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Senior Advisor

Shellady - "Rough Roads"

Ok, I just find this fascinating. Note the title of Scott's video from 8/27/15 over there on the right.

"Rough Road ahead for Commodities"

 

The moment this video was recorded was virtually the low in commodities. Commod's have been in one of the most severe and prolonged collapses in all of history and this is what we put on the front page for farmers to listen too? Kind of like the "Gold is Dead" cover story a few decades ago.

 

The lows are getting closer. Notice the action in crude. That is a violent bounce. Which market gets to bounce next?

 

A much better topic would be "Rough Road ahead for Bonds for the next 20 years".

16 Replies
Advisor

Re: Shellady - "Rough Roads"

'Tis true that the CRB downtrend is a probably a lot closer to the end than the beginning but I suspect that if we get new lows in the SP (and I think we will)  we'll also see new lows in the CRB.

 

BTW, a lot of bodies strewn behind of those predicting inflation and a bond bloodbath the last 7 years. However given that it is an ideological marker there is no cost to being wrong.

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Honored Advisor

Re: Shellady - "Rough Roads"

We`ve had inflation, it`s just most of it went into a 18,000 stock market whose true value is really 6,000.   A factory that leaves a small midwestern town and goes to Mexico, the US town loses alot of `living wage` jobs in turn the company owner gets $2/hr workers and no environmental regs.  The former US factory worker has to enter the service economy working 30/hr weeks. 

 

The fed with a $4.5 Trillion balance sheet and a US national debt of $18 Trillion, just hasn`t made it down to mainstreet.

 

http://market-ticker.org/akcs-www?post=230615

 

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Senior Advisor

Re: Shellady - "Rough Roads"

Whatever H, I'll stay hedged the bonds and be happy with my interest rates. Not like they are going lower by much. Kind of like buying $2 corn for hog feed back in the early 2000's, just conservative business plan is all.

 

My point though was about how the "sky is falling" psychology is over-taking normally rational minds. The stock market has 4 down days, is still up for the year, and SCREEMMMMM! This is scary? Why is it scary?

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Advisor

Re: Shellady - "Rough Roads"

I don't want to get in a testoterone match about who's "scared" and who's brave.

 

Stock indices breaking down out of an ominously anomalous multi-year tight range levitation should get attention. I don't care where it goes just want to be on the right side or out of the way.

 

 

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Honored Advisor

Re: Shellady - "Rough Roads"

The thing is with the stock market who knows?  It could be 19,500 by the end of the year or it could be a bear market, if that is the case it probably won`t go straight down because there are people that see it as a "buying opportunity" they get in and it bounces up.  If Yellan comes in, guns ablazin` the fed might bail it out, with this funny money anything is possible.  But with HFT, computer models are in charge, if the price and model hits a certain level, they just get out in a split second and the slowest computer is left holding the potato...to say nothing of the poor schlemiel that does his own stock picking based on fundamentals through E*Trade.

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Veteran Advisor

Re: Shellady - "Rough Roads"

Totally with you on those sentiments, Nox.  Investment dude called me week before last -- wanted me to invest in something since my money market account wasn't earning much.  I told him it wasn't much different than past couple of years, but that money market account represents more than simply the rate it pays, principal probably safer than bond funds, and would rather keep it where it is while general market direction settled a bit.  And, Nox, I really appreciate your comments, please don't be shy on sharing your equity market observations.  I recall that you sounded some solid warnings before the last big meltdown.

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Advisor

Re: Shellady - "Rough Roads"

Thanks.

 

FWIW, I'm not currently anticipating a crash of that proportions- or at least not with that sort of speed- maybe in a long term bear, ultimately.

 

Could see 30% here on the outside, a garden variety 20% correction more likely.

 

Although that is very much worth what you're payin'. I generally don't like to go into my opinions too hard because it can leave you with some ego hanging out to defend.

 

I might need to change my opinion quickly should evidence seem to dictate.

 

BTW- Naz Comp chart is most interesting to me- there's an unfilled gap down around 4500 and that seems well within reach without geting too extreme. But also worth noting that today's gap down left an island of sorts- wouldn't die on the beach defending the idea that wouldn't fill sometime either.

 

 

 

 

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Senior Contributor

Re: Shellady - "Rough Roads"

Hey guys.

 

We have a family farm an I want nothing but money to flow from it. I would love to see $7.00 corn again - believe me when I say I am on your side.

 

I am not a buyer of crude until $35ish as I have stated time and time again on the television. While I am thin, funny and good looking, I am also wrong on the markets - a lot.

 

What I do know is this....the world is not right. We can't have 'normalization' while the Fed pumps QE1, QE2 and QE3. Don't trust anything except your own personal liquidity in days like today.

 

We can't buy inflation with 0% interest rates in its 7th year??? The engine must be broken. Oh, and then there is China. China has grown my 56X in 20 years. This will not end well and it won't be a soft landing - it will be a thud.

 

Commodities unfortunately are at 10 year lows....as a group...and with China and the Far East faltering, things don't look great for in short term going forward.

 

 

 

 

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Senior Contributor

Re: Shellady - "Rough Roads"

And, just a last note, I feel strongly enough about our faltering economy I say it like I see it instead of the talking heads on TV. I answer to no one. I rarely reply on the site because it usually ignites a firestorm that I can't reply to.

 

Except for you guys/gals. My late father was a farmer. Can't get it our of my blood. Sorry.

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