Short term trades in the stock market •$$$$$•

[SpasticGramps]

Moral hazard short squeeze coming IMO. Russia, China, Brazil are going to bailout Europe now.

S&P 1300

Good cases for both 1000 and 1300.

 

[Hydrosun]

I'm doing pretty good betting the NFL.

 

[nukklehead]

Moral hazard short squeeze coming IMO. Russia, China, Brazil are going to bailout Europe now.

S&P 1300

Good cases for both 1000 and 1300.

Ill go with the 1000 on that one.. ( actually 950 sounds better)
but who knows...?????Im no pro.. I just like to eyeball and compare the economy/S&P to what it was then to what it is now.... what it is now is overvalued.. its not worthless... just overvalued

 

[SpasticGramps]

Fundamentals definitely point to 950 or lower. Fundamentals don't really matter anymore though. This "new market normal" trades almost solely on moral hazard (government intervention). And mainly rumors of government intervention at that here lately.

It's a totally schizophrenic market. Take these two articles from MarketWatch for example.

Greece staying put in the euro

End game approaches for Greek crisis

German Chancellor Angela Merkel, French President Nicolas Sarkozy and Greek Prime Minister George Papandreou are slated to hold a conference call late Wednesday afternoon as Greece finds itself under pressure to implement further austerity measures in an effort to meet its deficit targets.
But many economists fear policy makers have failed to grasp the imminent likelihood of a Greek default and the damage it could do.

“The risk of a banking crisis is very real. I don’t think policy makers have the luxury of time in getting ahead of this,” said Neil Mackinnon, global macro strategist at VTB Capital in London.

A default by Greece appears likely in a matter of days or weeks, he said, putting the onus on policy makers to come up with a mechanism similar to the Troubled Asset Relief Program, or TARP, put in place in the United States after the collapse of Lehman Brothers and the rescue of AIG.

Market is having it's short squeeze moral hazard rally today. SP close to 1200. Solely based on the conference call between Germany, France, and Greece where they pledged to keep the circle jerk going strong when fundamentals and other market makers tells us a default is coming very soon.

The setup is just like 2008, but worse IMO. Liquidity is drying up. Fundamentals are tanking. Bank CEO are allover TV and news papers saying that they are fine and have enough capital to handle the Europe default. Market is rallying on rumors and hope that everything is going to be OK while CDS, bonds, and US dollar shows that shit is falling apart.

 

[SpasticGramps]

Sold off into the close. Fade that pop and sell that bounce.

 

[bentom187]

a new spin on the recent gold rush. im intrested to hear what the experts here have to say the implications may be,granted this is in april.

http://www.youtube.com/watch?v=rgdn0bNsMkQ

 

[SpasticGramps]

And here's Canada........ having been toted around as the last bastion of stability in the Western World it now has to wake up to the ugly reality that it isn't safe from the systemic tidal wave of shit making it's way onshore.

Global uncertainty, European crisis fuel Canadian meltdown fears

Discouraging signs for the economy are piling up in the United States and Europe, sparking worries that Canadian businesses and consumers may not be able to prop up the recovery for much longer.

Confidence among the smaller companies that account for most American hiring sank to a 13-month low in August, a report from a U.S. business group showed Tuesday, and the number of owners predicting better economic conditions six months from now plunged to the lowest since 1980. In Europe, speculation increased that Greece will default on its debt, and Italy’s borrowing costs soared amid intensifying fears that European authorities cannot keep the euro-zone’s debt crisis from spreading to its biggest economies and their banks.

 

[SpasticGramps]

Someone just woke up and smelled the coffee.

Eurozone crisis could rip EU apart: officials

AFP - The eurozone crisis could wreck the European Union, top EU officials warned on Wednesday as the leaders of Germany and France held talks with Greece to avoid a default and widespread chaos.

The pressure rose on all fronts with United States again expressing great concern, with Treasury Secretary Timothy Geithner saying European states "now recognise they are going to have to do more" to resolve to the crisis.

