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Why U.S. stocks can NEVER have a serious correction

Posted by Richard640 @ 22:08 on February 11, 2020  

Monday, February 10, 2020

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U.S. stocks have become a ‘safety trade’

There’re a lot of liquid assets swirling around the world, waiting to move as the market narrative shifts.

Traditionally, when things get scary out there, the typical “risk-off” trade is to dump stocks and rotate into safer assets like Treasury securities and cash.

But within big asset classes like stocks, you’ll find that some stocks are “riskier” than others. For example, developed market stocks are considered more stable than emerging market stocks. Large-cap stocks are considered more liquid than small-cap stocks.

And so when you think of stocks that way, “risk-off” may actually mean global equity investors are rotating into more stable stocks (like U.S. stocks) and larger cap stocks (like U.S. stocks). These characteristics define the S&P 500 (^GSPC).

Fundstrat’s Tom Lee thinks this dynamic may explain much of the sharp market rallywe’ve seen in recent days despite the persistence of disconcerting headlines (e.g. coronavirus, U.S. political uncertainty).

“There is just not enough S&P 500 to go around,” Fundstrat’s Tom Lee said in a note to clients on Thursday. “The S&P 500 is about $25 trillion in market cap and there is $300 trillion of global household liquid assets.

.”

Trillions of dollars are looking for somewhere to go. (Fundstrat)

Lee also notes that U.S. stocks further benefit from being heavily exposed to the U.S. economy where the data continues to improve as the rest of the world stagnates.

“Thus, picture the panic as money leaves riskier regions and looks for the U.S.,” Lee said. “This causes the S&P 500 to spike.”

Lee’s thesis that U.S. equities have become a “safety trade” is confirmed by global asset fund flow data.

According to Jefferies’ Global Asset Fund Flows Tracker: “In the week 30 Jan-5 Feb, a resumption of strong buying of US equities (+US$14.0 billion, a 7-week high) dominated global equity fund inflows (+US$14.1 billion). However, [emerging market] equity outflows accelerated.“

new hampshire early returns

Posted by treefrog @ 20:43 on February 11, 2020  

sanders

buttigieg

klobuchar

warren

biden

no surprises…  a clear case of ELECTILE DYSFUNCTION.

go home, joe.  it’s over.  you too fauxcahontas, get lost!

 

crude oil

Posted by treefrog @ 17:25 on February 11, 2020  

…has been correcting since december.  is that a double bottom i see forming @ about 49.45/50?

Re Republicans Versus Democrats? I Made Up New Names, That Better Describe Them

Posted by Mr.Copper @ 17:05 on February 11, 2020  

The Democrats have really screwed themselves real good. I’ll bet money, many democrats are embarrassed and are rotating out of that pro global commie type party. And all the past people that stopped voting decades ago, came into the Republican party.

Re the very good massive Divisiveness evolving, the “smart separating from the diabolical” another one?  I would describe the parties a few different ways.

Originally I called it the Practicals’ versus the Emotionals.

Another view, The Boys&Girlymen versus the Men.

The latest? The Rural versus the City Folks, or.

The Silent Majority, versus the Vocal Minority.

Now guess which is which? 🙂

FYI, I won’t be posting for a while. Taking a break.

Buygold

Posted by ipso facto @ 16:32 on February 11, 2020  

I’m hopeful for the shares as well … MACD leaving a lot of room for the HUI to run now. Also the quarterly reports should help. Most producing gold companies should be making some good scratch.

Maybe we’re living on a world where gold companies can succeed! 🙂

R640, Ipso

Posted by Buygold @ 15:46 on February 11, 2020  

Despite Powell and his B.S. I’m liking the close in the shares. Not so much in the metals and it surely doesn’t mean we’ll rebound tomorrow, but the shares look pretty good considering the performance of the metals…

Alex Valdor

Posted by Buygold @ 15:43 on February 11, 2020  

Thanks for posting Egon, pretty sure I live on another planet as well.

