US Yield Curve Crashes Most In 6 Years As Stocks, Bitcoin Hit Record Highs

What could go wrong?

 

Small Caps exploded higher today, driven by financials, presumably on tax reform hype.. but after Bob Corker said "yes" there was some notable "sell the news"...

Notably, as soon as the cash market closed, futures ripped to the highs of the day...

 

On the week, Nasdaq (green) and Dow (red) outperformed as Trannies (blue lagged)...

 

Tech outperformed on the week but financials lagged...

 

Oddly, high-tax companies notably undeperformed low-tac companies on the week....

High yield bonds lagged notably on the week...

 

Yields were mixed on the week with the short-end higher and long-end outperforming...

 

30Y Treasury yields are at their lowest since September's Draghi taper tantrum...

 

The 5s30s yield curve crashed 10bps this week to 52bps (the last two days post-Fed have seen the biggest curve flattening since June 2009)...

 

The weekly plunge is the biggest percentage flattening of the Treasury curve since the US downgrade in the fall of 2011...

The yield curve is down 5 straight weeks

 

The Dollar ended the week modestly lower, after chopping around on The Fed and tax headlines (and CPI)

 

Huuge week for copper but crude ended the week lower...

 

Bitcoin rose 13.5% this week - the 5th weekly gain in a row to a new record high...and gold managed to hold gains...

 

And Futures compressed their premium to spot...

 

And finally, there is a very serious dollar shortage around the world...signalling ominous signs of growing funding stress in the financial “plumbing”.

 

Comments

Hammer823 Fri, 12/15/2017 - 16:03 Permalink

Rally Program #2 run today.  Rise all morning until mid-day.  Flat line in the afternoon. Fade at close.  Textbook.Recipe for a guaranteed bull market:Rally on speculation of tax plan: +300 pointsPresent actual tax bill: + 300 points1st House vote passes: + 200 points1st Senate vote passes: + 200 pointsNegotiate bills: + 200 points2nd House vote passes: +200 points2nd Senate vote DOES NOT PASS: -200 pointsDJIA still will gain 1,400 points on the tax plan, even if the plan FAILS TO PASS. The speculation of something happening is all that matters to our stock “market”

spastic_colon Fri, 12/15/2017 - 16:18 Permalink

so who were the dumbasses (/s) that were selling in the wee hours election nite that suddenly got religion in the even wee-er hours before market open then?? the "cuz trump got elected" meme just doent fly with me..........but apparently it does with jp morgan.

Hammer823 Traderone Fri, 12/15/2017 - 17:26 Permalink

It’s nice when you make a bullish bet on good news and the market rallies when it happens. Why anyone would short a market rigged to go up is beyond me. Bears are right half the time with missed expectations or bad news but they still lose, since bad news is good news and the market rallies anyway.

In reply to by Traderone

Nature_Boy_Wooooo Fri, 12/15/2017 - 16:28 Permalink

My prediction.........bears shorting Bitcoin at CBOE get REKT this weekend after they all clock out for the weekend. Welcome to Bitcoin boys there is no weekend time with the family and no sleeping at night, this machine runs 24 hours a day 7 days a week. We've been waiting for you........ enjoy your weekend.

adr Fri, 12/15/2017 - 16:53 Permalink

SO we make Populous, a crypto invoice trading company, a $2 billion business before they even have a product ready in a market that may never be utilized.Investors buy tokens that will be used as collateral for the loans made against unpaid invoices. The crypto investors believe that this means the tokens must increase in value to match the value of the invoices being processed. If Populous trades $100 billion in invoices, one token must be worth $1,800. The other part is that you will receive dividends based on the fees Populous charges for using its network. The more tokens you hold, the more of your own capital you pledge as collateral, the more dividends you receive.The original white paper says the tokens were supposed to be stable and pegged to currencies like the dollar so buyers and sellers would know they were receiving exactly what they are settling on. I guess that isn't happening.SO what is invoice trading? Well it is a bit like payday lending. You have an outstanding invoice worth $3 million that is due in 90 days, but need some cash right now. You decide to sell that invoice for a reduced amount to get the cash now. Essentially being loaned money that will have an interest rate attached to it. But what happens if you don't pay the money back? What if you get stiffed on the invoice?So Crypto investors will be pledging their tokens as collateral for these invoice loans. Supposedly this is to make the invoice trading feel safe to those involved on the buying end. I'm trying to figure out how you keep your tokens if they need to be paid out if a deal falls through. I guess they are trying to make you believe that such a small percentage of deals will fall through that you will hardly lose any capital at all, and that the increased volume of transactions will cause so much appreciation in token value that it won't matter.I'm sorry but if I am doing business and some idiot in in Sri Lanka loans me $2 million on an unpaid $3 million invoice on my business in America, he deserves to lose his $2 million.What is this insanity?

silverserfer Fri, 12/15/2017 - 17:04 Permalink

crypto froth is just so foamy and bubbly. what a waste of time, and especially energy peoples. seriously. I know the markets broken but arent there like, roads and dams that need repair out there? 

Conax Fri, 12/15/2017 - 17:44 Permalink

That purple suit girl is pretty cute. Watch closely, the driver pumped the throttle from WFO to idle about three times as the boat went squirrely. He should have his Cap'n Ron license revoked.  Going too fast and no clue how to handle a boat that fast.  Enjoy the lawsuits, Cap'n!Dude looks like that CashnCarry bankster. To be cool, always shave your head.Back on topic, the equities will continue to boom til the end of the year because hey, there will be no bummers at the end of any year.  Bonuses and all that