Highlighting the threat to the global economy, Geithner is to exceptionally attend talks between European Union finance ministers and central bankers in Poland on Friday.

French President Nicolas Sarkozy, German Chancellor Angela Merkel and Greek Prime Minister George Papandreou were to hold a teleconference late Wednesday as markets price in a default by the government in Athens, and credit rating giant Moody's downgraded two major French banks given their exposure to Greek debt.

"Europe is in danger," Polish Finance Minister Jacek Rostowski, whose country currently chairs EU meetings, told the European Parliament in Strasbourg.

"If the eurozone breaks up, the European Union will not be able to survive," he added.

At his most dramatic, Rostowski even warned that "war" could return to Europe if the crisis fatally weakens the EU, founded amid the rubble of World War II.

His underlying message was backed up by European Commission president Jose Manuel Barroso, who described the crisis as "the most serious challenge of a generation."

Barroso stressed: "This is a fight... for the economic and political future of Europe."

Inching closer.

 

[Peppermint]

I usually hang elsewhere but found this thread so chiming in.

The Beginning of the End for Suburban America

[email protected] (Alexis Madrigal), On Wednesday September 14, 2011, 1:29 pm EDT

For decades, Americans have consumed more energy, built bigger houses, and driven more miles with each passing year. Not anymore.



In the years following World War II, the United States experienced an unprecedented consumption boom. Anything you could measure was growing. A Rhode Island-sized chunk of land was bulldozed to make new suburbs every single year for decades. America rounded into its present-day shape.

Along the way, there were three inexorable trends at the base of the societal pyramid. First, we plowed more energy into our homes each and every year. We cooled and heated our houses more (sometimes wastefully, sometimes not), brought in more and more appliances, added televisions and computers and phones. Per capita electricity shot up from about 4,000 kilowatt-hours per US resident to over 13,000 kilowatt-hours by the 2000s. Second, we needed more electricity because our houses got huge. The median home size shot up from about 1,500 square feet in the early 1970s to more than 2,200 square feet in the mid-200s. Third, we drove more and more miles every year to get around and between our sprawled-out cities. Back in 1960, Americans drove 0.72 trillion miles. By 2000, that number had reached 2.75 trillion miles. In 2007, vehicle miles traveled hit 3.02 trillion.

Now, though, the relentless growth in those figures is coming to an end. The AP's Jonathan Fahey reported last week that the utility company research consortium, the Electric Power Research Institute, projected that residential electricity demand would drop over the next ten years. "From 1980 to 2000, residential power demand grew by about 2.5 percent a year. From 2000 to 2010, the growth rate slowed to 2 percent," Fahey wrote. "Over the next 10 years, demand is expected to decline by about 0.5 percent a year, according to the Electric Power Research Institute, a nonprofit group funded by the utility industry." That's due, in part, to the decrease in the median size of new homes in recent years. The average size of a new home in 2010 is nearly 130 square feet smaller than in 2007.

Meanwhile, the number of miles that Americans drive fell in 2008 and 2009 -- even as gas prices fell off their highs. In 2010, Americans drove a little more, but so far in 2011, we're driving less. In other words, the growth in total vehicle miles traveled has stalled. And if you look at vehicle miles traveled per person, the picture is even more clear. On a per capita basis, people have been driving less for almost a decade. Now, with gas prices creeping back toward record high territory, we can expect the new downward trends to continue.

While I can see better energy efficiency, thus resulting in less consumption, with new technology appliances the less driving thing is kind of interesting. I remember when the 2008 collapse happened the freeways in the San Fran Bay area went pretty quiet.

Either way less consumption and the US is a consumer based economy. Less driving equals less $ into the oil/gas pipeline/companies and less wear and tear on cars so less replacement tires/parts/servicing/etc. Smaller homes equals less materials used and less labor required to build them.