Unfortunately, I’m at work so I can’t watch the video right now, but can’t wait to watch when I get home and find out what planet we live on! 🙂

This doesn’t even make the first page on ZH…but who cares about liquidity anyway? :)

Posted by Buygold @ 15:35 on February 11, 2020  

Fed Injects $68 Billion In Liquidity As Third Oversubscribed Term-Repo Confirms Liquidity Shortage Accelerates

The liquidity crisis that continues to percolate just below the surface of the market and has clogged up the critical plumbing within the US financial system, is getting worse, not better.

Gold And US Dollar seem to be, Moving Up and Down Together, Huh?

Posted by Mr.Copper @ 15:27 on February 11, 2020  

On a three month view.

USD up since Dec 19, DOWN today:

https://finviz.com/futures_charts.ashx?t=CURRENCIES&p=d1

Gold up since Dec ’19, down today:

https://finviz.com/futures_charts.ashx?t=METALS&p=d1

>>>Its the same on a 1.5 years view:

Dollar up left to right:

https://finviz.com/futures_charts.ashx?t=CURRENCIES&p=w1

Gold up left to right:

https://finviz.com/futures_charts.ashx?t=METALS&p=w1

>>Its the same on a FIVE year view. Lower left to upper right.

US Dollar:

https://finviz.com/futures_charts.ashx?t=CURRENCIES&p=m1

Gold:

https://finviz.com/futures_charts.ashx?t=METALS&p=m1

Whats the answer? Dollars and Gold are both in favor, so far. However if the Dopey/Dollar that provides Dopey/Prices, starts FALLING!!?? Gold will get a huge tailwind.

This is simple crap. The producers in most other commodity businesses like Oil and Food etc CAN over produce if enabled with high prices. But Gold simply can’t be over produced. Granted higher prices can only encourage selling of scrap or existing physical. But generally people tend to hold on when prices are rising. I see that with real estate. T Boon Pickens once said something like…”Why should I sell my one million barrels of oil today when I could sell it later at higher prices.”

 

 

Falco Resources Ltd. to Acquire Golden Queen Mining Consolidated Ltd.

Posted by ipso facto @ 15:22 on February 11, 2020  

https://finance.yahoo.com/news/falco-resources-ltd-acquire-golden-190846869.html

Egon Von Greyerz admits that he lives on a different planet ( after speaking in Australia )

Posted by Alex Valdor @ 12:28 on February 11, 2020  

EGON VON GREYERZ: “I LIVE ON A DIFFERENT PLANET”

Ipso

Posted by Buygold @ 11:44 on February 11, 2020  

Yeah. This makes me think we might be in for another year of more of the same.

Hope not, but the game feels the same.

R640 – well sir, it didn’t stick

Posted by Buygold @ 11:42 on February 11, 2020  

HUI down a bit now, but SM has rolled over.

I don’t know. PM’s getting hit when the Fed head speaks is pretty much par for the course.

Yawn

Buygold @ 9:21

Posted by ipso facto @ 11:11 on February 11, 2020  

We could probably have figured out that Jay was speaking today by the looks of the gold chart. Big ass down moves out of nowhere. Sheesh

It’s a Pollyanna world La La La

…interesting…

Posted by Richard640 @ 10:32 on February 11, 2020  

Labor Market Hits A Brick Wall: Job Openings Post Biggest Two-Month Drop In History

The record two-month plunge in job openings is a very loud, and very clear signal that something is breaking in the labor market…

Buygold-Hows come the HUI has suddenly popped with gold down 7.20–take a look! Hows come….

Posted by Richard640 @ 10:29 on February 11, 2020  

https://finance.yahoo.com/quote/%5EHUI?ltr=1

Goldi–thanks for the good info-I’d like to know too

Posted by Richard640 @ 10:26 on February 11, 2020  

Ballinger on the 30 yr.

There is one chart in all of the financial universe that tells me what the smartest people in the world are doing with their “big wallets” and that is the chart of long term bond yields.

