This page has been archived and commenting is disabled.

Market Snapshot: What's Left?

Tyler Durden's picture


What was already a relatively volatile morning leading up to the European close, paused for an hour or two until the FOMC statement was released with TSYs unch and ES at VWAP right before. Immediately, stocks ripped and dipped, the TSY curve started to flatten - pivoting around the 7-10Y, the USD took off, commodities and PMs dropped, and credit cracked wider. Somewhat interestingly, while all this chaos was occurring, ES remained relatively well behaved with regard a broad basket of risk assets - which while not a positive per se, did indicate that this was a very broad de-risking and not simply a US equity market prone to vicious dips, rallies, and retracements. It seems very obvious now, and fit with our indications of an exuberant equity market relative to the 2s10s30s fly, credit, and risk in general, that the rally in equities (which baffled anyone with common sense given the background of worsening macro data) was on pure hope and perhaps the sell-off's harshness today will have burned a few fingers as it seems the Bernanke Put strike just moved a lot further out-of-the-money.

Chart: Capital Context

As we closed, ES was perhaps a little overdone relative to a broad risk-basket but it certainly showed no sign of pulling back right into the 415ET close - only 1pt off its lows.

The Treasury complex was the story of the day (in terms of volatility-adjusted smash-mouth moves) with 30Y 30bps lower in yield from Friday and 19bps alone today. The whole curve flattened but it was the sell-off in the front-end that was notable with 2Y and 5Y +3.6 and 1bps higher in yield on the day respectively.

It was the highest beta sectors that obviously saw the most pain today with some of the major financials decimated. Financials wewre the hardest hit today -4.8% but Materials, Industrials, and Energy were also very weak. Tech outperformed and remains the only sector that is positive for the month of September now.

Financials are the worst performers for the month so far down around 11% - hardly surprising given the crutch of government support being taken away (and the removal of yet another source of easy money - the curve carry trade) - BAC -7.4% today lone ending at its low around $6.39.

The lack of LSAP-speak from Bernanke saw a relatively weak USD, as we went into the witching hour, take off - up over 1% today alone and of course this had a significant impact on the commodities and precious metals space. Gold, Silver, Copper, and Oil all fell after the FOMC statement with oil dropping the most and gold the least with oil and copper at the week's lows.

Credit markets were just as weak as equities with both the new IG index (which we noted was already relatively offered anyway) and the legacy HY index both losing significant ground on the day. In fact IG underperformed on a beta-adjusted basis as we suspect managers grabbed at whatever the cheapest hedge was in hope of saving some face on the day. By the numbers, IG17 ended the day around 8bps wider at 141.5bps, while intrinsics widened only 4-5bps as liquidity and pressure stayed in the index hedges - reracks tomorrow morning will be exciting. HY16 ended +37 at 705bps while intrinsics only widened 16bps - again clearly a mad scramble for liquid protection as we sold off this afternoon.

Corporate bonds appeared relatively net bought reflecting almost perfectly the shift in TSYs with the belly being most bought and short and long ends of the curves being least bought. Most notably was the underperformance of CDS indices relative to their underlyings. Chatter was that today was very much a buyer's strike in corporates as opposed to too many sellers as it is increasingly clear to everyone in the HY market especially that too much selling will tip this market down fast. It was clear that managers were using index overlays as opposed to rushing for the exits in their bond funds today and as we have noted before - as the basis between index marks and underlying portfolio illiquidity increases (especially if we some heavy concessions in new issuance) then pressure will come on bond fund managers to liquidate as opposed to manage risk - we love the smell of BWICs in the morning.

This reach for macro hedges fits well with our recent discussions of the normalization in the volatility markets - i.e broad investor base is not/less hedged. Today we saw the VIX rise and skews steepen as they start to converge up to where we discussed implied correlation was betraying they should be.

