Tag Archives: commodities

Debate of QE Termination a Head Fake Expect Market Rallies Upon Completion of QE2

“The USSR had two newspapers, Pravda and Izvestia.  In the Russian language, “pravda” means truth and “izvestia” means news.  The saying amongst the Russian people put the situation in a nutshell:  “There’s no Pravda in Izvestia and there’s no Izvestia in Pravda”.” – The Privateer ‘You heard it here first’ and ‘Mark my words’ are the hackneyed phrases that come to […]

Liquidity Expands + Credit Markets Improve = Equity Market Rally

Stock Market Strategy: All signs point to a continuation of the current rally. We will continue to use the direction of liquidity and the behavior of the credit markets as our fundamental guides to equity investing. The primary news story making the rounds today involves the European bank stress test results. I have included the official results and accompanying statement […]

Equity Markets Continue to Bleed. Why? German Stupidity, Volcker Rule and the Carry Trade Unwind

As usual European news leads the way with a ridiculous ’shoot in the foot’ decision coming out of Germany… Merkel will announce, on Wednesday, a financial transactions tax, and a ban on naked short selling on 10 of the “most-important” financial institutions in Germany. Ban also applies to CDS and Euro govt bonds. Will remain in place for an indefinite period of […]

Stalking a Bear or a Windmill? Commodity Prices Surge, Inflation Trade Gains Steam

Is it a bear or a windmill we’re stalking? You may find yourself asking that question as the equity markets drift higher seemingly oblivious to a myriad of negative news.  Classic commentary such as “the market climbs a wall of worry” or “the trend is your friend” are being bandied about with increased regularity.  Of course, these sayings are useless […]

Sovereign Debt Spreads Widen on Greece/Portugal Worries, Equity/Commodity Markets Roiled, Fed Begins to Backtrack

The equity and commodity markets get rocked as Sovereign debt woes resurface. The burning question: Will the dramatic widening of credit spreads in Sovereign debt, beginning to resemble the CDS collapse of 2008 in the private sector, lead to a revisit of a 2008 type credit crisis and all the fallout associated with it?… Greece, Portugal woes intensify – WSJ […]

G.O.P takes Mass., Market Reaction to G.O.P Win, Housing Starts Plummet, FHA Lifts Fees

G.O.P. takes Massachusetts Senate seat – NY Times NY Times reports Scott Brown, a little-known Republican state senator, rode to an extraordinary upset Tuesday night when he was elected to fill the Senate seat that was long held by Edward M. Kennedy in the overwhelmingly Democratic state of Massachusetts. By a decisive margin, Mr. Brown defeated Martha Coakley, the state’s […]

The Strenuous Life of the American Dollar

              With the enormous amount of government spending, some level of U.S. inflation is inevitable; but how high that level might get is debatable. With the global economy crawling out of the Great Recession, inflation-flavored fears now fill news broadcasts. As a result, gold and oil prices have climbed as inflation-conscious investors have poured their money into commodities due to […]

US$ Decline, T-Bond Prices Decline / Rates Up, CRB Index Down, Precious Metals Higher

By viewing the five charts above, (UUP = US$, TLT = Treasury bonds, CRB = Commodities, GLD = Gold) you have just witnessed a graphical demonstration of the beginning of the stagflation trade. Those of you who read this blog regularly know we have been warning of the inevitable rise of hyper-inflation at a time when a jobless recovery will […]