SPX Swings
By Barry Ritholtz - May 19th, 2009, 11:30AM
Ron Griess of The Chart Store has such simple informative charts, I cannot help but linking ot them on a regular basis:
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In any great organization it is far, far safer to be wrong with the majority than to be right alone. —John Kenneth Galbraith
Macro Notes
US$ rally continuesPeter Boockvar
Asian currencies continue to sell off vs the $ on the heels of the news yesterday that South Korea said they will look into hot money inflows stemming from the $ carry trade and the Bank of Indonesia said they are looking into the foreign buying of bills. This follows the news a few weeks ago that Taiwan was limiting foreign deposit holdings and Brazil was taxing foreign inflow transactions. As I mentioned yesterday, we may have reached a short term pain threshold in terms of $ weakness and foreign countries are fighting back as they certainly won't wait for...
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May 19th, 2009 at 11:34 am
The 2008 Spring Fling ended a year ago today. “Sell the SPOOS, Lloyd. Buy the Twos.”
May 19th, 2009 at 12:01 pm
@ leftback.
Good catch, that’s interesting. Also, the Spring Fling 2009 ended with the same number of trading/calendar days as Spring Fling 2008? Anyone up for a trip down memory lane to 600ish?
May 19th, 2009 at 12:20 pm
another look out for inflation post, you’d expect nothing less of me. this one via Jon Nadler/Kitco this morning, “Repeat After Me: Inflation is Desirable”
Nobody wants to see home values fall further. The Hamptons have just experienced the largest decline in home values on record. Get ready for the new series “The Homeless Wives of New York.” Nobody wants 10 percent joblessness. Or, 12% in the case of Oregon. And, while it may be instant schadenfreude to walk by some Rodeo Drive chi-chi salon while it offers $5 haircuts by celebrity stylists, the end result of a downward spiral would not be pretty at all.
Thus, the time has arrived when more and more people are clamoring for inflation to make a real comeback. NOT the Weimar Republic-style or Zimbabwe on the Hudson-style inflation that is still being heavily advertised in every hard money newsletter. Just plain-vanilla 5%-ish inflation for a while, thank you. Yes, above Fed targets, for a period, but highly ‘desirable.’ http://www.kitco.com/ind/nadler/may192009A.html
(note from me, he’s almost as clever as LB.)
May 19th, 2009 at 12:35 pm
Karen,
For an inflationary scenario to make sense, there must be a feedback loop for salaries to increase. That is not going to happen for a number of reasons. 1) If we see inflation in commodities, input prices for companies will rise and they cannot pass those on to the consumer — thus earnings shrink and they have to CUT labor costs farther. 2) Globalization makes it impossible to support current wage imbalances for American laborers vs. ROW. Wages and living standards WILL find equilibrium eventually, which may be a shock to many. 3) If inflation starts, interest rates must rise, triggering another wave of defaults and further deterioration of balance sheets. Hence it rapidly becomes deflationary. Or if the government tries to guarantee everything, it will lose credibility in the eyes of foreign creditors and there would be a selloff, as each additional dollar raised makes default risk higher (see hyperinflation). 4) Inflation would put additional stress on consumers who are trying to repair household balance sheets — counterintuitively it is likely to reduce their consumption due to age demographics and a lack of savings.
You’re right that the FED would love to create 5% inflation, but it is simply not possible for many fundamental reasons. BB does not have the appropriate tools to fight deflation of the magnitude that we’re facing. He’s currently running an admirable bluff with an umbrella in the face of a tsunami.
May 19th, 2009 at 12:46 pm
trader’s market
May 19th, 2009 at 12:51 pm
I can’t wait until I’m big enough and my mom lets me trade the S&P. (;
….actually, it’s not my mom. It’s my position limits. Kind of a surrogate mother, except the cooking is bland…keeps me alive though. (:
May 19th, 2009 at 12:51 pm
@Gav Hath
Well articulated…BB is in a pickle (and i think he knows it)…So in all likelihood we’ll be in this game of trying to prop up equity prices for awhile, then some attention to the 10y & 30y if they start to tick up (as in last week)…It will be interesting to see how long this could last…I think it could come down when poor REVENUES actually get exposed…The past 2 months have been all about the HOPE for profits as OPERATING EARNINGS were improved and the hope that the consumer has turned the corner (as if this were a “normal” business” cycle)…
When we realize that that is not the case (that REVENUES are still in the dumps)…That will be the signal for the next leg down…
So who knows? This rally could continue all the way until the next earnings season starts (in July)…Maybe it’ll just meander around and attempt to bump up into some technical levels (like the 200MA) to pass the time…
Think about it…6 more weeks of A LOTTA NUTTIN would be PERFECT for many…The VIX keeps coming down making puts cheaper and cheaper (or PROTECTION for that matter)…
May 19th, 2009 at 12:55 pm
Karen,
Always respect your posts however I’m going to side with Gavshire on this one. Credit Deflation is already here.
On another note, has anyone ever looked at the 16.6 to 16.9 year Gold and DOW cycles? Very interesting to say the least.
May 19th, 2009 at 12:58 pm
looks like a could have squeezed another 50 cents out of DSX today. Anyone want to put any odds the market rolling over this afternoon?
May 19th, 2009 at 1:01 pm
Vix below 30: This means the next leg down is starting now.
http://www.marketwatch.com/story/fear-is-fading-but-is-that-good-for-stocks
May 19th, 2009 at 1:01 pm
So the S&P 500 has swung 70% since 3-4. That’s remarkable. And how much further will it appreciate?
May 19th, 2009 at 1:04 pm
ben22 @ 12:55
It may be true that credit deflation is already here but COMMODITY inflation is coming soon; and “inflation” in crude oil has been here for more than two months already. (The CPI is another subject altogether).
May 19th, 2009 at 1:07 pm
@ben22
I don’t know (market rolling over)…
I was really convinced last week that the Wednesday move would have some follow through…Friday tried but couldn’t do it…
Nothing CONVINCING about yesterdays move up either (very low volume as I pointed out on yesterdays close)…
My friend…I’m still in your camp on BOTH scenarios…I could see a move down to the 700’s, followed by a rally to the 200 day MA this summer, followed by the HORRIFIC decline (which I think takes out the march lows sometime in the August-October timeframe)…
However, I even see it possible that the market just ‘flags’ around here until the end of the quarter…So 965 – 1K is still possible – albeit now you’re talking about going ABOVE the 200 day MA)…
I don’t know…
TRADING for me therefore has ceased…I’ll sit tight with my ’short’ positions…if I start to see the 950 to 1k…I’ll start throwing more logs on that fire…
As for today…DUNNO…
May 19th, 2009 at 1:09 pm
From the VIX article:
“This might mean that we’re eventually headed for a setback,” Tower said. “I still see this as a stabilizing market in a stabilizing economy, but [the market] has come a long way very quickly.”
The problem is the actual data show a consumer that seems to be getting sicker. Combine that with rising interest rates and surging oil prices and you have a not so good picture for stocks.
Especially the surging oil prices which puts a damper on the Fed’s money printing campaign.
May 19th, 2009 at 1:11 pm
I am interested to see that someone is buying the short end of the curve today, maybe Lloyd really is buying the 2s.
Credit deflation and commodity inflation can co-exist, in moderation, by virtue of a relative currency devaluation – but the competitive printing and devaluation going on now will protect us from serious inflation – for a while.
May 19th, 2009 at 1:13 pm
DL,
Gavshire is still right. There may be commodity inflation (personally, I don’t see how), but that’s a gimme. With such low savings rates and stagnant incomes, how will people afford higher prices? If people can’t afford higher prices, won’t that mean lower consumption and lower prices? The invisible hand at work?
In the 70’s we had a great feedback loop that was very difficult to derail. I’d say we have a similar feedback loop as well now, just going the opposite direction.
Lowering interest rates makes those in the lending world rich. I suppose if you commit a larger and larger percentage of your workforce to pushing money around, it might happen, albeit that is IMHO an unlikely scenario and one that carries a much greater risk of collapse in the future.
I guess I just can’t see inflation taking hold. Can you tell us what you see, or how that can take place?
Thanks,
Chuck
May 19th, 2009 at 1:14 pm
@DL
I think what ben is trying to say is that CREDIT DEFLATION = COMMODITY DEFLATION…It’s a “demand” issue…
Commodities got bid up the past two months because they generally do in the first phase of a new business cycle (reduced production capacity coupled with expectation of higher demand = bottleneck)…
However, it will prove to be a FALSE MOVE because DEMAND has NOT picked up…ONLY HOPE FOR DEMAND HAS PICKED UP…
So commodities will stay under pressure…Gold is the pure indicator of all this because it has stayed ABOVE the industrial commodities all along…Some of the other relations (oil, copper) have narrowed that gap in this recent rally, but my point is…
If you start seeing GOLD give up $900 and start back towards $820 (or even $680 at worst)…Understand that DEFLATION is still well entrenched…
May 19th, 2009 at 1:16 pm
ben22, if you’d read nadler’s entire piece you might have found it more agreeable… that was an “open mind” test..
“The jury remains split at the moment. We remain apprehensive that the deflationary sled -once in motion- will be very difficult to halt. If it can be halted at all. As for inflation making a comeback, we’d give it at least three years, possibly more. Let’s first return to ‘flat stability’ if possible. Then, we can talk inflation. What we cannot talk about is out-of-control inflation.”
http://www.kitco.com/ind/nadler/may192009A.html
nadler’s commentary has been excellent of late. you might also check marty chenard’s take (cracks in the ice) on spx rsi: http://www.stocktiming.com/Tuesday-DailyMarketUpdate.htm
all said, i am not a one trick pony, lol.
May 19th, 2009 at 1:17 pm
cvienne @ 1:14
If you and Ben22 are saying that the CRB index is going to be LOWER in 18 months than it is now, I’m more than happy to take the other side of that trade.
