Friday, February 24, 2017

Empire Of The Conned: THE BIG LONG

This week the Dow exceeded the prior number of record closes set in 1987,  ahead of the crash, and the pending Reagan tax cut...


The problem with a rally based upon conning people, is that eventually you run out of people left to con.

At the worst possible time...

Earnings yield with global GDP:



Trump can tell a lie with ten times more conviction than anyone else can tell the truth. A mere five weeks into his Presidency and he's aging like a 70 year-old Twinkie.

Orange on the outside, hollow on the inside:



In the same week that he bragged about approving the Keystone Pipeline deal, Exxon wrote off $16 billion of their tar sands reserves, for a start. Also in this same week that he touted shale oil, U.S. crude oil and gasoline inventories reached new record highs, and U.S. oil exports filled the gap created by the OPEC agreement two years in the making:
The U.S. exported a record amount of crude oil, topping a million barrels a day for a second week and filling the gap in world markets created by OPEC cutbacks...Oil has been holding above $50 per barrel since OPEC reached the output deal in December. "It looks like compliance is going to be well below 80 percent. Exports are on the upswing. We're seeing the tanker data"

This was the week that the Trump reflation charade came unglued full force...

U.S. Deficit (red), One Year Treasury (green) and Northern Trust Asset Management, are all pointing in the same direction. Just like the last two times...



Risk is coming off, as rotation from micro cap to Dow stocks shows:



The Dow and S&P reached new all time highs this week, but the five year was unimpressed:



Gamblers should have learned last time what comes next...

30 year Treasury (black) with banks stocks (red):



Bueller?


Another retailer - Victoria's Secret parent company imploded...



Frackers and other junk stocks imploded






Natural gas


Oil with volatility



Large U.S. banks rolled over



Large Canadian banks rolled over



Cisco made a new moonshot high



The USDJPY imploded:






And the S&P had its first overnight 10 point gap down today since the election. Bought with both hands of course...

with Nikkei aka. "overnight risk"




Thursday, February 23, 2017

Grand Champion Con Artist



Beijing has spent a trillion dollars supporting the Yuan since the Fed started withdrawing liquidity. Trump wants them to stop...

S&P opening downside gaps with Chinese Yuan:

Any questions?



Speaking of ignored risks, here is the current positioning across various asset classes:

Bond short exposure



Junk stock exposure



Bank exposure




Oil exposure



Mutual fund cash balances



Bearish assets



Option hedging. Or not...



Active Manager risk exposure




"Don't worry, we're smarter than the rest of the world combined"

U.S. versus world:





World Versus U.S. Who Wins?

Not everyone can be conned...

The entire world is not all that impressed with the circus-clown-in-chief. Nor are they interested in funding AmeriCon First. But no arrogant fucktard saw that coming...

Year-to-date currencies versus dollar:

Even the Mexican Peso is kicking Trump's dumbfuck ass. And the British pound is facing imminent Brexit...




$USD index



When I say this will be "painful", I am thoroughly understating how painful this will be...

Because payback, is a bitch:





 “not much administration can do to affect growth in short term"

How about a rate hike? Will that help?




Treasury bond futures speculative short interest as of Feb. 14th, 2017 i.e bets on higher interest rates 



The Anti-Christ Trade Is Ending. Badly. What Else?

God help anyone who bought into it...


Circus Clownius only controls 45% of the world's stockpile, so he wants to build that up to prove that once and for all he doesn't have small hands. I feel safer already...



Nevertheless, uranium stocks not impressed by the latest chit chat from the realtor-in-chief:



Today we learned that Gasoline demand (product supplied to retail) keeps plummeting a la recession:

24 week moving average. 2008 demand is circled, black line is average price of unleaded:



Speaking of 2008, the last time gasoline demand imploded was in 2008 when the U.S. deficit rolled over. After all, how better to conceal a recession than with inter-generational theft?

Doh!




We also learned that volatility reached a new 21 year low, however, as we know volatility by definition is mean-reverting, since trading ranges can only narrow so much...



Nasdaq with Nasdaq VIX:



Reach for junk with VIX:



Oil (red), Rest of world (black) with VIX:



Oil realized Volatility



Frackers



Hedging. Or not...



Rydex bank assets



Coal



In Goldman Sachs, Exxon, and the Anti-Christ We Trust