Q1 '10 SHORT-TERM SENTIMENTS

rffrydr · Posted: Sun Jan 03, 2010 10:41 am Post subject: Q1 '10 SHORT-TERM SENTIMENTS

Let the good times roll:

diesel · Posted: Sun Apr 04, 2010 3:37 am Post subject:

Looking through some charts and interestingly the percentage of stocks keeping above their 50 day moving average has remained steady for the SPX and NDX but has been making successively lower highs for the NYA and COMP.

Looks like stock picking and long/short strategies are going to be more important going forward...
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rffrydr · Posted: Thu Apr 01, 2010 8:48 am Post subject:

Almighty Goldman revises jobs number down 75000 to 200000.
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rffrydr · Posted: Wed Mar 31, 2010 6:33 pm Post subject:

There's a lot of chatter over what they need to do to set up what they are going to do. What they are not going to do is do anything before the nation sees some jobs. Besides according with traditional rate campaigns out of a deep hole, it's politically untenable. We forget how close we were to loosing the Fed as we know it. Didn't scare me (though I was against it) but it sure scared the Fed.

The reserves rate is probably where the first "action" takes place--if you don't count the absence of QE. Discount moves, as they were pained to point out, was PR.

I've been looking for 100bp, one shot, soon after Xmas. There's much of the world needing to fund itself off the bank's balance sheet still but, for consumers, Fed rates have been one long piece of string. Worse.

The world turns with or without the Fed. Sometimes they lead; sometimes they follow....usually when it matters.

Today should've have been good news for the liquidity barons. It wasn't.
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nodoodahs · Moderator Joined: 06 May 2005 Posts: 2408

Well, rffrydr’s question was positive – “is X really Y?”, whereas your question is bordering on the normative – “do we need X?”.

Positively, I don’t think we’ll get X (monetary policy normalization) anytime soon.

They’ve held out the prospect of resuming buying in MBS if mortgage rates spike up again, for instance. And that’s not the only QE or easing measure they’ve still got ongoing, other than super-low FFRs.

And we’re probably six months, if not nine-to-twelve months, out from a Fed Funds Rate raising campaign, based on what I see of the Keynesian “data” that the Fed looks at for decision-making. They might move that other, relatively-unused rate back to a full 100 bps above FFR sometime in the near future, though.
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diesel · Posted: Wed Mar 31, 2010 1:44 pm Post subject:

I think the question is do we need a normalization of monetary policy at this time? Things don't look too lose to me at the moment with commodities/inflation well contained. If you add in the fiscal tightening next year [large tax increases] and well.....
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rffrydr · Posted: Wed Mar 31, 2010 6:26 am Post subject:

ADP not following the script: if we get another flatish jobs this friday we'll get a good test of our liquidity theory of asset prices. I believe a disappointment will be treated with disappointment. What you have to ask yourself is normalization of monetary policy a tightening of liquidity?
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rffrydr · Posted: Tue Mar 30, 2010 7:53 am Post subject:

Another guy afraid of plug pulling:

http://macro-man.blogspot.com/2010/03/book-talkin.html

I think we can handle a "normalization"--which won't come too fast. Lower for longer still in force. Normal would we a huge relief.
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spycharter · Posted: Fri Mar 26, 2010 11:36 am Post subject:

spycharter · Posted: Fri Mar 26, 2010 8:16 am Post subject:

Go short, short term:

This is the best place to short at 117.3, SPY is going to drop to 116.6 to fill the gap up this morning

rffrydr · Posted: Thu Mar 25, 2010 7:55 pm Post subject:

That "window dressing" works...and it works both ways. It's didn't take much back in the glory years of 06-07 to come in and buy Exxon and Citi into quarter-end. And it's one reason why we had to wait 'til after the New Year to get some traction to our bottom. You wanna take a chance on something but you can't afford to look stupid from the gate.

If you figure that two-thirds of the time, over a long time, the market is muddy then you'd expect this tendency to get muddied-up in the data. The "black box" is only exacerbating the trend.

On a related note: over the last couple years the moral has been not to be short but sell out fast long profits fast. Corporate debt has become the buy-and-hold. I thought today may have finally put a nail in that--but seemed just to prove it. Grind is the way but a streak to 1220 would be a big confidence boost going into spring.
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nodoodahs · Moderator Joined: 06 May 2005 Posts: 2408

HenryTo · Posted: Thu Mar 25, 2010 3:04 pm Post subject:

I would say that the output is statistically insignificant - there's also no logic to it.

The quarterly window-dressing stuff, on the other hand, does have some credibility from a marketing standpoint. This quarter is one good example. No actively-managed equity mutual fund wants to show a cash balance on their 1Q marketing materials given the good start to the year.

nodoodahs · Moderator Joined: 06 May 2005 Posts: 2408

rffrydr · Posted: Thu Mar 25, 2010 7:31 am Post subject:

And the Put/Call shot right back up yesterday. And the cruise lines on fire (a trip on the RC in store, Henry?) There's gonna be some chasers out there.

Talked to a retiree yesterday, capitulated on Starbucks last month.
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diesel · Posted: Thu Mar 25, 2010 3:42 am Post subject: