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The Ultimate Divergence: Birinyi's Ruler Predicts S&P At 5000 When Volume Hits Zero

Tyler Durden's picture




 

In a day like today, when stocks and bonds are rallying, indicating that the market is once again convinced Fed "bad cop" Fisher was full of it, and more easing is expected (as noted earlier), and with NFP set to fall on a market holiday, thus the number, if weak, can be spun as one ushering in more QE over the weekend, one can only sit back and have fun with Birinyi's ruler. Which in turn brings us to the following conclusion: with the market in 2012 once again in a straight diagonal line, just like in early 2011, gaining 50 SPX point each month regardless of news, climatic conditions, liquidity and frankly anything else, it is quite obvious that the S&P market will hit 5000 by December 2019, a date which is also notable because as the second Birinyi ruler chart shows, that is when trading volume will officially hit zero.

Birinyi vs stocks...

and volume:

 

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Mon, 04/02/2012 - 13:03 | 2309960 Spooky Polish
Spooky Polish's picture

Ohhh ... Bullish ? 

or just bear shit to eat. Maybe some WS suckers will call it honey... 

 

 

Mon, 04/02/2012 - 13:11 | 2309975 idea_hamster
idea_hamster's picture

2019 != 2020, but point taken....

Mon, 04/02/2012 - 13:23 | 2310007 Manthong
Manthong's picture

Change we can believe in.

Mon, 04/02/2012 - 13:28 | 2310017 Precious
Precious's picture

This charlatan Birinyi admits he's been clipping articles from shitrags like Fortune for the last 50 years.  That's the basis of his insights.  What a fucking joke.  What's more ridiculous than Birinyi are the fools who put money in his fund.

http://finance.fortune.cnn.com/2012/03/09/laszlo-birinyi-market-bull/

Mon, 04/02/2012 - 15:13 | 2310353 Carl Spackler
Carl Spackler's picture

The explanation would be called hyperinflation ala Weimar but the"Ruler" is a figment of Birinyi's imagination.

 

 

 

Mon, 04/02/2012 - 13:05 | 2309964 Problem Is
Problem Is's picture

Yeah... that can be the problem with extrapolations...

Extrapolate: To infer or estimate by extending or projecting known information...

Mon, 04/02/2012 - 13:46 | 2310083 WestVillageIdiot
WestVillageIdiot's picture

At the rate I was growing when I was 15 I figured I would be at least 11 feet 7 inches by this point in my life.  I still can't figure out where my math went wrong.

Mon, 04/02/2012 - 13:54 | 2310101 DavidC
DavidC's picture

WVI,
That was hilarious! Thank you!

DavidC

Mon, 04/02/2012 - 17:09 | 2310780 Spooky Polish
Spooky Polish's picture

2 much cigarettes 

Mon, 04/02/2012 - 13:06 | 2309968 TwoJacks
TwoJacks's picture

you need sellers for stocks to drop..  if all buyers simply hold, even short sellers eventually have to buy back to raise prices.  it's the ultimate conspiracy - buyers have all apparently agreed to never sell again.

Mon, 04/02/2012 - 13:26 | 2310025 Dr. Engali
Dr. Engali's picture

There aren't any shorts to buy back their shares. It's a fucked up market.

Mon, 04/02/2012 - 13:48 | 2310089 WestVillageIdiot
WestVillageIdiot's picture

The shorts have been left bleeding on the side of the road so many times since 2009 that there is nobody to play that role anymore. 

I keep telling friends that I am more afraid of the system now than I was in early 2008 and I was scared shitless at that time.  It won't die in a momentary blast but in a long, drawn out whimper.  It's like having a Band-Aid ripped off slowly that runs from your toes to your eyebrows, that runs two circles around your groin area.

Mon, 04/02/2012 - 15:56 | 2310494 Quaderratic Probing
Quaderratic Probing's picture

Straight from Buffets book...the best time to sell is never

Mon, 04/02/2012 - 13:07 | 2309969 HD
HD's picture

It will be great. "I'm a millionaire - look at my stock portfolio. I'll tell you the secret of my investing success, just visit me at home anytime...I live in a van down by the river."

Mon, 04/02/2012 - 13:50 | 2310092 WestVillageIdiot
WestVillageIdiot's picture

"Woo hoo, we are all millionaires.  Now here is your $32.50 for that cheese sandwich you have in the case." 

Mon, 04/02/2012 - 13:07 | 2309971 Catullus
Catullus's picture

Law of the Nth + 1 Bagholder.

Mon, 04/02/2012 - 13:13 | 2309974 hedgeless_horseman
hedgeless_horseman's picture

 

 

The rise and fall of the American empire.

The money supply and real GDP will look about the same as the above two charts.

Mon, 04/02/2012 - 13:31 | 2310043 malikai
malikai's picture

Are you implying you do not believe in the Global Economic Recovery©? Are you al-queda?

Mon, 04/02/2012 - 13:51 | 2310095 WestVillageIdiot
WestVillageIdiot's picture

I wish I could get my Johnson to look like a chart of the rise in sovereign debt over the past 10 years. 

