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DrStool

The Crash is Here 3/6/20

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A couple of thoughts 

Pretty sure this is the biggest crash in history in T-bill rates.

 

The Fed can't keep up with it. Stocks are following. The only question is whether this is 1987 or 29, redux. I'll take 29. The panic into short duration Treasuries is sucking liquidity out of equities. It's catastrophic. Some big players who were short bonds have gone under, no doubt. The Fed is being swamped. It's like Lucille Ball with the cream pie assembly line.

 

 
 

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My goodness this is really big! :ohmy:

EUR/USD exploding to the upside, above 1.13 now

Gold rocketing

Oil tumbling like a wingless turd

DAX new low for the year, ES broken thru critical levels...

When they start selling the FANG's (maybe today?) the circuit breakers will go on.

 

"At the start of each day, the NYSE sets three circuit breaker levels at levels of 7% (Level 1), 13% (Level 2) and 20% (Level 3). These thresholds are the percentage drops in value that the S&P 500 Index would have to suffer in order for a trading halt to occur. Base price levels for which these thresholds will be applied are calculated daily based on the preceding trading day’s closing value of the S&P 500. Depending on the point drop that happens and the time of day when it happens, different actions occur automatically: Level 1 and Level 2 declines result in a 15-minute trading halt unless they occur after 3:25pm, when no trading halts apply. A Level 3 decline results in trading being suspended for the remainder of the day".

 

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Shit. I don't want to see the EUR rally. 

 

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1 hour ago, DrStool said:

 

The Fed can't keep up with it. Stocks are following. The only question is whether this is 1987 or 29, redux. I'll take 29. The panic into short duration Treasuries is sucking liquidity out of equities. It's catastrophic. Some big players who were short bonds have gone under, no doubt. The Fed is being swamped. It's like Lucille Ball with the cream pie assembly line.

 

It's more like the other way around. The panic out of stocks, is pouring liquidity into Treasuries. All Treasuries. Pick your story. I'm telling a story which would lead to a bottom in rates. 

I've got no way to judge if some players, or some markets, derivatives probably,  are now dead and a more general liquidity freeze is at hand.

 

 

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Now some words from Larry Kudlow.  Give him a couple lines of blow and a few shots, put a mic in front of him and off he goes.

 

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Above 1.15 I'll start to feel it. 

 

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Some big funds have gone bust, book it. Anyone short Treasuries. 

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This is the biggest crisis in a couple generations.  The truth will come slowly. 

 

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One  economic bright spot. Ammunition sales are soaring.  Is there a pure play on that? 

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At the risk of being "that guy", and trying not to jinx the recent sharp decline, but I believe today is the 11 year anniversary of the intraday S&P low, with something like March 9 the closing low anniversary that kicked off what turned out to be quite a bull run? If my hazy and fading memory serves, I think that closing low was something like a 12 or 13 year low at the time. Granted, those 2009 lows came after a 50-some percent drop vs. where we are at today, but I don't dare go back and read the end-of-the-world articles from those days in the mainstream and financial media. I'm afraid they may sound similar to some of what we are hearing now.

Maybe this time it really is different (and worse), and to match the 2007-2009 decline in a percentage fashion there would obviously be a long way to go yet. If that is the case, this decline is just a cub so far and a real bear has yet to appear. But I hate market milestone anniversaries like today and next week. They give me the willies because of increased potential for weirdness. And it has been weird enough lately. Some of these violent intraday price swings in such short time periods of time are breathtaking. 

 

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Here is a too clever by half idea. If crashes don't happen off tops then maybe we haven't crashed, yet.  How about below the 2/28 2855 low then?

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5 day cycle projection 2910. 

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I agree. Too much weirdness. 

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But WTF does it mean? 

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34 minutes ago, PullMyFinger said:

 If that is the case, this decline is just a cub so far and a real bear has yet to appear.

 

Yep I think so too ... just too sharp a drop so we're gonna get a humungous dead cat bounce imo .. I would regard a true bear market as one which steadily grinds down with brief rallies along the way.

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