Seems some indication of a contraction in various areas and from what I understand the US economy expansion is based part on more and more houses and bigger houses which seems to be reversing. Considering all of the cars a reduction in driving will hurt some companies profits. The US has peaked in more ways than one IMO.

 

[SpasticGramps]

This was on the front page of Bloomberg. The Chinese White Knight is coming to save the day!

China Willing to Assist Debt-Crisis Nations: Zhang

China is willing to buy bonds from nations involved in the sovereign debt crisis, National Development and Reform Commission Vice Chairman Zhang Xiaoqiang said in an interview with the media in Dalian yesterday.

China is willing to offer assistance, Zhang said without elaborating, adding that Premier Wen Jiabao made similar remarks earlier, according to a transcript distributed on the planning agency’s website yesterday evening. Caijing magazine attended the briefing and published an article earlier.
Wen, speaking at the World Economic Forum in Dalian yesterday, signaled that that developed nations should cut deficits and open markets rather than rely on China to bail out the world economy. China can best contribute to the global economic recovery by ensuring steady growth at home, he said.
“Countries must first put their own houses in order,” Wen said. “Developed countries must take responsible fiscal and monetary policies. What is most important now is to prevent the further spread of the sovereign debt crisis in Europe.”

Could be in for a moral hazard bailout bonanza short squeeze?

China is not going to like holding the hot potato by itself in the long run. Similar to how the Europeans went to President Ford in 1975 about not bailing out NYC's bankruptcy crisis as to risk systemic implosion. I'm sure they are now fear mongering with China to be bailed out themselves. Or maybe this will be a reverse colonization and Asia will own Europe.

Then maybe Europeans can move into the massive ghost cities in China that have no people right now. Building just to be building. Spending just to be spending. It seems the whole world is Neo-Keyensian to me.

I'm bullish short term. Europe's survival now relies on China's assistance. I say rally on the bailout bonanza.

So when do I get my bailout?

 

[The iD]

indices bottomed before hours monday @ ~10760DJI and tested 10870 lows during the day. i unloaded nearly all of my short positions and took profits, now just playing intraday pops n drops until OT is announced next week. im light equities, heavy cash, AU/AG, commodities, all bullish short term. then its BTD thru 1.2kS&P to 1250/1300. i think it tops out, faltering @ ~1250, in line w/ GS's new estimate, yet when it hits 12k they will raise it back up to 1.3k+. EU is just stalling w/ fake news and repressing the negative until friday after hours, the reality continues to get worse and worse. we will continue to trend upwards in this channel until fri/mon, but by late mon/tue everyone is back buying the Bernanke put again. will only last to late Oct, Dec if they are lucky and let the banks play w/ the derivatives and the Fed sell Puts. then comes 1.6T$ more in quantitative easing w/ QE3, w/ or w/o halting the qualitative easing that is OT when Italy and Spain join Greece in the default pile and the second leg of the Grand Suppression is confirmed.

slight downside risk if Bernak doesnt OT or if the market sells off due to recession confirmation or having "priced in" OT about 50x already. continuing downward pressure from EU contagion risk. dont expect volatility to lessen anytime soon. EU will print, Bernanke will print (more than he currently is), everyone w/ a printing press will use it. be prepared for a steady stream of shit to be funneled into the fan over the next year+ as politics plays an even larger role in economic policy. goodie gum drops. risk peaks likely around the election in Nov'12. if we get past that we will prolly be lucky enough to get to wear these clown shoes for another 5-10yrs as we circle the drain. barring a black swan, that is. i predict that sooner or later things will just snap seemingly out of no where, but by the completely clueless countenance of the generally mindless US populace, that time may well be long off.

best paper trade = USD > toilet paper. no amount of money is worth anything if youre caught alone in your pad clutching a hollow cardboard tube.

hope China does bail out the world. it will make their recession hurt even more. lets test everyones pain threshold. throw that nice strong old debt that you got at some worthless new debt. then who bails out China? how long after China bailed out Greece did it take for them to get to their current default state? so 3-6mo and Italy is done too, good to know.

