Henny Penny Posted May 9, 2004 Report Share Posted May 9, 2004 If the spring of 1994 hikes happened - we'll have a new Fed chmn in Jun. Link to comment Share on other sites More sharing options...
The End Posted May 9, 2004 Report Share Posted May 9, 2004 Just keep in mind 10,000 and a retest of 1087 equates pretty well. They will try and bounce it there. I think. If not, game over, for a few more %. Link to comment Share on other sites More sharing options...
The End Posted May 9, 2004 Report Share Posted May 9, 2004 If the spring of 1994 hikes happened - we'll have a new Fed chmn in Jun. I think Greenie retires in June 2004. Link to comment Share on other sites More sharing options...
Captain's Log Posted May 9, 2004 Report Share Posted May 9, 2004 If the market tanks until June (like I have a feeliung it will), he may jump on his own sword. Link to comment Share on other sites More sharing options...
The End Posted May 9, 2004 Report Share Posted May 9, 2004 He wants to write his side of the story before history has a chance to change their mind about him. Link to comment Share on other sites More sharing options...
brian4 Posted May 9, 2004 Report Share Posted May 9, 2004 I agree Greenspan wants out of Dodge before the Markets implode, the one wearing the Can will be Ben the "Printing Press" Bernanke! Link to comment Share on other sites More sharing options...
Hypertiger Posted May 9, 2004 Report Share Posted May 9, 2004 From the Option Investor-" In 1994 after 3 years of no interest rate hikes and on the Monday after a blowout jobs report on Friday-this happened-2/4/94 +0.25-surprise hike, 3/22/94 +0.25 FOMC meeting, 4/18/94 +0.25 surprise hike, 5/17/94 +0.50 FOMC meeting, 8/16/94 +0.50 FOMC meeting, 11/15/94 +0.75 FOMC meeting, 2/1/95 +0.50 FOMC meeting A total increase in 12 months of 3% doubling rates from 3 to 6 %. Could it happen again??" The Fed was fighting inflation...after a few years of New Jack City they did'nt want to go back...95 they let up on rates cried about irrational exuberance announced the new economy and the rest was history... until the debt inflationary potential burnt out in 2000...then the recovery from stupidity with even greater amounts of stupidity...Next? oblivion... Link to comment Share on other sites More sharing options...
Hypertiger Posted May 9, 2004 Report Share Posted May 9, 2004 Monday better be hard up...any sort of return to waterfall collapses will crumble the just think positive religion... Link to comment Share on other sites More sharing options...
Captain's Log Posted May 9, 2004 Report Share Posted May 9, 2004 Re: comparison to 1987. This is an excerpt from an interview with John Murphy in April "Technical Analysis of Stocks and Commodities". The full interview is on the traders.com but need to be a member to read it I have the paper copy so had to typ this. excuse any typos). This is a small part of the interview. ----------------- Question : You mentioned that the events of 1987 were pivotal for you in understanding intermarket relationships. What lessons did the top in the Japanese markets in 1989 hold for you ? JM: "I was finishing up the first intermarket book in 1990 and wrote a chapter on Japan. It was similar to what happened in 1987 in that everybody blamed things like program trading instead of looking at the real issues. The Yen had started to collapse and bonds had broken down badly. These are signs of a market top. I wasn't trying to predict a top, but rather saying that people don't look beneath the surface and don't understand what is happening. But if you look at the intermarket relationships, it become clear." "It was also the time of the first Gulf War, so the was a tremendous spike in oil prices. Japan is a big importer of oil, which made them more vulneralbe. There was a rise in commodity prices that, along with the bond and currency moves, shows a number of similarities to 1987 in the US. The point of showing these relationships is that it is important to look beneath the surface." ------------ Earlier in the interview he says "After Analysing the CRB index for a long time, the one thing that really got me is when I noticied the strong correlation between bond yields and the CRB. They always tracked together. It made perfect sense. Rising commodity pricies are inflationary, and normally, that results in rising interest rates. That's basic economics. But intereste rates affect the stock market and rising rates ad bad for it. I realied that commodities are a leading indicator for bonds and stocks." -------------------- Similarities to today. We've had CRB go up, bonds are collapsing, Oil is going up and if you listen to talking heads, the Stock market is er, uh, Bullish !!! Au contraire Moiseur Six pack. There may be trouble ahead. Link to comment Share on other sites More sharing options...