Charts: Bloomberg

UPDATE: we have had a number of comments/questions on whether this sell-off has legs. Of ocurse we have no idea other than, as we mentioned above, the rally seemed based on more dollar devaluation and portfolio disequilibrium which Twist is far less than expected. However, based on the long-run relationships between credit and equity markets, the following chart shows that it appears equities have further to fall until they reconnect with credit's expectation. This is of course a relative-value perspective but does warrant concern over equities' current pricing.

This stock indiator is based on the Capital Context Corporate Index. While today's sell-off in stocks did push the indicator back towards the equilibrium, stocks remain notably expensive relative to credit market expectations on an empirical basis.


- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Wed, 09/21/2011 - 16:38 | 1694351 GeneMarchbanks
GeneMarchbanks's picture

We're lookin' good for tomorrow...

Wed, 09/21/2011 - 19:51 | 1695075 max2205
max2205's picture

I am going to learn to speak Japanknees. Could be useful

Wed, 09/21/2011 - 16:40 | 1694357 BrocilyBeef
BrocilyBeef's picture

good times, noodle salad.

Wed, 09/21/2011 - 16:44 | 1694386 WestVillageIdiot
WestVillageIdiot's picture

GS closed at $97.86, just above its new 52-week low.  Morgan Stanley also took out its lows.  I could see Goldman shorting its own shares on this huge ride down and making money.  Morgan Stanley isn't smart enough. 

Great times for the financials.  And yet the water ferries still whisk the Wall Street crooks back and forth across The Hudson.  I hope some of those fuckers lost it all today. 

Wed, 09/21/2011 - 16:48 | 1694401 BrocilyBeef
BrocilyBeef's picture

what does it mean when you lose someone else's money?

Wed, 09/21/2011 - 16:57 | 1694433 WestVillageIdiot
WestVillageIdiot's picture

A sweet gig, while it lasts.

Wed, 09/21/2011 - 18:08 | 1694762 Zero Govt
Zero Govt's picture

not much longer now, every ponzi comes to its grinding grizzly end ...Blankfein, Dimon, Bernanke, couldn't happen to a nicer bunch of cunts

Wed, 09/21/2011 - 20:33 | 1695189 Freddie
Freddie's picture

I would love for all of them and Buffett to be coughing up their feces until they finally shut down to take the dirt nap they deserve.  F**kers.

Wed, 09/21/2011 - 16:40 | 1694358 tawdzilla
tawdzilla's picture

did we run out of vapor yet?

Wed, 09/21/2011 - 16:42 | 1694374 BrocilyBeef
BrocilyBeef's picture

nope, we've got cases left.

Wed, 09/21/2011 - 17:34 | 1694592 tawdzilla
tawdzilla's picture

how 'bout now?

Wed, 09/21/2011 - 17:40 | 1694621 BrocilyBeef
BrocilyBeef's picture

I just checked a few minutes ago but now we're all out!

Wed, 09/21/2011 - 16:40 | 1694360 WestVillageIdiot
WestVillageIdiot's picture

Thank god I didn't pull the trigger on those October 22nd QQQ puts.  I had my finger on the trigger and said, "fuck it.  I'm out."  I don't want back in, even though they would have made me money.  TODAY.  And what about tomorrow and some bullshit announcement?  I lost a lot of money playing these games.  I have learned humility.

And what are these markets going to do without all the pigeons like me that want to short the shit out of it but won't come back in because we've been fucked 1,001 too many times?  Good luck, cocksuckers, you drove your customers away.  Now let's see what you can do. 

Wed, 09/21/2011 - 16:51 | 1694410 Logiclee03
Logiclee03's picture

Quit whining....did you have a plan...a target..a stop loss>>>doesn't sound like it! Buy damn straddles till it breaks the top or bottom and if you are not sure where they are.....I'd suggest you comment in the National Enquirer>>

Wed, 09/21/2011 - 16:59 | 1694437 WestVillageIdiot
WestVillageIdiot's picture

Thank you for that foolproof strategy. Where can I send the check for your consulting fee?



