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Why Madoff Didn't Succeed 4/15/21

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11 hours ago, Jorma said:

If ever there was an event which would signify the end of an era or even an age then Madoff's death would make for a perfect moment for a long term top.  Sadly perfect stories rarely occur in the real world.  I suppose we can view today's red bar as just a tiny little sparkler to mark the occasion of his death. Certainly he deserves a high rank among  histories greatest conmen. 

Bernie ran a big Ponzi Scheme.

His only problem was that is wasn't big enough. 

We are talking many orders of magnitude. 

Witness the partnership of the US Treasury and the Fed. 

It has been so successful that Jaysus is Lord. 

People keep asking the Fed high priests and interpreters when they're gonna stop this shit. 

The answer is always the same. 

Not yet. 

Not anytime soon.  

Because they know they can't stop. If they stop funding it, the Ponzi will collapse, and all their gangsta bank sponsors and clients and cronies will be destroyed.

The thing is, we face a cliff where the US Government will soon need a LOT more money. What will Lord Jaysus do. Walk on water? Teach the people to fish? 

FREE REPORT – Proof of How QE Works – Fed to Primary Dealers, to Markets, To Money 

 

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Meanwhile, Slinky climbs the stairs. The 5 day cycle turned up overnight, setting up conditions for another breakout and a move to 4160 today. Maybe more. 

Here's the hourly chart. 

tvc_cfa5dea490ff3e7a37bfe0134e295ff6.png

Drilling down to 30 minute bars, there's a 2-3 day cycle projection of 4140, but there's no reason to expect that to be the peak. Rising trend resistance is at 4145 at 5 AM in New York. That moves up to 4152 at the open. Then it runs into channel resistance around 4157. That line will be at 4160 at the NY close. 

tvc_c04576a8be4e062a19974ca8f914139c.png

The first challenge for the running of the bulls comes at resistance indicated around 4140. I assume that they'll clear that. 

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We're in the middle of the Fed's monthly MBS settlement week. There's a lot of cash coming into Primary Dealer accounts. But what will they do with it? 

Primary Dealers Go Full Reverse Thrusters

I'm really impressed at how JPM and GS were able to generate enormous profits in Q1 despite the losses in the bond market. I guess the rise in stocks bailed them out. Their portfolio positioning was likely better than the 22 other Primary Dealers. Although WFC also did well. 

As the NY Times put it:

Quote

Strength in the banks’ investing, lending and trading businesses added to the euphoria. All three reported robust revenues across multiple lines of business, driven by a combination of active and rising markets, a flurry of new mortgage activity and the boom in special-purpose acquisition companies, or SPACs. Corporate merger and acquisition activity also marked an all-time high by dollar value.

Wow. It's all good. They also pointed out that the banks boosted their bottom lines by sharply lowering their loan loss reserves. 

Ok. 

I'm not a micro anal cyst. I do macro. And the macro clearly showed that the banks who own Primary Dealers, took massive losses in their bond portfolios. But I guess they can subsidize those from all these other skim lines that they run. 

Are these profits real, and will they use them to get their dealer subsidiaries through the coming fiscal cliff?

Those are the questions that I'll attempt to answer in upcoming reports in Days of Our Lives.

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HOW TO AVOID BAG HOLDERDOM 101

JPM and the Goldmember are experts at avoiding bag holderdom.

The others (especially the swiss) not so much.

They are obviously not keeping the toxic stuff on their balance sheet, and if they have to they buy downside protection as cheaply as possible.

The game is to pass the stinky stuff on as quickly as possible and just keep the transaction fees.

The game in financial assets is to take the return and pass the risk onto someone else.

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Bulls eked out a win today's Screen Game by a score of 38 to 30. That's swing trade buy signals vs. sell signals from yesterday's action. 

The bulls have been controlling the ball, despite losing a few of these scrimmages lately 

Why didn't the market pull back when the bears had more signals on their side? Answer- residual momentum.  There weren't enough sell signals to offset the 155 buy signals on March 28 and 75 on April 2. These numbers showed the thrust off the intermediate bottom.

The number of sell signals, while more than buys over the April 8-13 period, was still low at no more than 31 each day. There was no downside thrust. Nothing to get the ball rolling for bears. Bulls played defense spectacularly. On Tuesday, this week, they have the ball again.

Be careful. It's deflated.  

Here is today's  output. 

This is raw data. These are not recommendations. They represent charts that have triggered short term signals near key cyclical support or resistance levels. Pick through these and see if there are any that you like from your own charts. Feel free to post your charts here with comments. 

 

