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We Don't Need No Green Shoots


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#16 Charmin

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Posted 14 September 2009 - 08:14 PM

Your bearish and waiting for bulls to wear themselves out so you short all peak levels waiting for the collapse. Friday was your entry near the close.

Do you short the nasdaq, and go long the spx or the opposite spread?

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#17 Trader Joe

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Posted 14 September 2009 - 08:18 PM

Tonight's CNBC One Year Financial Melt-Down Anniverary Bukakee Party

....what a friggin' joke

....Haines pissed he has to be on the air this late, already 3/4 in the bag

... Cramer snorting lines off of Erin's naked ass (nice Rolling Stones "lip/tongue" tattoo)

... Gasbagarino just happy to have a job

.... Liesman, sayin' anything to make sure he can land a job with the Fed once CNBC folds

....Faber, just waiting for a real reporting job to come along

.... Burnett, duh? (so what's new)

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PS - Here's a story line CNBC, "How we missed the entire melt-down and were screaming BUY BUY BUY all the way down"

#18 MrHanky

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Posted 14 September 2009 - 08:23 PM

Wow....


Patrick Swayze dies at 57

http://news.yahoo.co.../us_obit_swayze

Nothing


#19 mdporter

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Posted 14 September 2009 - 08:52 PM

That Wells Fargo VP that moved into the Malibu REO was fired.

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#20 psyche doctor

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Posted 14 September 2009 - 09:00 PM

Just some bigger picture thoughts.

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#21 An Ant

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Posted 14 September 2009 - 09:18 PM

Personally, I too think we are topping. I think we get a gap down again tomorrow, so I guess we can try this again.


Only to close at high with a white candle ?

:angry: :( :cry: :angry2: :huh: :o

#22 Slappy

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Posted 14 September 2009 - 09:30 PM

Tonight's CNBC One Year Financial Melt-Down Anniverary Bukakee Party
.........

PS - Here's a story line CNBC, "How we missed the entire melt-down and were screaming BUY BUY BUY all the way down"



Ah, but what's one night of nostalgia, last week it was the 'NEW AGE OF WAL-MART", now that's looking forward, not all that behind stuff..

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BTW congrats Correll, You'll want to bookmark THIS ONE so you can get to know the target customer base.


Er, something like that....

#23 Charmin

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Posted 14 September 2009 - 09:33 PM

Shorty, the Dow has still closed below 9666.66, but we now have two closes over the November high close. Was that in the news today? Are the brakes being applied?

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#24 psyche doctor

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Posted 14 September 2009 - 09:36 PM

Only to close at high with a white candle ?

:angry: :( :cry: :angry2: :huh: :o



Could happen. I posted a chart on IDS earlier today, suggesting the gap would be filled. The dipsters never cease. If we gap down tomorrow, the same could happen. I think we are making some kind of top, but it's a guess how it will end. A power spike needle reversal is a high probability scenario. Damn the dippers.
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#25 DrStool

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Posted 14 September 2009 - 09:48 PM

jickiss is back!



jickiss is back!


and

Potentially a Giant Story,

unless all of, meaning each and every one, of the "Made Guys" is truly Untouch-able.

They are all Masters of the Soft Touch.

will the AG press on, to Re-Touch, or be Turned?

http://finance.yahoo...t...ml?x=0&.v=4


Perhaps one of you stoolie lawyers could explain to me how a judge can force an agency to prosecute a case it does not want to prosecute. Threat of sanctions for doing a half assed job? :unsure:

Doc: I continue to appreciate the Money and the Fed section of the WSE. It remains the best analysis of the Fed's actions on the internet. Regarding the Sept 12 edition and the graph on p. 28 showing the massive amount of $ pushed to the Primary dealers: If we compare to the graph on p. 31 which shows Alphabet Soup, and in particular total Fed credit, it seems possible to draw the following conclusions:
- Total Fed credit is going sideways, not growing.
- Money to the Primary dealers is growing very fast
- The above two facts can only coexist because of the decline in Soup programs and the increase in Securities on p. 31.

Assuming total Fed credit continues sideways, the decline in Soup can only go so far (firm support at zero) meaning the growth in cash to the Primary Dealers on p. 28 must stop rising.

Stating it differently, TAF is the only program with any significant amount left outstanding (around $200B) so if Fed credit continues constant, then the cash to the Primary Dealers can only rise another $200B. But the rate of decline in TAF has slowed in the last 2 months to maybe $20B per month, hence the cash to the Primary Dealers can only rise by $20B/month - a vastly lower rate of increase compared to what has happened since, say, March 2009.

