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What's Spooking US Financials?

Tyler Durden's picture


Since just after the open on Tuesday, the major US financials have decided that they will not go Bove-like to the moon and in fact have fallen back quite notably. As European pain has re-emerged, of course, its Margin Stanley that is hurting the most (-5%) but the rest are down 2.5 to 3.5%. It seems once again that the major financials' stocks have got ahead of themselves (both relative to the market and their CDS).

The Major US Financials have been lagging notably since just after the open on Tuesday - as Spain started to deteriorate...


and once again (exemplified by JPM) have got ahead of themselves...


Chart: Bloomberg


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Thu, 08/23/2012 - 15:12 | Link to Comment HedgeAccordingly
HedgeAccordingly's picture

This bonds? 

Thu, 08/23/2012 - 15:24 | Link to Comment sickofthepunx
sickofthepunx's picture

could it be that, for all intents and purposes, they are insolvent?

Thu, 08/23/2012 - 15:42 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

And the mechanism would be that someone finally . . . FINALLY . . . took a good look at credit default swap exposure to not just Spanish sovereigns, but also bonds on Spanish banks, national AND regional.

If I was Rajoy, I would be out telling those banks to do everything in their power to increase swap traffic and swaps outstanding on themselves.  

A huge swap exposure allows Rajoy to demand money with no austerity.  The EU, terrified, would write checks.

Thu, 08/23/2012 - 15:35 | Link to Comment LMAOLORI
LMAOLORI's picture



I think Hedge Funds are part of it 

Hedge funds are betting on disaster

also the Fed

Oil near $100. Thanks a lot, Fed!

Thu, 08/23/2012 - 15:15 | Link to Comment Bam_Man
Bam_Man's picture

Somebody knows something "big" is going to happen soon. The gold price is the tell.

Israel about to bomb Iran? Greece/Finland/Germany about to drop out of the Eurozone? Something else entirely?

Thu, 08/23/2012 - 15:32 | Link to Comment veyron
veyron's picture

meh.  If people thought something big would happen they'd be buying physical, not paper.  Especially someone like Soros ... why would he buy GLD and not the real thing?

Thu, 08/23/2012 - 15:38 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

Because if you own paper, you can control the price of physical. 

If you have the means, I highly recommend it.

The wealthy, who are already wealthy, are vying for political control.

Those who think gold is irrelevant are ignorant.  Those who think gold's relevance is tied to its price in any currency are also ignorant.

Gold is simply relevant.

Thu, 08/23/2012 - 15:38 | Link to Comment veyron
veyron's picture

Question still remains.  He has the choice of hoarding millions of dollars of gold or buying shares in GLD.  WHY GLD?  WHY NOT ALL PHYSICAL?

Thu, 08/23/2012 - 15:43 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

Why did he marry a younger wife?  Long answer: Illusions of immortality; Short answer: it gets his dick hard.

Thu, 08/23/2012 - 16:25 | Link to Comment gmrpeabody
gmrpeabody's picture

I can't figure out why you guys don't think he already has a shit load of physical...., paper is just icing on the cake and a piece of the price control.

Thu, 08/23/2012 - 15:43 | Link to Comment john39
john39's picture

no doubt he has more than he will ever need.  The GLD buy is about something other than wealth...  he is a player, power is the game.  his masters gave him an assignment, he carried it out...  why will no doubt become apparent later.

Thu, 08/23/2012 - 16:13 | Link to Comment bagehot99
bagehot99's picture

Perhaps he realizes he's The Rich™ as far as the street level Occupiers are concerned, and they might quite like to relieve him of his physical come the revolution. But he's the only one who can execute a sell order through his B/D. I'm doubtful if it all blows up that his B/D will even exist.

I'd keep it in big bars in my massive vault, if I were him - but I suspect he's done some of that too.

Thu, 08/23/2012 - 16:22 | Link to Comment AT
AT's picture

You can take physical delivery from GLD if you own enough shares.

