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Retail Pulls Money Out Of Stocks For 13th Consecutive Week

Tyler Durden's picture




 

Not like this will come as a surprise to anyone in the aftermath of last week's abysmal FaceBook IPO which pretty much killed all retail interest in equity markets, but in the last week, the "dumb" money pulled another $3.5 billion out of domestic stocks per ICI, bringing the total tally to 13 consecutive weeks of outflows, and 52 weeks of outflows in the past 56 weeks, with redemptions amounting to $46 billion in 2012, compared to just $6.5 billion for the same period in 2011. Algo-matic, the 20 remaining Primary Dealers and whatever hedge funds are left can pass hot grenades amongst each other: the retail money (RIP) has found other ways to amuse itself.

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Thu, 05/24/2012 - 17:42 | 2460363 Boilermaker
Boilermaker's picture

Just makes it easier to manipulate.  Right?

Thu, 05/24/2012 - 18:03 | 2460453 The Monkey
The Monkey's picture

Means the smart money is buying right now. Stocks look super cheap and the risks are exaggerated.

Thu, 05/24/2012 - 18:15 | 2460487 lizzy36
lizzy36's picture

Absolutely.

In fact one should ignore the $700B pulled out of equity funds in the last 5 years, and lever up and buy all those super cheap stocks. Start with FB tomorrow. I mean yes still about 22x sales, but hell cheaper than it was a week a go.

GO GO Smart Money!!

Thu, 05/24/2012 - 18:30 | 2460540 Ahmeexnal
Ahmeexnal's picture

euro about to collapse to the 1.24 handle.
eurobanks who are on the other side of a major short are about to implode.

Thu, 05/24/2012 - 18:40 | 2460575 The Monkey
The Monkey's picture

We don't know that it will fall any more. USD longs could be on the wrong side of the trade. The dollar may converge back to equities on more can kicking and the bloombergs will light up green for days / weeks on end.

It happens.

Thu, 05/24/2012 - 18:41 | 2460577 Boilermaker
Boilermaker's picture

How astute.

Thu, 05/24/2012 - 18:45 | 2460586 The Monkey
The Monkey's picture

Keep your bearishness in check. Bill Gross of all people was on CNBC telling people to buy treasuries. Last year he shorted them at the top. Might mean that yields have bottomed and the can is about to be kicked again.

Thu, 05/24/2012 - 19:00 | 2460622 Boilermaker
Boilermaker's picture

Holy shit...you are truly a simpleton, aren't you?

Thu, 05/24/2012 - 19:38 | 2460726 The Monkey
The Monkey's picture

Just keep this in mind, EUR/USD shorts were at an all-time high a few days ago. Any good news will cause a massive rip in the markets as shorts run for cover.

Thu, 05/24/2012 - 20:36 | 2460871 The Monkey
The Monkey's picture

Here is a contrarian trade for you.  Short US treasuries, long EUR.

Thu, 05/24/2012 - 19:36 | 2460722 LynRobison
LynRobison's picture

If you are really interested in how and why Bill Gross ended up getting burned by shorting treasuries, read http://news.goldseek.com/GoldenJackass/1337803200.php. 

 

Treasuries will crash and the US government will default. It is a foregone conclusion. 

Thu, 05/24/2012 - 19:42 | 2460744 The Monkey
The Monkey's picture

Respectfully, I don't agree with your position on treasuries.

I went long the 30 year as Gross went short @ over 4.6%. Now that he's talking them up, makes me think that the market is fixing to rip again and yield are going to explode upward. Fed is out of tools to hold long term rates down. Hate to say it, but might be a great time to short 30 year treasuries and go long stocks.

Thu, 05/24/2012 - 21:15 | 2460971 Acorn10012
Acorn10012's picture

And that's why they say there are two sides to every trade. You have an interesting take...a bit contrarian but who knows?

Thu, 05/24/2012 - 19:34 | 2460709 RiverRoad
RiverRoad's picture

And the CME is making it easy for TPTB folks to move their money out of Euros and into gold and oil.  When the rush is into agriculture/food you'll know we're really in deep shit.

Thu, 05/24/2012 - 21:41 | 2461023 bagehot99
bagehot99's picture

Correct. 

Thu, 05/24/2012 - 18:31 | 2460544 Xkwisetly Paneful
Xkwisetly Paneful's picture

Absolutely!

Better to buy after they plow $700billion in with a sharp contraction of the money supply besides.