Marc Faber on Economy - 'They're gonna print & print & print' (9-Sept-11)(FINANCE & ECONOMICS)[youtube]

stay frosty,

-iD

 

[Dislexus]

Its how we beat all the debt from WWII and rebuilding.. printprintprint

Who supplies the paper for the dollar bill... buy stock in them... buy cotton futures... lol

 

[SpasticGramps]

The Global Bailout due to the liquidity crunch that the MSM isn't talking about is here.

Bailout bonanza goes into hyperdrive. Moral hazard short squeeze like a mofo? Or will the horrible economic data out today win out?

The Global Liquidity Bailout Arrives: World Central Banks Announce Global Dollar Shortfall Funding Resolution

Remember that dollar liquidity crunch Zero Hedge has been covering for the past month? Here is the denouement, in the form of the first global liquidity bailout of the world for 2011, on the 3 year anniversary of the Lehman collapse.

ECB Announcement:

15 September 2011 - ECB announces additional US dollar liquidity-providing operations over year-end

The Governing Council of the European Central Bank (ECB) has decided, in coordination with the Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank, to conduct three US dollar liquidity-providing operations with a maturity of approximately three months covering the end of the year. These operations will be conducted in addition to the ongoing weekly seven-day operations announced on 10 May 2010. The schedule for these additional operations is as follows:

Print, print, print. Wonder what the half-life of this bailout will be? Each one gets shorter and shorter. Daily bailouts to hourly bailouts. Tick tock.

 

[Hydrosun]

So when do I get my bailout?

When you walk through the door marked "Soylent Green" at the government assistance building.

 

[Peppermint]

Who supplies the paper for the dollar bill... buy stock in them

Crane & Company. Neat TV documentary a few years back about the new money development and printing process and they covered Crane but they're private.

 

[SpasticGramps]

Most money today is digital numbers anyway. Zeros added on an excel spreadsheet. Paper hyperinflation is so 20th century.

 

[SpasticGramps]

To those who haven't figured it out. The world wide bailout that was just announced by all the central banks is confirmation of what I've been saying for the past few weeks. The banking crisis is going full blown now. Liquidity is drying up as counter party risk is back in full force. The status quo is getting desperate.

This is such a 2007/2008 redux. Stocks soaring while bonds and credit markets are pricing in the second leg down. The convergence trade for equities once the short squeeze happening now is over is going to be nasty.

Look for more and more quant desks to start blowing up like the UBS "rogue" trader who just lost 2b and got arrested. Not mention Goldman Sachs firing their quant fund manager yesterday as their desk blew up as hedge fund managers are being systematically destroyed by the insane volatility.

the volatility is going to make some of us throw up.

Total market chaos brought to you by your Central planning Noe-Keyensian dictators.

Liquidity. It's what's not for dinner.

 

[SpasticGramps]

This must be why we are rallying? Foreclosures further confirm US entering the second leg down. In the new normal this is very very bullish.

Mortgage default warnings surged in August
Report: Mortgage default warnings spiked in August, signaling potential new foreclosure wave

LOS ANGELES (AP) -- Banks have stepped up their actions against homeowners who have fallen behind on their mortgage payments, setting the stage for a fresh wave of foreclosures.

The number of U.S. homes that received an initial default notice -- the first step in the foreclosure process -- jumped 33 percent in August from July, foreclosure listing firm RealtyTrac Inc. said Thursday.

The increase represents a nine-month high and the biggest monthly gain in four years. The spike signals banks are starting to take swifter action against homeowners, nearly a year after processing issues led to a sharp slowdown in foreclosures.

"This is really the first time we've seen a significant increase in the number of new foreclosure actions," said Rick Sharga, a senior vice president at RealtyTrac. "It's still possible this is a blip, but I think it's much more likely we're seeing the beginning of a trend here."

