Jerome Powell just said with a straight face that all of the Fed programs have been instituted in order to allow markets to once again effectively price risk
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
Originally Posted by Krugminator2
SPY hit 301. Absolute bloodbath. These "obvious" ideas always seem so much easier to implement in hindsight.
Last edited by Krugminator2; 06-11-2020 at 01:14 PM.
Today's selloff seemed to come out of nowhere. Luckily I don't trade short term.
One reason given was a "spike" in corona cases. But deaths keep falling. Personally I think cases rising and deaths falling is a good thing.
Last edited by Madison320; 06-11-2020 at 02:25 PM.
Instead of saying markets are the most overbought and speculative in history and a selloff was inevitable, articles always come up with some BS fundamental reason.
This is going off topic but it seems like the number of cases is diverging from the number of deaths. Cases are rising or at least leveling off but deaths continue to drop. It seems to me all the news is now switching from reporting cases not deaths. Coincidence?
More testing, though hospitalizations are reported as rising also.
I don't see how any of it matters since it's been proven that the tests are garbage, hospitals are lying about admissions and causes of death and there are questions about whether the tests that do sometimes work are detecting antibodies from past flu shots and recent bouts with regular flus and colds.
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
The news media is disgusting. Fear and sensationalism sells. They completely stopped covering the virus to cover the domestic terrorists. Then now back to peddling fear even though summer is hitting and the death rate had dropped nationally.
I'm wondering how much the overall increase in total US deaths will be for 2020. I'm been running some number thru my head and it seems like it's only going to rise by a percent or two. You'd think it was tripling listening to the news.
PPT computers on the job today. Headline hit during JPow's Senate testimony that Beijing is closing down all schools for Covid resurgence. All markets immediately fell off a cliff, Dow dropped from +800 to +90 in a few minutes, then 10, 20 and 30 point chunks immediately started trying to push it back up. I could watch the algos continuously trying to sell-off but for every 10 point chunk drop a 20 point boost countered it. The algos finally got the message that YOU WILL NOT GO RED and stopped selling. Big chunks back up to +450, where it stayed.
Nothing resembling a market exists any more. The entire thing is engineered and rigged.
A few points from JPow's testimony.
1.) Credit markets have greatly improved but the Fed promised to buy corporate bonds months ago, which turned markets around, so we have to do it whether it's needed or not.
2.) Dem senators asked nothing but questions about how will JPow get black people those sweet, sweet Fed bux. Election year
3.) When asked about expanding the balance sheet this far, this fast, how will it be unwound? JPow replied "we don't think about that."
Last edited by devil21; 06-16-2020 at 09:38 AM.
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
Dow and S&P closed red on a Friday. AFAIK that hasn't happened in a long time. Every effort was made to keep the numbers looking pretty over the weekends.
Rumors of June 21 and perhaps June 24 being interesting dates to watch.
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
The market is still really strong. The stocks that have lead the rally (tech like Shopify Tesla and the biotech stocks) are still really strong. Even though there are a lot speculative extremes major tops are a process that don't happen overnight.
Some small cracks showing in the market. Shopify and Fasly down on a big up day in the market. Tesla looks like a bit of a blowoff move. Decent odds of another gap up tomorrow. If the market gaps up and closes red tomorrow above average chance for start of a pull back. Nasdaq 22% above the 200 day. Vix closed up slightly on a big up day which has been a tell this year.
Mr.CrackheadMarket needs another fix.
On the other hand...
...that might do it.
Last edited by r3volution 3.0; 07-06-2020 at 09:16 PM.
The above notwithstanding, that being a short-term issue, I'd say that the risk is decidedly to the upside.
Dow 50,000 is far more likely than Dow 5,000.
The Fed will never allow the latter to happen, at least not for more than a day or two, or however long it takes to warm up the printers.
The Venezuelan stock market is up 270% YTD.
Whether we see 50k or 5k depends entirely on how long the Fed runs the printers before the FRN is wiped away and the dollar itself revalued/reset to their CBDC digital dollar. I'm thinking it's not going to be nearly long enough to see 50K. 5K after a reset is more likely, imo. I also think this is why coinage is being pulled from circulation under the Covid cover story. A quarter dollar is a quarter dollar regardless of what happens to the FRN's official valuation. After a, say, 10:1 revaluation, a quarter dollar coin becomes quite valuable. I don't see them letting true hyperinflation take hold before a reset is done. I forecast years ago that a reset to gold-backing (albeit now it looks like a gold-backed digital currency) would happen before real skyrocketing prices hyperinflation was allowed to happen and I'm sticking to it. Most of the signals I'm seeing say that a reset isn't far off....late stage Treasury FRN looting, coins pulled, cash restricted, distractions galore, WEF's "Great Reset" website, gold and silver demand at institutional levels, Fed openly violating charter just to keep up illusion of functional markets, among others.
http://www.ronpaulforums.com/showthr...-money-is-done
Last edited by devil21; 07-08-2020 at 10:58 AM.
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
Alright. This is just obnoxious. The only time I can find the 10 day moving average of the put call ratio this low is two weeks before the flash crash in 2010.