Wed, 09/21/2011 - 17:15 | 1694508 Panafrican Funk...
Panafrican Funktron Robot's picture

Straddles, wow, that's so fucking foolproof.  /bows before your greatness.

Wed, 09/21/2011 - 18:02 | 1694736 Chappy
Chappy's picture

Good luck with stop losses.  The HFT drive the atock prices down until they bounce off your stop.  I've had that happen in several ETF's and other stocks.  I thought I just had bad luck then I begam to realize the games they play.


Wed, 09/21/2011 - 18:47 | 1694904 Nobody For President
Nobody For President's picture

Yep, been there, watched it happen so fast I couldn't even get to the mouse to cancel...60cents down and back up before you could hiccup. Don't much use stops with ETFs any more.

Wed, 09/21/2011 - 21:11 | 1695304 propflow
propflow's picture

straddles.. that easy huh. ? good one. lol



Wed, 09/21/2011 - 16:57 | 1694429 duo
duo's picture

That's why I used Friday's SPY puts.  Minimum premium.  Doubled my money in 15 minutes.  Premiums ATM were $1.50, instead of $5 for the October's

That being said, the AUD/JPY cross, with almost perfect correlation to ES, says we should be at 1100.  It's not too late to short this.

Wed, 09/21/2011 - 17:00 | 1694447 WestVillageIdiot
WestVillageIdiot's picture

It is for me.  I would rather sleep well at night.  I will hold my reserves until I buy more shiny objects. 

Wed, 09/21/2011 - 17:01 | 1694454 NotApplicable
NotApplicable's picture

Did you miss yesterday's article about trades taking place 190 ms before the quote even existed? I'd say TPTB are far beyond needing actual humans in the 'market' anymore. Even a casino has to have some level of integrity, Wall St. on the other hand, merely needs the SEC to STFU and go back to watching tranny-midget porn.

Wed, 09/21/2011 - 18:29 | 1694845 BlankfeinDiamond
BlankfeinDiamond's picture

I feel your pain.  My fucking QID is finally going somewhere.  I guess I was naive enough to think that the Fed couldn't keep pulling rabbits out of its hat.

Wed, 09/21/2011 - 18:58 | 1694937 YHC-FTSE
YHC-FTSE's picture

@Westvillageidiot +1

Ditto. Only a few days ago I posted that it's a risk on world, and I regret that bitterly. I'm out, but it was easy while it lasted. I'll stick to buying physicals and being a spectator for awhile. It's tempting to envisage a rally tomorrow after such a hard sell today, but I think the article is spot on about the last credit-equity relationship and according to the charts, the sell off has legs. So, interesting days ahead and I get to sleep at night.

Wed, 09/21/2011 - 21:19 | 1695321 propflow
propflow's picture

after what came out from the fed today, your shiny objects have seem to have some downside. be advised

Thu, 09/22/2011 - 06:38 | 1696094 YHC-FTSE
YHC-FTSE's picture

Thanks mate. 

Wed, 09/21/2011 - 19:06 | 1694960 EB1
EB1's picture

The markets are always trying to psyche us out.  Clear your head and jump back in at the right time.   



Wed, 09/21/2011 - 20:52 | 1695242 Freddie
Freddie's picture

Just buy the f*cking dip.

Wed, 09/21/2011 - 16:40 | 1694362 Caviar Emptor
Caviar Emptor's picture

Whatever "risk-on hard-on" was left is now limp. 


Wed, 09/21/2011 - 16:43 | 1694383 BrocilyBeef
BrocilyBeef's picture

wank on, wank off.

Wed, 09/21/2011 - 16:40 | 1694363 Josh Randall
Josh Randall's picture

People in the business are now walking around with The old white elephant -- front pant pockets turned inside out, and the zipper down and c*%k hangin out....thanks Ben

Wed, 09/21/2011 - 16:41 | 1694372 Waffen
Waffen's picture

So Rule 48 tomorrow morning and a benign beginning of the day I presume?

