Nat Gas has just hit its absolute minimum valuation in mid Sept. It has bottomed. The Grains have bottomed around the same time. Gold just reached a new high, and I do beleive that Gold price precedes the inflation deflation level by 2 months.
Everything is converging on November, 2009.
The November CPI number will surprise everyone.
Then the inflation chain reaction begins.
By the way, commodities are global, and demand has picked up worldwide.... What people fail to understand is.... if all americans change their spending habits and refuse to consume ANYTHING, the prices will still increase.
And as for "Ghost Malls", I know all about them -> Take a Look at GGWPQ.PK
I am really concerned about what will happen after America sees that inflation is here.
I am afraid of "inflation day". I hope people don't go off the handle. My fear keeps pulling me to stock up on necessities before the Nov - Dec CPI numbers are released. If Nov doesn't scare enough people, then Dec CPI release definitely will.
Believe me when you have inflation, you WILL know. You don't have to search for indicators around that will ring a bell and let you know that we have inflation.
Some of the things that you can check are how fast inventories are drying up at manufacturers/malls/shops etc.
OIL/Gold have been played by big hedge funds. No way oil could have gone upto 140+ and then back to 30 in less than one year with nothing really changed as far as demand is concerned.
Home prices have been and will continue to go down. Milk??? Dude, milk and groceries are the hardest hit because of deflation. Milk went over $3.5 a gallon and now stands at less than $2.2 in safeway. Don't see any inflation there.
$$$ has been hovering around 75/76 for a few weeks while Gold goes gains over 15% in the same period. The correlation between $$$ and gold is long gone.
Moreover, Gold is considered safety vehicle, it is NOT really an inflationary one.
Gold rising is NOT equal to inflation. Inflation is caused by lot many factors and what you see is just the resultant outcome.
So with gold at ca. $1,100 an ounce you don't see inflation? This is an all time high for gold made two days in a row.
AMZN made money last quarter because they charge no sales tax which incentives people to buy their products. You also don't have to use gas to go buy their products.
Thanks for pointing me in the right direction. I have some work to do.
I was hard pressed on Thursday, after the close, to find a chart that wasn't either making a new high or that hadn't already broken down and had re-approached a major moving average on Thursday's strength.
With the stronger dollar and with virtually ALL stocks at some type of resistence level ....
I just didn't see the market continuing up. It would mean that stocks continue to make new highs and/or break through some major moving average. I just didn't see that happening. Who knows what Monday brings.
They already "have" by stepping on the money supply air pipe:
(1) Note non-seasonally adjusted M1 figures starting in June 2009 in the atch'd 29Oct2009 data release:
(2) "Senior Loan Officer Opinion Survey on Bank Lending Practices" continues to show tightening
(3) Fed Chief Fisher said just days ago that their tightening, when it starts, will be "aggressive"
(4) The Fed historically acts at or near the jobless peak ---however, they've already acted on several fronts in a "stealthy" manner ---- see WSJ's Sep article on "the Feds Job is Only Half Over"
(5) The Fed has started talks with bond dealers about withdrawing the unprecedented amount of cash injected into the financial system the last two years.
(6) Central bank officials are discussing plans to use reverse repurchase agreements to drain some of the $1 trillion they pumped into the economy. That’s where the Fed sells securities to its 18 primary dealers for a specific period, temporarily decreasing the amount of money available in the banking system.
Bottom Line: the FED has to withdraw liquidity from the system and it's not just about the Fed Funds Rate--- the process has started and that's why I went long the dollar recently --- I like being early.
What a load of crap!
You go ahead and long the dollar based on this incorrect information.
Don't you realize that M1 is constantly being adjusted based on the monetary base X the velocity of money?
The fact that M1 has been only slightly increasing or decreasing in the last 6 months is not because anyone is stopping the M1 windpipe, it is because the velocity has "temporarily" dropped.
Now the last M1 figure released has jumped 10 points in 2 weeks.
This is without Velocity increasing at all!
Velocity is down because of fear. Fear cannot last forever. Fear is artificial.
On the other hand, the monetary base has been doubled since Sept 2008.
Now einstein you tell me, if the M1 is increasing (10 points!)without velocity, what if going to happen to M1 after velocity (spending) resumes?
M1 is most certainly going to double very quickly.
I also shorted equities this week for the same reasons. I went long UUP on Wednesday and SDS today.
This site will give you info on Treasuries across all maturities
The long end of the curve tends to fluctuate much more than the short-term, so I tend to keep an eye on the 30 year treasury bond. The index for it's yield is ^TYX and can be found here
With bonds of all types, yield is inverse to price. So, if the yield goes up, the price goes down and vice-versa. I haven't found a good way to plot the inverse of ^TYX to get the price action, so I use the ETF TLT as a proxy. You can then compare the price of the long bond directly with an index like the S&P 500. As you can see, there is a pretty strong inverse relationship in place.
As for auctions, you can find the current schedule on the treasury's website. It'll give you info on what maturities are being auctioned and when. http://www.treas.gov/offices/domestic-finance/debt-management/auctions/
I'm still working on finding a reliable source on how well an auction did (ie how strong the demand was), but it usually comes out in the price action the day of the auction. Strong demand = lower yield = higher price.
Hope that helps.
Fed doesnt have to raise rates, the market is gonna do it. The Fed announced it will no longer buy Treasuries, that fact will start the selling of treasuries, and that will cause rates to go up, and the dollar along with them.
One thing you have to realize when you lecture this person... He, and most people in fact, ACTUALLY THINK that the Fed "controls" the rates, that they "set" the market.
He will be astonished right up to the point where the DXY reaches 98-100. He'll scratch his head while he sits in his cardboard box and think to himself... "But the fed didn't raise rates !"
I'm no longer so sure that's going to happen even after the end of Quantitative Easing. I mean, I want it to, and have money set aside to take a position in TBT or TMV, but I'm waiting to see if Treasuries decouple from Equities.
The last two months, The relationship has been: market down, dollar up, treasuries up. That's a clear indicator of the safety trade. If the relationship holds, we may not be able to count on Bond yields increasing due to market pressure. We could instead see something like the end of last year, where stocks fall and the flight to safety causes treasuries and the dollar to rise. In such a scenario, bond yields would be held down due to increased demand.
The results of the 10y and 30y auctions next week should be very interesting.