May 19th, 2009 at 1:25 pm
I also think that the ratio of house prices to commodities could continue to decline for several years. (This could be expressed as a ratio of the Case-Shiller index to the CRB index, or expressed in terms of the number of barrels of oil it takes to buy the median-priced house). If that’s true, it would help keep a lid on the consumer price index.
Of course, one’s view on the strength of the U.S. dollar is important here as well.
May 19th, 2009 at 1:26 pm
@karen: We are convinced that you have many tricks up your sleeve.
@DL: Not 18 months, for sure. 0-6 months is where I am looking. Oil storage is full and demand is weak.
May 19th, 2009 at 1:28 pm
@DL
You’re going out 18 months…
I’m talking about the the next 6-9…Then I’ll re-evaluate…
@karen
How was the graduation ceremony?
May 19th, 2009 at 1:33 pm
leftback, i’m very impressed and pleased you didn’t say “skirt.”
dl, look at the $copper chart, again.. very nice. and the $tran… gotta luv this one, too.
8:59 (Dow Jones) A sustainable recovery in dry bulk shipping may be underway after last year’s huge plummet, according to Dahlman Rose & Co. Rising Chinese steel prices have pushed Capesize rates to more than $35,000 per day, firm says, helped by Chinese government stimulus supporting its steel industry. Dry bulk stocks are substantially leveraged to an improvement in steel demand outside China, which Dahlman sees as likely during 2H09. Depressed vessel rates could rise 20% on recent improvements in charter rates, firm says, which would help balance sheets. Upgrades Diana (DSX), Eagle (EGLE), Genco (GNK), Safe (SB), Star (SBLK) to buy and Excel (EXM) to hold. (EBW)
May 19th, 2009 at 1:36 pm
@DL,
Appreciate the thoughts and always enjoy your short and to the point posts. I agree you could have both exist at the same time but talking commodities is very broad. For example, while I believe that as the market really takes a nasty dive you could see gold rise, I don’t necessarily feel the same exact way about oil. As far as how I’d trade it, I wouldn’t buy the CRB Index b/c of what I think is coming. I think that will lose money, when the deflation really hits it will be like the flip of a light switch, which is why I also think the Fed or anyone else will be powerless against it. It does encourage me the more people on here I see thinking they have done enough to prop this up. It’s exactly what I hope for as we get closer to the top of this countertrend rally.
like LB, I believe inflation will come, just not anytime soon, and I think the credit deflation in the meantime puts a lid on all hard assets.
May 19th, 2009 at 1:38 pm
karen,
I didn’t read the article, just what you put up above. Thanks for calling me out on that one. That other para you include though is more along the lines of my own thoughts. I actually look forward to that inflation. I think equities are going to be so cheap before this is over that if you are smart enough to get ahead, and we then get inflation on the other side, you are going to do extremely well.
Oh, you are def. NOT a one trick pony. Clearly.
I would have been more inclined to hold on to DSX if they were still paying that fat Div.
May 19th, 2009 at 1:39 pm
cvienne @ 1:28
If, in six months, the S&P500 is no lower than it is today, then crude oil will, at that point, be substantially higher than it is today.
May 19th, 2009 at 1:40 pm
@DL
I’ll say this a different way…
What I want to see is ORDERS…SALES…REVENUE…
Actual companies making actual products that actual people buy with actual money…
When I read stories of empty container ships sitting idle in Singapore harbor, when I go to my local WAL-MART and see a lot of cars (yet 80% of the people inside are in the GROCERY SECTION -like me)…When I go to Home Depot and see most of the traffic buying mulch and pansies (instead of new kitchens & air compressors)…When I go to restaurants, and, unless it is a “college town” see most of the patrons as being senior citizens spending their $250 “one time”…
It leads me believe that PEOPLE ARE SPENDING LESS…
We don’t have a lot to go on…We had Q3 & Q4 ‘08 as horrible…Now we’re seeing Q1 ‘09 earnings and the whole ‘green shoots’ arguments is based on OPERATING EARNINGS…
Yeah that’s great…congratulations that you fired half your staff and that Lloyd Blankfein has dictated to sheep that that was the end of some classic BUSINESS CYCLE, so now we should call up stocks in the expectation of HIGHER PROFITS at some point 6-9 months in the future…
I DON’T BUY IT…
Show me the people…and SHOW ME THE CASH that they have to buy stuff with it…
Until then (and probably not much farther than when we actually see the REVENUES from the actual companies making the actual widgets that actual people buy with actual money)…I’m skeptical…
May 19th, 2009 at 1:44 pm
@DL,
One more thing, I’m with the others above that I wouldn’t really take that bet over 18 months. You would win that. When the deflation hits, imho it will come really fast and I think we are really close to that happening. 18 months puts us out at the end of 2010 roughly and I think that the real bottom will be in by then so you would be right. Buying here though, and riding it up and down might not get you anywhere.
I can share with you though, on top of the banks and AAPL, the most demanded asset class from retail is OIL so far in 2009. They all tell me the price it is going to as well.
I’m just saying I wouldn’t buy any commodities right now, right here right now. I think you’ll have a steal of a price to buy them at some point in the next few quarters though.
Disclosure: I’ve been long all sorts of hard assets or equities that deal in hard assets during this rally.
May 19th, 2009 at 1:45 pm
ben22:
I’m just waiting for a significant correction in the SPX. After that, I’m going to load up on EWZ and OIH.
May 19th, 2009 at 1:49 pm
@DL,
One more, one more thing. I just re-read your post at 1:25. A few comments.
I think the US $ stays strong, contrary to what many believe will happen to it, which is also another reason I wouldn’t buy oil here.
Also, to your point about how many barrels of oil does it take to buy a home. The chart that tells me the most that deflation is here is the DOW priced in Gold.
May 19th, 2009 at 1:51 pm
>> For an inflationary scenario to make sense, there must be a feedback loop for salaries to increase.
Why?
If asset and commodity inflation occurs without salary increases, then Americans will simply have to spend less on discretionary items, such as casual dining and new electronics. (Are we capable of doing that? Can we the people do that for a few years, to repair our balance sheets? Yes we can.)
It would be *nice* for salaries to increase. But, we know they won’t.
China will have to consume more of its production domestically, while we tighten our belts and spend proportionally bigger outlays of our personal incomes on food, clothing, and a roof overhead.
May 19th, 2009 at 1:51 pm
DL,
That’s probably smart. I was also long EWZ at one point this year along with FXI which I talked about on here very early in the year. They were my two international plays along with other global stocks I owned. I’m still in FXI though I have since sold EWZ. I owned a little PetroBras as well but have also sold that. Wasn’t smart enough to buy any Russian ETF’s.
I’m sure you’ll do fine.
May 19th, 2009 at 1:54 pm
It’s funny that the “we *need* inflation” motto comes after someone mentions how this debt implosion is hurting the Hamptons.
I’ll break open a bottle of my finest crocodile tears. (”Oooh, look: 2001 vintage”.)
May 19th, 2009 at 1:55 pm
Ben22
Regarding the USD. Strong for how long? Yes, if the SPX drops down to 700, the USD will rally. Once that correction in stocks is out of the way, however, I think that the dollar will decline.
I just think that we’re going to pay a huge price at some point for the massive printing by the Fed.
May 19th, 2009 at 1:56 pm
“@leftback, i’m very impressed and pleased you didn’t say “skirt.” ”
Karen, I usually try not to think what TBP posters are wearing, especially dead hobo. Besides, many of us imagine you trading in a bikini on a shady patio overlooking the beach, while occasionally admiring hard assets.
@ben22: LOL. J Retail always knows EVERYTHING, that’s why he is THE MAN at Uncle Chuck’s House. “Gimme Five, Johnny. How’s that BAC stock workin’ for ya, man? Outstanding…”
After making 200% in UEC and 100% in GMO, I’d say the easy money in materials has been made. With regard to oil, Mish and Gartman have had great pieces on contango and the way this stimulates crude oil storage, and why it is a sign that oil is currently overbought. Until this narrows, I probably will not get bullish again.
May 19th, 2009 at 1:58 pm
@DL
Let me ’second’ what ben22 just wrote 1:44…
Full disclosure:
I have been long gold since 2004 (@ 375 an ounce)…I don’t even own the ‘paper gold’ I own the BULLION (and I have a lot of it)…Yet I’m not worried about a price decline here…Hell, I own the bullion so it’s not like I can click and sell anyway…I think the stuff is eventually going to 6x the S&P…But right now, I think it could even go down to the $680 – $820 range (gold)…
Oil…I agree with you as well LONG TERM…but that has MANY different currents which underly the price (whereas GOLD is a lot more stable as an indicator)…Oil could spike due to a geo-political event (like if Israel decides to take out Irans nukes)…China could float its currency (which would crush the dollar) and oil would spike…hurricanes, pipelines, whatever you want to nominate…It’s all possible…
But right now I see CREDIT DEFLATION in the world and that is going to keep oil demand under pressure…
The point at which oil inflates again will be that point when the US “policy” becomes so focused on ALTERNATIVE ENERGY that it forgets that the world runs on oil…Incentive for domestic production will not be profitable (which will eventually cause the next bottleneck)…Ironically, it will hurt Americans more than it will hurt the ROW…
So for 6-9 months, I think we’ve seen near the highs for oil (unless some EVENT DRIVEN thing occurs)…After the next ‘dip’ in the S&P…I’ll be buying ALL hard assets hand over fist…
May 19th, 2009 at 1:58 pm
@manhattanguy http://www.ritholtz.com/blog/2009/05/spx-swings/#comment-173293
More like VIX is crashing through $30. It is dropping faster than it did through the $40 mark.
