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Mutual Fund Outflows Surge As NYSE Short Interest Back To March 2009 Levels... Yet Stocks Refuse To Plunge. Why?

Tyler Durden's picture





 

ICI has reported the latest weekly mutual fund flow data and it is not pretty: the outflow from domestic equity mutual funds of $5.7 billion for the week ended September 30 is the largest since August 10, and is the 6th consecutive week of redemptions from mutual funds, bringing the total outflow YTD to $89 billion, following $98 billion in 2010. This is almost $200 billion in nearly consecutive weekly outflows from equity funds in the past two years, the bulk of which has gone into bond funds. Is there anyone who still thinks that retail has any interest in investing in stocks? But wait, there's more. According to the NYSE, short interest at the exchange soared to a whopping 15.7 billion shares as of September 15, an 828 million increase in one fortnight, and the biggest since the March 2009 lows. There is one difference: back then the S&P was 40% lower. Which means that the bear cavalry is positioned and waiting for a massive market flush... which keeps on not materializing.

Why?

Because these same mutual funds, despite having record low cash holdings, continue to refuse to sell their stock holdings and replenish cash. The only reason we can attribute to this is that slow money managers keep hoping Bernanke will pull something out of his sleeve and create another Hail Mary market rush into year end, saving quite a few P&Ls, not to mention careers. Alas, with stocks where they are it is increasingly looking like Operation Twist may be the only thing they will get for 2011 - Bernanke needs the S&P in triple digits to have a strong case for a $1-2 trillion LSAP. As such funds find themselves in no man's land, where they will be redeemed at the end of the year unless stocks soar for whatever reason, but will refuse to sell before they absolutely have to, which will be end of December, or whenever the Nash equilibrium fails.

So with less than three months left, every single day that does not result in a massive market move, brings stock ever closer to that proverbial flush which the noted shorts are so stubbornly waiting for. And with every passing day this equilibrium becomes more and more tenuous until one day the selling has to commence. Is it any wonder that hedge funds are now overwhelmingly bearish and also waiting alongside the bear cavalry to scoop up the firesale which should begin if Bernanke does nothing but sits on his gluteus maximus?

NYSE short interest:

Domestic Equity Mutual Fund flows:

Mutual Fund cash balance:

 


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Wed, 10/05/2011 - 15:37 | Link to Comment Joe Shmoe
Joe Shmoe's picture

Isn't this one an age old contrarian indicator?

 

 

Wed, 10/05/2011 - 15:42 | Link to Comment Pladizow
Pladizow's picture

These late day rallies are a JOKE and the market is a FARCE!

Wed, 10/05/2011 - 15:47 | Link to Comment ratso
ratso's picture

Oh right, THE SKY IS FALLING not just today.  The end of the world has been briefly postphoned.

Wed, 10/05/2011 - 15:50 | Link to Comment Stoploss
Stoploss's picture

Yeah, the bear cavalry..

 

You're pretty much fucked..

Wed, 10/05/2011 - 15:55 | Link to Comment clones2
clones2's picture

Just a market bounce back to the 10dma....  Not too surprised...

Wed, 10/05/2011 - 16:39 | Link to Comment Pinto Currency
Pinto Currency's picture

 

 

Perhaps some investors have the view that buying Treasuries, when the Fed is printing money to maintain their price level, is more risky than buying stocks in companies.

Wed, 10/05/2011 - 22:33 | Link to Comment jeff montanye
jeff montanye's picture

wish the charts above were longer term.  what was the short interest in late 2007 and 2008?  what was mutual fund cash in '65 and '72?  

Thu, 10/06/2011 - 02:12 | Link to Comment Mauibrad
Mauibrad's picture

Mutual Fund managers panicked selling on the horizon, bitchez?

Wed, 10/05/2011 - 15:45 | Link to Comment r101958
r101958's picture

"Mutual Fund Outflows Surge As NYSE Short Interest Back To March 2009 Levels... Yet Stocks Refuse To Plunge. Why?"

How about because the TBTF's have too much of their free fed money invested in them? They stand to lose quite a bit if they crash. Who else do we really think is manipulating this market right now? Us?

 

Wed, 10/05/2011 - 15:51 | Link to Comment SheepDog-One
SheepDog-One's picture

Theyre just not ready for the crash quite yet, these record high shorts ARE the banks...theyll pull it soon enough.

Wed, 10/05/2011 - 15:59 | Link to Comment r101958
r101958's picture

Yes, I agree. It seems that they will do whatever they need to do to the market to keep oil at around 80 (WTI), gold at around 1600 and silver at about 30. I believe that oil under 80 is not profitable for the source of that market (WTI). All this in an effort to make any grumbling J6P stop grumbling. For those that have been studying and/or watching the markets for a while, TPTB hope that we give up on our hope that there will actually soon be some clarity and reality in the markets.

Wed, 10/05/2011 - 16:29 | Link to Comment r101958
r101958's picture

...forgot one thing.....and to keep treasuries right about where they are now.

Wed, 10/05/2011 - 15:51 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

I agree with Joe Shmoe.  I'm 100% certain the market will be crushed at some point, but these shorts need to be out before it does.  Look at every other point on that chart and you can literally play the opposite game with the amount of short interest and the performance of the market.

