Friday, November 20, 2015

Deja Vu

Once in awhile I get that feeling that "this" has happened before.
Today I got that feeling looking at the volume in DIA and FAZ.

Part of the feeling is a result of the narrative in the financial sphere that acknowledges the high valuations of stocks on a P/E basis, and acknowledges the strong U.S. dollar and the increasing likelihood of a rise in interest rates. There is the divergence between the few leaders of the market and the many losers as reflected in the A/D line. And all we can talk about is stock buybacks, and unicorns.

 And I found this really interesting picture...

Do your stretching exercises,
control risk.


Friday, November 13, 2015

Paris Terrorism

Terrorist attacks in France.

Why does a downturn in the stock averages precede every major terrorist event?

It seems that way.

Cnn Attacks in France

Is this the new 'Real Politic' ?


Fed is Hamstrung

Just the thought of a rise in interest rates has financial markets swooning. Stocks are one thing, it wouldn't hurt for a healthy correction to happen, but the bond markets are another thing. Particularly with the levels of debt that has accumulated over the last several years. Instead of the last few years spent paying down debt the world has created more. And much of the debt is priced in US Dollars. As I have said previously the Federal Reserve, like it or not, is the central bank of the world. The charts below show what has happened with just the thought of a "normalization" of interest rates over the last year.

I do not think they can touch interest rates until inflation is actually a fact. If clear heads prevail there will be no rate hike in December. And the market will shortly catch on....


Nations always inflate away excessive debt. And the world is no different when interconnected by finance. Whether inflation is a moral good or not is another question. I am trying to see what will actually happen when crowds prevail upon policy.

Control risk,

Wednesday, November 11, 2015

US Dollar Top?

It seems I am interminably trying to pick a top in the Dollar.

Oh, well....

control risk,

Nov 11, 2015  
0702 PST
They are jumping into the weak dollar trade this morning. Yikes!


Friday, November 6, 2015

No Keystone Pipeline?

The POTUS is to speak momentarily about his nix of the Keystone.

The financial/political talking heads are talking bad about his decision.

Nat Gas showing some strength. Drillers and pipelines showing some strength.

It could be that NOT doing Keystone will slow imports, raise domestic energy prices, and save some of our oil business jobs that would be lost with the shutdown of domestic production due to low prices.

This at a time when interest rates are set to rise. What better time to raise interest rates than when energy prices gain. And what better time to raise energy prices to save oil businesses than when interest rates are set to rise and make the oil debts worse, thus saving many from bankruptcy. It is even good for the banks who hold oil debt.

I think they just don't like the Pres.


Friday, October 30, 2015

Not As Weak as Expected

Just a note here.

Gold and Silver are not as weak as I expected over the last two days. Two days is a short time, I know, but GLD and SLV do not break with the sellstops like they usually do.

And UUP is weaker than I would expect. Seems more are selling the rally than expected.

A trading rule I have is that when something surprises me I wake up and pay attention.
The dog that didn't bark.....

Control risk,

Wednesday, October 28, 2015

Break Time!

I sold the rest of my 'weak dollar' trades today. Started selling a few days ago. This trade saved the year.
The Federal Reserve changed their language in the statement released today and seemed to put themselves back on track for a rate hike sooner rather than later.

I will not attempt to predict whether gradual rate hikes will crash the "fragile" economy or not. What I do expect is for the speculative markets to begin anew to worry about interest rates rising, and more specifically, worry about the negative effects of a strong U.S. Dollar.

There is no hurry. And no shame in buying things back if wrong. Right now it seems to me that the probabilities are for a weakening of stocks and real asset derivatives.

We may revisit the junk debt and the emerging market worries. Even as China surprises?

Stay dry.


Thursday, October 15, 2015

Repos Rise!

OMG! WTF! Reposessions up 60%!

Or perhaps the banks are expediting the repos because they can take them back on the books and maybe they see a market for these homes. At long last....Z


The banks want these homes.



"To the Moon, Edith!"

"Oh, Archie....)

People are waking up to a weak USD.
Oil will come alive probably sooner than widely anticipated.

Control risk,

Tuesday, October 6, 2015


Silver stocks and the metal itself is on a tear, relatively speaking after years of decline. The miners are showing some life. Undoubtedly a lot of short covering going on, but that is the first step in a change in trend.
Dollar weakness will come to the forefront in coming months and years.

Control risk,