Thu, 08/23/2012 - 16:25 | Link to Comment Solarman
Solarman's picture

Once you control 50,000 shares, you can redeem for physical.  Right from the vault.  He did this last time.

Thu, 08/23/2012 - 15:44 | Link to Comment scatterbrains
scatterbrains's picture

I agree plus the insiders would be pressing a break out near the 1900 highs on an eminent ease. This is still a head fake and in fact on a closing line chart basis gold hasn't broken out yet though it is on the knifes edge. I'd luv to get long but I'm not about to let these crooks bend me over.


Thu, 08/23/2012 - 15:19 | Link to Comment I am a Man I am...
I am a Man I am Forty's picture

the selloff in oil

Thu, 08/23/2012 - 15:20 | Link to Comment Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Everybody knows that the fight is fixed, the poor stay poor and the rich stay rich...

Thu, 08/23/2012 - 16:58 | Link to Comment falak pema
falak pema's picture

that the law of the Indian, aryan, caste system. We haven't budged an inch!

Thu, 08/23/2012 - 15:20 | Link to Comment Robot Traders Mom
Robot Traders Mom's picture

@Tyler-Hearing all the rumors of new TALF program-5 yrs 2% Housing refi under 700k, float to 1mo OIS+100 bps after the 5.

Any legs to this and have you covered/going to cover and I missed it?

Thu, 08/23/2012 - 17:03 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

count me too fuked up to remember, r_tz_mo

what were the de.e.e.tails of this program again?  L0L!!!

i just tried to find an article i recently read abt this but gave up;  as i recall, the article didn't think this bullshit was doing anybody who needed help any good really b/c the banksters still controlled things and could end-play people but maybe realtors@ and their "inverstors@"  found it useful in some ways?

or maybe that was the last one?


another down day and R_T will sober up and send for money to get back fromCabo?  ...  he slammed 75 poppers in 24 hours is what i heard  

spray the basement again?  we don't want him seein any bugs when he gets home!  ...  better bomb it mebbe?    Hahaha!

Thu, 08/23/2012 - 17:24 | Link to Comment Robot Traders Mom
Robot Traders Mom's picture

Side note: Why are you boozing without me?


I'll be singing at the Cock Pit tonight for a couple hours!

Thu, 08/23/2012 - 19:53 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

i'll be by for a virginTyler but i'll prob be outa this b4 i see you 

Acapulco Gold - YouTube  (canadian rap-i-rat version)

The Rainy Daze - "That Fuking Acapulco Gold" - YouTube  (older, more sedate denver'65 version)

Thu, 08/23/2012 - 15:24 | Link to Comment Hype Alert
Hype Alert's picture

Volume hasn't returned since Knight's fiasco and volume also took a major drop starting mid December 2011.  At least looking at my charts on SPY.  I'm not sure if Knight was the straw that broke retails back or if their is something else going on with the HFTs.  Something's just not right about this.


Not to mention, it's rigged.

Thu, 08/23/2012 - 20:54 | Link to Comment ZeroAvatar
ZeroAvatar's picture

Agreed.  The way everything seems to have 'turned on a dime' is just too freaky, teaky.

Thu, 08/23/2012 - 15:21 | Link to Comment adr
adr's picture

My guess is that the Big Banks were looking forward to partaking in some Spanish bailout money. We all know the Greek rescue package went straight to the banks.

If Spain doesn't request a bailout, that means no quick free cash for the banks.

With liquidity drying up faster than midwest corn, that ain't good for them banksters.

Thu, 08/23/2012 - 15:40 | Link to Comment hugovanderbubble
hugovanderbubble's picture

Spain wont recieve money for their banks till mid october

Thu, 08/23/2012 - 18:50 | Link to Comment ajkreider
ajkreider's picture

I agree. I mean if there's one thing banks don't have, it's cash. I'f only they had access to cheap capital, they'd be trading at two times book value.

Oh, wait . . .