Wed, 10/05/2011 - 16:23 | Link to Comment Strider52
Strider52's picture

Well, I think we can all agree that most everything is intentionally misreported. Employment, inflation, bank health, number of traders that are actually human, you name it.

It seems to me that it's entirely possible that the world economy already completely crashed big time, but TPTB can hide it nearly forever. Everything reported, or 'leaked', or rumored, is completely fake.

Wed, 10/05/2011 - 16:57 | Link to Comment Ned Zeppelin
Ned Zeppelin's picture

A fiat world where the rules are made and changed at a whim.  That is why I think the end game is the enforcement of the "fiat reality," and there will never be a clearing.  Folks "winning" by holding PMs will simply not be allowed. This game has no end.  The markets oscillate up and down, the oscillations calibrated for maximum "skim" each time the crowd gets fleeced.

Wed, 10/05/2011 - 16:56 | Link to Comment RickyBobby
RickyBobby's picture

If she blows through 11.5K I'll have to take my shorts off. As sure as the sun rises in the east when I take 'em off she'll crater.

Wed, 10/05/2011 - 17:09 | Link to Comment CH1
CH1's picture

I think that's pretty much the plan.

They know when the plug gets pulled - you don't.

Wed, 10/05/2011 - 15:57 | Link to Comment firstdivision
firstdivision's picture

No wonder that short squeeze kicked into such high gear.  Someone bought 5k shares of FAS.

Wed, 10/05/2011 - 16:08 | Link to Comment riley martini
riley martini's picture

5 for 1 reverse split announced for fas today. Would you want to buy it?

Wed, 10/05/2011 - 16:02 | Link to Comment pupton
pupton's picture

From the chart it appears that short interest spikes at the beginning of big moves to the upside...but what the heck do I know.

Wed, 10/05/2011 - 16:53 | Link to Comment Bartanist
Bartanist's picture

Lol ... It is commonly known that massive selling causes prices to go up... The converse is also true.

Wed, 10/05/2011 - 16:30 | Link to Comment AbelCatalyst
AbelCatalyst's picture

Yes, contrarian indicator...  However, you have to remember the Baby Boomers are getting closer and closer to retirement and their appetite for risk is quickly diminishing.  These wild swings are making them shart their pants!!  

Their need to conserve $ will quickly outweigh their desire to have a high-end retirmenent.  Once the scale is tipped, it will be like flicking a light switch - They'll say, "if I don't pull out right now I may NEVER retire."  Then you'll see a massive stampede for the exits - first ones out can retire with dignity, last ones out will live in low-end trailer parks!  Don't underestimate the fear of a curtailed lifestyle!! 

They're just beginning to pull out - they're looking around the room to see where the exits are (and if others are moving toward the exits).  Can you hear the light switches clicking on all accross the US?  Can you feel the panic beginning to build?  Seriously, this is a BIG deal, especially in light of the boomers just losing all that RE equity...  The reason they are staying in the stock market is a deep-seated hope that they will make 20% per year again - aint' gonna happen...      

Wed, 10/05/2011 - 16:56 | Link to Comment Bartanist
Bartanist's picture

Dignity? Is that like pride? Pride is not a virtue.

Oh, and maybe, tornado magnets aside, a low-end trailer park is a better place to find spirituality than in Naples, FL or Nice, France.

Wed, 10/05/2011 - 17:13 | Link to Comment Pinto Currency
Pinto Currency's picture

 

Do you remember Ronald Reagan's old saying that the most terrifying words to any business owner are "I am from the government and I am here to help."

 

If I was a long term bond holder, I'd be terrified of the words "I am Ben.  I am from the Fed.  I am here to help your bonds.  I am going to print, print, print and buy, buy, buy those bonds to help you."

 

It might even make me buy P&G, J&J, ABX, and ultimately SWHC.

Wed, 10/05/2011 - 15:38 | Link to Comment Robslob
Robslob's picture

ONE MAN MARKET

Wed, 10/05/2011 - 19:29 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

ONE BIG BUCKET SHOP

 

Wed, 10/05/2011 - 15:39 | Link to Comment jayman21
jayman21's picture

Hey Tyler - Any idea on average leverage ratio for the MF?  Would be interesting to see how many redemptions turned into short-term loans to cover the outflow vs. a true sale of assets to cover the outflow?

Wed, 10/05/2011 - 15:39 | Link to Comment TradingJoe
TradingJoe's picture

We are going momo again! Hehehehe me shorting like a BEAR! ::::))))))

Wed, 10/05/2011 - 15:40 | Link to Comment adr
adr's picture

The market has been trying to flush for weeks but there is this damn giant log stuck in the toilet with a stupid beard, a big nose, and this stupid grin expressing this flush me if you dare look.

Should have bought a Kohler.

 

... meanwhile looks like 11k+ is a real posibility at the close, unfuckinreal

Wed, 10/05/2011 - 15:45 | Link to Comment CClarity
CClarity's picture

Toto, we're stuck in the Wizard of Kansas with magical thinking believing that debt will just go poof.

Wed, 10/05/2011 - 15:45 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

The crapper is clogged with single-ply linen paper.

The toilet went crazy yesterday afternoon.

The plumber, he said, "never flush a tampoon."

This great information cost me half a week's pay,

and the toilet blew up later on the next daaaay-ay-ay-aaaay.


Wed, 10/05/2011 - 15:55 | Link to Comment DosZap
DosZap's picture

TheFourthStooge-ing

NEVER put a Paper hand Towel in one either..............same issue.