Maybe this time is different for a variety of reasons. But there is strong evidence to believe Nasdaq will take a huge $#@! next couple of weeks. I don't care how much money the Fed is printing. I think 5% pull back seems doable from QQQ at 262.18. Down below 250.
I don't see a return to gold even if the alternative is hyperinflation.
It would mean the greatest liquidation in world history. Among other effects, entitlements and pensions would collapse.
And that makes for a very tough slog come reelection time, and I think we know where the politicians' priorities lie.
But, if you're right, gold will have to be revalued to an extraordinarily high level.
So, whether that happens, or, as I expect, we stagger into stagflation, gold and the like is the place to be.
How are you playing it? Have you sold stock, bought puts?
I've toyed with the idea, but I can't bring myself to risk losing the upside.
We're entering a world of extreme volatility.
We could wake up tomorrow and find that the Fed monetized half the bond market.
Scaling in slowly. Shorted qqq small two days ago. Bought puts yesterday and today. Not going to add right now. Don't feel great about it. Even though everything is up not really climaxy moves.
Watching Fsly, gsx, lvgo for red days to short. Also looking at all electric car stocks to short bldp tsla blnk nio solo. There is probably a 90% chance gsx is a total fraud and a zero and everyone knows it but it is 90 bucks because the market doesn't care. Tech bubble valuations right now.
A small number of stocks are causing this melt up. Stay at home stocks and tech stocks like electric vehicles.
Last edited by Krugminator2; 07-09-2020 at 05:11 PM.
The accepted notion is that gold would have to be revalued to an extraordinarily high level, but is that really the case? It would have to be -if- the same amount of nominal FRNs/FRNs denominated accounts existed during the gold revaluation. Seems to me that real Main St. money is actually being drained from the economy right now, not expanded. Families are spending any savings for daily life necessities and if/when the Trumpbux stop, we'll see just how few fiat dollars really are out there. It's not that many, really, that aren't tied up in various 401ks or under similar trust/custodial arrangements with banks. The same banks that are 75% physically closed, while hard currency is being withdrawn from circulation.
Wall St accounting entries are expanding hugely, yes, but those are merely ledger accounting entries between banks and can be deflated just as quickly as they were expanded, if not faster, if/when the Fed decides. Foreign held dollars are reportedly becoming scarce, which indicates a similar global draining of dollar liquidity and the associated moves by other countries to quickly get out of the dollar, which reportedly is starting now and looks to be reflected by the now-falling DX. A return to a gold-backing would not require a huge upward revaluation if most of the fiat FRNs have, in fact, been zero'ed out from the global economy and Main St. All that would be left is Wall St and the next President, who will be a Dem imo, will serve to cut that down. The WEF is calling it The Great Reset for a reason. I don't think they mean resetting upward but resetting downward.
Last edited by devil21; 07-09-2020 at 06:34 PM.
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
The more dollars outstanding relative gold reserves, the smaller the amount of gold available to back each dollar, i.e. the higher "price" of gold in dollars. E.G. If we take current M1 + Savings Accounts and give that a 10% gold backing, that would require a gold "price" north of $6000. The only way to get a lower price is to do a lower backing (which risks bank failures and liquidation) or to reduce the number of dollars or dollar-denominated demand deposits (which pretty much requires that same liquidation).
I thought that's what I said?
"Let it not be said that we did nothing."-Ron Paul
"We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book
Shorting the QQQ at 268/269 is about as low risk as it gets in the market. Not free money but will likely trade down from here over the short term.
Well then, I guess we agree.
Up about 3% since you posted...
It should crash, of course, but it would appear that price discovery has been outlawed.
QQQ went straight down 15 points starting within a couple of hours from that post.
I'll own it when I am wrong but that was my biggest day of the year or close to it.
In the the other post thought 250 was doable. Bottomed at 252.76
Last edited by Krugminator2; 07-20-2020 at 07:32 PM.
Genuinely glad to hear it worked out for you, but I do think you're playing with fire shorting this market.
Short term moves aside, are you expecting a long-term deflationary trend?
No idea. I would be pretty skeptical of anyone says they know. I don't guess at those big macro things because I will probably be wrong 80 percent of the time. It would seem like we should finally have price inflation given how aggressive the Fed has been. But if this is an asset bubble and it pops then that would be deflationary.
I think we're different kinds of investors.
I'm $#@! at timing; all I do is think about the long-run trends and try to get positioned, with patience.
You're good at timing and don't focus as much on the long-term trends.
Anyway, I think the long-term future is pretty clear. The Fed is trapped at ZIRP because there will be a deflationary collapse of politically unacceptable proportions if they tighten to any significant degree (we saw the preview late 2018). Given that, what happens if/when inflation appears? Suppose, a year or two from now (which is my actual timeline, for what little that's worth, given my $#@! timing), the Fed's still trapped, and the CPI's at 4% and rising? They will have the choice to allow the inflation to continue or to allowe a deflationary collapse, and I'm 100% certain that they'll choose the former, for political reasons. AFAIK, no state with the ability to print the currency in which its own debt is denominated has ever defaulted in nominal terms. I don't expect the US to be an exception.
Silver hit a multi-year high today, 19.99, on an unrelated note...
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