Monday, August 08, 2022
Stock Market Unclosed Gap / Stock-Markets / Stock Market 2022
By: Monica_Kingsley
S&P 500 bulls made a good run, but didn‘t deal with the bearish outcome looming, The renewed tightening bets spurred by strong headline NFPs figure, will take their toll on risk-on assets that had been driving Friday‘s run. Bets on another 75bp hike in Sep have increased dramatically, practically proving Daly or Kashkari right in that the Fed isn‘t done yet or even close to the Fed funds rate to really get inflation down. While they claim that 2% is doable and soft landing within reach, the progression from 9% downwards just doesn‘t go fast like that. At best (repeating myself for months here), they would get to 5-6% CPI, which means a tough Sep and one more FOMC still this year. Combined with balnce sheet shrinking projections, that would take a great toll on the real economy – one that is being softened by the still very expansive fiscal policy.
Let‘s look around the world (apart from the troubles in Europe and Asia such as shown in JPY weakness), many other central banks are tightening, Latin America is also tightening. It‘s not only UK and the implications discussed on Friday:
(…) Let‘s have a look at yesterday‘s Bank of England moves, kind of foreshadowing what‘s reasonable to expect from the Fed. In the UK, the prospect of entering recession Q4 2022 amd remaining in it for more than a couple of quarters, is being acknowledged. The central bank though intends to keep tightening anyway, preferring to take on inflation after it ran out of control longer they publicly anticipated. Meanwhile in the States, unemployment claims have edged higher – indicative of growing softness in the labor market.
Long-dated Treasuries continue rising as is appropriate in these conditions of economic slowdown slowly gathering pace. Similarly to inflation expectations, they‘re not yet taking the Fed‘s hawkish rhetoric absolutely seriously unlike commodity prices that are at best carving out a bullish divergence (still in the making, therefore without implications yet). Precious metals appear farther along the route of acknowledging the upcoming stagflationary reality as I continue looking for inflation to remain in the stubbornly high 5-6% range no matter the Fed‘s actions over the next 3 FOMC meetings at least. Obviously, the hotter the underlying markets, the more tightening has to be done, and that‘s extra headwind for the markets, and one making the Fed pivot a bit more elusive.
The key thing that has changed from the above, is the turn in yields – Treasuries would have a harder time rising now, but given that I expect better CPI on Wednesday (oil is down and hasn‘t bottomed yet etc), yields should retreat in what I look to be a positive market reaction – one of hoping that the Fed wouldn‘t tighten that much as is feared today they would. This wouldn‘t however save the stock market bulls.
Monday, August 08, 2022
The End Game for Silver Shenanigans... / Commodities / Gold and Silver 2022
By: MoneyMetals
The federal criminal trial of JP Morgan executives Michael Nowak, Gregg Smith, and Jeffrey Ruffo began on July 8th. These senior bankers are accused of running a years-long scheme to manipulate precious metals prices through what is known as “spoofing.”
Perhaps the three will be found guilty, but it isn’t likely to have much impact on trading in the paper silver markets. If there is solution to artificially rigged prices, it will come from somewhere else.
It isn’t that regulators don’t have a lot to go on. Investigators had the goods when prosecutors got Deutsche Bank to plead guilty and cooperate.
Monday, August 08, 2022
WARNING Corsair MP600 NVME2 M2 SSD Are Prone to Failure Can Prevent Systems From Booting / ConsumerWatch / Computing
By: HGR
NVME drives are supposed to herald greater speeds coupled with greater reliability over traditional platter spinning drives. However clearly the technology has yet to mature. And worse than mechanical hard drives when they go they tend to go fast! As illustrated by this 1tb Corsair MP600 drive which despite being listed as being 93% Good died within minutes, with the failure resulting in preventing the system from booting from it's good boot drive. So a sign that your NVME2 is on the verge of dying is if you experience failure or slow boot times.
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Saturday, August 06, 2022
Elliott Waves: Your "Rhyme & Reason" to Mainstream Stock Market Opinions / InvestorEducation / Elliott Wave Theory
By: EWI
R.N. Elliott's stock market observations fell together "into a general set of principles"
It's understandable why investors with little experience consult the market opinions of professionals.