Wed, 10/05/2011 - 16:00 | Link to Comment SheepDog-One
SheepDog-One's picture

Shitters full!

Wed, 10/05/2011 - 15:40 | Link to Comment SheepDog-One
SheepDog-One's picture

This just shows when it DOES really come unhinged one of these overnites, there will be no stopping it and total devastation. Which is of course what they planned for all along.

Wed, 10/05/2011 - 15:51 | Link to Comment Harbourcity
Harbourcity's picture

The market is a horny 16 year-end trying to get into his girlfriends pants, sure she's fighting pretty good but with or without her giving in, he's blowing his load.

Wed, 10/05/2011 - 16:07 | Link to Comment pupton
pupton's picture

Ummm, is that called rape?  Or is he going home to polish the salami?

Wed, 10/05/2011 - 16:02 | Link to Comment Biggvs
Biggvs's picture

So just following the historical logic here... if short interest is at March 2009 levels, then the selloff has already occurred and we should expect a 100% rally in the S&P, no?  :P

Wed, 10/05/2011 - 16:07 | Link to Comment pupton
pupton's picture

That's what you could infer from the chart, yeah...

Wed, 10/05/2011 - 15:41 | Link to Comment rambler6421
rambler6421's picture

It ain't plunging cuz of the Plunge Protection Team.........Duh.

Wed, 10/05/2011 - 15:45 | Link to Comment fonestar
fonestar's picture

"We've got a leak in these pipes!  Quick, call the plungers!"

Wed, 10/05/2011 - 15:45 | Link to Comment Comay Mierda
Comay Mierda's picture

PPT 3:30pm ramp up in effect again

 

new strategy: buy at 3:30pm sell at 3:59pm

Thu, 10/06/2011 - 02:41 | Link to Comment o2sd
o2sd's picture

Only if it's blood in the morning. Green in the morning means PPT day off. Blood in the morning, PPT arrives on cue at 3:30 with new rumour of a plan to get together to plan a bailout of Europe.

Remember:

Green in the morning, market is yawning.

Blood in the morning, PPT warning.

 

Wed, 10/05/2011 - 15:44 | Link to Comment doomz78
doomz78's picture

QE4, QE5, QE6, QE7, QE8, QE9, QE10,  In the form of daily market capital injections into the stock market via JP Morgan Chase and Goldman Sachs.  And not forgetting the help of the CME.  It's a market in perfect balance if fraud and market manipulation are your fetish.  Ben Bernanke and the boys know that Quantitative Easing is not palitable in this political and economical environment.  This is just a theory of mine but having followed the market for over 10 years.  It looks rigged. 

Wed, 10/05/2011 - 15:43 | Link to Comment fonestar
fonestar's picture

S&P500, last bastion of a failed system?  Defend at all costs! 

Wed, 10/05/2011 - 15:44 | Link to Comment SheepDog-One
SheepDog-One's picture

'One day, the selling has to commence'...no one to sell to....1 man market conundrum.

Wed, 10/05/2011 - 15:44 | Link to Comment alien-IQ
alien-IQ's picture

The /ES is up about 70 points since yesterdays 3:30pm rumor, despite the fact that it has been proven to have been purely meaningless bullshit.

You gotta admit...this shit is hilarious.

Wed, 10/05/2011 - 15:44 | Link to Comment Belarus
Belarus's picture

I have said it many times here before but i'll say it again: with this kind of short interest, there is no way the market will crash. Record short interest is the ultimate contrary indicator. 

They will ramp this market and fuck every short out there. Only then will stocks be able to crash. until then boys...

Wed, 10/05/2011 - 15:50 | Link to Comment Racer
Racer's picture

Yep, if the funds refuse to build up cash in the hope they can be saved by the ChairSatan, then short squeeze it is... but then when the evil one does nothing there will be no shorts to soften the waterfall drop, Oct 1987 and the Great Crash will be like minor blips, they will of course try to slow it with circuit breakers but that will only cause more panic like the delays with the tickers during the Great Crash.

The only buyers are the shorters... so no buyers/shorters.... watch out below

Wed, 10/05/2011 - 16:26 | Link to Comment Mohan
Mohan's picture

This is about time CNBS parades some analyst who calls for a new bull market based on short interest only!

Wed, 10/05/2011 - 15:45 | Link to Comment LongSoupLine
LongSoupLine's picture

This is horseshit...look at this manipulative ramp!  Where are the fuc'ing regulators?!?!  THIS is why people are parked outside Scam Street. 

Wed, 10/05/2011 - 15:45 | Link to Comment Dangertime
Dangertime's picture

Time marches on.

September 15th is almost three weeks ago.  It looks like everybody who was going to sell this fear spike has already sold it.

Looks like another 6 to 9 months of rising equities before the real downdraft begins.

Wed, 10/05/2011 - 15:47 | Link to Comment SheepDog-One
SheepDog-One's picture

LOL, go ahead and fall for it!

Wed, 10/05/2011 - 16:00 | Link to Comment Dangertime
Dangertime's picture

I didn't fall for the April silver mania.  I'm guessing I won't fall for this head-fake bear market.

Having said that, I think gold and silver will recover very nicely.  It would be a good time to pick those up as well.

