sandy beach

Draghi's successor is going to have to go all in on buying European bank debt.

The SPY daily looks a bit like a possible setup for an island reversal. Not saying it will be but I would be careful until this resolves.

“Why buy German 10-years at -60 bps? Well, core inflation in Germany typically falls 330 bps in a recession. The current core is 1.2%. So that means deflation lies ahead and as such generates a de facto expected “real” yield of +1.5%.” David Rosenberg @EconguyRosie Aug 21 Twitter

What economists claim to believe in public bears no resemblance to what they admit to believing in private. Their proclamations are designed to sell a political narrative. They are guns for hire. What would be interesting is if we forced economists to compete in the open market based on actual abilities to produce positive outcomes (or not). Can you imagine if the paycheck of an economist was based solely on his or her ability to make accurate predictions? Can you imagine a field of economics based on empirical and historical data?

The 30 year yields make perfect sense if you assume yields in the future will be even more negative than they are now by a long shot, you expect deflation and you expect big banks to buy the long term bonds of their sovereigns knowing firstly that they will be bailed out of any losses and secondly that the central banks will buy them back over par as needed quid pro quo.

Thanks for that.

Thanks for the reminder Doc. I've been lightening up on exposure to equities the last couple of months. The U.S. Treasury will be draining a lot of liquidity from the market the next couple of months as they issue excess paper. Your were the first to pin-point this. This won't be positive for financial assets. Trade safe.

I thought this was a joke! What an unmitigated disaster. 850 years up in smoke. https://www.dailymail.co.uk/news/article-6925015/Fire-breaks-historic-Notre-Dame-cathedral-Paris.html

I suppose you are kidding but... Friedrich Trump b March 14, 1869 Kallstadt, Rhineland-Palatinate, Germany https://www.geni.com/people/Friedrich-Trump/6000000013186432678?through=6000000013186406566 I actually help out on a lot of genealogical sites. Hope you can find your roots!

Americans are too dumb to trade I guess: http://www.finra.org/investors/alerts/leveraged-and-inverse-etfs-specialized-products-extra-risks-buy-and-hold-investors Companies like Vanguard are now taking a paternal role and outright banning the trading of a whole slew of products like inverse ETFs, legerated ETFs, commodity and VIX products, etc: https://investor.vanguard.com/investing/leveraged-inverse-etf-etn I expect this type of "evil short seller" B.S. in China or Turkey but in the U.S.? An outright ban on consumer shorting is coming as the American I.Q. approaches 85.

New Home Sales for January from the Census Bureau https://www.census.gov/construction/nrs/pdf/newressales.pdf Lumber futures cratered - now recovering.

Exited XBI at $92.09 for a small gain.

Now that is funny! LOL

Mr. J - you are a sentinel!