Wed, 09/21/2011 - 16:42 | 1694380 GeneMarchbanks
GeneMarchbanks's picture

Unless you're SocGen;)

Wed, 09/21/2011 - 16:42 | 1694377 Caviar Emptor
Caviar Emptor's picture

The equity market has devolved into a barometer for monetary expansion. 

So they got to trim the sails a little more, but then it'll move sideways until the next time the Fed prints. 

Wed, 09/21/2011 - 16:50 | 1694408 GeneMarchbanks
GeneMarchbanks's picture

I think it's pronounced:   


Wed, 09/21/2011 - 16:42 | 1694378 DoChenRollingBearing
DoChenRollingBearing's picture

What's left?  Gold...

Wed, 09/21/2011 - 16:47 | 1694396 Shell Game
Shell Game's picture

..and still affordable.

Wed, 09/21/2011 - 16:50 | 1694404 BrocilyBeef
BrocilyBeef's picture

pick one: a) dirt b) silver c) water d) magnesium

Wed, 09/21/2011 - 17:01 | 1694457 WestVillageIdiot
WestVillageIdiot's picture

e) booze

Wed, 09/21/2011 - 17:41 | 1694629 BrocilyBeef
BrocilyBeef's picture

@WVI props! and me wife is bringing home the wine!

Wed, 09/21/2011 - 16:56 | 1694424 jdelano
jdelano's picture

gold miners.  If gold holds they will be the only place to pick up gains.  Watch them rocket once everybody figures that out.  I'm switching all my gld for gdx tomorrow.  

Wed, 09/21/2011 - 16:57 | 1694431 BrocilyBeef
BrocilyBeef's picture

agreed. mutual funds or pick stocks though?

Wed, 09/21/2011 - 17:14 | 1694501 troublesum
troublesum's picture

Seriously.. you haven't learnd a damn thing in the 3 weeks youve been on this site...its called DEFLATION!! (more technically stagflation but its assets that are getting the deflating and commodities that are getting the inflating) is gold an asset or a commodity?  f-ing gold pumpers wont be happy till they lose everyone elses money along with their own...

Wed, 09/21/2011 - 17:37 | 1694608 jdelano
jdelano's picture

Hello Troublesum.  Rough day?  That's too bad and I feel for you, but I don't like being a whipping post so a couple of points in my defense.  I've been reading the tylers regularly for over a year.  Just never felt the need to get involved with commenting until the wheels started to come off this market.  As to your hostility.. 'Methinks you doth protest too much.'  Go back through those three weeks of posts and you will see that my calls have been dead on and as I have been trading off them, I have been having a very good year.  What exactly is it you'd have me learn?  (How to spell "learned"?  I've mastered that one already--keep trying and someday you will too.  I believe in you.)  Am I genius?  Probably not. But I read a lot and can think for myself.  The scenario at the moment is this---flooded M1 in a deteriorating macro environment.  No catalyst at the moment to drive gold wildly higher, yet also too much concern about currencies to drive it much lower.  In other words, not unreasonable to expect that the price of gold will hover close to where it is.  Gold miners have hugely lagged the advances in gold, so much so that the operating increases are negligible and profits will be very impressive.   Hence my call to shift from gld to gdx.   You know it makes sense, otherwise it wouldn't piss you off so much.  Let go of your hate, Luke.       

Wed, 09/21/2011 - 17:40 | 1694625 Alea Iactaest
Alea Iactaest's picture

Did you even read the article? Or better yet, a screen?


OIl: Down

Silver: Down

Gold: Down

Copper: Down

Fertilizer: Down

Ags: Down


Not sure which commodities are inflating at the moment. Sure seems likely they will in the future, just not right now. So I'm not sure if I'm agreeing with your DEFLATION!! or pointing out that commodities are *not* inflating atm.

