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goldminingXpert (29.46)

Hey Ben: Quit Taunting The Bond Market

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May 22, 2009 – Comments (19)

It has big teeth:

funny pictures of cats with captions

Short story, interest rates are skyrocketing. Check out the charts of TLT and IEF to see how quickly things are plunging. When TLT and IEF (bond prices plunge, interest rates soar). Conclusion: interest rates rise, housing/retail falls, economy slows further, stocks plunge. This was happening slowly but a big treasury auction next week has sent the process into overdrive.

On the bigger picture, after getting within 1 point of my bounce point yesterday, we came within 3 points of my up-move call (900) and are headed back down. We should break lower Tuesday under 878 and into the wild bearish frontier. That's got to be a disheartening finish for bulls after what looked like a constructive day.

19 Comments – Post Your Own

#1) On May 22, 2009 at 3:56 PM, goldminingXpert (29.46) wrote:

Forget to include ID: This is TMAPd22v16.

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#2) On May 22, 2009 at 6:16 PM, gman444 (28.84) wrote:

Can't say it's happening yet, GMX.  I mean, you had to figure there would be a sell-off into the close, with all the "uncertainty" and the long w/e, right?  Which is exactly what happened.   But as for me, I sold all my longs this week, and am way short the market. 

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#3) On May 24, 2009 at 3:33 PM, vmh104 (< 20) wrote:

GMX, some details as to how you are coming up with this would be appreciated!

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#4) On May 24, 2009 at 7:39 PM, Mary953 (78.45) wrote:

GMX - You are not a fake, it seems.  What does it mean if the writer of the blog "was faded when he wrote that" exactly?  I don't understand, but it would seem to mean that he owes you an apology.  I like the Tiger by the way.  Has Tigerpack seen it?

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#5) On May 25, 2009 at 10:36 AM, kaskoosek (32.38) wrote:

The reason they are increasing is because there is too much liquidity.

 

I think that this bodes well for the stock market and bad for the dollar. You have to ask yourself what is the reason behind this.

 

How wil fed actions play into the economy as a whole.

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#6) On May 26, 2009 at 11:27 AM, rexlove (99.59) wrote:

I think there are still too many value plays in the market for the S&P to correct very much. A move to the lower 800's maybe but a retest of the lows seems out of the question this point. There is too much good news in the market. Earnings are coming in over the estimates. Housing is stabilizing. Banks are making money hand over fist in refinancing and other loans. I have a little money sitting on the sidelines in case of a small pullback but am going all long at this point. Stick to your high yield stable companies and you'll be sitting pretty by the end of the year.

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#7) On May 26, 2009 at 12:23 PM, MrSucrose (< 20) wrote:

GMX/everyone-

The majority of my savings is in the governments thrift saving plan, which uses a series of index funds as you fund choices. (S&P, Russel, International, Bond, Goverment debt) I am wondering if the government securities fund might be the best place for my money until the end of the year.  It is basically built on buying/selling 90-day T-bills on a daily basis and harvesting the interest.  Wondering what everyone thinks.

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#8) On May 26, 2009 at 3:59 PM, vmh104 (< 20) wrote:

rexlove ; Housing is stabilizing. Banks are making money hand over fist in refinancing and other loans.

Uhm no... this is gobbly gook...

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#9) On May 26, 2009 at 4:57 PM, rexlove (99.59) wrote:

vmh104 - why is it "gobbly gook"? That's real intelligent.

Take a look at the latest Case-Shiller data for March. It was released today. While overall real estate prices are declining the rate of drop is also declining. In fact a couple cities showed an increase month over month. To me this shows that we are stabilizing. First hand - I can see this in my own market (NY Metro).

In banking have you seen the 1st quarter banking numbers? Here's some examples:

Citigroup made 1.6 billion

Bank of America 4.2 billion

Wells Fargo  3 billion

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#10) On May 26, 2009 at 8:51 PM, vmh104 (< 20) wrote:

rexglove; I appreciate the call to more intelligence. Haven't seen much evidence of that in the pro-bull stance of the last few weeks. I assumed too much. Point taken.