Now if only I would have had the courage to buy those July $80($70…$60….$50) VIX puts when they were a few bucks. Or even picked up a bushel of the July $25 puts when they were trading for dimes just a few weeks ago. They are worth close to a buck today. I had the conviction, just not the courage
May 19th, 2009 at 2:01 pm
The commencent address for the class of 2009 political science graduates was given by Richard A. Muller, Professor of Physics, UC Berkeley. The two inspirational takeaways from the speech were why it’s termed a “commencement” and not a graduation, and secondly, while 2009 may seem a daunting and challenging year to begin, there have been other periods in world history, equally as bad or worse… it wasn’t a particularly rousing presentation.. but it was practical and mixed with humor, of course. Other than that, the sun was out, it was loooong, and I did get a little teary when my son’s girlfriend walked the stage.. the reason I was attending : )
May 19th, 2009 at 2:02 pm
Two thoughts:
If people aren’t *forced* to sell equities, why would they? It looks like they don’t want to, because they don’t know where else to invest.
…
Every time there’s bad news, there’s a bailout. Every bailout puts cash into circulation. Firms receiving that cash are no longer hamstrung with worthless IOUs but can invest that cash anywhere. So, every bailout (and unsubscribed Treasury auction) is a *boost* to the market. What I’m getting at is: maybe we should be more fearful when the bad news *stops*. That’s when the supply of “new money” ebbs.
“FD”: I have no idea which way we’re headed.
May 19th, 2009 at 2:03 pm
Complacency levels on the VIX are usually in the $15 to $20 area before the crisis. I’d call complacency if we get back under $25 and closer to $20.
May 19th, 2009 at 2:03 pm
leftback @ 1:56
“many of us imagine you trading in a bikini on a shady patio overlooking the beach..”
My sentiments exactly.
(I suppose it would be considered too perverse to ask her what she is wearing right now).
May 19th, 2009 at 2:03 pm
DL,
That question I just don’t know the answer to right now. I have stated on here many times that treasuries are a huge bubble, and you will be able to make money on that for a while so I think we are coming from the same place, just don’t think the starting points will be the same.
I hope your scenario comes and not mine. I’d really prefer to be wrong about what I think is going to happen because I have a terrible picture in my mind. I’d much rather just deal with a “correction” to 700 from here, or wherever we end up on this rally. I fear though, that it is going to be far worse than that. Obviously stocks and the dollar have a pretty clear negative correlation.
May 19th, 2009 at 2:05 pm
cvienne @ 1:58
“After the next ‘dip’ in the S&P…I’ll be buying ALL hard assets hand over fist…”
We can agree on that.
May 19th, 2009 at 2:06 pm
@Lefty,
no these retail really do know, some of them work at a Valero refinery! They have the “inside track”
lol.
Man, I wish you could hear what some of these peeps say. Sometimes I have to try not to laugh, I just nod my head like a robot and do my best to talk them out of disaster.
May 19th, 2009 at 2:08 pm
@karen
Alright…Thanks for filling us all in…In the end, “It’s all good”…huh?
May 19th, 2009 at 2:11 pm
if Karen lives in San Francisco as she has mentioned- cold and overcast most of the time- any surfing is done w/ a 5/3 wetsuit unless you want hypothermia- the surfing that I have witnessed in SF proper was Fort Point under the Golden Gate Bridge-
you could head to Santa Cruz however a bit further south- but SF is definitely not Malibu – total different vibe
May 19th, 2009 at 2:14 pm
@all
For what it’s worth…as I pointed out yesterday…VOLUME…
Use whatever you want (I’ll use JPM as a proxy – who cares whether it’s up or down)…
37 million shares right now…So right now it’s on track for a 53 million share day…Those are like February 9th numbers…
Or go look at the charts yourselves and draw your own conclusions…October, January…
Maybe I’m just cross eyed…but I think this VOLUME thing has to be saying something
May 19th, 2009 at 2:14 pm
@wunsacon,
All due respect to your comment above about belt tightening but you must either be wealthy already or you earn a very good income because it’s not so simple as just cutting back. The average household budget doesn’t work that way. They have, for a long time now, not had discretionary income to spend, they have been using credit for that.
Ever heard of some of these:
18 months no interest on
furniture
appliances
tv and stereo
etc.
You also fail to mention one big need type item for most homes, which is health care premiums. If you pay for them on your own, you already know how much they cost, if you don’t, and don’t have an employer raising your workplace benefit cost, you are in the minority. Here in DE many families don’t have much of a choice but to send kids to private schools since the public school system is a complete disaster. I have clients that have 2-3 kids, with household incomes of over 150k per year that have virtually no discretionary income at all at the end of each month. There is also psychology at work here, after 20 years of overconsumption, you don’t just change your habits.
I could give you hundreds of examples if you would like to see some.
May 19th, 2009 at 2:18 pm
The thing that caught me by surprise MOST about the March 6-9 reversal was just that…VOLUME…
I had been “technically” waiting for 600…I was ALL PREPARED to see two “capitulation” days that took us to 600 in a flash and then reversed INTRADAY…
NEVER HAPPENED…
Relatively light volume for a reversal (back then)…
Could this turn out similar?…A simple exhaustion of buying interest?
We’ll see…
May 19th, 2009 at 2:19 pm
DL, lol, a very pretty, fitted, yellow dress.. remember, i’m in the city. i’m staying an extra day and mixing it up by moving to the Fairmont because the rates are so incredibly low! (supply and demand at work.)
cvienne, i do look for the good and positive where possible…
and to both of you, i want erx on the next spx sell-off.. and, i’m thinking gold could see 848-850, again, without breaking anything.
May 19th, 2009 at 2:20 pm
http://www.nytimes.com/2009/05/20/business/global/20kroner.html
Despite Oil Reserves, Norway Slips Into Recession
Well, after we praised Norway the other day…this article gives the other side…a very small country, who at least didn’t squander their good fortune, and now has the oil reserve money to fall back on…
Problem is in a country of 5 million, nothing they do means much…and in the future, when they run out of oil, they’ll be just another bubba…but socialist…which to me means less likely to innovate..
May 19th, 2009 at 2:22 pm
ahab, i live in san clemente, california… so, so, so, so cal… at one of the best and most consistent surfing locales in the country… which a sand beach that can be walked for miles and miles… just visiting san francisco..
May 19th, 2009 at 2:24 pm
SCO or DUG- anyone care to comment-
as a trade- I don’t see the catalyst for oil
May 19th, 2009 at 2:29 pm
Karen-
now you’re talking- though I do love SF- very unique city
May 19th, 2009 at 2:37 pm
@karen
Love the Fairmont…I haven’t been there in 20 years tho (back when I was a 20 somethin’)…Hope it hasn’t changed…Sure it hasn’t…
I’m with you and ben on that GOLD call…Understand it’s the longest standing asset class that I still hold…And I’m not talking about having some jewelry here and there, I’m talking about BUYING bullion (after I sold my real estate in early ‘06 because of VALUE)…I plowed 25% of that profit into GOLD, and just recently paid CASH for a new property at a discount (with some $$ left over to install “off grid” energy)…
I’m a LONG TERM guy…The next LONG TERM eye I have are on these same hard assets…But I already have my basement stocked with food, so oil & nat gas are the next things…
I think it’ll take 6-9 months for the prices to come down to a reasonable level to do that though…
I bought oil in December (day before Christmas), but I was outta there way back when it crossed $50 the first time…
I bought nat gas (UNG) down at $13, but I was outta there at $16…
The “bottom” on the next leg down WILL be the final bottom for energy…I’m not sure whether it will be below or above the recent bottoms (probably around the same)…But it will be worth owning
May 19th, 2009 at 2:41 pm
@ ahab: “SCO or DUG- anyone care to comment-”
I like em both and have SCO on right now. Have long term energy positions (VLO, COP) so I am hedging.
May 19th, 2009 at 2:42 pm
ben22, I’m trying to imagine what could spoil the bear party. Why? During 2006-2007, I started hedging early and made very little as the market continued to defy gravity (and foreign markets went ballistic). The bear case makes so much sense. I believe the economy will be rough for average Americans no matter what. But, in *nominal* terms, I’m trying to be open-minded.
>> The average household budget doesn’t work that way.
You’re right that I don’t know the average household budget. But, I do know some coworker(s) who are underwater on their homes and close to being laid off but continue to dine out several times a week with the whole family, buy I-pods and expensive(?) handheld gaming devices for their kids, and chauffeur their kids around in gas-guzzling SUVs to after-school activities that the kids should instead walk to.
I doubt these are unique cases. I think people can — and will be forced to — cut back on things they take for granted.
May 19th, 2009 at 2:48 pm
sco or dug? look at dto instead of dug… i thot i posted this but it seems to have disappeared or i got distracted curling my hair and packing… lol.
May 19th, 2009 at 2:48 pm
Another thing…
Just since I’m bored here watching this 39 million share JPM day (I mean it’s like watching Atlantic City on a mid-January morning)…
This SPX will eventually find a bottom…400, 600…who knows…
For Franklin…sure, at some point, economies will eventually recover…but it’s going to look NOTHING like what you see today…
I’m willing to bet that MSFT will go the way of Eastman Kodak…
You’ll have HALF of the companies in the DOW and S&P that you see today…The other half will be companies you’ve never even heard of…Companies that MAYBE DON’T EVEN EXIST today…
In any case…one of the reasons I’m BEARISH on the markets today is that I see the need for transition…STOP propping up the old and START investing in the new…
BHO campaigned for that idea, yet so far all he’s done is PROP UP the old…
HE is the one who needs to change…
May 19th, 2009 at 2:51 pm
wunsacon Says:
“I do know some coworker(s) who are underwater on their homes and close to being laid off but continue to dine out several times a week with the whole family, buy I-pods and expensive(?) handheld gaming devices for their kids, and chauffeur their kids around in gas-guzzling SUVs to after-school activities that the kids should instead walk to.”
sounds like a prototypical American to me- dumbasses
leftback-
thanks for the feedback
May 19th, 2009 at 2:54 pm
cvienne-
“everyone thinks of changing the world, but no one thinks of changing himself”
Tolstoy
May 19th, 2009 at 2:58 pm
“I’m trying to imagine what could spoil the bear party”
Johnny Retail and Brian the Broker are all over this right now.
Irrational markets know few bounds – especially when Johnny is on the loose.