Wed, 10/05/2011 - 17:33 | Link to Comment tekhneek
tekhneek's picture

You had to try and fuck the contrarians up that are simultaneously commodities investors. Didn't you?

Fargin' Sneaky bastages.

Wed, 10/05/2011 - 17:40 | Link to Comment DosZap
DosZap's picture

tekhneek .

Exactly, The FED is not the only one's who get to mess w/folks heads.

LOL

Wed, 10/05/2011 - 15:46 | Link to Comment Cone of Uncertainty
Cone of Uncertainty's picture

I would say there is a lot of cognitive dissonance going on in the markets now, especially with the median manager money.

Most shops have gotten so tired of trying to follow and understand the European situation, that they simply ignore it, willfully.

I think a large number of managers are going to be in for the shock of their lives when shit really starts to unwind.

I mean WTF, most of these fucking lemmings think we are going to muddle through and that we are still working our way through a V shaped recovery.

Wed, 10/05/2011 - 15:49 | Link to Comment SheepDog-One
SheepDog-One's picture

Reminds me of a video I saw on youtube of a deck 2 stories up way overloaded, all the people out there having fun and partying and dancing around oblivious, until a split second later when it gave way and they were all lying down on the pavement.

Wed, 10/05/2011 - 16:03 | Link to Comment fyrebird
fyrebird's picture

"Situational Awareness" is what's lacking here.

Anybody not running for their lives by now is clearly out of their mind.

The world will not miss them after they are gone.

Wed, 10/05/2011 - 15:48 | Link to Comment monopoly
monopoly's picture

The only good part for us is the miners. They are moving higher on fundamentals. What a concept.

Wed, 10/05/2011 - 15:48 | Link to Comment DosZap
DosZap's picture

Think this is a good time to sell Gold, and buy back after the crash takes it OUT,back down to $750-800.00?

Or do you think this time IS different, and folks will sit on the PM's.

Just a question on what some of you think, esp since the metals are up compared to the last 24-36hrs.

Wed, 10/05/2011 - 15:52 | Link to Comment doomz78
doomz78's picture

Trying to predict the gold market in this market is like trying to predict the second coming of Christ.  Too many variables.  Europe, Money Printing, Derivatives market, China slowing down growth, ..Fraud and market manipulation in the COMEX.     There are too many variables.  The best thing to do is to buy slowly over time and put the same amount of cash on the sidelines overtime.  Then if you get a 800/1000 an ounce opportunity strike then.  my opinion of course.  I am not a professional and my opinion means as much as Bernankes. Disclaimer.. 

Wed, 10/05/2011 - 16:04 | Link to Comment DosZap
DosZap's picture

doomz78

Thanks for the reply,

I agree 100%, and have bought nearly all the way up.

But, when they tank this again, I am THINKING the folks that do not have their stash bought at the lows, are going to be WISHING they had lots of dry powder.I have quite a bit, but it never hurts to have MORE dry powder.

Plus take profits off of what I have now, and add to existing powder, could double/triple total ounces.

Or Not..............who knows.

Sheep are Sheep, and I do not for see the weak hands not doing EXACTLY the same thing as they did in '08. Dumping PM's for cash.

Anyone contrary thoughts, appreciated.

Wed, 10/05/2011 - 16:18 | Link to Comment doomz78
doomz78's picture

We are one massive disaster away from Gold going to 2500 an ounce.  So I don't try and sell anything at high prices when it comes to gold and silver.  Its more of an accumulation game for me. 

Trying to time the market is a great way to lose money unless you are a professional trader at a too big to fail bank.  Then you don't care and you make the market.  And if you screw up you get bailed out anyways. 

You hold gold to lock in your purchasing power today.  What has changed?  Is theworld in better financial shape today as it was 1 month ago?  Has USA debt incresed or decreased in the last 4 years?  If it gets ugly do you think the fed will print money or raise interest rates?  

 Dont get caught up in the short term noise.  I like the monthly purchasing plan with cash on the sidelines strategy.   And timing the market is insanely hard to do.  It's like trying to predict, the fed, the fraud, european problems, china, and every other issue all at once.  Nearly impossible. 

Wed, 10/05/2011 - 16:38 | Link to Comment americanspirit
americanspirit's picture

You are right on target. Accumulate and hold.

And I'm willing that one massive disaster you refer to will involve Syria, Iran and Tel Aviv, and soon. Alternatively I wouldn't rule out Pakistan/India. Imagine how much gold a nuclear war there would permanently remove from the table in the form of vaporized bullion.

When either happens I expect gold will streak considerably higher than $2500 USD/oz.

Wed, 10/05/2011 - 16:51 | Link to Comment pelagivore
pelagivore's picture

Completely agree with this view. The market is not only saturated with noise but its volatility is dependent on unforcastable elements on a short-term basis - week on week or even monthly. Emotions are becoming more important and this may be one of the reasons that 'rational' models are no longer working.

The point is that we are going through a period of deflationary fear currently, I suspect that it will last until the global economy has slowed sufficiently to force central bankers to bail out the system once again. Remember that the consequences of deflation in a high debt environment are much worse than inflation - at least in my opinion. During a deflationary period, gold will fall in price, but remember that the gold price is falling in value because investors etc are simply buying more dollars, thus the gold price falls in dollar terms, in fact its price may remain quite stable when viewed in other currencies or other assets.

