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Senior Contributor

OptionEye Morning Macro Outlook June 26th

Good morning.

 

Corn up 1, beans up 8 and wheat up 1.

 

Stories doing the rounds that corn inventories may be rising at their fastest pace in 9 years. U.S. inventories on June one are forecast to have jumped 35% which would be the biggest gain since 2005.

 

Ugh.

 

Oil is down .22 cents to $106.28. The gold market is down $11.26 to $1307.93.

 

The 10 year yield is sitting at 2.56%. That kind of wants to trend lower.

 

Yesterday we got GDP numbers for the 1Q of this year. AND THEY WERE HORRIBLE. No better way to say it. We stink. The market was surprised but only for a few hours as the euphoria of QE and global central bank intervention krept back into the market and we finished nicely higher on the day. What a joke. Total denial. I say i don't believe in this rally at all but if you want to make money you have to be on board. Morally I am against it but monetarily I'm for it.

 

Just make sure you have a seat when the music stops.

 

 

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Veteran Contributor

Re: OptionEye Morning Macro Outlook June 26th

OptionEye:

Perhaps another way to describe the report would be to say the cold spring/winter weather slowed down the economy more than expected. Did it stink? Not necessarily because of the natural cause. Does it mean anything negative about the economy? No. Total denial? Hardly. Bottom line: The market reacted the way it did for rational reasons. The Future: The next quarter will see the trend back in place. Thankfully we have tools to adjust, assist, and support  the economy.

 

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Honored Advisor

Re: OptionEye Morning Macro Outlook June 26th

Corn inventories rising........this time of year?  In the US?    Must have been some real early corn planted.     Smiley Wink

 

 

Of course corn inventories have risen over last year.........poor crop and good prices in 2012 left many bins empty.   Good crop in 2013 and there are a few bushels in the bins yet.    This is certainly not new news...................

 

Let's headline the demand story and tell us just how much more corn has been used compared to other years.

Advisor

Re: OptionEye Morning Macro Outlook June 26th

The data is a little hard to come by but it appears that in Q1 1978 (the winter that 2014 is most often compared to) growth was mildly positive. A lot of stuff going on then and I wouldn't call that a definitve argument.  But I'm really not buying the bad winter story, entirely.

 

As I said, 2.9 + (-2.9) = 0

 

You can also take it to the bank that all the bad stuff got shoved in this quarter. don't want an official call on recession (two successive negative quarters, a ridiculous metric anyway) right before a midterm, a form of subterfuge that either side engages in if they have the levers of power.

 

And hey, it is all about consumer confidence anyway, right?

 

So party like it's 1999.

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Honored Advisor

Re: OptionEye Morning Macro Outlook June 26th

And just like in the olden days proof.  

 

Bill Clinton had his 100,000 this or that.

 

The USDA used to have this hat they could pull 300,000,000 bushels out of, with inflation it is now 400,000,000.  

 

Maybe they are reconstuting the ddg's back into corn?

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