Wed, 09/21/2011 - 20:54 | 1695251 Freddie
Freddie's picture

What happened to gold during late into Jerry Ford's term and all through with that co** s***er Carter?   Huge debt hangover from JFK/LBJ's Vietnam War.    Same thing today as Carter but about 20X worse with the Kenyan muslim.

Wed, 09/21/2011 - 21:26 | 1695342 Zgangsta
Zgangsta's picture

But... but... didn't Paul Krugman said that deflation is bullish for gold!?

Wed, 09/21/2011 - 17:17 | 1694522 Panafrican Funk...
Panafrican Funktron Robot's picture

Gold miner stocks.  Key word:  stocks.  They're stocks.  They are not gold.  Ergo, stay the fuck away.

Wed, 09/21/2011 - 17:21 | 1694535 DoChenRollingBearing
DoChenRollingBearing's picture

Miners have other risks:

-- expropriation or higher taxation

-- strikes

-- mismanagemnt (hedging)

Stick to the hard stuff: physical gold!

Wed, 09/21/2011 - 16:44 | 1694389 stateside
stateside's picture

It surprised me a bit that the FED chose to throw stocks off the cliff today.  This was the one area (although with no major support) where people could actually smile a bit when they opened their 401k statements and have a bit of confidence.  They have lost their jobs and the FED can't help and hire anyone.  Their homes are worth less than their mortgage and the FEDS can't increase house prices or demolish homes to spur demand.  The only thing the FED could have done temporarily to save what is left of the US consumer confidence was to print more and save the stock market.  Instead, they chose to let the stock market die and with it any remaining consumer confidence and any chance of the annointed one getting re-elected.  Interesting ........

Wed, 09/21/2011 - 16:56 | 1694428 Sequitur
Sequitur's picture

Deflation. Credit bubble must be popped.

Wed, 09/21/2011 - 16:58 | 1694435 economessed
economessed's picture

I don't buy the premise that the Fed "let the stock market die".  The Fed can't produce goods out of raw materials.  It can't deliver needed services.  It can't add value.  Those are the things that drive earnings growth over the long run -- not magical accounting tricks, not currency debasement, not artificial means of pulling forward demand.

Seriously.  Let's admit it.  The Fed, Wall Street, and the Federal Government have profoundly distorted productive capital allocation to the point that its become systemic.  They've pushed us into a debt-fueled liquidity trap.  We're never going to be able to move forward as a society until those propped-up barriers to sound capital formation are allowed to die.

Until then, farewell equity levitation mechanism.

Wed, 09/21/2011 - 17:20 | 1694534 espirit
espirit's picture

Market was all bubblely on unearned QE3, about time it caught up with The Dr. Copper.

Wed, 09/21/2011 - 17:03 | 1694461 WestVillageIdiot
WestVillageIdiot's picture

"The only thing the FED could have done temporarily to save what is left of the US consumer confidence was to print more and save the stock market."


I'm sure that would make everything alright when they fill up the tank or go grocery shopping.  For the vast majority that don't own stocks those food and energy bills outdo any wealth effect felt by those that do own stocks. 

Wed, 09/21/2011 - 17:21 | 1694538 Caviar Emptor
Caviar Emptor's picture

First of all the Fed pumping the market was all about saving Wall Street, recapitalizing banks and large corporates. Not about consumers with 401Ks. They knew that many were out in the 08-09 crash. And since that time consumers have only withdrawn cash from equity mutual funds. They need the cash to live on. So there's very little "wealth effect" to be gained from further pumping the equity market. 

Fed wants mom and pop in bonds. In a depression, 1% with safe return OF capital is a good deal

Wed, 09/21/2011 - 21:03 | 1695279 Freddie
Freddie's picture

They are even more evil about it.  So you make a few bucks trading or on your 401-K.  The more you have - the more taxes you pay when you sell.  They own us.  Thank dumb sheep who enpower them watching TV.  They can manipulate the sheep through the media.