In my view, the current period of deflationary fear is likely to be followed by a rapid shift to inflationary, once governments come riding to the 'rescue' by printing. The timing is difficult, but I suspect late this year/early next. Bernanke doesn't really have to do anything to alienate the US government at this point, all he has to do is wait, knowing full well that when things get sufficiently bad, they will come to him. This could nicely correlate with other central bankers, EU, China, moving in the same direcation and we will very likely get another big positive move in the gold price.

Keep in mind that there is one thing that continues to decline in value, through this whole mess; thats the trust that people have in government, academics and banks. Trust keeps us all believing that the paper dollars in your pocket are worth something. That trust is being systematically destroyed. Do you see that changing? If you don't, than its a big risk trying to be cute with your gold.

Wed, 10/05/2011 - 17:31 | Link to Comment DosZap
DosZap's picture

pelagivore

Thanks, No, I pretty much knew what I was going to do, and HOLD like I have and add, as $$$ and DIPS presented.

One thing for sure in this world, is nothing is SURE.

Wed, 10/05/2011 - 17:44 | Link to Comment tekhneek
tekhneek's picture

Keep in mind that it's possible no matter how much dry powder you have, you might not be able to get your hands on as much as you can afford at some point in the future.

Imagine selling it all at the high, only to find out that the reason it got so expensive is supply constraints. I wouldn't want to be sitting on a huge pile of dry powder and no available supply to hedge myself with against my cash position. That would suck. Big time.

This is why I don't advocate selling. I don't time the market. I accumulate every chance I get. If I'm not sure, I'll do 25% here and wait then ... 25% again and wait... etc... sometimes 50%/50% (day-to-day and sometimes week-to-week) but there are also days (like when it dipped to 28) that I just dump it all in.

It's better to average the market (in my opinion) than it is to time it.

Just some more thoughts.

Wed, 10/05/2011 - 18:49 | Link to Comment donsluck
donsluck's picture

Who is Christ?

Wed, 10/05/2011 - 19:57 | Link to Comment LooseLee
LooseLee's picture

Christ is not a personality but an expression of Supreme energy. This expression of Supreme energy has been given many names including Nirvana, Enlightenment, Ultimate Being, Self-Realization, etc.

Wed, 10/05/2011 - 15:55 | Link to Comment MachoMan
MachoMan's picture

I'm pretty sure the general consensus is buy all the way down, buy all the way up...  just be sure to buy...  physical.

Wed, 10/05/2011 - 15:55 | Link to Comment monopoly
monopoly's picture

That is absurd. You think the dollar is going to rock higher the next few months. Just look around you, and then read your own post. Beyond comment. But as long as we have these posts and until the cab drivers in NY advise us to buy gold and there is a gold machine in every Starbucks.  I like what I got.

Wed, 10/05/2011 - 16:05 | Link to Comment Banjo
Banjo's picture

Does not sound like you have physical? or perhaps you have both physical and paper exposure.

 

I remember almost anytime there is something big going on in the market the queues at the bullion dealer are out the door.

 

As a physical holder I would rather not take the chance of being told they are "out of stock"

 

The paper game well flip a coin your guess is a good as mine or the next guy :)

Wed, 10/05/2011 - 17:26 | Link to Comment DosZap
DosZap's picture

Banjo

No, I do not play paper games.

No ETF's for me.Strictly Physical.

My thoughts were as decribed, take frn profits off what I own NOW,add to dry powder, and wait until the Mkt crashes, and load up when the prices crater AGAIN.

I was not alert enough(since I had pullled my exposure to it OUT (of the Mkts),to BUY in at the $700.00 ranges............

So, I am set w/phys, and buy the DIPS, if their decent when I have the coin.

Just want to make sure IF we drop back to '08 levels, I get a shot at Backing Up the Truck.
LOL

Thanks all who responded.

Wed, 10/05/2011 - 15:50 | Link to Comment Blorf
Blorf's picture

Exchange stabilization fund. It's no accident margin requirements on all approved investment types keep dropping while metals keep rising.

US markets down 10% or so for the year while everything else on the planet has cratered. You should recognize this as a sign that it's being propped up.

We know that the Fed sells mass put options on t bills to keep the yields down based on fed minutes. It wouldn't surprise me if the govt was doing the same with equity futures/options.

Is there any other explanation? Retail pulls money out, hedge funds are blowing up, and the market just levitates with stick saves every afternoon.

I have no idea how one would investigate this. Are ES puts unusually cheap?

The market imploded when the government ran out of cash this summer over the shutdown

Wed, 10/05/2011 - 15:50 | Link to Comment the iD
the iD's picture

no one wants to be first

no one wants to be last

 

enjoy being in the middle of the herd you TPTB fucks. cant see the approaching cliff thru all that wool. intraday calls, holding a % thru close, profits into rolling up calls and long dated puts. go ahead, steal from the future and line my pocket in the short term and let me position better every day for your inevitable demise while i purchase tangible goods and AU/AG at a discount. fund your own demise, ladiez.

Wed, 10/05/2011 - 15:50 | Link to Comment Dr. Engali
Dr. Engali's picture

Trying to fight a multi trillion dollar hedge fund.

Wed, 10/05/2011 - 15:51 | Link to Comment Shizzmoney
Shizzmoney's picture

I wonder what a good estimate of the O/U of the historic DOW loss we will see once Greece defaults, or in January, when all of these retail-friendly stocks, like stores and popular high volume selling XMAS products like Housewares, TVs, and Videogames (after seeing bullish gains in the last week), crash.