Mon, 04/02/2012 - 13:10 | 2309976 yogibear
yogibear's picture

The rally monkey is banging the cymbals again. You know what time it is again?

Bernanke and the Federal reserve will just keep expanding this bubble.

Mon, 04/02/2012 - 13:11 | 2309978 Stoploss
Stoploss's picture

Yeah, how 'bout that bond action of late? Just when you think you've seen it all, you get green mkt AND bonds, at the same time! LOL!!!

Mon, 04/02/2012 - 13:12 | 2309980 SmoothCoolSmoke
SmoothCoolSmoke's picture

Birinyi, "SCOREBOARD!"

Sad, but true.

Mon, 04/02/2012 - 13:14 | 2309987 Xue
Xue's picture

S&P will be at 5000 when my coffee will be at $50.

Mon, 04/02/2012 - 13:32 | 2310045 a growing concern
a growing concern's picture

Don't worry, though, because you'll be making $100,000 a year.  You'll be rich, I tells ya!

Mon, 04/02/2012 - 13:15 | 2309988 kito
kito's picture

it is quite obvious that the S&P market will hit 5000 by December 2019:

ha, like there will be a functioning market by then!................................

Mon, 04/02/2012 - 13:21 | 2310000 kito
kito's picture

oh wait.....there isnt a funtioning market now........................silly me...............

Mon, 04/02/2012 - 13:22 | 2310002 ghengis86
ghengis86's picture

We don't even have one now

Mon, 04/02/2012 - 13:19 | 2309999 q99x2
q99x2's picture

That means that if in 2019 I sell my one share of AAPL and there are no buyers that I'll singlehandedly crash the market. But I guess that everyone is a buyer in 2019 so the market would go to infinity whenever someone decides to sell a share. Something doesn't seem right.

Mon, 04/02/2012 - 13:21 | 2310001 Milton Waddams
Milton Waddams's picture

By 2019 there will be no market.  Some Bernanke-clone will simply declare the fair value of each individual stock.  'Our analytical models indicate that the fair value of Walmart, based on real time data, is $23981.  All transactions in the equity shall be conducted at that price until further notice.'

Mon, 04/02/2012 - 13:22 | 2310006 bugs_
bugs_'s picture

it may be illegal to sell by then

Mon, 04/02/2012 - 14:36 | 2310249 SilverCoinLover
SilverCoinLover's picture

If the Supreme Court upholds Obamacare in June, by 2019 we could all be mandated by government to do just that, everyone forced to buy and hold stocks by law with selling only allowed by permission! If they can force us to buy health insurance, they could force us to buy anything!

Mon, 04/02/2012 - 13:23 | 2310009 Pecunia Non Olet
Pecunia Non Olet's picture

Such manipulation destroys the edge

Mon, 04/02/2012 - 13:24 | 2310011 monopoly
monopoly's picture

It is so hard to even relate to all this if you are living in America. But, that was the America of the history books. And as far as bonds go, a 30 year bull market in bonds does not end in one or two months. Patience all, patience, Benny will lose it and Not get it back. 

Mon, 04/02/2012 - 13:30 | 2310036 smb12321
smb12321's picture

You are right.  All predictions of collapse next ___(fill in time frame) are absurd.  Collapse may be inevitable but it is not predictive.  Next to the debt bubble, the bond bubble is the scariest.  Just as frightening is the loss of private citizens and foreigners from treasuries.  It's apparent that the Fed (now buying 70%) will soon be the only buyer of treasuries in a ZIP market.

Mon, 04/02/2012 - 13:24 | 2310012 junkyardjack
junkyardjack's picture

By then everyone will just be trading Mega Millions tickets

Mon, 04/02/2012 - 13:24 | 2310014 smb12321
smb12321's picture

What will happen is that John Q will jump in at the end in time for the crash.  I say, the trend is your friend.   The ONLY way to lose money in the market is by investing on the up side in a bear market (or conversely, going short in a rising market).  An idiot can make money in anu market by following trends but the fool tries to buck the trend.

So, buy precious metals, invest and keep those S&P "black swan" puts up to date.

 

Mon, 04/02/2012 - 13:25 | 2310020 Sudden Debt
Sudden Debt's picture

Hope is not an option. There is too much debt, too little cash-flow, too many promises, too many lies, too little common sense, too much mass delusion, too much corruption, too little trust, too much hate, too many weapons in the hands of too many crazies, and too few visionary leaders to not create an epic worldwide implosion.

Mon, 04/02/2012 - 13:27 | 2310028 monopoly
monopoly's picture

Sudden, you are right. And....we have the same scenario here in America. Same problems, same thieves, different faces and accents.

Mon, 04/02/2012 - 13:28 | 2310030 WAMO556
WAMO556's picture

hey, I just read that somewhere???!!!