His motto is “Buy in May and Feel OK” and “Sell in August, full of Disgust”.
May 19th, 2009 at 3:04 pm
@call me ahab
Actually – Michael Jackson also basically said the same thing in song lyrics…
Interesting…
It seems that to CHALLENGE OTHERS to act in a certain way seems so hard for the ORATOR to accomplish personally…
May 19th, 2009 at 3:06 pm
@LB
Keep buying JR…
It’s getting cheaper 4me every day…
May 19th, 2009 at 3:20 pm
@ Left:
What symbol do you use to watch the 2’s? I use TXN for the 10’s.
May 19th, 2009 at 3:26 pm
“Johnny Retail and Brian the Broker are all over this right now.”
case in point- a friend of mine told me he instructed his broker to go “all in” in the market- he had been sitting around in a Treasury fund for the last two years-
so they are out there- however- I think it is a risky strategy- too much downside risk- my only concern is that there is behind the scene machinations from the Fed/Treasury to manpulate the market to keep an upward momentum in play as long as possible-
which brings me back to the housing start/permit #’s- being spun as possible good news- but what of the inverse- if the #’s came in higher- would that be spun as possible bad news?
I think not-
“ignorance is strength”- George Orwell
May 19th, 2009 at 3:29 pm
@wunsacon,
I see what you are saying now. I just got out of a meeting. The meeting was to show the client what accounts he has that he could take money out of and what the tax consequences would be. These are retirement accounts btw. Why did we have to have this meeting? Well, the client is still working, but hasn’t been paid in 4 months as his company is in deep shit. He thinks next year could be better, if they can make it that long (his words) He’s racking up bills and his daugher is getting married in October. He needs cash bad, we already burned through his reserves. Thankfully he lost no money last year, but I’m not so sure he’ll ever be able to replace what he’s going to have to take out as a result of the lack of income. He’s a nice guy, just an average guy, but he’s hurting bad right now. There are lots of him out there and people that are still working are scared too.
Still, it will be more than just cutting back for people, it will be a lifestyle change. Those people you describe, I hope they get hurt. As bad as that sounds, they earned any trouble coming for them.
Just my own thought, but here I could see why people talk about the “bear party” as there are lots of us here with a less than optimistic outlook. That said, when I talk with regular people, and lots of other FA’s as I’ve already mentioned this week, they aren’t bearish and they certainly weren’t short the market last year. Sure they think that things are going to be choppy, a little hard moving forward, but there is a common theme among them that things are already getting better, often followed by “it can’t get any worse”
Also, why so upset about making very little during 2006-2007? On some level I can understand but clearly that was nonsense? If you would have stayed bearish all the way through last year didn’t you in fact clean up?
May 19th, 2009 at 3:29 pm
@ Ahab, Left:
Johnny R is definitely getting into this thing.
Anecdotally, we just got off the phone with someone with alot of speculative money to put to work. Has been sitting patiently in cash all year. He wanted a trade idea to try us out.
We told him to look into TLT or if really speculative, SDS.
He laughed at us and told us the Dow was headed straight to 10,000.
We wished him well.
May 19th, 2009 at 3:38 pm
“He laughed at us and told us the Dow was headed straight to 10,000″
good one I-Man- I would have had to ask where he gleaned this incredible information- CNBC per chance?
May 19th, 2009 at 3:41 pm
We didnt ask. The conversation was pretty much over at that point.
May 19th, 2009 at 3:47 pm
@I-man
That’s the interesting thing to me about this rally…
When the S&P was ticked over 840 (about the beginning of April), I said to myself…”OK now everyone can be a little happy”…The market traces back a FIBONACCI (down to about 730-740)…Then we see where we go from there…A little something in there for EVERYONE (bulls & bears)…
At that time, I was thinking that 666 might have even been the low (even though I’d thought otherwise before)…
But this subsequent rally to 900 and beyond has got me thinking that we’re not only going to take out the March lows (but we’re going to go WAY LOWER)…Perhaps 400 when all is said and done…
Why?
Our friends JR…
So I’m willing to give more ground if need be in the short term…The more FRANKLINS that get sucked in in the interim…The larger the move to the downside becomes probable…
May 19th, 2009 at 3:48 pm
I-man: No symbol. I just gaze at this daily (I am a whole curve big picture guy):
http://www.bloomberg.com/markets/rates/index.html
TLT. Interesting thought. I have noticed that everyone hates Treasuries at the moment, and even Johnny R may have been told that the long bond in particular is going to blow at any second. Which is why here at Schadenfreude we have of late been buying a spot of 5s and 10s to go with our 2s….
SO, Gary Shilling, I-Man and David Rosenberg on one hand, and InvestTools on the other hand…. interesting !!
ben22: fascinating about people in suspended animation. I am seeing this everywhere. Middle class meltdown.
May 19th, 2009 at 3:50 pm
I’m back.. the Fairmont SF is over the top… beyond The Plaza.. I’m rather speechless for a change. : )
May 19th, 2009 at 3:50 pm
10 minutes to close…
JPM only 49 million shares transacted…
WHERE IS THE VOLUME MY FRIENDS?
May 19th, 2009 at 3:51 pm
cvienne-
it appears your strategy is to let the market go higher and then short- but- if you think the market will advance are you taking any long postions while you’re wating?
just wondering
May 19th, 2009 at 3:53 pm
FWIW, you won’t get “inflation” the monetary base will still be dead. What will happen is liquidity will get out of control and artificially pump asset prices, leading toward a repeat and eventual return to recession. Sorta like the last expansion, but faster and the “recovery” will be even less impressive than the last if you get my drift.
The only REAL way out for America being the debter is actual real monetary inflation to rid debts or give up and liquidate. I bet the latter happens when the Wall Street Oligarch gets in the ‘right” position.
May 19th, 2009 at 3:55 pm
Thanks Left! I get lazy with my quote montage sometimes and am quick to forget how much useful info is on that site.
On TLT, yes indeedy. Sitting right here around 95 with multi year support at 94… could be a nice low vol trade over the coming months. Probably has legs to 105 if the equities roll over.
I prefer SDS, QID, FAZ, SRS and SCO myself of course.
I hate govies too, but not yet. I suspect there will be one more run to govies before the inevitable disaster that is going to occur there once the vigilantes return to ball squeeze Obama.
May 19th, 2009 at 3:57 pm
@Itis: Jobless recovery, right? I agree for once, and also about the liquidation – once GS gets short.
BTW, I-Man and ben: Where was J Retail in March, at the Leftback Lows™? In the fetal position, that’s where….
May 19th, 2009 at 3:58 pm
You think the folks that picked up some HPQ ahead of earnings are starting to feel a bit queasy?
May 19th, 2009 at 3:59 pm
Spends all day floating in positive territory and then closes negative. Could this be Touraround Tuesday?
May 19th, 2009 at 4:00 pm
Jobless recovery, I am not sure we even get back to trend growth yry before it implodes again.
May 19th, 2009 at 4:00 pm
s/b Turnaround…guess I’m thinking of a London bus tour of pubs
May 19th, 2009 at 4:01 pm
Wow… lowest volume print on SPY since 12/31/08 if I did that right…
That says it all right there boys. (+ Karen )
May 19th, 2009 at 4:05 pm
And while I’m at it…
@ Mistress:
Would you call that a grave stone doji on today’s daily SPY print?
May 19th, 2009 at 4:06 pm
i-man-
Karen yes- however I have also heard of a Delilah and Hortense frequenting these very threads- hmmm . . . where might they be-
I guess they are stillaway
May 19th, 2009 at 4:07 pm
@call me ahab
NO LONGS at this point…
Disclosure:
I was “short” going in to March 6-9…Arrogantly (my bad), the market appeared to be trading TECHNICALLY at that time and I was waiting for a CAPITULATION move down to 640-600…
I guess I missed it by a day…it never happened…I considered it a HEAD FAKE at the time…I never covered any shorts (mostly INDEX stuff)…
So I waited…
At 850 I ADDED to the shorts I’d been holding all along…
At 900 I ADDED to the shorts I’d been holding…
At 930 I ADDED again…
No new longs at ANY TIME (except that I bought UNG at $13, but sold it 100% at $16 – small position)…
I still have about 30% cash…
At this point, I’m looking to push in a little more if I see the S&P do an INTRADAY spike above it’s 200 day MA…
Then I’ll add shorts again at 1k to 1030 (if that happens)…
I can’t imagine it will, but REALLY…TRULY…I’m willing to hold on to these shorts until the time comes along that I actually need the cash for personal or living expenses…
That’s not likely…
I own my property 100%…property taxes are low…I have acres of property to grow food…livestock…solar power 100% to needs (wind & energy)…well water…
As long as my “shorts” are LOSING, I pay no capital gains taxes to the government…
WHAT…ME WORRY?
May 19th, 2009 at 4:08 pm
Wonder if Andy T has a Technical Name for that Intra-Day Quadruple Top Thingy?? I bet he does.
To us here at Schadenfreude it seems a bit – toppy. Almost like there was now a right-hand shoulder in place…..
“one more run to govies” – oh yes, run for the govies, the greenback and the yen.
Peep never think about these trades but there is an enormous market of professional investors who do. Usually in May, and progressively so as we approach Memorial Day, in order that they can sleep soundly at the beach house without having to worry about pets.com or the CMBS market.
- “run for the shadows, nothing’s going to touch you in these Golden Years…”
May 19th, 2009 at 4:12 pm
@LB
it’s called the QUADRUPLE EVEL KNEIVEL FORMATION…
May 19th, 2009 at 4:12 pm
or- otherwise it could be
“ground control to Major Tom”
May 19th, 2009 at 4:13 pm
Strange market indeed. That late dump sure would make me a bit uneasy if I were a late coming bull.
Is it a quite established “fact” that the inverse relationship between the dollar and the stock market is driven from the dollar side, and not vice versa?
It looks like UUP (dollar index ETF) dropped all day and then ticked up at the same time the market started down; a bit after 3 p.m.