The record for the biggest daily DOW loss in the modern era is -777 (ironic, really). 

What's gonna be the line for this Over/Under? -1000? -2000? More? 

Wed, 10/05/2011 - 15:54 | Link to Comment The Big Ching-aso
The Big Ching-aso's picture

Fat floats.   There's a lot of fat left in the market.   The market keeps getting fed with all these fatty substances.   Treasury Twinkies, Bennie Bon-Bons, etc., etc., etc.

Put it on a crash fat-free diet and all hell's gonna break loose.    You ever been around somebody who's used to eating everything in sight and can't no longer?

Ugly, baby.  Ugly.

  

Wed, 10/05/2011 - 15:59 | Link to Comment fyrebird
fyrebird's picture

Images of Mr. Creosote, though I know that's not what you were suggesting. It's still funny as all hell.

Wed, 10/05/2011 - 15:54 | Link to Comment SheepDog-One
SheepDog-One's picture

Remember back in December Lindsay Williams gave an interview where he said the big one is coming in late fall, and youll know its near when you see PM's plunge by 50% or so, and stock markets are swinging 4%-5% daily. 

Looks like check, and check.

Wed, 10/05/2011 - 15:54 | Link to Comment Sambo
Sambo's picture

Gluteus maximus aka ....is sitting on the Market Up button...

Wed, 10/05/2011 - 15:56 | Link to Comment SheepDog-One
SheepDog-One's picture

The stock markets are just the show on the curtain for the conditioned public, has no bearing on the scenes behind the curtain, it means nothing now.

Wed, 10/05/2011 - 15:58 | Link to Comment SheepDog-One
SheepDog-One's picture

I wonder if 'Anonymous' actually will 'remove the NYSE' on Oct 10th like theyre saying they will. 

Wed, 10/05/2011 - 15:58 | Link to Comment GrinandBearit
GrinandBearit's picture

Although they are frustrating to watch, these phony, algobot driven market rallies do not concern me.  I just keep buy more PMs on dips. 

Today I visited a coin store in the burbs that I've never been to before.  I picked up ten 1/10 ounce eagles at spot and 1 roll of mixed EF Morgan and Peace dollars for $23 each - which I thought was a great deal.   It's a bit of a drive, but I'm definitely going to visit him again soon. 

 

Wed, 10/05/2011 - 16:12 | Link to Comment DosZap
DosZap's picture

GrinandBearit

which I thought was a great deal. 

 

Dude, you stole BOTH shows. BOTH,at least 10-15.00 each on the Silver dollars, and a MIN 8-9% prem on the 1/10th oz..................CONGRATS!.

Wed, 10/05/2011 - 15:58 | Link to Comment RobotTrader
RobotTrader's picture

4th quarter is the last chance to "Make Your Year"

Lots of Hail Mary passes being thrown today.

Wed, 10/05/2011 - 16:11 | Link to Comment SwingForce
SwingForce's picture

Want a laugh? "2 yutes got wakt t'day....."  (SO & ED really did) and now this:

http://www.youtube.com/watch?v=YpNgONH2ncI

Wed, 10/05/2011 - 16:20 | Link to Comment SwingForce
SwingForce's picture

Refuse to plunge? WTF do you call the PARABOLIC drop into 8/9?  Algoes Gone Wild? Duh, Hello, are you coming from Tijuana? I don't mean to be rude, but here's a plunge you can talk about http://www.youtube.com/watch?v=NcG-rjoYiMo

Oh jeez, maybe just MAYBE people are buying stocks for INCOME, despite END OF DAY shenanigans of the MF Industry. Talk about BKNY frontrunning FX trades, how about frontrunning Barron's bad news last weekend? Sell your MF at ANYTIME of DAY on Monday and you got the worst price of the day. Buy back on Tuesday at ANYTIME of DAY you got the worst price of the day. MoFo's have been front-running small guys orders for decades, I don't even understand how they are still in business- ETF's solved the problem of Intra-Day Lockdown, or so I thought.

Hey , I love this song of the jungle: http://www.youtube.com/watch?v=MwHWbsvgQUE

Wed, 10/05/2011 - 16:02 | Link to Comment ivars
ivars's picture

Long term dollar index (USDX) prediction chart 2012-2018 with description and zoom options ( click on chart, then click on left upper corner zoom symbol) is posted here:

http://saposjoint.net/Forum/viewtopic.php?f=14&t=2626&p=34401#p34401

Key points:

1) That is very important one to understand why there will be no inflation for another 4 years till 2016, why gold will not move up much in 2011-2013, and how USA will finance its needs by issuing even MORE unsustainable debt (held hostage to USD reserve currency status ) even in recession with approval of creditors (held hostage by USD reserves they have and need to continue trade imbalances with reserve currency issuing nation) . USD will deflate (gain in value) during 2012-2014. Recession will continue all this time, debt deflationary one.

2) Then, in 2014 the defaulting process will begin, lasting from 2014-2016, 2 years, with everyone scrambling around to try to position itself best ( if that is possible ) with all means available for the imminent default.

3) Nevertheless, I still stick with silver showing unexplained upside even during deflation period, as shown many times already in silver  graph from 35 in Q1 2012 up to 100+-20 USD in October 2012.