Mon, 04/02/2012 - 13:33 | 2310046 Sudden Debt
Sudden Debt's picture

Yep, marketingoracle, I found it so good I copied it

Mon, 04/02/2012 - 13:26 | 2310022 monopoly
monopoly's picture

And then you will have gold, PMs and interest rates all rising at the same time. Now that will be a sight to behold. 

Mon, 04/02/2012 - 13:26 | 2310023 lizzy36
lizzy36's picture

Ask no questions.

If $4 a gallon gas is good $5 a gallon will be great. (costanza market).

Ask no questions.

Buy the dip and everything else.

Ask no questions.

Liquidity is the solution.

Ask no questions.

Remember the trend is your friend.

Ask no questions.

Igonorance is bliss, and just buy the fucking rip!

Mon, 04/02/2012 - 14:02 | 2310105 hedgeless_horseman
hedgeless_horseman's picture

 

 

Ask no questions.

Nations must run deficits.

 

Mon, 04/02/2012 - 13:28 | 2310033 swissaustrian
swissaustrian's picture

SkyNet will have forced everyone out of the market by 2020.

Mon, 04/02/2012 - 13:31 | 2310040 monopoly
monopoly's picture

Even my bride of 30 years just advised with gas over $4.00 the sheeples will stop driving again. I advised, "dear", lol, there is no demand, the rise in price is due to the absurd policies of the inmates at the aslyum. Lets see what happens as we reach a 5 handle. She gets it now, but most do not.

Just buy AAPL, AMZN and CMG. Oh and GRPN on the "dip".

Mon, 04/02/2012 - 13:35 | 2310054 a growing concern
a growing concern's picture

You forgot LULU, jacktard!  It's the cornerstone of any sound portfolio!

Mon, 04/02/2012 - 13:37 | 2310059 monopoly
monopoly's picture

thanks a growing....I am on it. :)

Mon, 04/02/2012 - 14:08 | 2310150 junkyardjack
junkyardjack's picture

RGR for all the people hoping for the end of the world

Mon, 04/02/2012 - 13:37 | 2310055 LawsofPhysics
LawsofPhysics's picture

Ahh yes.  We will all be "wealthy" beyond our wildest dreams, but as soon as someone trys to sell and/or buy anything we find out...  wealthy?  ...not so much.  Take stock in a bride of 30 years as most last less than a year these days.

Mon, 04/02/2012 - 13:34 | 2310051 BlackholeDivestment
BlackholeDivestment's picture

...2019 zero mark on the chart? Interesting optimism. http://www.youtube.com/watch?v=Ebb_2StFk3E 

...eh, -3 years ain't a bad miss is it? Lol 

http://www.youtube.com/watch?v=fXq81-cGJr4

Mon, 04/02/2012 - 13:34 | 2310052 MFL8240
MFL8240's picture

This is actually disgusting to read.  To think that all this whole economy is hinging on manipulation and games by a handful of bankers makes me want to vomit.

Mon, 04/02/2012 - 13:38 | 2310060 LawsofPhysics
LawsofPhysics's picture

yes, but it certainly makes it easy to know who to bet on in the short term anyway.

Mon, 04/02/2012 - 13:39 | 2310069 YesWeKahn
YesWeKahn's picture

Bernanke's last words: "cough, cough, is S&P 5000 yet? my policies finally worked, ...".

Mon, 04/02/2012 - 13:40 | 2310072 TradingJoe
TradingJoe's picture

Who ever goes long here is TOAST, who ever goes short here is...you guessed it TOAST...:)))! Phyzzz It Izzzzz!

Mon, 04/02/2012 - 13:51 | 2310094 slaughterer
slaughterer's picture

There are plenty of charts worth shorting without putting yourself in the toaster.  Seriously, today opened up the wild-game park for shorts galore.  Put on your jungle gear. 

Mon, 04/02/2012 - 13:56 | 2310109 DavidC
DavidC's picture

It IS a bubble and it WILL burst at some point....the only problem is when.

Look what happened last August, 12,800 to 10,400 in less than three weeks, and the only thing that's changed since then is Governments having MORE debt and the Fed leveraging itself up even more.

DavidC

Mon, 04/02/2012 - 14:11 | 2310161 slewie the pi-rat
slewie the pi-rat's picture

rilly?

quick!

somebody adjust that fuking azteCollinator for the damned 60's; and get me some0dat haroldCamping to talk at, stat!

Mon, 04/02/2012 - 14:42 | 2310279 SilverCoinLover
SilverCoinLover's picture

That current dip in volume is spooky. Nearly all the other dips occurred during the last week of December which is to be expected. If the current one is for real, vol could in theory hit zero by next year!

Mon, 04/02/2012 - 16:13 | 2310569 Koffieshop
Koffieshop's picture

Yeah.
The only other mid-year dip that superseded it's previous December dip is in 2008 in that chart.
Something is happening.

Mon, 04/02/2012 - 15:30 | 2310386 resurger
resurger's picture

lol Tyler!

Mon, 04/02/2012 - 16:05 | 2310540 Hook Line and S...
Hook Line and Sphincter's picture

Birinyi also said the sky is blue and things fall towards the ground.

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