Wed, 09/21/2011 - 19:55 | 1695088 max2205
max2205's picture

Holy fuck, they just finished a fucking 20% bounce off the Aug selloff

Wake up and figure it out. Testing lows time

Wed, 09/21/2011 - 16:48 | 1694393 Threeggg
Threeggg's picture

Housing Market;

Bob Shiller being interviewed on Faux Business News right now looks like his dick is dragging in the mud. He has "no" confidence............none !

He said " Housing prices have shown a rise in a "couple of markets" of 1.2% per year and says that "if you include inflation we are looking at a 25% devaluation in housing values over the next 5 years".

Man, he looks confused and scared !


Wed, 09/21/2011 - 16:51 | 1694411 BrocilyBeef
BrocilyBeef's picture

Operation Meatballs!

Wed, 09/21/2011 - 17:04 | 1694469 WestVillageIdiot
WestVillageIdiot's picture

Schiller is a royal douche bag.  Look up some of the ridiculous bullshit he has spewed the past 5 years.  Why anybody would still listen to that guy is beyond me.

Wed, 09/21/2011 - 19:13 | 1694978 EB1
EB1's picture

To me the biggest risk to housing are huge tax increases.  It's probably best at this point to hold your wealth in assets that are harder to tax. 

Wed, 09/21/2011 - 19:59 | 1695098 max2205
max2205's picture

You won't be happy with the type of people that will move onto the house next door with mortgage rates at 2.75%. Almost anyone can and will get a house. Landlords are fucked. Fuck them for raising rents in a resession

Wed, 09/21/2011 - 16:50 | 1694409 mynhair
mynhair's picture

Good stuff, many thanks again.

Hope I haven't shot myself in the foot, but snagged TMV at 16.58

Wed, 09/21/2011 - 17:32 | 1694587 CvlDobd
CvlDobd's picture

< Japanese Deflation (at best)

< Hyperinflation

Your most likely shooting yourself in the foot. At least you won't have to go to Vietnam now.

I'll short bonds at 0% rates. Other than that and I am fighting one strong trend! Look at a chart for TYX going back to 1994. Sure play the intra channel bounce with that but the long term trend is still down with rates.

Japanese type real estate bubble (check), stimulus (check), printing (check), repeat the last two and wonder why it isn't working (check). Pretty sure this looks like Japan. Also everyone is looking for the death of the dollar. Not yet my friends. If we are following a Japanese path (again at best) then wouldn't we have expected the yen to implode by now? Despite the Japanese gov. the yen is still a haven for some reason.

Wed, 09/21/2011 - 19:14 | 1694976 YHC-FTSE
YHC-FTSE's picture

Other than being one of the four components of the SDR, why the hell is the Yen still a haven? Anyone worked that riddle out? If you can solve that one, you can solve anything. Are currencies in the SDR bullet-proof because over 180 IMF member countries have to buy them to stay a member? 

Wed, 09/21/2011 - 20:00 | 1695109 max2205
max2205's picture

U r fucked

Wed, 09/21/2011 - 16:51 | 1694412 Atlantis Consigliore
Atlantis Consigliore's picture

What's left after the Buffet Rule?


Politicized FED told not to, and they do it anyhow? 

Operation ZERO with Jimmy 2.0 and da Twist?


you re missing your shot tyler,

a cable TV show..   "Twist and Short!!!!...

back up band:  The ANAL-ysts


bet a bunch of pets on it, and twist baby, better than


the alphabet channels with their BS....and Krypper. 

Wed, 09/21/2011 - 16:55 | 1694419 Tsar Pointless
Tsar Pointless's picture

The 30-year Treasury bond under 3.00%.

Never thought I'd see that in my lifetime.

Thanks, Chairman Ben, for making my 41st birthday a most memorable one!

