Archive for the 'Markets' Category

One Number To Rule Them All

Thursday, January 25th, 2018

There is one number that will determine the fate of the world and its financial markets.  In the United States, that number is the Core PCE inflation number, or at least expectations of what that number might be in the future.  This number or its expectations will determine the posture of the Fed.  Analogous numbers […]

Price Protection Group

Tuesday, May 23rd, 2017

Asher Edelman had an astonishing interview on CNBC Fast Money this afternoon.  In it he claimed that Reagan’s Executive Order 12631 which established the Working Group on Financial Markets resulted in the fabled Plunge Protection Team which he called the Plunge Protection Group, reporting only to the President.  Comprised of the heads of the SEC, […]

On the Nature of Price Movement

Saturday, March 18th, 2017

There are, I think it is safe to tentatively assert, only two reasons why the prices of things – whether goods, services, financial instruments, derivatives or other commodities – fluctuate.  These can be categorized as flow and state.  Consider first the notion of flow.  At the margin where price determinations are made, there are usually […]

What Was Once Taboo Is Now Policy De Rigueur

Wednesday, February 15th, 2017

There was a time back in Donald Trumps cherished clean American past when representatives of our government would go out of their way to distance themselves from any notion that anything they do is intended to affect markets directly.  It was considered bad form to interfere with markets as we considered our nation the worlds […]

Apple Stock Being Manipulated?

Tuesday, January 24th, 2017

Look at the hourly chart of AAPL below.  For the last week plus it has barely moved around $120 per share.  The week before, it barely moved around $119 per share for the whole week.  There is no way a stock like this can have such low volatility right at an even dollar number for […]

To Tim Seymour: Yeah I Bought Gold At The Bottom

Saturday, October 22nd, 2016

On September 2016, there was a fantastic exchange between CNBC commentator Tim “All Is Well” Seymour and Bill Fleckenstein.  In it Seymour mocks Fleckenstein for his bearish views and then says, “yeah and I bet you bought gold at the lows right?”.  My views run more towards Fleckensteins and less toward Seymours.  Aside from the […]

Why Rates Rose and Stocks Fell Last Week

Monday, September 12th, 2016

Long term interest rates curiously moved sharply higher last week as Fed officials were perceived to have turned more hawkish about raising rates, insisting that September was a live meeting for the Fed.  30 Year Bond Futures (USZ16) on Thursday and Friday went from just over 171 to just under 167 to close out the […]

Yellen Suggests Equilibrium Real Rate for Overnight Money is Zero

Thursday, June 16th, 2016

The most interesting tidbit to me in Janet Yellen’s post-FOMC press conference yesterday was when she was discussing the neutral real rate of interest (net of inflation) for an American economy running at trend growth near full employment.  She cited that there is some research that suggests that that rate is now zero percent.  Now […]

Bear Markets and The End of Two-Term Presidencies – Also, Bernanke Dooms the Markets

Wednesday, January 20th, 2016

It occurs to me that the last two times the US has entered the final year of a two term Presidency, the stock market has crashed.  Stocks made a high in March 2000, 8 months prior to the voting that elected Bush W.  Then they ground lower until March 2003 when that same W shared […]

The Tyranny of the Non-Economic Market Players

Friday, November 14th, 2014

Anyone paying attention has by now noticed that these are not your father’s markets.  Stocks go one way, up.  Commodities swing wildly up and down as the “stock guys” wax and wane over their love of this or that market (for the second time this year it is Ag markets – after all everyone knows […]

The Real Meaning of the Japanese Action – Raw Desperate Fear

Monday, November 3rd, 2014

Stock markets rallied hard on Friday after the Bank of Japan (BoJ) threw the kitchen sink of Central Bank Keynesian bullshit at their bond and stock markets, as well as ours. In order to allow their great pension monster GPIF to move a large sum in the hundreds of billions of dollars out of JGBs […]

On The Big Spending Boost Expected From Lower Gasoline Prices

Thursday, October 30th, 2014

The talking heads on the financial news are all agog about how much stimulus the lowering of gasoline prices will provide and how we are in for an awesome Christmas retail season with gas prices down. First of all, here in Minnesota, gas prices are holding above $3 or even $3.19, which represents an outsized […]

The Story With

Thursday, October 23rd, 2014

Amazon just reported earnings for Q3 2014. They missed on both the top and the bottom lines. My 2 cents on Amazon are as follows. Whatever happens with their cloud and server business, which they largely pioneered to their great credit, the end of the road is in sight for Amazon and their million x […]

A Strike Against MLB – Our Viagra Culture

Thursday, October 16th, 2014

It is too bad I cannot watch the Baseball playoffs and I would assume the World Series either with my kids who are school age girls. In between every half inning there is a Viagra commercial and talk of getting it up and keeping it up. To which I can only say WTFF? I mean […]

Ms. Yellen Doth Protest Too Much, Obama for the Rich

Monday, August 4th, 2014

The recent testimony by the Fed Chair in Congress was very troublesome the more I think about it.  Pressed by Jeb Hensarling, the House Financial Services Committe Chair, about weekly meetings with the Treasury Department, she repeated over and over how independent the Fed is and how important that is.  Well, if she is taking […]

The IBM Cloud and Josh Brown

Wednesday, July 16th, 2014

I was in the process of getting my ass handed to me this spring short alot of agricultural commodities when Josh Brown was put on the air to wax lyrical about how Ag was where everybody had to be in a ZIRP world in order to seek yield.  I do not remember exactly what he […]

The Clueless and Naked Empress Janet Yellen on Display

Wednesday, July 16th, 2014

Janet Yellen was just surprisingly asked a good question in the House version of the Humphrey Hawkins testimony, which is turning out to be much better than the Senate version, which is usually not the case as House members tend to be woefully ignorant of anything that goes on in the world or how it […]

On Michael Lewis’ “The Market is Rigged” Interview

Monday, March 31st, 2014

On 60 minutes Michael Lewis stated that the market is rigged.  And he is right.  But when asked by whom, he replied by the exchanges and HFT players.  Of course he is right the market IS rigged.  But I worry less abut HFT “rigging” the market than I do the Fed.  The market IS rigged.  […]

China Tightens Economic Screws. Is it a war front?

Wednesday, March 12th, 2014

The talking heads on the business shows are agog at the collapse of Copper prices this week as Chinese export data fell hard.  It should be no secret that China’s leaders are trying to deftly deflate a credit bubble there before it brings their whole economy down – and with it potentially the Communist Party.  […]

The Immoral Fed

Tuesday, March 4th, 2014

During the financial implosion of 2008-2009, the Fed was faced with the insolvency of most if not all of the large institutions it exists to service. Recall that the creation of the Fed grew out of the experiences of bank runs in the late 1800s and early 1900s, specifically the Panic of 1907. During that […]