Restating this differntly again, the last $100B increase in cash to the Primary Dealers on p. 28 required total Fed credit to increase by roughly $100B as shown on p. 31.

So as I understand it, the continued growth of the cash to the Primary Dealers on p.28 means the Fed must continue to print money to purchase "securities" as shown on p. 31. But in its public statements, this is exactly the activity which the Fed has stated they will be scaling back. If their actions are the same as their words, this means the cash going to the Primary Dealers is about to top out. And in turn, that is bearish.

Maybe I am just "talking my book" regarding my current underwater SPY short position, but doesn't this add up to a potential top in the S&P500? In light of the massive stock market rally and the fact that TNX and hence mortgage rates are nicely under control, it would be tough for the Fed to justify initiating a whole new program of printing money right now, when they have made public statements to the contrary.

I read in this same WSE edition that the Fed is buying MBS from the banks, and the banks are using the new cash to buy short term Treasury bonds (hence the massive bid-to-covers for T-bills). But even assuming this continues, I don't believe it has any direct impact on the cash to the Primary Dealers graph on p. 28. I recognize that the MBS holdings are toxic waste so this Fed program is, in fact, improving the quality of the bank credits at the expense of the quality of the Federal Reserve credits. But correct me if I am wrong - I do not see how this would make any difference to the graph on p. 28.

I am reading a bearish signal in your data. Would love to hear your comments on this.


Great synopsis. There are a couple ways of looking at this and you have hit on some of them.

In general, I agree with your conclusion, but I fear that you are way out in front of this. Yes, they plan to wind down the direct purchase ops over the course of the 4th quarter, so yes, a top should form over that time. And yes, the MBS mostly avoids the PDs, but not all of it. There's going to be some slosh. As noted in the PD section, they did slough off some MBS to raise cash in late August. If they continue this after the direct Treasury purchases end, that will be a source of cash with which they can continue this ridiculous game in the stock market.

I guess I should point out that we're still in the third quarter, in one hell of a stupid market. Stupid can last a long time. This is the problem and it's why I always defer to the technical indicators for market direction and timing. The liquidity analysis tells me what to expect, and when, but I have to give greater weight to the TA for timing purposes.

Even there, I've already been burned by intermediate sell signals that failed. That's a hallmark of a bull market or a bubble market, not that it makes any difference. Trend indicators and longer term cyclical indicators have not failed however. If my focus was longer term, I would not have gotten my ass chewed up those couple times I tried to short this POS over the past few months. Unfortunately, like many bears, I have a proclivity to nibble on the short side when intermediate indicators signal that it's worth a try. In the monthly long term updates since April I have laid out all the reasons why it wasn't a good idea to even think about shorting. But as a habitual bear, I haven't been able to stay on the wagon all the time.

Then there's the problem of the Fed speaking with forked tongue. Its words and its actions are often on different, sometimes contradictory, tracks. Watch what the Fed does, not what it says.

While we kind of know what the Fed is planning, nobody, including the Fed itself, knows what it will do when the time comes to act. As I've chronicled this mess, I have been able to point out massive, incredible blunders by the Fed as they wildly threw all kinds of shit at the barn door, not knowing what effects, especially unintended effects, these actions would have. Then we watched as the Fed suddenly reversed course once they realized that their actions had made matters worse. They keep relying on these stupid, worthless econometric models, and then when they blow up, they ad hoc it.

The Fed's models have no room in them for the most important element of all, human psychology. Instead of having 5000 economists on staff what the Fed needs is 5000 anthropologists, clinical psychologists, and historians. Now, in the midst of the greatest financial crisis in history what we get is ad hoc response after ad hoc response as a rudderless Fed policy goes bouncing off the walls of the Eccles building's marble halls.

Overall, I think your reasoning is sound, but I fear that you are just too early. If the Fed scales down these programs in Q 4 then the market should top out. But even assuming that they follow through, a lot of stuff bad for a bear can happen over the course of the next couple of weeks.

At this point its very much day to day in terms of when they pinch the first turd off the high, but those darn cycle projections just keep rising. As bears we can hope that the last set of projections will be wrong. We just don't know which set will be the last until the market tells us. In my view, it hasn't told us yet.

The proof is in the pudding. I just want to see the first minor support level broken, then we can talk about the beginning of a setup for a bigger turn. Until the first broken minor support level, the trend is still up.

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#26 shorty

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Posted 14 September 2009 - 09:49 PM

spoozer takin' a 3-pernter up the keyster in the night session :D

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#27 Jorma

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Posted 14 September 2009 - 10:18 PM

The Treasury issued a little report today patting itself on the back for a job well done and saying they will continue doing that great job forever. In order to do that they are keeping the TARP money.