But many of these new investors are left scratching their heads. Two headlines from July 29 indicate why:
- [Fundstrat Managing Partner] says the 2022 bear market is over, stocks could hit new highs before year-end (CNBC)
- Stock market's post-Fed bounce is a 'trap,' says Morgan Stanley's [Chief Investment Officer] (Marketwatch]
Yes, two directly opposing opinions that were published on the same day.
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Saturday, August 06, 2022
COST OF LIVING CRISIS NIGHTMARE - Expect High INFLATION for whole of this DECADE! / Economics / Inflation
By: N_Walayat
The Inept Governor of the Bank of England has miserably FAILED in the banks primary remit of pegging inflation at 2%. This video illustrates why the Cost of Living Crisis will soon become a decade long nightmare for most Brits.
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Friday, August 05, 2022
WHY PEAK INFLATION RED HERRING / Economics / Inflation
By: Nadeem_Walayat
When one looks under CPI inflation hood then one sees strong signs of inflation topping, given what we have already seen transpire in the commodities markets such as Gasoline prices having fallen since the May inflation report and many of the components such as Airfares also turning lower.
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Friday, August 05, 2022
Recession Is Good for Gold, but a Crisis Would Be Even Better / Commodities / Gold and Silver 2022
By: Arkadiusz_Sieron
The US economy fell into a technical recession. As a safe-haven asset, will gold soar now?What Is Recession, Anyway?
Ladies and gentlemen, please welcome the technical recession! According to the initial measure of the Bureau of Economic Analysis, real GDP dropped 0.9% in the second quarter, following a 1.6% decline in the first quarter (annualized quarterly rates). As the chart below shows, on a quarter-on-quarter basis, real GDP decreased by 0.4 and 0.2 percent, respectively. Thus, the US economy recorded two quarters of negative growth, which implies a technical recession.
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Friday, August 05, 2022
Stock Market Rallying On Slowly Thinning Air / Stock-Markets / Stock Market 2022
By: Monica_Kingsley
S&P 500 rose, driven by tech at expense of value, which is normail in economic slowdowns. The junk bond rally however stands out – a prime candidate to attract selling at the nearest whiff of risk-off. The many fundamental reasons described in Monday‘s article, remain intact, if there weren‘t geopolitical ones. Tellingly, the yield curve inversion continues deepening, and bonds aren‘t buying the tightening story in the least – they fear the Fed overdoing it. And that‘s a key catalyst behind yesterday‘s decline in real assets, with its new interpretations of neutral Fed funds rate, or „having enough not to make trade-offs“ inflation remarks.
Sure, ISM services PMI provided a daily boost to the rally, and so the revamp calculations behind tomorrow‘s non-farm payrolls would work (would the pesky hours worked sending the opposite message, get recalculated as well?) in a bid to keep the increasingly FOMO confidence in the S&P 500 rally going. It still has the hallmarks of a short-covering rally, and not of genuine animal spirits – that doesn‘t square with the dreaded R word.
Friday, August 05, 2022
SILVER’S BAD BREAK / Commodities / Gold and Silver 2022
By: Kelsey_Williams
Bad breaks can be tough to recover from. The process can be arduous and can take a long time. Sometimes a full recovery remains elusive and distant.
Silver has a history of bad breaks over the past half-century. Below is a series of charts that tell the story…
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Thursday, August 04, 2022
Stock Market Trend Pattren 2022 Forecast Current State / Stock-Markets / Stock Market 2022
By: Nadeem_Walayat
My stock market big picture remains to expect the Dow to target a trend towards 29,600 by late August / Early September. Note 29,600 is a TARGET for a low and NOT THE LOW, No one can KNOW THE LOW with any degree of confidence, all one can do is arrive at a high probability target and then look to see if the market confirms that expectation or not, so far the market is confirming it is heading for 29,600.