Guest Posted May 9, 2004 Report Share Posted May 9, 2004 Higher prices making Wall Street shudder By MEG RICHARDS AP BUSINESS WRITER NEW YORK -- Higher prices for everything from gas and groceries to industrial commodities and labor have translated into a gigantic "sell" signal for Wall Street, and left little doubt that inflation is on its way back. http://seattlepi.nwsource.com/business/apb...20Wall%20Street Link to comment Share on other sites More sharing options...
DrStool Posted May 9, 2004 Report Share Posted May 9, 2004 Except this time yields and commodity prices went in opposite directions for three years. The theory does not work. There are no consistent intermarket relationships. Depends entirely on how the hedges are set up. Also depends on whether interest rates are positive or negative in real terms, and whether there is too much, or too little lquidity. The bottom in commodities was in 2001. The top in bonds 2003-04. So observing "the strong correlation between bond yields and the CRB. They always tracked together." is a false premise. They do not "always track together." Intermarket analysis is horseshit. What one market does in no way predicts what another market will do on any consistent, coherent, basis over time. The fact that they move together at times is because they are driven the same causes at that time. But that is an always changing equation. Link to comment Share on other sites More sharing options...
brian4 Posted May 9, 2004 Report Share Posted May 9, 2004 Doc- I think that was Murphys point " that they are moving together at the mo because they are being driven by the same causes." I do agree that intermarket analysis over the long haul doesn't work but a short term pattern is still a pattern-No?? Link to comment Share on other sites More sharing options...
The End Posted May 9, 2004 Report Share Posted May 9, 2004 Fear, Greed, liquidity or the lack of liquidity moves markets. Every market. With that I must add that it SEEMED as though the stock market liked the declining Doo-lar over the last year. I think that had to do with the policy at that time. Link to comment Share on other sites More sharing options...
The End Posted May 9, 2004 Report Share Posted May 9, 2004 In adddition, One thing that I think the Bush administration will regret is that they started the rally WAY too early and will pay the price for it. Cycles not withstanding. Link to comment Share on other sites More sharing options...
Captain's Log Posted May 9, 2004 Report Share Posted May 9, 2004 Except this time yields and commodity prices went in opposite directions for three years. The theory does not work. There are no consistent intermarket relationships. Depends entirely on how the hedges are set up. Also depends on whether interest rates are positive or negative in real terms, and whether there is too much, or too little lquidity. The bottom in commodities was in 2001. The top in bonds 2003-04. So observing "the strong correlation between bond yields and the CRB. They always tracked together." is a false premise. They do not "always track together." Intermarket analysis is horseshit. What one market does in no way predicts what another market will do on any consistent, coherent, basis over time. The fact that they move together at times is because they are driven the same causes at that time. But that is an always changing equation. Ah but should they have.... If the bond wasn't pegged at emergency levels / PPI's claiming no inflation (despite realities), and market frigged wiht foreign intervention, would the natural market reaction be to have raised them. What Murphy also says in the article is that "At the start of 2000, we had an inverted yield curve. Every time we have had an inverted yield curve in the last 40 years, we have had a recession". If inflation is much higher than what is being admitted, do we have an inverted yield curve today ? To me, the bond market is making up for lost time in that they are reverting to a natural level. (higher yields). The dollar increases in value but at some time, this will stop and dollar and bonds will go down. When dollar goes down again, CRB will go up. Link to comment Share on other sites More sharing options...
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