Hmmm
May 19th, 2009 at 4:13 pm
Nice Bowie reference Left… I might peg you at 40.
May 19th, 2009 at 4:14 pm
You can’t beat a late dump. Especially if you are a Bear, in the woods.
May 19th, 2009 at 4:16 pm
HPQ matches street- down after hours
May 19th, 2009 at 4:17 pm
My good friend over at CNBC Bob Pesani will say over 20 times where’s the volume…… sometimes if you look closely when volume is down he says it with a tear in his eye!
May 19th, 2009 at 4:18 pm
@LB
if you haven’t seen the “quadruple evel formation” on a graph it looks like this…
Evel Knievel starts his ascent on the ramp around early March…
By May, he’s launched himself up off the support ramp and is flying over “double decker” busses…
At some point he hits the downramp…
By October he is tumbling head, over bone, over sinew, on his way to his next hospital appointment…
From that point on he is licking his wounds in the hospital…yet contemplating and planning his next jump…
May 19th, 2009 at 4:19 pm
People dumping heading out for long weekend…..
May 19th, 2009 at 4:21 pm
I bet today’s market drew some more money in from confident bulls, and some bears that gave in. Nice pop at the start, then meander along looking very harmless, then BAM, down the chute into the close.
I know my emotions have been tugging at me that way. That’s why I always fade my emotional reactions.
May 19th, 2009 at 4:21 pm
i-man-
if someone is quoting Bowie- then they are pushing 50 – unless they “just happen” to be an aficionado of 70’s music
May 19th, 2009 at 4:22 pm
Onlooker from Troy @ 4:13
“Is it a quite established “fact” that the inverse relationship between the dollar and the stock market is driven from the dollar side, and not vice versa?”
Chicken and egg dilemma. But currencies trade continuously from Sunday evening until Friday late afternoon, and the dollar volume is far greater than for the US stock market. So I’d say that the currency traders have more influence.
May 19th, 2009 at 4:24 pm
I-man, sorry, it is not… a doji, yes, but not a gravestone doji. look at some of the dojis of the last few weeks. the uptrend continued. personally, i see the lack of volume more bullish than bearish… big volume down would have been a distribution day.
I’m really going to have some fun now. I’ve got room service and a bottle of wine (don’t worry, I won’t drink the whole bottle now.. a glass with lunch and the rest this evening) and i’ll look at some other charts..
I hope AT will comment on the fact the nasdaq exceeded 1750 today, but didn’t stick. All very interesting.
May 19th, 2009 at 4:29 pm
DL
Yeah, that was my gut inclination, that the currency market is so much bigger and widely influential that surely it pushed stocks and not the other way around. Just wondered if anybody had some more informed opinion on that.
While we’re on it, it seems that at SOME point that would break down, no? I mean, if the dollar took a real dive that would be really bad for our economy and cause a lot of turmoil. Surely the market wouldn’t go up in those conditions, would it? I’ve never quite figured this out. Need to do some more homework.
May 19th, 2009 at 4:31 pm
@karen
are you at Ghirardelli square, or the other one?
Not stalking, I’m 1000’s of miles away, just curious…
President’s Club member?
Dubai, St. Andrews, and Savoy are nice (in different ways)…
Plaza sucks…
May 19th, 2009 at 4:31 pm
Just a plain old vanilla doji then. I’m learning. I thought when the wick went so high and price closed pretty much flat that made it a gravestone. Guess I need to hit the Nison book again. Now that I have it zoomed up close looks like it might even qualify as a spinning top.
May 19th, 2009 at 4:32 pm
QQQQ has been losing steam relative to SPY since May 1st; ditto for IWM versus SPY.
May 19th, 2009 at 4:35 pm
Onlooker from Troy @ 4:29
I suppose that, sooner or later, we’ll get a repeat of last summer, when the dollar was caving and oil was rocketing. It’ll probably take at least another year to get to that point, I would think.
May 19th, 2009 at 4:37 pm
cvienne-
I hear you- sounds like quite the set up you have- like I mentioned previously- love Canaan Valley for the boarding and my son is all over Fayetteville for the climbing-
“Patience is the companion of wisdom. ”
Saint Augustine
May 19th, 2009 at 4:37 pm
I-Man: I can also quote Cole Porter, Jerome Kern, Coldplay, Oasis, The Jam, Van Morrison and the Red Hot Chili Peppers. So what’s in a number?
Wonder if the US$ will continue to rise tomorrow? If crude reserves “exceed expectations”, it may well do so.
I use the ” ” because many of us think those inventory numbers are fake and that NYMEX market is manipulated.
Onlooker: “I mean, if the dollar took a real dive that would be bad for our economy and cause a lot of turmoil.”
That is an event that happens as money supply and interest rates are rising rapidly. Later, much later.
IWM has been dead for a week or more. NAZZ is looking sickly. SPY will follow.
May 19th, 2009 at 4:40 pm
Checking in from the sunny, beautiful north shore here in MA after the close and noticed a late day mini dump in lieu of pump. Last time I was away, things got ugly in late feb/early march. Time for a reprisal? Added more QID in the high 35’s today.
May 19th, 2009 at 4:41 pm
cvienne, the one high on California street… you should have seen me pulling my rolling carry on up Mason from Geary… apparently they are doing residences at Ghirardeli.. I will explore that later.
i’m trying not to be too excited about the darn good reports from my 2 shippers today. prgn was up nearly 21% at close and is up another 9.7% in after hours… my dht was ended up 3%, but also got an upgrade..
yes, on the President’s Club but i just joined recently… free internet is a must for me.
May 19th, 2009 at 4:44 pm
leftback @ 4:37
“IWM has been dead for a week or more. NAZZ is looking sickly. SPY will follow”
That is my working hypothesis at the moment. (Also, the transports may be breaking down).
May 19th, 2009 at 4:46 pm
@I-man,
Man, that is a nice story about that person that called. Typical. I had three messages geting out of my last meeting just now. All three were the same:
“Are we getting back in?”
@Leftback,
where was retail in March?
Well, I can only speak for my clients, but all agreeing with me of course. They were predicting the market would fall much lower and that we were best staying in cash and short term bonds.
Right around that time I trotted out the chart BR had posted here that showed the index and then the 200 day MA on the top of the chart, and it showed how deeply oversold we were. I like to use visuals on the screen in my office when showing a client a strategy. Some of my younger clients that are more aggressive with longer time horizon were shown this as I wanted them to buy some equity in late Feb/Early March. Of the two dozen or so I showed this to, three of them followed my advice.
Of course now, the ones that didn’t, want to know if we should get in now because as one of them said to me last Monday: “WE missed the move back up”
Yep, WE did.
I could tell you so many stories like this you’d question why I’d ever keep this job. But, for every pain in the ass I have 3 people that I really enjoy and look forward to meeting with.
May 19th, 2009 at 4:47 pm
@ Left:
Touche. I and I shall chill on the age comments. To quote Andre from Outkast…
“age aint nothin but a number.”
May 19th, 2009 at 4:47 pm
Jeff, where are u exactly? I lived in Manchester by the Sea for it’s 350th anniversary… if you can, go to Wolf Hollow… http://www.wolfhollowipswich.org/index.htm
May 19th, 2009 at 4:47 pm
Karen-
go to Hog Island at the Ferry Building- off The Embarcadaro- great Oysters- get a couple dozen and a glass of wine
May 19th, 2009 at 4:52 pm
I’m a big Van Morrison fan. Astral Weeks is one of my fav. albums.
May 19th, 2009 at 4:52 pm
leftback, you left out Donald Fagen, and anything Steely Dan, Jackson Browne, any published poet, for that matter.. maybe we should just list what you can’t quote from..
May 19th, 2009 at 4:52 pm
Maybe QID offered a good entry today, will it jump tomorrow? Also, longs look at GFA (DYOD) and think about it in the context of Real-dominated bond issuances and govt spending programs. It’s worth one’s time.
WRT quoting saints:
“Mom, get off my back, I’ll be holy later, when it’s easier, geesh!”
-Saint Augustine (it’s footnote in the City of God-look it up)
Also-
“Hey, you there! No laughing! Do you want to go to hell.”
-St. Benedict
And
“Girls? Eww.”
-St. Thomas Aquinas
May 19th, 2009 at 4:53 pm
@karen – you should take the California cable car up from Market. The views are amazing. On the other hand, walking up those hills in SF is supposed to be great for the legs. Beautiful city, great food. In Chinatown, don’t miss the smoked duck, hunan style. Enjoy.
May 19th, 2009 at 4:53 pm
Karen, my high tick on the Nasdaq shows 1749.65….CNBC is showing it as 1750.05, so I’m not sure I would say it “EXCEEDED” 1750. That stated, the sharp snapback and lack of follow through lower this week should be very irritating to short term bears. At the same time, bulls should now be a little discouraged by the rejection into the 78.62% retracement and the clear “doji.” As you pointed out though we haven’t had many dojis confirmed….
Short term market action has turned a bit cloudy to be honest. The move off the highs is difficult to describe as “impuslive.” I’m still short the S&P500 (via Sep Puts) and still short the DX, though that trade is feeling a little long in the tooth…
The sharp move up the last 48 hours is a little surprising/embarrassing to me after I sent out that bearish Nasdaq report. I’ve made a notation to delay sending a widely distributed report till Monday mornings…HA. I have an “update” ready to go whenever 1750 gets taken out……Medium/Longer term view remains unchanged. Best. AT.
p.s. leftback…we have ‘names’ for everything….quaduple tops are rare indeed….probably a “triangle” of some kind…..
May 19th, 2009 at 4:53 pm
karen,
do you believe in a shipping recovery or do you think that’s been overdone?
May 19th, 2009 at 4:56 pm
AT,
Awesome as usual. Any new thoughts on Gold?
May 19th, 2009 at 4:56 pm
mregan Says:
“Girls? Eww.”
-St. Thomas Aquinas
________________________
too funny!