Thu, 08/23/2012 - 15:37 | Link to Comment Jlmadyson
Jlmadyson's picture

Credit to gloomy but worth a discussion Tyler.

Top NY Times article:

Oh yea and Faber just said Germany into recession soon and global recession 100%.

Not so great for saving the EU then eh.

Thu, 08/23/2012 - 15:24 | Link to Comment Jlmadyson
Jlmadyson's picture


Thu, 08/23/2012 - 15:31 | Link to Comment not fat not stupid
not fat not stupid's picture

2012 volume drop = No new 401K money in equities.

Thu, 08/23/2012 - 15:37 | Link to Comment holdbuysell
holdbuysell's picture

Perhaps Bernanke needs to issue another several hundred million in reverse repos...just as a test of course.

Thu, 08/23/2012 - 15:38 | Link to Comment Randall Cabot
Randall Cabot's picture


Aug. 23, 2012, 3:25 p.m. EDT



Romney says he won't renominate Bernanke

Thu, 08/23/2012 - 15:43 | Link to Comment holdbuysell
holdbuysell's picture

Were his lips moving when he said that?

I recall another one of those Economic Deceivers (cough Obama cough), promising in 2008 to cut the deficit in half by now.

Thu, 08/23/2012 - 16:07 | Link to Comment Bay of Pigs
Bay of Pigs's picture

No, he'll pick someone even worse.

While Romney says he hasn't considered a single person, he added that Glenn Hubbard, who had given that interview earlier in the week, is "a wonderful economic adviser," and that Greg Mankiw is "likewise an excellent economic adviser."

Thu, 08/23/2012 - 15:46 | Link to Comment Monedas
Monedas's picture

Mitt no revomit Binky ?       Monedas     1929        Comedy Jihad Soul Is The Brevity Of Wit

Thu, 08/23/2012 - 15:58 | Link to Comment q99x2
q99x2's picture

If Dick Bove said anything positive recently there's your clue. Everytime that dirtbag opens his mouth financials take a dive. The man stinks. He doesn't shower and he lies -- always.

Thu, 08/23/2012 - 16:34 | Link to Comment poor fella
poor fella's picture

Don't get too cocky - Birinyi and Thomas Lee are lurking in a dark corner dismissing negative news and ready to scratch, poke, and pull the hair of all bears like a two-girl ninja rat-pack tagteam.

Thu, 08/23/2012 - 17:06 | Link to Comment orangegeek
orangegeek's picture

Global Economy = Runaway Train.


5 days to impact.



Thu, 08/23/2012 - 17:17 | Link to Comment negative rates
negative rates's picture

All kinds of financial tools, for all kinds of financial fools.

Thu, 08/23/2012 - 17:23 | Link to Comment mammoth mo
mammoth mo's picture


Could always be a trap.  As soon as we go Short they could moon us again.

Of course I went short anyway but just saying.

Thu, 08/23/2012 - 17:38 | Link to Comment ajkreider
ajkreider's picture

You lot crack me up. What's spooking financials? How about nothing?

Citi has been up over 20% in a month. This is just profit taking. Didn't see this kind of worry when the banks were surging.

Thank you. You may now go back to your self-congratulatory doomsaying.

Thu, 08/23/2012 - 20:02 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

give yer-self a greenie +1

that's not bad, even if it IS true!

it can not or can't not go unpunished

strangely, they seem to mean the same thing!  good shit, maynard!  i think i'm channeling rumsfeld!  does this mean war?

look at your timestamp

the ideologues are a-trollin tonite!  and you after just one week are now on their shit-list, too!  L0L!!!

Thu, 08/23/2012 - 21:56 | Link to Comment Ted Baker
Ted Baker's picture


Fri, 08/24/2012 - 05:14 | Link to Comment Grand Supercycle
Grand Supercycle's picture

SPX / DOW / NASDAQ / DAX / FTSE choppy daily charts are still breaking down.

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