 

[SpasticGramps]

More coffee anyone? Wakey wakey time coming?

Lehman Brothers II crisis is coming soon MarketWatch

NEW YORK (MarketWatch) — Three years ago, the House of Lehman collapsed like a house of cards. And if you thought the original was scary, just wait until Lehman II comes to a theater near you — in IMAX 3D with digital surround sound.

That’s the view of sober-minded Canadian strategist and money manager John Stephenson, senior vice president of First Asset Management in Toronto.

He predicts a new, Lehman-like financial crisis in the next six to 12 months, only this time involving the debt of governments and European banks.

He thinks it could drive stocks much lower, to levels at which they traded, well, just after the collapse of Lehman and AIG in fall 2008.

“When it happens, it’s going to happen fast, and it’s going to be ugly and very deep,” he told me in a telephone interview, adding that he expects it to be “worse than the last crisis. Last time around, the governments had some room to bail people out. They don’t have that capacity [now].”

Stephenson isn’t well-known in the United States, but I find him smart and credible. He’s been named one of the 50 best money managers in Canada and is steeped in Toronto’s conservative Bay Street culture.

Other famous investors agree with him. Investing giant George Soros, for one, said: “This crisis has the potential to be a lot worse than Lehman Brothers.”

Read Jim Jubak’s take on preparing for the next crash on MoneyShow.com.

Political costs of bailouts

Taking a page from the work of Carmen Reinhart and Kenneth Rogoff, Stephenson says the financial crisis first hit the private sector and then moved to the public arena as governments bailed out the banks to “save” the economy.

“A buildup in government debt has been a defining characteristic of the aftermath of banking crises for over a century, ” wrote Reinhart and Rogoff in their 2011 paper “A Decade of Debt.” “For the countries with systemic financial crises and/or sovereign-debt problems, average debt levels are up by about 134%.”

That puts a huge burden on taxpayers and makes the creditworthiness of sovereign debt shakier. “You’ve had a transfer of risk to governments,” Stephenson said. “The average citizen wonders why they’re going to have to suffer for someone else’s mistake.”

 

[SpasticGramps]

Let's play spin the central planning intervention wheel. Will it land on Operation Twist or QE to infinity next week? Moral hazard short squeeze still in full force. I say Bernanke's Neo-Keyensian obsession with pushing stock prices higher leads us to test 1250 if not beyond.

Forget Operation Twist: Rosenberg Says Bernanke Will Shock Everyone With What Is About To Come

As we have been pointing out since the beginning of the week, the one defining feature of the past 5 days has been a relentless short covering rally. And while the mechanics were obvious, one thing was missing: the reason. Well, courtesy of David Rosenberg's latest, we may now know what it is. Bottom line: for all who think that Bernanke is about to serve just Operation Twist next week... you ain't seen nothing yet. "The consensus view that the Fed is going to stop at 'Operation Twist' may be in for a surprise. It may end up doing much, much more." Rosie continues: "Look, we are talking about the same man who, on October 2, 2003, delivered a speech titled Monetary Policy and the Stock Market: Some Empirical Results. I kid you not. This is someone who clearly sees the stock market as a transmission mechanism from Fed policy to the rest of the economy. In other words, if Bernanke wants to juice the stock market, then he must do something to surprise the market. 'Operation Twist' is already baked in, which means he has to do that and a lot more to generate the positive surprise he clearly desires (this is exactly what he did on August 9th with the mid-2013 on- hold commitment). It seems that Bernanke, if he wants the market to rally, is going to have to come out with a surprise next Wednesday." In other words, stocks are now pricing in not just OT 2, and a reduction in the IOER, but also an LSAP of a few hundred billion. There is, however, naturally a flipside, to Bernanke's priced in announcement: "If he doesn't, then expect a big selloff." In everything, mind you, stocks, bonds, and certainly precious metals. And, of course, vice versa.