 

 

Thu, 05/24/2012 - 19:08 | 2460646 blueridgeviews
blueridgeviews's picture

Love the sarcasm!

Thu, 05/24/2012 - 20:20 | 2460831 skepticCarl
skepticCarl's picture

It's satire, actually.

Thu, 05/24/2012 - 18:17 | 2460494 Xkwisetly Paneful
Xkwisetly Paneful's picture

Have the corresponding inflows of the retail into the metals?

No! That can't be! The metals are the sharp square trade!

Thu, 05/24/2012 - 18:22 | 2460516 Joe The Plumber
Joe The Plumber's picture

GLD is still the biggest etf right?

Thu, 05/24/2012 - 18:34 | 2460559 Bill D. Cat
Bill D. Cat's picture

This one time , on a dare , I tried pulling out . Unfortunately , I'm still paying for it .

Thu, 05/24/2012 - 20:43 | 2460893 UP Forester
UP Forester's picture

The next 18 years are gonna be a bitch, eh?

Thu, 05/24/2012 - 22:14 | 2461091 moonshadow
moonshadow's picture

and then come those college student loans! Halp obama! haaalp!

Thu, 05/24/2012 - 20:27 | 2460845 WatchingIgnorance
WatchingIgnorance's picture

MARKETS = CASINOS.

Don't end up selling your hair to a wig shop!

Fri, 05/25/2012 - 00:09 | 2461302 peekcrackers
peekcrackers's picture

You would have a better chance shooting craps in a back alley in Deroit .

Thu, 05/24/2012 - 21:14 | 2460969 jus_lite_reading
jus_lite_reading's picture

LMAO!! Are you the new Million Dollar Bonus aka Hairy Wanker aka Hamy Wanger etc etc etc?

You've got to be kidding...

Or as dumb as Leo Kalakas...

Or one of Obumbos brand spanking new propaganda AI puppets trolling the internet...

Fri, 05/25/2012 - 05:55 | 2461568 Element
Element's picture

Well he does sound audaciously hopeful.

Thu, 05/24/2012 - 18:07 | 2460465 HD
HD's picture

Exactly right.

Thu, 05/24/2012 - 18:35 | 2460560 Cdad
Cdad's picture

@brother boiler

Per the question of manipulation...maybe in the very short run.  However, you cannot have stable markets without capital formation.  With capital running away at full speed from these stupid, totally bogus markets, all you will really ever have is volatility.  Which will, of course, drive even more capital out of the markets...which is why Ben Bernanke keeps printing dollars...and round and round we fuckin' go.

Way to go Ben!  Way to go criminal syndicate Wall Street!  You have killed capital markets.

I feel your frustration, Boiler...but take heart.  The dipshits on Wall Street have now opened a 60 point S&P gap...between here and the breaking point at 1280.  This is going to be fun.

Thu, 05/24/2012 - 20:25 | 2460841 skepticCarl
skepticCarl's picture

"retail money (RIP) has found other ways to amuse itself."  The most popular way is buying ETF's, instead of old fashioned MF's.

Thu, 05/24/2012 - 17:42 | 2460364 Conrad Murray
Conrad Murray's picture

Boomers are cashing out. Young people have no jobs, so no money to invest.

Game over.

Thu, 05/24/2012 - 18:19 | 2460505 Caviar Emptor
Caviar Emptor's picture

Sums it up, buddy. The chips are gettin cashed in. It gets pretty sad when there's only 2 of you left at the craps table and everyone else has gone. The croupiers all try to keep it cheerful and snappy, pretending that everything is fine. But it's not. Still they only have one speed: fast, so that you make more losing bets that they can scoop up. 

Thu, 05/24/2012 - 19:27 | 2460700 Cdad
Cdad's picture

Good thing the financial services industry is as bloated as it still is!  Buy bank shares and be the mostest smart "value buyer" on your block!

Thu, 05/24/2012 - 17:44 | 2460367 GenX Investor
GenX Investor's picture

We love hot grenades, it's what we do down at the Shore with our wing-men!

Thu, 05/24/2012 - 17:52 | 2460404 Paul Atreides
Paul Atreides's picture

hi ho hi ho it's hand grenades I throw...

Thu, 05/24/2012 - 20:44 | 2460898 UP Forester
UP Forester's picture

Hot grenades are expensive, what with the thermite and all.

Molotov Cocktails are much cheaper.

Thu, 05/24/2012 - 17:44 | 2460368 malikai
malikai's picture

iCrap.