4) My thinking is, increase in silver USD price that has to be related not to inflation, but demand/supply issues. I favour explanation that demand will soar NOT because of some sudden new use of silver, but increased OLD use, perhaps very old use. I have only two options-either military buildup, or monetary policy of some sovereign based on silver (NOT the USA).

Wed, 10/05/2011 - 16:05 | Link to Comment SwingForce
SwingForce's picture

What would really help with everyone's visual process is, if you were to pay for your stuff with CASH. 

A stack of hundreds. You would definitely think twice about buying an ounce of gold, I assure you.

Wed, 10/05/2011 - 16:08 | Link to Comment Waffen
Waffen's picture

if this thing doesnt begin until 2014 I will shoot myself

Wed, 10/05/2011 - 16:23 | Link to Comment nyse
nyse's picture

Me too.

Wed, 10/05/2011 - 16:57 | Link to Comment catacl1sm
catacl1sm's picture

Just get a real job and stop looking at it. Problem solved.

Wed, 10/05/2011 - 16:05 | Link to Comment gringo28
gringo28's picture

uhhhh, because retail actually increased their equity allocations last month, duh. they just aren't doing it through mutuals. get on the band wagon, this market is going up.

Wed, 10/05/2011 - 16:07 | Link to Comment SwingForce
SwingForce's picture

GRINGO!  28 and many more! http://www.youtube.com/watch?v=UI2FolId6CA

Wed, 10/05/2011 - 16:06 | Link to Comment Caveman93
Caveman93's picture

I bet most folks laid off are transferring their 401's to CD's or just pure cash at this point in the game. 

Wed, 10/05/2011 - 16:09 | Link to Comment SwingForce
SwingForce's picture

And paying their high priced, un refi-able mortgage, until they are sucked dry. Its a sad way to die.

Wed, 10/05/2011 - 16:15 | Link to Comment pettolicious
pettolicious's picture

I emptied mine and bought two rental houses.   Put 50% down on each (which, probably means the equity will be evaporated by EOY).  Different from PM's, but both are rented currently with long standing leases.   Will see if smart or not - especially if tax treatment for rental property changes.  Had to do something, couldn't stand to buy another share of a date indexed fund or Magellan and don't have time to day trade.  

Wed, 10/05/2011 - 16:19 | Link to Comment SwingForce
SwingForce's picture

You're a fart smeller, er, I mean, whatever, INCOME is the word baby! Houses or stocks, same INCOME!

http://www.youtube.com/watch?v=UI2FolId6CA

Wed, 10/05/2011 - 16:28 | Link to Comment DosZap
DosZap's picture

Caveman93

Did just that over a year ago(401k),got better than 90% out(all they would let me  have) ........saw what was coming.(the Mkt did not concern me,as I had moved into MMkt Funds prior to the last '08 dump), saved a wad.I figured Sammy would be coming for the rest, and wanted it CLOSE,like 2 blks away, so I can cash out in 15 mins.

Wed, 10/05/2011 - 16:13 | Link to Comment Zer0henge
Zer0henge's picture

Why?  How about because those charts show we are AT A BOTTOM!  I thought you guys could read charts?

Wed, 10/05/2011 - 16:15 | Link to Comment johnnymustardseed
johnnymustardseed's picture

If you have not noticed, up 400 points.... down 400 points..... up 400 points..... back down again... it is called manipulation. Anyone who thinks this capitalist market is anything but rigged is flat out a fool!

Wed, 10/05/2011 - 16:23 | Link to Comment nyse
nyse's picture

Im short as fuk, but this does not seem good for the bear case...

Wed, 10/05/2011 - 16:24 | Link to Comment IMA5U
IMA5U's picture

never understand the rule changing/rumor planting of the government

 

beta chasers are patting themselves on the back today

 

"it was so cheap.  i had to buy it"

Wed, 10/05/2011 - 16:26 | Link to Comment SwingForce
SwingForce's picture

GITARZAN, sorry folks, had to do it.

http://www.youtube.com/watch?v=D3_1KN5c4BU

Wed, 10/05/2011 - 16:32 | Link to Comment A_Mutz
A_Mutz's picture

on the first chart....it seems to me like giant short interest leads to giant rallys.  Just a thought.

Wed, 10/05/2011 - 16:38 | Link to Comment animalfarm1984
animalfarm1984's picture

I am sure Big Ben told them not to sell.  But they will have to sell when there is no more cash for redemption.

Thu, 10/06/2011 - 00:47 | Link to Comment lano1106
lano1106's picture

With zero interest rate loans, I do not see how they can run out of cash...

 

Wed, 10/05/2011 - 16:55 | Link to Comment pcrs
pcrs's picture

surging short interest, compared to 2009, maybe time for a rally? All the weak hands in cash? Time to hyper inflate then.

Wed, 10/05/2011 - 16:54 | Link to Comment YesWeKahn
YesWeKahn's picture

FFC forcasts that SP500 will only bottom in April 2012 when some of the hard core short sellers need to cover to pay increased taxes thanks to Obama. Before then, it will be a volatile and painful drops and monster rallies. However the overall trend is still down until next year.

BTW, expect that the rally will continue tomorrow. I think I will short again at the end of day tomorrow.