May 19th, 2009 at 4:57 pm
ben22 @ 4:46
“I trotted out the chart …that showed the index and then the 200 day MA on the top of the chart, and it showed how deeply oversold we were”
I think that there’s a lot of merit to moving averages.
Speakin’ o’ which, what do we do now that QQQQ has surpassed its 200 DMA…?
May 19th, 2009 at 4:59 pm
mregan Says:
>“Girls? Eww.”
-St. Thomas Aquinas<
too funny
May 19th, 2009 at 5:00 pm
@ karen
I know that Mason from Geary climb…sounds like you’ve been BART’in it around…
Get a limo girl…:-)…doorstep service
May 19th, 2009 at 5:01 pm
ahab, thank you for the recommendation… men and their oysters, lol. i’m by myself, as always, so i’ll probably just shop union square later : ) it’s only 2 pm here, btw… hours of light to go.
May 19th, 2009 at 5:02 pm
leftback @ 4:53
“On the other hand, walking up those hills in SF is supposed to be great for the legs”
I lived there for two years and was in terrific shape (as a consequence of the hills).
May 19th, 2009 at 5:06 pm
well if it was me Karen- I wouldn’t be eating those two dozen oysters with a glass of wine- a nice draught beer would be in order- but it appears you like wine-
I’m a manly man
May 19th, 2009 at 5:08 pm
“I lived there for two years and was in terrific shape (as a consequence of the hills).”
You go, Delilah !!
Perhaps Karen doesn’t need to climb hills, and already has great legs?
We need more action from the market, eh?? Or more tools like f411….
May 19th, 2009 at 5:08 pm
ahab
What, as opposed to a “girly man”…?
May 19th, 2009 at 5:09 pm
@AT
I want to say “thanks for the chart” my friend (e-mail)…
Despite yesterday (and furthermore the LOW VOLUME of yesterday & today)…I don’t see how anything is not still perfectly intact…
Annoying yes…Nonetheless…intact…
May 19th, 2009 at 5:12 pm
ben22. gold looks lost in a sea of choppiness right now. in re: june gold futures….that move down from 1008 to 865 looks a very straightforward “abc” and now the rebound looks like an “abc” type of move….it rallied to the 38.2% at 920 and then retreated and now it’s rallied back to the 50% at 936 and struggled…that’s what moves do when they’re correcting a move down….for instance if gold were about to launch into some big move higher it wouldn’t have paid any attention to the 38.2 and 50% retraces…it would just be moving quickly….so at a minimum, it seems like it has a leg down coming….for now it’s a sort of “no man’s” land. Any kind of action below 880 from here and longs would need to EJECT fast. Any break of 980 would send shorts to the EXITs. So, I sort of see a big 100 pt range here where it’s difficult to get excited about it.
May 19th, 2009 at 5:13 pm
ben22 says credit deflation is here, and we all know people and corporations for whom the music is about to stop completely. Once they can’t shop on the credit card any more, this market is going down:
http://globaleconomicanalysis.blogspot.com/2009/05/effect-of-household-deleveraging-on.html
May 19th, 2009 at 5:13 pm
DL Says:
“girly man”…?
SNL classic
May 19th, 2009 at 5:14 pm
To quote the Burning Spear…
“People get ready.”
May 19th, 2009 at 5:15 pm
@karen
WHATEVER YOU DO DON’T BUY ANYTHING…
It would give a jump to retail sales… F411 would start harmonizing about ‘green shoots’, and we’d all be f***ed!
Speaking of ‘green shoots’…
My corn is already calf high…I’m on my 3rd generation of arugula & lettuce harvest…and the rest of the crops are doing nicely…
Too early to tell…But it FEELS like my grape harvest is going to produce some nice bottles of wines going forward…
2009 might end up to be AT LEAST a nice date to stamp on the bottles…
May 19th, 2009 at 5:18 pm
Damn cvienne… I just planted mine on Sunday… but I and I will still be “knee high by july”.
May 19th, 2009 at 5:18 pm
DL,
RE: QQQQ
I would be a buyer of QID despite my shorter term bullish stance. My main reasons are
1. Don’t fight the seasonal trends of tech, the tech cycle is coming to an end. AT warned against trying to fight these trends, I thought that was sound advice.
2. When the dollar firms up, which I think it will, tech should get a beat down as a result
3. If we want to talk p/e, and I don’t care which measure you use, the massive p/e’s on some tech stocks needs to get flushed out before this is over.
4. Most managers I see on Bloom or CNBC like tech. I like to bet against the herds.
5. The higher beta NAS was leading most of this year vs the DOW and S&P, lately that has reversed for the most part. That rally has really lost steam which only makes sense given the major divergence between the three in terms of YTD performance.
I think a smart strategy for going short here with anything would be what I-man suggested about building in 3rds
I typically do a reverse pyramid strategy but both will work.
May 19th, 2009 at 5:21 pm
@cvienne: Just found the Evel Knievel formation. Nice work…. LOL.
May 19th, 2009 at 5:21 pm
cvienne-
the staggering amount of rain this year must have helped with the crops- “knee high by the 4th of July” has been exceeded
watch out with the Arugala- if Karen hears that she will want you to pack some in dry ice and ship immediately
May 19th, 2009 at 5:22 pm
AT,
Thanks very much. I have been very confused by gold for a couple of weeks now. Just watching and reading clues from other people about what they are seeing.
When the administration says they have done enough to solve this problem, it should mark a top for stocks and a bottom for gold. Just an idea that could come true.
May 19th, 2009 at 5:22 pm
ben22,
>> If you would have stayed bearish all the way through last year didn’t you in fact clean up?
“If only”.. I was one of the bears who — in relative terms — threw in the towel and thus did not clean up.
Maybe my attempt to “try to understand” the bull case is “me throwing in the bear towel” again. I.e., maybe this is precisely the time I should be selling most of my longs (instead of a mere trifle).
May 19th, 2009 at 5:23 pm
Two word contrarian indicator on buying tech stocks:
DENNIS KNEALE
May 19th, 2009 at 5:27 pm
@LB,
great link from Mish. I basically agree with all that he said in it. That guy is solid.
May 19th, 2009 at 5:29 pm
Kneale is possibly the dumbest person on TV- a complete hack- who should get zero air time- evertime I see him I want to take those Eurotrash glasses he wears and shove them in his ear hole
May 19th, 2009 at 5:32 pm
@wunsacon,
That’s the hardest thing besides giving yourself time is sticking to what you think is right. I already know I’m going to have a really hard time getting short at my targets because everyone and everything (emotionally) will tell me not to do it. I’m trying to mentally prepare myself for that now so that I don’t get suckered when the time comes.
I could see how bears got impatient last year, after all, the real profits on the short side, if you were using index ETF’s, for the most part came pretty late in the year.
It’s only May 19. A lot will happen between now and 12/31.
May 19th, 2009 at 5:32 pm
ben22-
agreed on QID- I have actually been surprised at the strength in tech in general
May 19th, 2009 at 5:34 pm
@ben 22
Funny, I like ALL your arguments…But I like #3 the most (which is something I’d not yet considered)…People still are willing to put high beta multiples on tech…Probably, when TECH starts trading at OLD INDUSTRIAL multiples, we’ll know that the bear market is over…i think i always KNEW that in a sub-conscious way…I’d just never brought it to the surface…
@LB
Isn’t that the FUNNIEST thing you’ve ever seen…I saw that chart posted on this site a few months ago…
@I-man
I have to ‘qualify’ the corn story…
I decided to try something different this year…I was TIRED of waiting for the last frost or spring soaking to end b4 planting the corn…So I took a limited number (about 144 ears) and planted the ’seeds’ using grow lights (on an interval 12 weeks basis – 1 row x12 per week)…
So that way, I expect to be able to start ‘harvesting’ by mid to late June (probably late – as they appear now)…so that’s just PERSONAL consumption as I’ll have fresh corn all the way from June – late September)…
Anyway – I do that with ALL my consumables nowadays…I ‘pre-seed’ using growlights (SOLAR PANEL & GREENHOUSE energy & climate)…I transplant outside when the weather permits…I’m still perfecting the science (as the farm I bought has a mildly different geographic bias with respect to bees & insects than I’d been familiar with b4)…
May 19th, 2009 at 5:42 pm
*DJ Bank Of America Selling 825 Million Shares At $10 A Share-CNBC
Like I said before, VIX below 30 means a new down leg is starting.
May 19th, 2009 at 5:43 pm
HP report is not helping either..
Hewlett-Packard Co. reported a drop in earnings for the second fiscal quarter as sales fell across nearly all the company’s business lines, most particularly among PCs, servers and printers.
http://www.marketwatch.com/story/h-p-earnings-fall-as-pc-printer-sales-drop
May 19th, 2009 at 5:44 pm
@ahab
Karen…or ANY of you can have all the arugula you want…
This year may be the best year for Arugula that I’ve ever had (relatively cool temperatures & good seed)…
I lived in Italy for 12 years (so I know how to grow it)…
In Italy, I had 3,000 olive trees so could make a good homegrown olive oil to compliment it…Now I have to scratch for the best (olive oil) I can find…
Also, the SALAD…Pure fresh cut arugula (from my fields), fresh olive oil, & parmesian cheese…THE BEST…
It happens to be seasonal right now so I’ve been eating A LOT lately…
I’ve gotta try and find a way to make a good aged Parmesian…My neighbors have cows (I don’t yet)…The cows eat well, but it’s still not the best like they eat in Reggio Emilia…I’ve made some cheeses (and they were good) but they don’t compare yet to the real thing…I’m working on that
May 19th, 2009 at 5:47 pm
something seems really odd about this-
http://www.cnbc.com/id/30829896
quote:
“If General Motors files for bankruptcy, as is widely expected, plans include a quick sale of the automaker’s healthy assets to a new company owned by the U.S. government”
“the new company is expected to honor the claims of secured lenders, possibly in full.”
