. The fed is destroying the dollar propping this market. As the gas prices rise the fed is going to have to either stop propping this market or the economy will slow enough that the sellers will ovewhelm the fed. My guess is that they look for an "excuse " for the market to sell off and not hurt Obummer. That excuse is probably war.

Mon, 03/12/2012 - 14:55 | 2247996 zebrasquid
zebrasquid's picture

Market is overdue for some powerful down days.  This is the time to be buying out of the money puts to make 10-50x your money.  Sure it's scary, now that everybody is bullish.

 That's what makes it the right time.

Mon, 03/12/2012 - 11:01 | 2247180 tmosley
tmosley's picture

Hope you guys are hedged with gold...

Mon, 03/12/2012 - 09:50 | 2246952 ebworthen
ebworthen's picture

Head and Shoulders?

Dandruff?

Mon, 03/12/2012 - 09:50 | 2246954 Eclipse89
Eclipse89's picture

Socialism at its best.

Mon, 03/12/2012 - 09:52 | 2246962 GeneMarchbanks
GeneMarchbanks's picture

Short ban at its most blatant.

Mon, 03/12/2012 - 09:51 | 2246958 Theta_Burn
Theta_Burn's picture

Love to see a chart of the hibernating short interest in the PM complex..I mean with 2.5 trillion in extra pumpage what better reason for the weakness=/

Mon, 03/12/2012 - 10:12 | 2247010 SHEEPFUKKER
SHEEPFUKKER's picture

So true Burnie- the only things getting shorted are PM's.  Things that can't last forever won't. 

Mon, 03/12/2012 - 09:54 | 2246965 monopoly
monopoly's picture

Wow, been babbling for months here, shorting does not work. At some point you bet, but why decimate your equity waiting for the right pitch. Just keep getting ready for down the road.

Mon, 03/12/2012 - 09:56 | 2246969 Village Smithy
Village Smithy's picture

Who is going to be buying to cover on the way down? Nobody, Q Tom Petty, "I'm freefallin".

Mon, 03/12/2012 - 19:18 | 2248929 smiler03
smiler03's picture

I love that track... and Lawyers in Love :O) 

Greek Lawyers and English Lawyers, Lawyers in love.

Mon, 03/12/2012 - 09:57 | 2246974 LawsofPhysics
LawsofPhysics's picture

There is no market, shorting irrelevant, especially after one looks at all the FX moves.  Fiat dying faster and faster so markets will remain unchanged or go to the moon before imploding.  nothing really going up in value, just paper buring faster.

Mon, 03/12/2012 - 10:00 | 2246982 EscapeKey
EscapeKey's picture

There is the market the Fed creates, nothing more, nothing less.

Prices? Leave those to the central planners. After all, they know better.

Mon, 03/12/2012 - 10:05 | 2246994 resurger
resurger's picture

the market is almost dead, it like there is something bad about to hit! everything near 0%

Mon, 03/12/2012 - 10:32 | 2247086 uno
uno's picture

only selloff is for primary dealers to unload their Treasury holdings on bagholders

Mon, 03/12/2012 - 09:57 | 2246975 resurger
resurger's picture

Am short and bleeding ... but it will pay off soon

"Take off is optional, landing is a must"

good luck making money on those levels, QE/LTRO withdrawals will come soon

Mon, 03/12/2012 - 09:59 | 2246978 lizzy36
lizzy36's picture

It has been so warm out west, that this week in Banff National Park (area between banff and canmore) a Grizzly Bear was spotted walking aroud. This bear awoke about 6 weeks early from his winter slumber.

Like bears, humans adapt. The powers that be, have made it incrediably hard to short stocks. The have taken the volatility, and the two way market, and manipulated it into a one way bet. Funny thing is all this manipulation has made people less confident in the market NOT more. 

Mon, 03/12/2012 - 10:01 | 2246987 EscapeKey
EscapeKey's picture

Well, yes, every time the short position has been significant, the Fed has printed money to squeeze the shorts.

Mon, 03/12/2012 - 10:21 | 2247041 francis_sawyer
francis_sawyer's picture

Quad Witching this week... No doubt the perfect opportunity to invoke max option pain on any suckers who enjoy getting fleeced by algos while they're busy watching if their NCAA brackets are coming out ok (while drinking green beer with the other hand)...

Perfect time for alpha mo-mos to sell & then buy back just before the quarter ends to window dress the quarterly reports...

What a shit game... I'm glad I don't play anymore...

 

Mon, 03/12/2012 - 10:01 | 2246988 GeneMarchbanks
GeneMarchbanks's picture

Well, for what it's worth, I'm 100% confident in Brian Sack & Co.

Mon, 03/12/2012 - 10:01 | 2246985 Conrad Murray
Conrad Murray's picture

Then again with central planners out there with their CTRL+P willing to micromanage every downtick of the stock market

Everyone should have seen this coming when those Germans bought the market. Those crazy krauts try to over-engineer everything.

I'm sure there's a central planning/fascism/Wiemar/Depression/WWIII joke to be had somewhere too.

Mon, 03/12/2012 - 10:03 | 2246992 JPM Hater001
JPM Hater001's picture

Now that's some effective hopium.

The hangover is going to suck.

On the upside...shorting your favorite banker has never cost less!

Mon, 03/12/2012 - 10:08 | 2247001 SimpleandConfused
SimpleandConfused's picture

I remember fondly the days ZH readers seemed to think the Fed had bitten off more than it could chew and the markets were indeed going to crash.

Good to see that reality has set in around here and we can learn that lesson from so many decades ago:  Never fight the Fed. 

I can save Tyler a little writing effort.  This is not ending anytime soon.  BTFD.

Mon, 03/12/2012 - 11:10 | 2247205 lizzy36
lizzy36's picture

The Fed is conducting a real time experiment.

The biggest problem, is many investors are not "fighting the fed" they are choosing NOT to play. 

The blow back for all the Fed intervention is not an increase in confidence amongst market participants but the exact opposite.

The general sentiment is that the Fed is excellent has become excellent at blowing bubbles. 

I agree this is not ending anytime soon. But when this bubble does burst it will make 2008 look like childs play. All Central Banks are all in. They are suffering from the delusion that they CAN control the outcome. Good on them 

Mon, 03/12/2012 - 12:03 | 2247381 SillySalesmanQu...
SillySalesmanQuestion's picture

+ 1000

The black hole of the market is sucking up every bit of liquidity it can as it implodes...then...run!

Mon, 03/12/2012 - 10:09 | 2247003 SmoothCoolSmoke
SmoothCoolSmoke's picture

Buck Fernankie, and the (w)hor(es)se he rode in on!

Mon, 03/12/2012 - 10:17 | 2247018 DaveyJones
DaveyJones's picture

CNBC / Onion Headline: Stress Tests Expected to Show Progress at Most Banks

Mon, 03/12/2012 - 10:41 | 2247127 surf0766
surf0766's picture

"Progress" is that code for something?

Mon, 03/12/2012 - 10:30 | 2247076 firstdivision
firstdivision's picture

The question that needs to be answered is, what is the short interest on Sigma X?

Mon, 03/12/2012 - 14:55 | 2248018 zebrasquid
zebrasquid's picture

'Don't fight the fed' is old Marty Zweig advice from the 1980s.  The world was a different place then, so how is that relevant now?  Fed didn't have $3++ Trillion balance sheet of toxic crap back then, either.

No need to fight the Fed anymore...they've already strapped themselves with dynamite and reality will soon light the fuse.

 

Tue, 03/13/2012 - 02:21 | 2249686 cnhedge
cnhedge's picture

this short interest is not good.

 

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