In late 99' there was a burst of monetary stimulus, predicated on inoculating the markets against the effects of Y2K, which was a threat to the newly formed electronic banking system. Since then any excuse will do. The upshot all this money printing is the damping effect on economic growth, or money velocity. These three … Continue reading Where the money never stops…
Following the 1998 rate cuts into a speculative stock market, and then facing the threat of Y2K, which is the computer variation of the Corona Virus. The result was a permanent flattening of the Yield Curve, which did not finally steepen until the stock market crashed, or perhaps because of it. The last instance of … Continue reading “Let’s do the Twist, like we did last summer….”
American pragmatism is globally unique. The conspiracy theory surrounding the Corona Virus is built by the Alt Right, and the Democrats used the crisis as a cover to defeat Donald Trump in 2020. How they knew the virus crisis would defeat him, not make him look the powerful leader they know he really is, how … Continue reading The Church of What’s Happening Now
Here is a quick list of quotes you will hear in the future: "We never thought the virus was a threat to the population at large, but rather certain individuals. What it did pose was a sort of secondary threat to our health system. We weren't prepared, and our hospitals, and healthcare system, workers, and … Continue reading Future Quotes
We broke out of the range all the way to 295 or so and then fell back below 287, which I contend may be the new Jump the Shark line. There is a new daily line at 286, which is currently resistance. If can get back above that 286, then the 287 line comes into … Continue reading A whole new way of thinking
Update 10/08: A mirror chart assumes the left side can be reversed on the right side. There is very little standard charting work to suggest this is necessarily valid, though I have seen chartists do this, and that is where I got the idea. The rationale behind applying this, and actually seeing it work, the … Continue reading Through the VIX Looking Glass updated 10/07 with concurrent call from Under the Shark Volcano..
September 18th, 2019..... The line in the water was crossed, again and again. Since technical lines of support resistance tend to be hard lines, this sort of fuzzy logic must seem confusing to newcomers to the field of technical analysis. A full explanation to follow We keep returning to this level, we may as well … Continue reading Return of Jumping the Shark !!!
We could already have established a benchmark on the YC at around that historic .2 level. The hidden signal here is the ROC, or Rate of Change. Circa 94 the ROC was a modest 200. In the current situation it has already hit 600 which is still much lower than the alarm bell readings in … Continue reading Yield Curve History (Update 11/06) incl PREQUEL to “Yield Curve Intolerant”
Some analysts are sure the dollar is going lower. News flash the dollar has been going lower in terms of purchasing power, which implies the dollar is worth more, it takes more dollars to buy a dollar. I would say the Bernanke program of sterilization using Treasury bonds for cash, did a lot to create … Continue reading Manifesto Pesto
You might call it a bear trap, all it proves really is that Volatility is still high, which is a headwind for stocks. A quick review of 2008 provides some good examples of how money flows are still very strong. Wall Street is partying like we hit the purple line, E, the bottom. The Federal … Continue reading More is Less of Something Big
The decline in the A/D, new money, since the middle of April, has been a load on the market. SPY has managed to wobble out with lower highs and lower lows. Now the classic swing move in A/D, blue circle on the right above. First impression the return of positive money flows SHOULD bring about … Continue reading Something Big
To recap: In Economic Thrombosis I the government attempts to "freeze" credit markets. In a normal market the seizing up of credit is a financial crisis, while in the current context the crisis is being controlled, like a controlled burn in a forest, or a patient in an induced coma. The system of modified asymmetrical … Continue reading Economic Thrombosis II
Due to the economic hardships imposed by the Corona Virus the US Government needs to freeze the credit markets, and first of all the mortgage market. Their solution is forbearance to mortgage holders (borrowers), Banks no longer hold mortgages, they package them into MBS, Mortgage Backed Securities, which are then sold to the INVESTING PUBLIC. There a several economic … Continue reading Economic Thrombosis I