I closed my double gold short, and went long double vix futures.
The close of 67.86 is different than what we have seen for a long time.
for a long time the weekly average was maintained and the price came to close below it. This time it did not.
Expect further decline.
MBS - Mortgage backed securities are toxic assets.
If it were not for the fed, no one in his right mind will own them.
That is what QE is all about.
Financing the deficit?
Toxic assets are worthless assets today tomorrow, at maturity and always.
Throwing good money after bad money is bad overall.
A car with a defective engine that its owner polished the exterior to fool buyers with a nice clean look is still a car that is defective.
Owning defective cars and more of them and accounting for them as assets of value is bad accounting.
correction:Because of that, I do NOT see a long position in the market via any vehicle (401 k, individual stocks, ETF’s, etc.) is a good idea. Keep in mind that efforts are being put to justify the functionality of such models; to me that is fudging the data; so even if you print 1750 on the S&P that is a cause of concern and not a cause of celebration or validation.
Again, I do NOt think individual investors should start buying in the market... even if markets go up.
The perception as it pertains to the market as suppose to the real economy is that if you keep stimulus long enough the economy will strengthen enough to hold its own thus not repeating the mistakes of the past around the depression time when stimulus was withdrawn supposedly prematurely. That is a perception because the economy is cyclical meaning that when consumption / product cycles are considered the natural tendency of the economy is to fluctuate. Also, there appear to be a phase shift between the market and the real economy. Harmonizing all is an un-natural suppression to market and economical forces and can only lead to chaos at the end. I do not think the models used and being experimented with will perform as expected. A Huge disappointment is in the making; especially if further steps are taken to fulfill the prophecy of the models (self-fulfilled prophecy).
Right now we are compressing a spring for a lack of better term, no matter how long we keep it under compression the energy stored will not dissipate; in fact in the market that energy will gather momentum with time. Because of that, I do see a long position in the market via any vehicle (401 k, individual stocks, ETF’s, etc.) is a good idea. Keep in mind that efforts are being put to justify the functionality of such models; to me that is fudging the data; so even if you print 1750 on the S&P that is a cause of concern and not a cause of celebration or validation.
Going forward lip service is the only support the market will have.
What has been done and currently being done is not enough to stop the tsunami if it were to start.
Lip service and psychology / manipulation thru media outlets are what are left.
In my opinion 401 k and all long positions should be closed.
I must say, that there will be a back stop down deep.
In the past I said many times that aapl will be going down in the 400's at that time aapl was marching forward as if there was tomorrow. Again AAPL will trade below 400; use any bounce to unload.
GooG will do the same as aapl did; goog is going to 600 range the below that longer term. Cut your exposure to it. If you are short, then dollar cost average.
The qqq will trade below 60; I said that before too; but so far that did not happen, not to be confused with that it won’t happen. Again the qqq will trade below 60.
No need to mention that there is a concentrated effort to tell you otherwise.