Thu, 05/24/2012 - 17:44 | 2460371 ACP
ACP's picture

Not only is there no trust in the markets, a lot of people simply need the cash.

Thu, 05/24/2012 - 17:50 | 2460396 devo
devo's picture

Couldn't you use this as a bearish argument against gold, too?

i.e. If people need cash for basic necessities they're not going to have money to put into gold and silver. I think a large part of the continued bull market and eventual bubble relies on joe sixpacks getting into gold.

Thu, 05/24/2012 - 18:03 | 2460449 AustriAnnie
AustriAnnie's picture

I think you just demonstrated how much higher gold has to go.  It will be awhile before Joe Sixpack cancels his cable, and his monthly igadget contract, drives less to save on gas, and transfers that money into gold.

We are nowhere near that yet.  It will take a lot of fear/greed for that to happen.  And until it does, there are many who argue that the top can't be called.

I tend to agree.  

Nobody had the money for a house, either.  But they still bought them.  When Joe is borrowing to buy gold maples, that will tell us something.

Thu, 05/24/2012 - 18:08 | 2460467 devo
devo's picture

If Joe is charging gold maples on his credit card (which he never intends to pay back) the government/JPM will flip their wig, though. This should get interesting.

Ps. No need to thumb me down, guys. I love gold and silver just as much as you do. I'm just asking a question.

Thu, 05/24/2012 - 18:15 | 2460488 fuu
fuu's picture

"I think a large part of the continued bull market and eventual bubble relies on joe sixpacks getting into gold."

Right. It has nothing to do with fiscal policy, debt load, and what not.

Thu, 05/24/2012 - 18:20 | 2460508 AustriAnnie
AustriAnnie's picture

The early movers (those who buy at the bottom) are the ones who know it has everything to do with fiscal policy, debt load, and what not.

Joe Sixpack will buy PAPER gold for the wrong reasons at the wrong time.  Just because he heard its "the thing to do."  He will not understand the value of physical, firstly.  Secondly, if he buys the physical, he will be doing so to try to make a buck selling it immediately (not for insurance against fiscal policy and debt load run amok).

Thu, 05/24/2012 - 18:38 | 2460569 devo
devo's picture

What about the supply side of the equation? As Joe Sixpack buys at the wrong time, more and more upstart miners begin producing and saturating the market. We see this in action on the TV show "Gold Rush".

I think gold bulls should want oil to rise as it will slow down production/supply. Speaking of supply, I noticed Gainesville is out of 10oz silver bars. Interesting...

Thu, 05/24/2012 - 18:48 | 2460591 AustriAnnie
AustriAnnie's picture

How much mining until the physical even gets close to meeting the paper claims on said physical?

All the mining in the world just cannot keep pace with the rate of printing, IMO.

I just don't see "too little fiat chasing too much gold".   If that happens, I think it would happen in paper markets, which don't mean shit to me.  I stored my labor hours in gold at a certain price.  I'll extract those labor hours from gold and exchange them for consumption of goods, at a certain price.  All the events in the middle, while significant to the world, don't affect my willingness to buy and hold PM's.

Thu, 05/24/2012 - 18:53 | 2460608 devo
devo's picture

I agree, but a "mining bubble" could reduce purchasing power (in theory, and depending on several factors) even in a currency collapse. Say inflation is 10% and gold extractions goes up to 5%. The gold would be worth more than the paper, but it might only be able to buy a cabin instead of a single family home.

I buy gold for the same reason you do. I'm just thinking out loud. We can move on.

Thu, 05/24/2012 - 19:16 | 2460671 Xkwisetly Paneful
Xkwisetly Paneful's picture

Who holds the most gold?

Same folks who run the printing presses?

The idea that somehow gold is a safe haven from same folks you desperately trying to hide from all the while they are the gold market is hysterical!

It has to do with future demand, without QE to infinity it has already been shown gold has no more buyers than anything else.   Oddly though, that is not true  with equities is it? Afterall the retail guy does not own it up to his eyeballs already like he does gold.

As they trade near 52 week lows and the YOY returns are commensurate with most other asset classes.

 

Thu, 05/24/2012 - 19:40 | 2460730 fuu
fuu's picture

"Afterall the retail guy does not own it up to his eyeballs already like he does gold."

You're fucking high.

Thu, 05/24/2012 - 23:31 | 2461204 Tijuana Donkey Show
Tijuana Donkey Show's picture

I resemble that remark

Fri, 05/25/2012 - 00:54 | 2461354 fuu
fuu's picture

Not that there is anything wrong with that per se.

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