cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Senior Contributor

OptionEye - Macro Outlook - April 21st

Good morning. 

 

Bird Flu outbreak doing the rounds. Not expected to be a huge issue but definitely needs to be watched. 

 

Overnight grain prices all a little lower with corn and beans both down about 3 cents and wheat down 4 cents. 

 

Yesterday we saw the equity markets take back Friday's losses as ridiculous as that may seem. Earnings are beating but they are beating very low expectations. There continues to be a large movement for firms to buy back their own shares with this cheap cash - also driving things higher. As I have said many times, we have an all time record high stock market but how can we say we have an all time record high economy. 

 

The dollar is stronger again this morning and sits at 98.28 up .33. 

 

The equity market is higher again as the Euopean markets are mixed. 

 

Oil is lower by .23 cents to $56.15 and gold is up by $2.27 to $1198.15. The 10 year yield is still sitting at that 1.87% with big support at the 1.83% level. 

 

Today we have no economic indicators to key off of so the talk will be the dollar, earnings and Greece. 

 

 

 

 

0 Kudos
14 Replies
Highlighted
Senior Contributor

Re: OptionEye - Macro Outlook - April 21st

Just an observation and a thought:

 

You seem to alwaysbe  puzzled by the resiliency of the stock market, and you have been so for a long time.  The right wing of the conservative movement has been calling for a stock market crash/deep pull back, since the market broke 14,000, several years ago.   "Sluggish economy, weak recovery, poor wage recovery, poor job recovery, etc.

 

I would hope that when (and it will eventually happen)  the stock market eventually pulls back or corrects, we don't hear, "see, I told you so".   i know most posters here are conservative and pooh-pooh Obama, his healthcare bill, his foreign policy positions, his judicial appointments, but let's face it guys, the economy and this country are a hell of lot better off financially than they were 6 years ago.   

0 Kudos
Highlighted
Honored Advisor

Re: OptionEye - Macro Outlook - April 21st

Well Vanderplas, i`ll tell you what I heard Democrats say about Reagan`s good economy 30 years ago "If I could spend $1 Trillion, I could show you a good time too"  Well, under obama the national debt went up $8 Trillion...and you know a good lot of that money found it`s way into the stock market.   Interest rates are Zero..just look at a history of fed funds rates and up until 6 years ago they were never zero% ..that`s ridiculous.

 

But, if unemployment wasn`t measured at a 30 hour work week and the those part timers and those out of the work force were counted as under George W Bush, unemployment today would be 10%.  I guess the flippant answer is, if the economy is so strong why can`t Yellan raise interest rates and what would that do to the $18 Trillion nation debt?

 

That all said of course the Dow can keep going up, it might hit 36,000 like some predicted a few years ago, cheap money is being pumped into it.  And BTW the market doesn`t seem to be too worried about a "President Hillary".

0 Kudos
Highlighted
Senior Contributor

Re: OptionEye - Macro Outlook - April 21st

People who want interests rates to rise are usually the ones with big bank accounts.

0 Kudos
Highlighted
Honored Advisor

Re: OptionEye - Macro Outlook - April 21st

So Obama and the Keynesians have just stumbled on "alchemy", we are going to spend and print our way to perpetual prosperity?  It will never end and the rest of the world will be just fine with this.

0 Kudos
Highlighted
Senior Contributor

Re: OptionEye - Macro Outlook - April 21st

Whatever you say.

0 Kudos
Highlighted
Veteran Advisor

Re: OptionEye - Macro Outlook - April 21st

Hey Scott, 

 

That light at the end of the tunnel is a train coming right at you so take your sell positions off.  Rule number one: Don't pick a top.

0 Kudos
Highlighted
Senior Advisor

Cheap cash!

So, does anyone know where I can buy some 'cheap cash'? The only cash I can see is worth more than it was and I haven't seen any sale banners for it lately. I have a stash of Brazilian Reals and if I could buy 'cheap cash' I could convert that position.

 

I've asked my friends if they've seen any cheap cash and they look at me funny and then tell me if I find a source for cheap cash to let them know. The closest I've gotten is someone telling me I can find cheap cash on Wall St but those getting it won't sell it to anyone else. Apparently they have a use for it - buying bubbles.

 

Who thought bubbles would actually be worth anything?

0 Kudos
Highlighted
Honored Advisor

Re: Cheap cash!

Well Pal, I can go down to the bank and borrow all kinds of money for 3.5%.  I`ll bet there are farmers in their 80`s that couldn`t recall ever being able to do that.

 

That "cheap money" is only Uncle Sam exporting our inflation, which isn`t a good thing for the few exports that we have left and I don`t know about you but my garage is already full enough of "pink flamingos" that were made in China.

0 Kudos
Highlighted
Honored Advisor

Re: Cheap cash!

We picked up some operating money at under 3%, that is cheap by most any standard in any country in any period of recorded human history. After inflation, cost of funds is roughly zero. That is cheap Pal.

 

Cash one of the trusts loans to the bank is worth .21% per year. Great wealth transfer from the savers getting zero return to the financial class loaning it back to the Treasury at 1.6% for 10 years.

 

This issue is not a party issue. Both parties voted to spend all the money. Why? The people demanded it of them. Rothschild, or pick a economic historian, they all foretold this day would come. This is a cultural problem, a human problem. The choice, and it is a choice by ALL involved, is to spend for today rather than save for tomorrow. It doesn't matter if it is the super wealthy liberals in America, or the Senator from Florida protecting the sugar price, a conservative Defense hawk forcing new fighter planes into the budget. Look in the mirror, we all are guilty. Or gasp, the Farm Lobby crushing any possible means testing of the crop insurance subsidies for the wealthiest American's.

 

You can spend it now, or spend it later. If you borrow to spend tomorrow's wealth today, well, that is problematic because it has to be repaid someday. Either by the borrower, or the lender. Most will be repaid by the lender it seems.

 

Debt simplies eliminates freedom of choice. Once nation states get into the act, the same rules apply, normally death and destruction follow in its wake.

 

Didn't mean to write a thread-killer post. I am not that pessimistic actually. Any country can just write off the debt and move on. Many have in the last 100 years. Just have to hope not every country does it at the same time. Since all are followng the same monetary policy at the same time. That creates the systemic risk.

0 Kudos