“The government’s plans include giving stakes in the new company to GM’s union”
whew- looks like a “surgical” BK to give us a leaner and meaner GM will give us nothing more than a government owned car company
May 19th, 2009 at 5:49 pm
@manhattanguy
“sales fell across nearly all the company’s business lines…PCs, servers and printers”…
WTF else do they sell? OK…I know…services…C’MON!
I posted earlier here R-E-V-E-N-U-E-S…F- the “operational earnings” from this ‘earnings season’…
On the positive side…The “farmers market’ that I bring my excess crops to over the weekend is doing fine…It seems like people are willing to spend their money THERE, not at the GAP
May 19th, 2009 at 5:51 pm
cvienne, my shoe budget alone.. well, in fact, no budget, no limit on shoes.. they are not shoes, anyway. they are foot jewelry.. and, boy, do i wear them out… you’ve probably figured out i am an olive oil fanatic.. at my home, i’ve got the best chipotle olive oil that i’ve been pouring over my arugual with an 18 year old balsamic… sigh. my olive grove is laughable compared to yours.. numbering 12.
andy, i think we are on the same page with gold.. (oh, that’s dangerous). i was super disappointed in it’s lack of go ahead… thus my selling… and as i said earlier, i see a fallback to 847-850 as no big deal, but a buying opportunity. oh, on the compq.. my sites quote 1750.05, both of them. e*trade and stockcharts.com, btw..
ben22, i just so insulted that you have been confused by gold when you have me as your guide! lol. Andy doesn’t even like gold, doesn’t understand it, and has confessed to it. the dbl standard on this blog is disheartening, at best. : ) further, Mish is a raving lunatic half the time… only females can be that emotional and get away with it : )
May 19th, 2009 at 5:51 pm
“Kneale is possibly the dumbest person on TV- a complete hack- who should get zero air time- evertime I see him I want to take those Eurotrash glasses he wears and shove them in his ear hole”
I think he is from Wisconsin – he prefers it in the ice hole.
May 19th, 2009 at 5:54 pm
@ call me ahab
Just like chrysler (where the UAW got 55%)…
It’s called ObamaMotors…
Let’s see how THAT business model does in about 12 years time…
Meanwhile, I suggest to ALL OF YOU to go out and do what I did…
Take your pickup truck (or variety thereof)…and fit it with a NATURAL GAS burning fuel line…
Nat gas prices will stay low relative to gasoline prices from now until the long distant future…
Save yourselves the expense (a conversion today will only cost you about $1,500 – $2,000)…
It will be a worthwhile investment…
May 19th, 2009 at 5:56 pm
cvienne-
you are a man after Karen’s heart (although I think she is married)- she will probably be in a state of unbridled ecstasy upon reading the intimate details of your arugula
May 19th, 2009 at 5:57 pm
call me ahab @ 5:47
Gettlfinger Motors
May 19th, 2009 at 5:59 pm
i say this for the following reason…
ObamaMotors will seek to ‘change’ cars to electric (meaning LESS production of gas guzzling vehicles and MORE production of low horsepower economy vehicles to meet his EPS standards)…
So the BEST ‘high duty’ vehicles you will EVER be able to find will be the ones produced TODAY…
Toyota, Ford, Chevy, TRUCKS…
All you need to do is ‘re-equip’ those with NAT GAS fuel lines (easy to do)…NAT GAS (as a fuel) is abundant in America and will be a READILY available source for fuel when the craziness now in Washington produces $200 a barrel oil within a few years…
May 19th, 2009 at 6:00 pm
@cvienne
WTF else do they sell? OK…I know…services…C’MON!
That’s exactly my point.
Atleast this wouldn’t call for a “better than expected” rally tomorrow.
I feel that S&P is going to test 875 pretty soon.
http://www.marketwatch.com/story/b-of-a-prices-offering-of-825-mln-shares-cnbc-20095191751130?siteid=yhoof2
May 19th, 2009 at 6:01 pm
manhattanguy @ 5:42
VIX dropped a lot today, considering that the DOW and S&P were both down.
May 19th, 2009 at 6:03 pm
@ DL-
undoubtedly- in the article it says the Treasury $ will be forgiven- there’s 14 or 15 billion I guess that have been squandered- but maybe as the new owners- the USG will look at it as an investment-
has to be more to this story because it just seems odd to me
May 19th, 2009 at 6:05 pm
my posts aren’t posting… which has me a bit upset… do they think i’m a c*ll girl? no links in my post.
May 19th, 2009 at 6:08 pm
@manhattanguy
who knows? (rally or not TOMORROW)…
The market is like a 3 week old puppy…No attention span further than about 30 seconds…
I DON’T CARE
I’ve been short since November 4, 2008…
I’m STILL short…I’ve recently ADDED to those shorts…
YOU DO THE MATH
May 19th, 2009 at 6:09 pm
But you are a cool girl, Karen…
May 19th, 2009 at 6:12 pm
@cvienne
“I’ve been short since November 4, 2008…”
Ouch.
I went long in mid March, but I closed my long positions and went short last week.
May 19th, 2009 at 6:15 pm
cvienne-
you seem like a pretty smart dude- bit of a “jack of all trades”- background in agriculture/engineering?
May 19th, 2009 at 6:16 pm
Not that it’s news or really meaningful but I’ve just got to point it out anyway. GS upgrades BAC to “conviction buy” (friggen B.S.) a couple of days prior to them coming out with this huge secondary offering. And the herd trampled over each other to get some of that. I know, I know – but really, why is it so damned predictable? It’s all just so damned incestuous on Wall Street.
May 19th, 2009 at 6:32 pm
@manhattanguy
what OUCH?
I went short SPY @ 1007…
added to that at 850, 900, and 930
My COST BASIS on that is 950…
I’m not OUCHING until the S&P goes over 950…
I’m patient
@ahab
No background in A/E…I’ve just been around…I lived in Southern California during the Reagan years…The moved to Italy during the Clinton years…moved back to the USA just about 3 years ago…
I picked up AGRICULTURE, and how to live simply, and beautifully, while I was in Italy…I had a farm in the hills…Olive trees mostly, but the natives taught me how to farm…There were olives, sheep, and whatever you wanted to grow (arugula, finocchi, pomodori, melenzane, spinachi), plus the cheeses…
Plus the “vini”, (grapes)…
Italians know how to live on NOTHING yet have wonderful lives…It makes me understand how FAR from that Americans still are…Here, they’re still fighting about job benefits, stimulus packages, and re-living the DEBT FUELED era of having 4,000 sq. ft. Mcmansions and how to perpetuate that existence…
In Italy, I think they did away with that notion about 400 years ago…
May 19th, 2009 at 6:51 pm
Also, the Spring Fling 2009 ended with the same number of trading/calendar days as Spring Fling 2008? Anyone up for a trip down memory lane to 600ish?
Too easy?
I’m in the camp that believes this move is a bear market rally and not the start of another bull market, but I think it will go higher and last longer then most of the bears here think, something more along the lines of Grantham’s 1100ish target.
IMO, it is just too convenient to think this will be an exact replay of May 08 and that now is the time to be loading up the puts and shorts. I suspect there is more pain to come for those getting bearish too soon.
May 19th, 2009 at 6:58 pm
Nice pull on the corn cvienne, I did that one year but it was a bitch to transplant…
I like the agriculture and trading mix, my two favorite hobbies. Work is just a side reality I tend to deal with for now. Until I pull a Livermore… (the fortune part not the suicide in a coatroom part.)
Hanging tight with my shorts, but with a bit of consternation earlier in todays session I must say. Not adding to them just yet, but eager to add some thirds to QID, SRS, SCO, and that old skank FAZ.
Volume again spotty, especially with SPY, QQQQ improved a bit, but still total tug o war. The top is in though… I-Man will chant it down.
I still think strong hands are selling. The big shorts should start to pounce soon I’d imagine, if it wasnt what we saw today. Havent checked short interest tho… what ya say SB?
LB- Cheers you with a Hoppy IPA when we get a US$ bounce, JPY$ spike, and some falling crude tomorrow (hopefully) young brotha.
Mistress- enjoy your evening in the SFBay, but hopefully its an Oregon pinot and not one of those cheap cali merlots.
AT- Thanks and Praise.
B22- nice posts.
May 19th, 2009 at 7:13 pm
I-Man, surely, to paraphrase “Sideways”, Karen will not be drinking any F#*&^% Merlot!
May 19th, 2009 at 7:43 pm
@cvienne,
man, it sounds like you’ve had an interesting life the last 20 years. I’m curious, where do you get your seeds for your crops?
May 19th, 2009 at 7:49 pm
I’ve read a lot on this site in the last several months, but little compares to Gavshire Hathaway’s deflationary analysis:
http://www.ritholtz.com/blog/2009/05/spx-swings/#comment-173283
Well said. This will be a brutal and strange decade we are entering.
May 19th, 2009 at 7:59 pm
Look, the FED can do nothing to stop the deflation:
As Zero Hedge expected a few short weeks ago, the Fed realized that its TALF revision 364.5 for CMBS was worthless, so today, after many deep thoughts on how to force feed U.S. taxpayers even more toxic garbage, the wise and grizzled Ben Bernanke issued TALF directive 364.6 and decided to extend the acceptance threshold to all past legacy CMBS loans as eligible for TALF. While the original seniority has to be most senior, the following cryptic language was added with regard to current ratings:
May 19th, 2009 at 8:04 pm
Not that it’s news or really meaningful but I’ve just got to point it out anyway. GS upgrades BAC to “conviction buy” (friggen B.S.) a couple of days prior to them coming out with this huge secondary offering. And the herd trampled over each other to get some of that. I know, I know – but really, why is it so damned predictable? It’s all just so damned inces-tuous on Wall Street.
May 19th, 2009 at 8:05 pm
Wouldn’t take my post above. So I stuck a hyphen into inces-tuous as I suspected that was the offending word, and it then took it. Strange censor logic.
May 19th, 2009 at 8:38 pm
Andy T – you were right about puts being the primary factor in OpEx this month, pushing down the SPY into Friday and allowing it to bounce back on Monday. Countertrend rallies are notoriously hard to read compared to the impulsive waves.