"the $750 billion Troubled Asset Relief Program (TARP) authorized by Congress almost a year ago will remain in place indefinitely.

"Uncommitted TARP resources give the government the capacity to respond to unanticipated financial shocks," the report says. "That capacity to respond with TARP resources continues to provide a critical backstop for financial stability.""

http://thehill.com/b...nancial-sector-

This matter is a potentially explosive political issue which virtually everyone in the Beltway is trying to finess. Everyone. Not a single anti bailout sunshine populist even Ron Paul has addressed this as far as I know.

Firstly I believe the "uncommitted TARP" funds are near $300 billion now. The law enacting TARP apparently didn't really cover what was going to happen with that money. It isn't like it was all supposed to just disappear. They were going to buy troubled assets, at first. After they got it of course it was give away city, sometimes for nebulous equity. By all rights that money could go back into the General Fund. Imagine.

Imagine no Treasury securities sold for a couple of months. What a nightmare, if you get my drift. Doc knows. Ben knows. If the Treasury says it has the right to keep the money that doesn't mean congress can't pass a law and take it back. Which Obama would have veto, and take a gigantic political hit. There are not 10 ordinary citizens who want Geithner to have a slush fund to bail out Pigmen.

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#28 psyche doctor

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Posted 14 September 2009 - 10:18 PM

b-wave scenario. If not a b-wave, then something else. :lol:

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#29 shorty

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Posted 14 September 2009 - 10:25 PM

"A rather cynical relationship between the parties: the SEC gets to claim that it is exposing wrongdoing on the part of the Bank of America in a high-profile merger, the bank's management gets to claim that they have been coerced into an onerous settlement by overzealous regulators. And all this is done at the expense, not only of the shareholders, but also of the truth."- U.S. District Judge Jed Rakoff, who today held up his approval of the settlement, and ordered the SEC last month to explain why it didn't pursue charges against specific executives at Bank of America over the accusations.

"BofA is in serious, serious trouble now," said Anthony Sabino, professor of law and business at St. John's University in New York, saying the bank is at war on two fronts. "One, Judge Rakoff, by refusing to countenance the settlement, is forcing the SEC to go back and demand more details and more money. The other battleground is with New York Attorney General Andrew Cuomo."

"I've never seen this," said James Cox, a Duke University law professor and securities law expert.
"To me, it's long overdue," he added, saying that the SEC and the Justice Department have tended to accept settlements from companies "without drilling down to find out who the culpable parties were. It's truly a come-to-Jesus moment for Bank of America and its relationship with its various officers," Duke's Cox said. "They need to hang up a scalp or two."



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#30 DrStool

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Posted 14 September 2009 - 10:35 PM

The Treasury issued a little report today patting itself on the back for a job well done and saying they will continue doing that great job forever. In order to do that they are keeping the TARP money.

"the $750 billion Troubled Asset Relief Program (TARP) authorized by Congress almost a year ago will remain in place indefinitely.

"Uncommitted TARP resources give the government the capacity to respond to unanticipated financial shocks," the report says. "That capacity to respond with TARP resources continues to provide a critical backstop for financial stability.""

http://thehill.com/b...nancial-sector-

This matter is a potentially explosive political issue which virtually everyone in the Beltway is trying to finess. Everyone. Not a single anti bailout sunshine populist even Ron Paul has addressed this as far as I know.

Firstly I believe the "uncommitted TARP" funds are near $300 billion now. The law enacting TARP apparently didn't really cover what was going to happen with that money. It isn't like it was all supposed to just disappear. They were going to buy troubled assets, at first. After they got it of course it was give away city, sometimes for nebulous equity. By all rights that money could go back into the General Fund. Imagine.

Imagine no Treasury securities sold for a couple of months. What a nightmare, if you get my drift. Doc knows. Ben knows. If the Treasury says it has the right to keep the money that doesn't mean congress can't pass a law and take it back. Which Obama would have veto, and take a gigantic political hit. There are not 10 ordinary citizens who want Geithner to have a slush fund to bail out Pigmen.


Mmmm. I don't think that's right. The $200 billion SFP funds on deposit at the Fed are borrowed short term. If they don't pay it back, they have to keep rolling it over. Only if they pay it back would there be no Treasury auctions for a brief time, but the revenue shortfall continues to grow, so it would only be a month or so before they would have to start borrowing heavily again. By telling everyone that they are not going to pay off the TARP, they are, in effect saying flat out that there will be no respite from the debt deluge.

That's my initial reaction.

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