Oh, and for fucking over my future birthdays, too.

Thanks a million, dick.

Wed, 09/21/2011 - 16:56 | 1694425 i love cholas
i love cholas's picture

Happy fucked up birthday!

Wed, 09/21/2011 - 16:56 | 1694426 BrocilyBeef
BrocilyBeef's picture

refi, bitchez.

Wed, 09/21/2011 - 17:31 | 1694581 Sancho Ponzi
Sancho Ponzi's picture

How many bankrupt and unemployed (ex)members of the middle class are going to qualify for a 4% mortgage? And what will they use for a down payment, EBT cards? This has to be prelim work to get mortgage rates as low as possible before they run millions of GSE mortgages through the refi conjiggulator.

Wed, 09/21/2011 - 17:34 | 1694595 CvlDobd
CvlDobd's picture

So are you three?

You must be the etrade baby. Although sosphisticated you seem you have a short memory. 2008 ring a bell?

Wed, 09/21/2011 - 16:56 | 1694423 BrocilyBeef
BrocilyBeef's picture

this market is dropping to its knees about to...

Wed, 09/21/2011 - 16:57 | 1694432 fdisk
fdisk's picture

Rally tomorrow.. Futures start to move higher off the lows..

Wed, 09/21/2011 - 17:03 | 1694460 jdelano
jdelano's picture

riding on the back of a winged unicorn...

Wed, 09/21/2011 - 17:20 | 1694531 d00daa
d00daa's picture

hahahahahahahahahahaha, seriously???


Wed, 09/21/2011 - 17:25 | 1694555 krilj
krilj's picture

Sold to you.

Wed, 09/21/2011 - 17:29 | 1694574 walküre
walküre's picture

S&P ended the day at 1166 and fell another 10 points in AH, futures "rally" from that level..

Are you serious?

S&P is actually off almost 4%. Check the real time DAX as well. Finished the day 2.5% down and is now at -4.3%.

Guess what, fdisk.

If you're still long, you're fucked. The relief rallies happened before the announcement today.

Oh, there will be a bounce but it will be off the 1050 S&P mark or maybe the 950 S&P mark. Go at it.

Wed, 09/21/2011 - 17:58 | 1694708 Monday1929
Monday1929's picture

1000 looks like a magnet for S&P. Then we grind higher for 3 months. or 6 months. F--k them, really.

Wed, 09/21/2011 - 17:09 | 1694451 Threeggg
Threeggg's picture

Well, I guess it's "Paper wealth" or "Hard assets".

Which is it ?

From Wikipedia;

Paper wealth means wealth as measured by monetary value, as reflected in the price of assets – how much money one's assets could be sold for. Paper wealth is contrasted with real wealth, which refers to one's actual physical assets.

Hard Assets are investments with intrinsic value such as oil, natural gas, gold, farmland,natural colored diamonds and commercial real estate. (I guess commercial real estate means, that which is not encumbered by paper wealth above.......and you have a tenant....and that can pay the monthly rent ?)


Wed, 09/21/2011 - 17:04 | 1694464 Everybodys All ...
Everybodys All American's picture

Where is the stupid money? Warren Buffet's of course. Backs Obama,buys BAC, and who is looking forward to his next idea?

Wed, 09/21/2011 - 20:38 | 1695206 unununium
unununium's picture

Donna be ridiculous.  He exercised his warrants at 7.14 and sold at 8.80 the next day.

Wed, 09/21/2011 - 17:04 | 1694470 krilj
krilj's picture

This rally was completely hammered out for the purpose of trapped whales with huge long  positions that got caught with their pants down by August's puke down.  These are the traders that will support the market because they NEED it to pause and take a breath while they sell into any strength they can create.

Buy long enough to make a 'bottom' and other traders will get long with you.  You sell into the strength they create from shorts being squeezed.  You make money on the trade off the lows and get out of the shitty stocks you no longer want.  If you manage to sell enough to clear your book, you get short too into the highs.  Now you are ready to do it again at the next 'bottom'.