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Thursday, August 04, 2022
Should We Be Prepared For An Aggressive U.S. Fed In The Future? / Interest-Rates / US Interest Rates
By: Chris_Vermeulen
Traders expect the U.S. Fed to soften as Chairman Powell suggested they have reached a neutral rate with the last rate increase. The US stock markets started an upward trend after the last 75bp rate increase – expecting the U.S. Fed to move toward a more data-driven rate adjustment.
My research suggests the U.S. Federal Reserve has a much more difficult battle ahead related to inflation, global market concerns, and underlying global monetary function. Simply put, global central banks have printed too much money over the past 7+ years, and the eventual unwinding of this excess capital may take aggressive controls to tame.
Thursday, August 04, 2022
Will the S&P 500 Stock Market Index Go the Way of Meme Stocks? / Stock-Markets / Stock Market 2022
By: EWI
Here's what usually happens when "financial lunacy" is prevalent
You don't hear much about the meme stock craze anymore -- and for good reason.
It's all but dead and has been for months (Barron's, Jan. 28):
A Year After It Began, Meme-Stock Mania Is on Life Support
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Thursday, August 04, 2022
Stock Market Another Upswing Attempt / Stock-Markets / Stock Market 2022
By: Monica_Kingsley
S&P 500 refused to swing higher yesterday, and bonds weren‘t much risk-on either. Revisiting the neutral Fed funds rate comments didn‘t do much good for risk sentiment, even though HYG doesn‘t yet reflect that with its closing price. A new attempt at 4,140s looks to be in the making, and even if we get a break higher, it‘s going to be a fake one, and fail. It would also coincide with a rejection of lower VIX values around 22, in favor of reverting back to the high 20s recent average.
The current optimism seems misplaced, and the upcoming ISM services PMI would reveal the slowly deteriorating internals of economic growth. Coupled with manufacturing PMI, these leading indicators illustrate a tough real economy to come in late 2022 / early 2023 – the dreaded R word.
Thursday, August 04, 2022
What is our Real Economic and Financial Prognosis? / Economics / Economic Theory
By: Raymond_Matison
According to Webster’s dictionary, the definition of prognosis is a forecast, or a prediction of a probable course of a disease in an individual, and the chances of recovery. In this article, we apply this definition of prognosis to our inanimate, yet seemingly “living and breathing” economy, and project its chances of recovery.
The world is filled with intelligent and highly experienced economists, and thousands of financial market observers who can give us a lucid and convincing interpretation of our economy and health of our financial markets. As a result, you can find widely recognized professionals who will diagnose and predict the direction of our economy and financial health as to support our own personally biased view of reality – regardless of what that may be. But independent of our own personally preferred views, what is the most probable reality we are likely to experience? What is the real economic and financial prognosis?
Government agencies and media are increasingly filled with unjustifiably adjusted and manipulated economic data, directed and misdirected propaganda, and outright lies, such that it is nearly impossible to judge the real strength or direction of the economy and the health of our financial markets. Since small and developing nations are quickly learning these “tricks of the trade”, international media and government agencies are universally now also dispensing politically favorable rhetoric rather than truth. So what measures can we review to accurately evaluate the health of our economy?
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Wednesday, August 03, 2022
The REAL Stocks Bear Market of 2022 / Stock-Markets / Stock Market 2022
By: Nadeem_Walayat
US Housing market variables are in a state of flux for we have the consequences of Quantitative Tightening with the Fed having started to sell $15 billion of Mortgage Backed securities per month, US teetering on the brink of recession given that Q1 saw -1.4% with Q2 also expected to be weak, a coin flip between +0.2 and -0.2 or worse and thus hey presto the RECESSION has ARRIVED! Brewing Financial Crisis 2.0 that I I flagged some 10 months ago where the reverse repo market of $1 trillion has now doubled to $2 trillion which implies increasing counter party risk where we wont know what the banking crime syndicate has exactly been upto in the housing market until banks start failing. Interest rate hikes of 0.75% when the Fed Chairman said 0.75% was off the table which means US rates are probably going to go a lot higher tham most can imagine today, consensus is 3.25% to 3.5%, reality could be north of 5%, so a lot of variables are in a state of flux which means instead of seeing clarity with more data I am seeing confusion!