Re: 2008 spring fling – the QQQQ hit a high of 50.5 in early June. However, the QQQQ trendline from the late March low to the mid-April decline and then the late May decline didn’t break until two days after the June high.
In contrast, this year the tight channel from April 20 to May 8 broke decisively on May 12. Like in 2008, QQQQ tried to retake the broken trendline but failed. (IWM/RUT shows the same pattern, but it broke down on May 13.)
In 2008, it looks like that QQQQ attempt at retaking the uptrend line in mid June was wave 2 of the 5 wave decline into the July 15 low. Applying that template to 2009, the QQQQ rally from the May 7 high to the May 13 low was wave 1 and the subsequent rebound is wave 2. In 2008 wave 2 was a flat lasting 5 trading days; we’ve seen 4 trading days since the May 13 wave 1 low.
While I think the high for QQQQ is in, I think we’ll see SPY get closer to 1000 in late summer. If SPY goes to 1000 but QQQQ can’t get above 35, that would be a bearish divergence.
May 19th, 2009 at 8:50 pm
Erik,
Nice analysis.
May 19th, 2009 at 9:00 pm
Indeed, Eric K…
That would be one hell of a divergence though. SPY will start to break when XLF and crude breaks, which is likely sooner than late summer. Just my from the hip analysis after a pint or two. But failed retest on the Q’z for sure. Repeat.
May 19th, 2009 at 9:05 pm
Re: The actual chart though:
That might be the cleanest looking potential (emphasis) Inverse Head & Shoulders base I’ve ever seen. Not confirmed yet of course. Is one of the strongest base formations though historically speaking.
May 19th, 2009 at 9:15 pm
@karen: I’m in hamilton. My sister’s family lives up here and her husband works in manchester by the sea. I’ve spent a lot of time up here over the past 13-14 years. Great area.
May 19th, 2009 at 10:02 pm
Interesting chart:
http://cobrasmarketview.blogspot.com/2009/05/institutional-buying-and-selling_19.html
May 19th, 2009 at 10:52 pm
@ben22
Sorry for the delay…I was away for awhile…
Re: (7:43)…Seeds…
I get seeds from all over the place…Exotic stuff you can get on the internet…Easy 7 normal stuff you can get at any local store like HD, Lowes, or Wal-Mart…
These days, I’ve taken to generating MY OWN seeds by letting some excess plants bolt and harvesting the seeds from that…It ends up so you don’t have to pay anything for anything…
For any of you people who want to start GROWING things on your own balconies or decks (if you don’t have land)…That’s easy too…I don’t recommend that you invest a lot of money in those high priced EARTH BOXES (which can run you up to $80)…Really all plants like is good drainage…So just get cheap laundry baskets from Wal-Mart…The slats provide the drainage but hold the soil…If you need more drainage, just drill a few holes in the bottom…
Also, if you’re PAYING for water and don’t have a well, cut the water spouts from the drains off your roofs, and funnel those into containers…Anything will do (like 50 gallon trashcans), but make sure you put screening over that in a way to keep the standing H20 from breeding mosquitoes…
Some bugs will naturally attract, but you can plant marigolds and citronella grass to keep those populations down and you’re good to go…
May 19th, 2009 at 10:59 pm
I-Man: Correct…the “potential” H&S though there is staggering…unfortunately for folks with a bullish bias it means correcting back to 750 ish…..i guess that’s only a 20% decline….that said….i’d probably “find” a technical reason to buy back shorts in the mid 700s…..
May 19th, 2009 at 11:10 pm
You guys never talk about the $wlsh, and i think you need to keep it in mind… $tran as well, of course..
Stuffing my face with room service pizza and organic merlot from Mendocino.. I wish I were in Italy, no one would be tracking my wine consumption… I can’t believe the comments I’ve gotten from ‘in room dining’ and the servers… lol.
May 19th, 2009 at 11:18 pm
@karen
I lived in Italy (umbria) for 12 years…Made my own wine from my own vines, and otherwise bought great other local ones for about $2 a bottles…
Needless to say, we didn’t bother ‘tracking’ what we consumed…
Few realize that wine goes great with pizza…most insist on beer…
May 19th, 2009 at 11:22 pm
And I DO talk about $TRAN…
I was yapping all up and down about it all last week…
You’re a doji girl arent you? Would today on $TRAN be a falling star?
May 19th, 2009 at 11:29 pm
cvienne, i replied to you earlier but my post was withheld… it’s now available at 5:51. actually, it was to you, andy and ben22.. i did boost that retail sales number btw..
May 19th, 2009 at 11:32 pm
uh-oh, now there is I-man’s gravestone doji on my $tran… well, we will see what tomorrow brings.
May 19th, 2009 at 11:50 pm
This is sort of interesting:
Samuel T. Benner was an ironworks manufacturer until the post Civil War panic of 1873 ruined him financially, he noted that the highs of business tend to follow a repeating 8-9-10 yearly pattern. If you apply this to the DOW:
Year Interval Market Highs
1902 April 24, 1902
1910 8 January 2, 1910
1919 9 November 3, 1919
1929 10 September 3, 1929
1937 8 March 10, 1937
1946 9 May 29, 1946
1956 10 April 6, 1956
1964 8 February 4, 1965
1973 9 January 11, 1973
1983 10
1991 8
2000 9
2010 10
So, what is interesting is that there weren’t really big market highs to speak of in 1983 and 1991, then around 2000 of course just after a major top. I wonder if the massive amount of credit injected into the system over that time had any impact. That said, I have a hard time thinking this rally could push us into new highs all the way into 2010.
With respect to economic low points, Benner noted two series of time sequences indicating that recessions (bad times) and depressions (panics) tend to alternate. In commenting on panics, Benner observed that 1819, 1837, 1857 and 1873 were panic years and showed them in his original “panic” chart to reflect a repeating 16-18-20 pattern, resulting in an irregular periodicity of these recurring events. Although he applied a 20-18-16 series to recessions, or “bad times,” less serious stock market lows seem rather to follow the same 16-18-20 pattern as do major panic lows. By applying the series to the alternating stock market lows, we get an accurate fit, published as the Benner-Fibonacci Cycle Chart. If you take the time to map this out, it draws some pretty interesting conclusions.
This formula, based upon Benner’s idea of repeating time series for tops and bottoms has fit most of the past century’s stock market turning points. Whether the pattern will always reflect future highs is another question. It’s a fixed cycle which can lead to problems.
May 19th, 2009 at 11:55 pm
my post got destroyed above, I tried to format it but then it ended up like that
probably makes no sense
May 20th, 2009 at 12:10 am
Ben22-
good effort nonetheless- point is understood
May 20th, 2009 at 12:20 am
@ben22
Have you ever heard of Martin A Armstrong?
His research shape up in a very similar way to Benner (with respect to cyclicality)…
if you are unable to find his “charts”, ask me and I’ll provide them…Meanwhile, it would do some good to research this guy yourself a little…
He is controversial (and actually in jail for fraud), but fascinating…
May 20th, 2009 at 12:26 am
@cvienne,
No i haven’t heard of armstrong. I’ll look him up. thanks.
May 20th, 2009 at 12:46 am
@ben22
I’ve been vaguely following his synthesis for years now, but forgot about him for a bit…
Here’s one of his LATEST…just published in february ‘09
http://www.contrahour.com/contrahour/2009/03/martin-armstrong-is-it-time-to-turn-out-the-lights.html
May 20th, 2009 at 12:54 am
@cvieene,
nevermind what I said before, I had just read a paper by this guy at ZH not long ago. I just didn’t recognize the name again right away. Not really sure what to make of him.
May 20th, 2009 at 1:01 am
Italians know how to live on NOTHING yet have wonderful lives…It makes me understand how FAR from that Americans still are…Here, they’re still fighting about job benefits, stimulus packages, and re-living the DEBT FUELED era of having 4,000 sq. ft. Mcmansions and how to perpetuate that existence…
In Italy, I think they did away with that notion about 400 years ago…
Isn’t that how long they’ve lived under central banking?…..Coincidence?
May 20th, 2009 at 1:03 am
there is an awful lot in that article from 12:46, gonna have to read that one again.
May 20th, 2009 at 1:19 am
@cvienne: why did you come back? Not a frivolous inquiry – I’m trying to decide whether to return to my European stomping grounds from years ago.
Re: Italian living – I learned much from their methods. Now about half of my fresh produce is volunteer – mustard greens, cilantro, arugula, borage, potatoes – I never know what I’m going to find out in the garden! Have the pomidori in the ground, also zwiebeln, radisli, spinat, peperoncini, ruebli; however, my corn isn’t in yet – still too wet here in Oregon.
I, too, have a day job as a freelancer for various print and web publications, but it’s more of a cover for my travel activities. Actual earned income is the smallest number in my list of sources of income.
Have learned much from the wisdom of regular posters here – just put in my first two trailing stops a couple of weeks ago. I’m long everything. Don’t understand arcana like puts, calls, ETFs, heads-and-shoulders, etc., but I, too, am nervous about the S&P500.
“We are all little students.” Wo men dou shi xiao xuesheng.
Zhou En-Lai
May 20th, 2009 at 8:41 am
@JoWriter
Re:(1:19)
I really came back due to something very simple…I’d had the incredible fortune (timing), of buying NASDAQ stocks in the early 90’s…
I sold everything literally in March 2000 and bought property in Italy with the proceeds (I’d been living there for 8 years, but didn’t own anything)…The property happened to TRIPLE in value in just 5 years…
Originally, I wasn’t buying for the investment value, but when home prices went ballistic, I saw the writing on the wall and decided to take the money and run (figuring that I’d be able to find something ‘cheaper’ after the inevitable crash)…
Recently, I just paid CASH for a property that was distressed so the loop is complete…
I really miss Italy, but i don’t mind being back here closer to my family either (as I’d spent the better part of 25 years in various places)…
June 1st, 2009 at 12:04 am
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June 17th, 2009 at 10:01 pm
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