Next stop 2010 lows.  Watch the whales play the same game there too.

Wed, 09/21/2011 - 17:13 | 1694484 Soul Train
Soul Train's picture

why would anybody be long now?

My money is not going long into the market after today's announcement. Get a life, Europe cancer ain't going away anytime soon.

Gold and silver. That's the way to go. Buy physical if you can.



Wed, 09/21/2011 - 17:23 | 1694546 Caviar Emptor
Caviar Emptor's picture

Fed finally got religion about Biflation. Main reason they're pulling back. 

Wed, 09/21/2011 - 17:35 | 1694598 walküre
walküre's picture

Tyler, have a look at the history of OP Twist.

What were the reasons for the Fed to use that "tool" (their words, not mine) in 1961?

How bad was the economy in 1961 and how bad was the credit market?

Then 1963 and Nixon lifted the gold standard which of course allowed a massive balance sheet expansion and explosion of credit.

So, now in 2011 and 40 years later the Fed is using OP Twist again.

2 choices at this juncture. The Fed will expand the balance sheet in 2013 (end of ZIRP) by means and ways we can only speculate upon or they will contract the balance sheet (again, end of ZIRP is already done deal) and perpaps reintroduce a gold standard?

That's a discussion I would like to see going forward.

Wed, 09/21/2011 - 18:07 | 1694756 mynhair
mynhair's picture

1963?  Nixon?  You a product of the public schools?

Wed, 09/21/2011 - 19:08 | 1694968 walküre
walküre's picture

WTF, my bad. No excuses.

What I wanted to discuss were the circumstances of OP Twist in 1961 relative to the economic situation then.

Gold standard got abandoned 1971, or 10 years later and the balance sheet expansion followed.

Any other "tools" the Fed may revive from the Dead?



Wed, 09/21/2011 - 21:19 | 1695322 Freddie
Freddie's picture

People in 1961 were not dumb enought to put a usurper Kenyan Muslim marxist in the white hut.  One who loots the treasury just like any dictator in Africa.   He is Mugabe and all the others from Africa.   This is all totally f**ked now.

Wed, 09/21/2011 - 18:20 | 1694819 adr
adr's picture

So how far is the price between Platinum and Gold going to get? Platinum is selling for $20 less than gold. Is Gold really going to be worth more than Platinum going forward?

Wed, 09/21/2011 - 18:40 | 1694876 Flatchestynerdette
Flatchestynerdette's picture

I hope my bank of america credit card still works. it and amex are the only cards i own to operate my small business when i need short term loans. yikes.

Thu, 09/22/2011 - 00:28 | 1695672 blunderdog
blunderdog's picture

Maybe you can just conduct those transactions in gold bullion...

Wed, 09/21/2011 - 18:44 | 1694892 Dingleberry
Dingleberry's picture

Funny how folks pick on gold. Look at one day's chart, and all the sudden it's crashing. What the fuck? How many times OVER THE LAST DECADE have you seen these wild swings, which ALWAYS EVENTUALLY END UP???  Do you fucking even know why it's risen over that time?  Do you believe that Heli-Ben is going to sit back and watch his 3 trillion dollar experiment go down the drain, unless he prints even more money?? And BTW, HE HAS TO PRINT MORE.  Or excuse me, "add to his balance sheet".  To not do so would be to admit defeat, and that his experiment was just an expensive fiasco.  When gold goes down, funny how the buyers come out of the woodwork. EVERYTIME.  If you believe in "deflation", then buy fucking bonds. I dare you.

Wed, 09/21/2011 - 18:57 | 1694940 msmith
msmith's picture
The SPX found its last major support at 1164 which was the bottom of the deceleration channel and the 23.6% retracement. .  More downside ahead though.
Do NOT follow this link or you will be banned from the site!