You think the Case-Shiller report is somehow positive??? I'm not sure it matters how we quibble over the reporting. But I see they are reporting an increase in decline. 18.7% for the year, 19.1% annualized for the quarter, 2.2% in March alone (2.2% annualized is 26.4%). It's getting worse faster, not better, not worse slower, worse faster. And this is despite all the incentives and stimulation...  and also obfuscation.. I have only seen anecdotes of the obfuscation... but this sort of thing... you wonder how much of it is going on. And of course then there is "sub-prime part 2 times 150%" in the form of alt-a and option arm. It's just about to get started which you can review here. Honestly if you want to make the case for a bull market you have to do so in defiance of continued double digit decreasing housing values for years to come.... the only viable short term solution to the mortgage crisis I see is hyper-inflation.... which has some problems of it's own...

The bank numbers. This is shady accounting perhaps? ...or at the very best taking one time profits...  I mean from the mark to market, to the counting of AIG CDS bailout money as earnings for the banks... how long are the banks going to keep that one up? If you really think the banks did so well in Q1 check out this.

In all do respect; gobbly gook! .... but please correct me if I'm wrong.

 

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#11) On May 26, 2009 at 9:13 PM, DeerHunter73 (73.58) wrote:

 Vmh104

Well done on your research, but as stated at the bottom of that blog its all an opinion not facts.

 http://www.safehaven.com/article-13261.htm

Disclaimer: The contents of this article represent the opinion and analysis of Thomas Tan,

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#12) On May 26, 2009 at 9:39 PM, vmh104 (< 20) wrote:

Hello Deerhunter,

You can find a similar disclaimer on any financial analysis document written by someone who makes money doing it. A legal disclaimer does not mean that all opinions and analysis are therefore unreasonable and have no factual basis. Inferring that just because of the disclaimer is completely unreasonable.

Now if Thomas Tan is a scoundrel and not to be trusted, if he has a track record of bending the facts, ignoring the facts etc. etc. then that would be different... or if you have some other reasonable interpretation to what he's presenting....  that would be different... of course I'm not relying on just this guy... it just happened to be one of the articles where a bunch of things have been collected and compressed so it was convenient to quote.

V

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#13) On May 27, 2009 at 10:15 AM, TigerPack1 (80.84) wrote:

Rising Treasury rates are telling us that the credit crisis and bear market in stocks are ending, nothing more, yet...

This situation happens at the bottom in every economic cycle.

Real world loan rates from banks, especially on mortgages and commercial real estate loans, have not budged the last few months.

Looks like we will rally one last time to new highs with the announced resumption of the short selling "uptick" rule in a few weeks.  We should get ABOVE the 200-day moving averages in most major indexes, and we'll see if that event encourages further buying from technicians and bears giving up.

(I had to post something on this thread with the nice tiger picture.)

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#14) On May 27, 2009 at 4:33 PM, ttboydxb (29.08) wrote:

Hey GMX (or anyone else), quick question.  With Bond yields going up (I'm looking at the 30 year in particular) what can the fed do to drive the yield back down?  Buy more notes?  Do they actually have the $$ to?  And if they do, doesn't that mean that international investors will stop buying them quicker making the Fed's actions worthless??

 

Thanks!

 

 

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#15) On May 27, 2009 at 4:48 PM, portefeuille (99.26) wrote:

Buy more notes?  Do they actually have the $$ to?

that is called quantitative easing ...

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#16) On May 27, 2009 at 4:57 PM, portefeuille (99.26) wrote:

that is called quantitative easing ...

see for example here.

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#17) On May 27, 2009 at 5:28 PM, ttboydxb (29.08) wrote:

Awesome link, thanks!  Watching it, I kind of have the impression that Quantitative Easing isn't going as planned, and the whole Uncle Sam being left with hat in hand scenario is in the future.  Thanks again portefeuille for that bit of education!

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#18) On May 27, 2009 at 6:15 PM, goldminingXpert (29.46) wrote:

they are attempting Quantitative Easing but it isn't working out quite as planned. It turns into a circle jerk when the government is just selling debt to instelf as the other buyers leave the building.

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#19) On May 28, 2009 at 6:32 AM, ttboydxb (29.08) wrote:

"It turns into a circle jerk when the government is just selling debt to instelf as the other buyers leave the building."

 

Love it dude!

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