Winter Watch

China on Saturday signaled intent to allow more “market” float of its currency.   This Reuters article suggests that the immediate effect will be to back up Treasury rates, and that the UST auction this week and next will be a litmus test....
Read More »

The Chinese are going to try and push through a $28 billion IPO of Agricultural Bank of China (ABC). Pricing will be on July 6th. This f need for dough will come at a time when market conditions have already weakened considerably as realization has spr...
Read More »

On the California watch, the June 15 budget deadline for the new fiscal year that starts July 1 has come and gone. The new budget advanced by the Governor has not been implemented and a deadlock has ensued.  An estimated $19 billion deficit needs to b...
Read More »

Tuesday’s brought the newest version of the 2% plus low volume algo driven rally, and took the McClellan Oscillator to the highest level in a year.  This is a phony market of the highest order,  and bears should treat it as a gift, and consider...
Read More »

“Whoever is careless with the truth in small matters cannot be trusted with the important matters.â€� ~ Albert Einstein April data on foreign holdings of US Treasuries has arrived on the scene.  Foreigners increased their stake to $3.96 ...
Read More »

There are numerous signs now that the endless so-called stimulus attempts of the Obama administration are being politically challenged. Here we see a proposal to bailout the States with $50 billion more; however, this one’s fate is already in dou...
Read More »

The S&P 500 has bounced between two very strong support (1050) and resistance levels (1100) . It’s been repelled by resistance three times and buoyed by support three times. When the S&P breaks through either support or resistance, watch ...
Read More »

With a series of disasters environmental and otherwise revealing problems with governance and regulation, one might wonder where the watchdog reporting has gone.  One never hears much about these problems until afterwards. The answer according to t...
Read More »

The statement from the G20 demonstrates clearly that, except perhaps for the US,  fiscal austerity has gained policy ascendancy.  The idea that Gumnuts can apply endless sugar highs and steroidal Keynesianism to support who knows what is going to be ...
Read More »

The statement from the G20 demonstrates clearly that, except perhaps for the US,  fiscal austerity has gained policy ascendancy.  The idea that Gumnuts can apply endless sugar highs and steroidal Keynesianism to support who knows what is going to be ...
Read More »

The funding level of US pension funds fell to 82 percent of liabilities in May.  Looks like the relationship is one percent  for every two percent in stock market gain or loss.  June’s losses so far promise to add further to pension funds&...
Read More »

One of the more revealing aspect of the American pretend and “pay me later” economy is that states are joining forces with housing squatters by just refusing to pay bills.  On a cash flow basis this works wonderfully just as long as the a...
Read More »

“An America that runs solely on fossil fuels should not be the vision for our children and grandchildren.” – Barack Obama I have some observations and notes about drillers, energy engineering firms and producers in terms of reaching s...
Read More »

I will be putting up a major post on energy this evening (Hawaii time or midnight EST). There was poor volume on the rally and on yesterday’s decline. The gamers are back in force. I’d like to see the MO relieve well up into positive territ...
Read More »

“The bank wouldn’t help…They’re all crooks.” – Florida squatter, NYT The New York Times has a revealing article out that describes the squatter “revolution.”   The squatters in the story freely admit to ...
Read More »

The chart below is slightly dated but shows the percentage of Treasury and agency securities to bank assets. The most recent data is shown here and is $1,502 trillion versus $11.930 trillion in bank assets or 12.6%.  Although this percentage is well w...
Read More »

I am sure that you, like me, have friends or relatives who if are not in denial about what is happening, are suffering from serious  cognitive dissonance issues (CDI).  I think this is an American epidemic. An understanding of how CDI works is esse...
Read More »

This is a market purely on life support, sustained by the federal government,”- David Stevens, FHA chief “European leaders face the difficult challenge of trying to restore sustainability to an unsustainable system.” – Uh? Timmy ...
Read More »

Today, the market looked like a staged rally. Allow me to emphasize the word “staged,” which is a classic reversal out of an early rout. It all happened right at the 1050 support level, finishing at the high of the day, and climbed still hi...
Read More »

Yesterday, I discussed the market’s herding, opiate induced and delayed tendencies to recognize and respond to clear and present danger. I used the OIH drilling sector and the oil spill as an example.  The herd trade du jour is the fear reflex t...
Read More »

“Both Europe and the USA are out of bazooka ammo now. Nobody can bail out so much as another lemonade stand. From here on governments really start to crumble.” —  James Howard Kunstler The algos seemed to have lost another reliable &...
Read More »

“Both Europe and the USA are out of bazooka ammo now. Nobody can bail out so much as another lemonade stand. From here on governments really start to crumble.” —  James Howard Kunstler The algos seemed to have lost another reliable “correlation” that had become known as the “Monday ramp,” as late day trading was...
Read More »

The 160 points in the last 15-minute shank pretty much came and went, once again demonstrating just how broken this market has become.  The strategy I employed was largely unaffected, although once again it became extremely difficult to execute option...
Read More »

“Charlie don’t surf” “You either surf or you fight”- Col. Kilgore I was hoping to watch a little surfing  today a la Col. Kilgore, but the battle isn’t quite concluded as the cold dead hands Boyz are back with an sh...
Read More »

We are at bottom of channel I have been posting about. If you have straight shorts or bearish double inverse positions without options written against them I would close them out here. If you have bear spread positions such SPY 117/112, XRT 42/40, or ...
Read More »

ICI has reported the equity mutual fund flows for the week (through May 12) of the flash crash and investors were spooked sufficiently to pull $12.331 billion out. That’s a real challenge when funds have 3.4 percent cash levels, which are at gen...
Read More »

The news out of Europe is a major attack on dangerous take-these-dice speculative pools that are gaming the markets.  In my view, such steps are long, long overdue.  Articles such as this “Germany Goes Rogue“  totally miss the point.  It should be “Germany Launches Counterattack Against the Rogues.”   THIS IS THE RIGHT APPROACH and...
Read More »

Reports are coming out of China that the real estate tightening is having an immediate effect, as sales volume collapses 50% and prices so far are off 10-15%. There is also a rumor that Shanghai is about to put on a property tax on non-operating properties.  So far this year, over 50% of fixed...
Read More »

It is my belief that the stock market is getting into a steep down channel pattern (see chart) .  There simply isn’t the kind of sideline cash on hand to reverse this.  There is zero, and I mean no indications that smart money is even remotely moving into stocks. There is a big need...
Read More »

We are seeing a pattern here, and once again it centers around spinning the truth. Case in point are new revelations based on film analysis of the oil spill leak, and that the true nature of the pipe is a gusher and not a leak. Once again this information comes to light three weeks after the...
Read More »