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hardnox604008
Advisor

And it is just that simple

No, not really.

 

But the Dow is conveniently parked at 13,000 as the market awaits tomorrow's results of the ECB's LTRO to the banks- general handicap is that less than Euro 500B is bearish, much more is bullish. 

 

 This would be in terms of the fact that central banks basically now set the price of assets in the short term and any attempt at prediction is purely based on predicting what they will do.

 

The problem of a completely broken transmission mechanism- i.e., that monetary policy only increases speculation in all asset classes but doesn't find its way into the general economy- is immaterial for the moment. Today's data was telling with very bad numbers in housing and consumer durables "offset" by a very good consumer sentiment- apparently,  a higher stock market makes people more optimisitic (but not optimistic enough to buy houses or other big ticket items), which in turn makes a better confidence number which, you guessed it, makes the market go up. This central banking gig is like fish in a barrel.

 

I still have mixed feelings about grains- on the one hand action hasn't been very impressive, on the other hand we're in a weak seasonal period.

 

I'd guess that this year will be like the last 6 where USDA will buy a spring rally with a small acreage number but of course the zillion dollar question is, what if they don't?  Or what if corn is .50 lower by the time they do?

 

No strategy in particular to offer. Maybe some put ratio spreads under the market just in case?

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7 Replies
sw363535
Honored Advisor

Re: And it is just that simple

Thanks nox,

The data of "consumer sentiment" is sure hard to verify without the spending support.-----good thought.

 

Kind of like a lecture from my youth----"when you haven't got anything good to say, at least smile" (good consumer sentiment)

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hardnox604008
Advisor

Re: And it is just that simple

I would suggest that if USDA does give a friendly acreage number to buy some acres, I would have a plan on how to sell some rather than complaining when the acres actually do appear in June.

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sw363535
Honored Advisor

Re: And it is just that simple

If that senerio happens there will be plenty of opportunity to sell in the acre buying process -------but that has to happen soon.  I don't think usda has time to influence acres now.  Next two weeks.

Reversing projections might happen now that crop ins numbers are set, but there is not much time left to change planting.   

thanks for the push.

 

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Artifice
Senior Contributor

Re: And it is just that simple

conveniently parked at 13,000  oh my..

corp profits srong.

 

owners own,,, not much for sale..

 

conspiracy.

own productive assets

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timetippingpt
Honored Advisor

Re: And it is just that simple

Hardbody:

   You should subscribe to the "Richard Young Intelligence Report". Seriously, the guy is very good as an investor over time.

He focuses mostly on dividends and compounding earnings and asset diversification. We've read his work for about 20 years now. Plus he loves to ride his harley's around the country, which is also interesting.

  Anyway, he prints 6 pages of charts, one of those charts is what the global price for gold would be in terms of global currency. Last month it was around $12,000 an ounce I think, and increasing at $2000 an ounce a year. Currency in circulation has grown at a compounded 11% a year since 1990 I think is that stat.  That is just one of the charts.

  He focuses mostly on stock/bond investments. And of course, he is pretty concerned about how unlimited currency works out in the real world (it never has in past human history).

  You would find his work interesting and it would add some balance to some of the other sites you follow.

The seasonal rally is upon us, time to begin sharping the long-knives and wait for the perennial bulls who are fatted and ready for slaughter to walk into the pen.

  Thanks for sharing your thoughts.

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hardnox604008
Advisor

Re: And it is just that simple

A number of years ago I subscribed to Dow Theory Letters. As much as anything I enjoyed the daily commentary from Richard Russell, sort of like having a conversation with your grandfather every day. I got busy and let it lapse and quite honestly am simply not at all sure of the validity of any broad TA methods in a world which is "pump, crash, rinse, wash repeat."

 

Anyway, this was the early 00s and Richard was always saying that for himself he was merely taking any new cash and income from dividends and buying gold without concern about where he bought each unit. Of course that beat the daylights out of the broad market over this timeframe.

 

I'm still of the opinion that Richard made the easy money in gold although it could certainly go a lot higher.

 

FWIW, the rising wedge in the SP or Dow looks very mature and the central bank escalator in the Naz just plain looks weird. But as I said I have vry low confidence in the near term direction of a market that is centrally planned.

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hardnox604008
Advisor

Re: And it is just that simple

Speaking of gold, looks like Dr. B's indication that the remaining supply of heroin may be rationed is casuing some tremors in the stock and gold markets.

 

"bullish"  GDP number is not bullsih because it means that QE is less likely. Just in case I need to be reminded what makes things go.

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