If copper has a Phd. in economics, then bond yields would be the academic masters that wrote the books that copper studied en route to its degree. Long-term yields are different than short term yields because the former is demand driven while the latter is policy driven or “administered”. The Federal Reserve maestros can play Pac-Man with short term interest rates, but they can’t with long term yields because over the long term, yields will move to levels governed by FEAR. And it is fear and fear alone that drives the risk-free rate of return for holders of all the wealth in the world.

Accordingly, it is this next chart whose eardrum-splitting air raid siren is drowning out the blips and beeps of the copper chart or the ding-dong of the stock chart without a trace of indecision or reflection. Long term yields are moving LOWER and they are moving lower FAST and that, my friends, reeks of a sense of urgency verging on panic and it began long before the coronavirus arrived. The chart below is truly “The Great Dichotomy”.It is this Great Dichotomy that terrifies me and the one chart that should be required reading for everyone participating in the world of financial speculation and a rote memory prerequisite for the all serious investors.

free replacement warranty!!

Posted by treefrog @ 10:25 on February 11, 2020  

21f5f680af10fe5fdaa073eca7d4dc83.jpg (564×761)

Richard

Posted by goldielocks @ 10:07 on February 11, 2020  

I looked at the biggest manufacturing cities in China Guangdong and Fujian as well as big cities Hong Kong, Beijing.
If these cities go into lock down then I’d see a concern for interfering with world wide exports and trade as well as the possibility of spreading it globally.
People learned a lot from the mistakes from the Spanish Flu of 1918.
Between military ships during the war and trade ships as well as other forms of travel and neglect city’s as well as military it spread everywhere.
They also exposed visitors of sick not masking them getting them sick spreading to their family’s and towns.
Much due diligence is being done to prevent the spread.
I’d be interested to know more about the economic consequences globally as well as the stock market.
Towns did run out of food.
Tragedy from neglectful leaders as few looked after the children who lost their parents because few are hero’s in a real bad situation and no one rescued them for fear of getting sick took them in or food when parents down in the hospital or died.

Today is the PEAK of the optimism that the virus has PEAKED.

Posted by Richard640 @ 9:45 on February 11, 2020  

It’s all down hill from here…

Decent

Posted by ipso facto @ 9:23 on February 11, 2020  

Skeena Intersects 14.82 g/t AuEq Over 31.30 Metres at Eskay Creek

https://ca.finance.yahoo.com/news/skeena-intersects-14-82-g-130000745.html

Scum alert

Posted by Buygold @ 9:21 on February 11, 2020  

Jay Powell is speaking to Congress today and tomorrow.

Generally not a good thing for pm’s but almost always great for stocks.

He’s already said he’s “monitoring Coronavirus closely” translation: I stand ready to pour printed cash into the stock market. Course, that’s naturally bad for pm’s right?

Buygold @ 7:57

Posted by ipso facto @ 9:21 on February 11, 2020  

Turkey better not come crying to us and NATO if the Russians bloody their nose. Putin looks like Gandhi next to Erdogan!

HUH?? Which one izzit-?? It ain’t over till it’s over….

Posted by Richard640 @ 8:14 on February 11, 2020  

US Futures Soar To New Record Highs On “Coronavirus Optimism” Ahead Of Powell Testimony

Global stocks resumed their ascent to all time highs on Tuesday amid fresh coronavirus “hopes” after China’s top medical advisor said the Chinese epidemic may peak over the next few weeks.

*********************************************************************

Hong Kong Coronavirus Expert Warns Outbreak

Could Infect “Between 60%-80%” Of Humanity, Causing 51 Million Deaths

Time to expel Turkey from NATO – At what point do the Russians step in to defend their Syrian allies? Then what? What a shitshow

Posted by Buygold @ 7:57 on February 11, 2020  

Dramatic Footage Shows Turkey-Backed Rebels Shooting Down Syrian Helicopter

“An hour ago, this Mi-17 utility helicopter of #Syria Arab Air Force was shot-down over Al-Nayrab…”

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Post by the Golden Rule. Oasis not responsible for content/accuracy of posts. DYODD.