Friday , December 15 2017
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Tag Archives: Chart Update

Gold Sector Correction——-What Happens Next?

The Long Awaited Correction is Underway The gathering of central planners at Jackson Hole was widely expected to bring some clarity regarding the Fed’s policy intentions. This is of course a ridiculous assumption, since these people have not the foggiest idea what they are doing or what they are going to do next. Like all central planners, they are forever groping in the dark. Hi there! Stanley Fischer finds chief central planner Janet Yellen deep in the bowels of the Eccles building. In...

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Insanity, Oddities and Dark Clouds in Credit-Land

  Insanity Rules Bond markets are certainly displaying a lot of enthusiasm at the moment – and it doesn’t matter which bonds one looks at, as the famous “hunt for yield” continues to obliterate interest returns across the board like a steamroller. Corporate and government debt have been soaring for years, but investor appetite for such debt has evidently grown even more. The perfect investment for modern times: interest-free risk! Illuustration by Howard McWilliam A huge mountain of...

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Meet The BOE’s Mark Carney——-Another Central Banker Wrecking Ball

  Mark Carney, Wrecking Ball For reasons we cannot even begin to fathom, Mark Carney is considered a “superstar” among central bankers. Presumably this was one of the reasons why the British government helped him to execute a well-timed exit from the Bank of Canada by hiring him to head the Bank of England (well-timed because he disappeared from Canada with its bubble economy seemingly still intact, leaving his successor to take the blame). This is how Mark Carney is seen by the press. A few...

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US Economy Update——A Lot Of Indicators Say Something’s Not Right

Another Strong Payrolls Report – is it Meaningful? This morning the punters in the casino were cheered up by yet another strong payrolls report, the second in a row. Leaving aside the fact that it will be revised out of all recognition when all is said and done, does it actually mean the economy is strong? Quo vadis, economy? Image credit: Paul Raphaelson As we usually point out at this juncture: apart from the problem that US labor force participation has collapsed (i.e., millions of...

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A Fully Automated Stock Market——-Peaking At Internals And Blowoffs

Anecdotal Skepticism vs. Actual Data About one month ago we read that risk parity and volatility targeting funds had record exposure to US equities. It seems unlikely that this has changed – what is likely though is that the exposure of CTAs has in the meantime increased as well, as the recent breakout in the SPX and the Dow Jones Industrial Average to new highs should be delivering the required technical signals.  The bots keep buying… Illustration via carolublog.wordpress.com All these...

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The VIX Breaks Out – Market Risk Continues to Surge

  The Sharp Move in the VIX Accelerates In Monday’s trading session, the upward move in the volatility index VIX (which measures the implied volatility of SPX options) continued unabated, vastly out of proportion with the move in the underlying stock index. “Brexit” fears continue to grow, which has apparently been the driving force behind this move. The “Brexiteers” are gaining support as the referendum date draws closer – global financial markets are getting somewhat upset over this. Photo...

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Brexit Paranoia Creeps Into the Markets

  European Stocks Look Really Bad… Late last week stock markets around the world weakened and it seemed as though recent “Brexit” polls showing that the “leave” campaign has obtained a slight lead provided the trigger. The idea was supported by a notable surge in the British pound’s volatility. Battening down the hatches… On the other hand, if one looks at European stocks, one could just as well argue that their bearish trend is simply continuing – and likely would have continued...

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Bank of Japan: The Limits of Monetary Tinkering

  Damned If You Do… After waking up on Thursday, we quickly glanced at the overnight market action in Asia and noticed that the Nikkei had tanked rather noticeably. Our first thought upon seeing this was “must be the yen” – and so it was: June yen futures, daily – taking off again – click to enlarge. Given the BoJ’s bizarre plan to push consumer price inflation to a 2% annualized rate within [enter movable goal post here] years, Mr. Kuroda cannot be overly happy about that. In fact,...

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Behind The GDP/BLS Jobs Mirage——-US Gross Output Continues to Slump

  The Cracks in the Economy’s Foundation Become Bigger Last week the Bureau of Economic Analysis has updated its gross output data for US industries until the end of Q4 2015. Unfortunately these data are only available with a considerable lag, but they used to be published only once every few years in the past, so the current situation represents a significant improvement. Decay… Photo credit: bargewanderlust As Ned Piplovic summarizes in his update on the situation on Dr. Mark Skousen’s...

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Dismal Earnings, Extreme Valuations, Elevated Risk——What’s Up With Stocks?

  Dismal Earnings, Extreme Valuations The current earnings season hasn’t been very good so far. Companies continue to “beat expectations” of course, but this is just a silly game. The stock market’s valuation is already between the highest and third highest in history depending on how it is measured. Photo credit: Kjetil Ree Corporate earnings are clearly weakening, and yet, the market keeps climbing. The rally is a bit of a “all of worry” type of phenomenon actually, since many of the...

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