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Wednesday, August 03, 2022
The ‘Wishful Thinking’ Fed Is Anything But ‘Neutral’ / Interest-Rates / US Interest Rates
By: MoneyMetals
With last week’s second 75 basis-point rate hike, the Federal Reserve now claims it has achieved a “neutral” monetary policy stance. That would mean, in theory, that interest rates are neither stimulating nor restraining the economy.
"Now that we're at neutral, as the process goes on, at some point, it will be appropriate to slow down,” Fed Chairman Jerome Powell said.
Powell was effectively telling markets he intends to pivot away from inflation fighting.
Yet inflation, even when measured by the Fed's own preferred gauge, continues to run hot.
Wednesday, August 03, 2022
Don’t Be Misled by Gold’s Recent Upswing / Commodities / Gold and Silver 2022
By: P_Radomski_CFA
Despite gold’s latest move higher, its outlook remains bearish. If its 2012-2013 pattern is to repeat, it means gold is now preparing for a big fall.
Patience Advised
Gold moved higher on Friday, so you might be wondering if this changed anything regarding the outlook. In short, it didn’t.
Let’s take a closer look at what happened.
Sunday, July 31, 2022
Aluminum, Copper, Zinc: The 3 Horsemen of the Upcoming "Econocalypse" / Commodities / Metals & Mining
By: EWI
This suggests "a burgeoning slowdown in economic activity"
It may seem strange to bring up deflation when surveys show that inflation is the public's number one worry.
But who would have thought that inflation would become a big issue, say, just two years ago?
Right -- a relatively small percentage of people. The point is: Things can unexpectedly change -- fast.
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Sunday, July 31, 2022
Gold Stocks’ Rally Autumn 2022 / Commodities / Gold and Silver Stocks 2022
By: Zeal_LLC
The gold miners’ stocks have been thrashed in recent months, crushed as heavy futures selling slammed gold. That obliterated any residual sector bullishness, leaving gold stocks wildly-oversold and deeply-out-of-favor. But having weathered a rough early summer, the battered miners and their metal are trudging back into their traditional strong season. That begins with robust autumn rallies really accelerating in August.
Seasonality is the tendency for prices to exhibit recurring patterns at certain times during the calendar year. While seasonality doesn’t drive price action, it quantifies annually-repeating behavior driven by sentiment, technicals, and fundamentals. We humans are creatures of habit and herd, which naturally colors our trading decisions. The calendar year’s passage affects the timing and intensity of buying and selling.
Gold stocks display strong seasonality because their price action amplifies that of their dominant primary driver, gold. Gold’s seasonality generally isn’t driven by supply fluctuations like grown commodities see, as its mined supply remains relatively-steady year-round. Instead gold’s major seasonality is demand-driven, with global investment demand varying considerably depending on the time in the calendar year.
This gold seasonality is fueled by well-known income-cycle and cultural drivers of outsized gold demand from around the world. Starting in late summers, Asian farmers begin to reap their harvests. As they figure out how much surplus income was generated from all their hard work during the growing season, they wisely plow some of their savings into gold. Asian harvest is followed by India’s famous wedding season.
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Sunday, July 31, 2022
US Fed Is Battling Excess Global Capital – Which Is Creating Inflation / Stock-Markets / Financial Markets 2022
By: Chris_Vermeulen
The US Fed continues to bring the big guns, raising rates another 75 bp (0.75%) on July 27, 2022. Even though they stated the economy is softening, current Inflation and CPI data suggest otherwise. The US Fed may be forced into another 75~100 bp rate increase next month if the US economy continues to show strong CPI and Inflation trends. There is only one other time in recent history like the current market environment – 1998~2004.
The DOT COM Bubble was unique in the sense that excess capital flowed into technology/internet companies’ hand-over-fist. It seemed all you had to do was register a URL, come up with some crazy business plan, and go talk to investors/VC. It was not a crisis like the 2008-09 Global Financial Crisis event. The DOT COM Bubble was a process of unwinding/consolidating excess capital away from a euphoric speculative phase in the markets.
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