Wed, 10/05/2011 - 17:04 | Link to Comment bid the soldier...
bid the soldiers shoot's picture

"Mutual Fund Outflows Surge As NYSE Short Interest Back To March 2009 Levels... Yet Stocks Refuse To Plunge. Why?"

MANIPULATOR SENTIMENT?

Wed, 10/05/2011 - 17:08 | Link to Comment Scalaris
Scalaris's picture

 

Bernanke wont do anything because he is prevented from a political standpoint to engage in further creative and familiar actions in order to provide the necessary investor-friendly market conditions with the subsequent green-lit market euphoria.

Firstly, because of the remnants of the inflationary consequences caused by the previous liquidity facilities endowed by him to the banks last summer, which were promptly funnelled into every single asset class, and therefore instigating the inflationary commodity prices which in turn caused the tilt of further disequilibrium between them, and the declining consumer purchasing power.

Secondly, because the uncertainty regarding the threats of sovereign bankruptcies, along with the resultant ramifications caused by the interconnected toxic sovereign debt holdings, held and re-invested through heavy overleverage between retail and central banks, will need to be alleviated.

Required alleviation can only be assured by the total guaranty of the debt by a central facility such a the EFSF, which can only in turn be guaranteed by the stronger sovereign economies, which will only accept if the necessary measures are enforced upon the governments of indebted states, in order to deem their own debt as less “toxic” or more credit-worthy, so that it can be somehow held within the guarantor states central banks without obliterating their balance sheets.

For this to happen, the European political administration will need to establish a central administrative authority, in order to “safeguard” and conduct the economic policies of European states in a collective, and in an aspirational utopian manner, preciseness.

To conclude, once the EFSF obtains the required approval through the necessary political institutionalization, and becomes the bona-fide European debt buffer, a much needed sense of stability will return to the markets, and with the American economy still unaffected by the superficial non-solutions enacted for the sake of political posturing, along with the one would assume S&P in triple-digits and oil down to high $60s by then, Mr. Bernanke will have the total approval to engage in the all too familiar QE, and ensure the vertical trajectory of markets and assets classes alike for at least the next 12 months.

Maybe.  

 

 

Wed, 10/05/2011 - 17:47 | Link to Comment rosiescenario
rosiescenario's picture

Let me pose a stupid question:

 

If there are massive redemptions coming into the mutual funds for the last 1.5 years, they must be selling something to meet these....right? Or is the author inferring that the funds are using margin to meet the redemption calls?

Wed, 10/05/2011 - 18:46 | Link to Comment SwingForce
SwingForce's picture

They are selling at the Beginning of the day, and filling their customers' orders at the End of the day. What's That SPELL?

Wed, 10/05/2011 - 18:51 | Link to Comment SwingForce
SwingForce's picture

The MOFO's buy back in before the close and jamm it up the next day, is there an SEC? Are you people blind? I can't believe this thread exists. Studidity RULES! 

Wed, 10/05/2011 - 18:56 | Link to Comment topcallingtroll
topcallingtroll's picture

Hard to understand the market going up with mutual fund outflows?

Maybe its because when yahoos leave the market it is time for real men to enter?

Been a real roller coaster though. First up four percent now down four percent in ewz. Still sticking to my girl from ipanema.

Wed, 10/05/2011 - 21:23 | Link to Comment rocker
rocker's picture

Worse yet with all the redemptions of hedge funds. Look at the charts of those listed. All going down.

Including the ones who have Tickers for different classes of funds they control and list.

I think we have come down to one thing:  Hence:   Pure Phony Market Manipulation

We have all heard of naked short sales. Well if they can drive a stock down without borrowing the shares.

The HFTs can manipulate price without even buying them.

As said by a trader today on Bloomberg, "At least the HFTs buying and selling to each other do provide liquidity.

What a joke.  The Market has become more FIAT then our dollar.

Wed, 10/05/2011 - 19:00 | Link to Comment magne13
magne13's picture

Maybe someone can shed some light on this, but what correlation does the short interest have to the index price if in fact the selling of mutual funds is simply a matter of mutual fund outflows going into etf long equity funds?  This is simply an asset allocation trade, if someone can, please post the mutual fund outflow against the equivalent ETF in flow for domestic equity funds, I am qute condfident that this will rectify and clarify the fact that looking at mutual fund outflows singularly is not indicative of market flows.

Wed, 10/05/2011 - 21:26 | Link to Comment rocker
rocker's picture

Why would you think the outflow goes back to ETFs.  I think not. 

Let's just call it bad math and call it a day.  Geeezzzzzz.

Wed, 10/05/2011 - 19:04 | Link to Comment magne13
magne13's picture

ALso the liquid cash chart of mutual funds may just be overlayed against the 30yr bond to see if there is any correlation with risk free yields and stock yields.  This chart I would say suggest that obviously the lower the long term rate the larger the incentive to put cash to work in other risk assets.  The job of an index manager is not that difficult, you get paid if you are wrong anyway,  you get paid to risk other peoples money, you do not get paid to simply return 1% in cash.

Wed, 10/05/2011 - 23:59 | Link to Comment onarga74
onarga74's picture

So the public is leading the charge out of stocks. Hedge funds piling in after em and playing short?  I'll take a double dose of the other side of those.

Mon, 10/10/2011 - 02:39 | Link to Comment Jack.w
Jack.w's picture

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karmete's picture

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