Symbol Buy Sell 500 200 125 50
ALKS.O 1 0 0 1 0 0
BUD 1 0 1 0 0 0
APA.O 1 0 1 0 0 0
APLE.K 1 0 0 0 0 1
ASB 1 0 0 0 0 1
AZN.O 1 0 0 0 0 1
BSBR.K 1 0 0 1 0 0
CX 1 0 0 0 0 1
CME.O 1 0 0 0 0 1
ED 1 0 0 1 0 0
CROX.O 1 0 0 0 0 1
CRIS.O 1 0 0 0 0 1
PLAY.O 1 0 0 0 0 1
FANG.O 1 0 0 0 0 1
EMN 1 0 0 0 0 1
EOG 1 0 0 0 0 1
FCX 1 0 0 0 0 1
GILT.O 1 0 0 0 1 0
GLNG.O 1 0 0 1 0 0
HFC 1 0 1 0 0 0
HUN 1 0 0 0 0 1
IMGN.O 1 0 0 0 1 0
ILF 1 0 0 0 0 1
EWZ 1 0 0 0 0 1
LYFT.O 1 0 0 0 0 1
LYB 1 0 0 0 0 1
MTDR.K 1 0 0 0 0 1
NTNX.O 1 0 0 1 0 0
PEB 1 0 0 0 0 1
PCG 1 0 1 0 0 1
SCHE.K 1 0 0 0 1 0
SBSW.K 1 0 0 0 0 1
SIRI.O 1 0 0 0 1 0
SM 1 0 0 0 0 1
TRV 1 0 0 0 0 1
TRIP.O 1 0 0 0 0 1
JETS.K 1 0 0 0 0 1
WEC 1 0 1 0 0 0
SGOL.K 0 1 0 0 0 1
BBBY.O 0 1 0 0 0 1
BDN 0 1 0 0 0 1
CTLT.K 0 1 0 0 1 1
CDE 0 1 0 0 0 1
WTRG.K 0 1 0 0 1 0
PCY 0 1 0 0 0 1
IOVA.O 0 1 1 0 0 0
IGSB.O 0 1 0 0 0 1
USIG.O 0 1 0 0 0 1
FALN.O 0 1 0 0 0 1
IAU 0 1 0 0 0 1
LQD 0 1 0 0 0 1
NEE 0 1 0 0 1 0
EGOV.O 0 1 0 0 0 1
NCLH.K 0 1 0 0 0 1
PLYA.O 0 1 0 0 0 1
SPG 0 1 0 0 0 1
GLDM.K 0 1 0 0 0 1
GLD 0 1 0 0 0 1
SPLB.K 0 1 0 0 0 1
SPR 0 1 0 0 0 1
UPWK.O 0 1 0 0 0 1
ANGL.O 0 1 0 0 0 1
VCLT.O 0 1 0 0 0 1
VIAV.O 0 1 0 0 0 1
VG.O 0 1 0 0 0 1
WPM 0 1 0 0 1 0
YUMC.K 0 1 0 0 0 1
ZS.O 0 1 0 0 1 1
             
Totals 38 30 6 5 9 51

These signals ideally have a time horizon of 1-4 weeks.  

The last 4 columns are for the time frame of the support or resistance line around which the signals were triggered.

Ignore the .O and .K These are peculiar to Reuters data. 

I initially screen 9000 NYSE and NADSACS issues for stocks that have been trading more than 1 million shares per day and are trading above $6. There are normally between 30 and 100 results, depending on where we are in the cycle. There are more signals at cyclical turning points and fewer as a move progresses.  

I use these screens to pick stocks for my ready list for my personal trading, and also for my weekly swing trade chart picks for Technical Trader subscribers.

I developed the algorithm to hunt for stocks that looked primed to have a good move, ideally over a period of 4 weeks. In practice they range from 1 week to 7 weeks. I consider the move finished when they break trend support, using the indicators from which the screen program is constructed. 

From the screen output I visually review the charts. I make my picks from that review.

There are usually between 2 and 8 good looking setups every day. The numbers are bigger around intermediate term turning points. 

Here's a typical chart. I review these daily for my own personal trading candidates, and weekly for inclusion in the Technical Trader newsletter. 

This chart is not a recommendation. I thought it interesting because it's a corporate bond fund. I will let you draw your own conclusions. 

image.png

 

This Monster is Poised to Explode

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Surprise, that "stimulus" worked! So, what about next month? Boom time, baby! That's what boom berg says... 

I'm a pessimist. Can't help it, always looking for a good short. I need to sit on my hands for a bit.

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I always liked:  Give a man a fish and he eats for a day. Teach a man to fish and he spends half of the rest of his life sitting in a boat drinking beer.

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2 hours ago, Jimbo said:

HOW TO AVOID BAG HOLDERDOM 101

JPM and the Goldmember are experts at avoiding bag holderdom.

The others (especially the swiss) not so much.

They are obviously not keeping the toxic stuff on their balance sheet, and if they have to they buy downside protection as cheaply as possible.

The game is to pass the stinky stuff on as quickly as possible and just keep the transaction fees.

The game in financial assets is to take the return and pass the risk onto someone else.

Except the bag in question is full of US Treasury securities.  Not exactly toxic but there is just too much of the stuff to clear the market at this price.  

 

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From Bberg....

“The consumer has so much money they’re paying down their credit card loan -- which is good,” JPMorgan Chief Executive Officer Jamie Dimon said Wednesday. “So the consumers have $2 trillion more cash in their checking accounts than they had before Covid. That’s also true on the business side, where businesses took advantage of huge financing in the marketplace to raise a lot of cash.”

This has to be the first recession in the history of mankind that everyone had more cash at the end of the recession than when it began. My god, not sure which part of the business cycle is more profitable.

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I want to sell everything.

I want to sell everything.

I want to sell everything.

I want to sell everything.

I want to sell everything.

I want to sell everything.

I want to sell everything.

I want to sell everything......

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6 hours ago, DrStool said:

Meanwhile, Slinky climbs the stairs. The 5 day cycle turned up overnight, setting up conditions for another breakout and a move to 4160 today. Maybe more. 

Missed by less than a point so far. 

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