Last year to the day, the markets were struggling, as the economic data worsened–post flash crash. I recall saying “a double dip recession is all but a foregone conclusion.” Well, that turned out to be wrong. Today the jobs reports is scaring the shit out of people because only 54,000 jobs were added, following several months of 200,000+. Well, color me retarded, but +54k is not exactly -300,000.
The response is negative because investors do not know if the slow down will be a hard landing or soft. Moreover, most agree the Fed will not initiate QE3. So, we have no babysitters and no one to give us allowance money. Couple that with the fact that our President is more interested in golfing than creating structural change in the economy, one might surmise we are in for a bit of trouble.
So now everyone is selling equities because of uncertainty. It is easy to get bearish. I’ve tried to bet against this tape several times over the past 3 years and made money only once: flash crash. The persistent and uncompromising trend is: get scared, sell, melt up, chase stocks higher.
As for protecting assets, although I believe we trade higher, do not underestimate investor desire to reduce risk. There is plenty of soft money out there sloshing around, loyal to nothing but the wind. Get to a point where you can accept risk and draw a line in the sand and commit to it.
More later.
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Market most likely will recover today once everyone realizes that the government will have to contemplate QE3.
Wouldnt Qe3 prove that keynesian economics doesn’t work
Actually, for all the shit people talk about Keynes (myself included), his economic models aren’t that bad.
It’s his groupies who misquote him and have no fucking clue what Keynes was talking about that cause most of the damage.
Keynes liked certain aspects of gold, and would be cursing out governments today who are lowering their currencies to try and leech off of other economies.
Keynsian economics needs to die because people aren’t responsible enough to handle it, not because Keynes himself was some sort of idiot.
Cain
Keynes hated gold calling it “the barbarous relic”.
He tolerated gold out of bare necessity. The Bretton Woods agreement, which he primarily helped to establish wasn’t so much a gold standard but a fixed currency system as gold didn’t cross borders.
He also set it up whereby there was limited trade between countries with heavy duty exchange controls protecting the capital account.
There was nothing good about his brand of economics. He was a dirt bag.
Actually, he came on record numerous times saying he liked the self correcting mechanism aspect of the gold standard. “The barbarous relic” comments were just one side of the coin.
He hated the gold imbalance that was created after Germany surrendered and thought it was useful at certain times to take the country off gold.
I don’t like Keynesian economists much, and I think managed money ideas are retarded (let’s just entrust managing the money to people who rely on the expediancy of the moment, why don’t we). But hating the man when he’s being openly misinterpreted probably isn’t fair.
We’re now in the other extreme, of having currencies being crushed every day. I doubt Keynes would appreciate this reality.
Cain
The General Theory is a crock of shit. There was an error is the first page of the fucking thing.
You know what Keynes was, he was a trader, a very good one and he saw economics like he looked at trading but they aren’t the same thing.
he also gave ammunition to the the big state fuckers to practice toxic economics. That lying sack of shit Krugman comes to mind.
In this day and age Keynes would be like a Soros.
it worked so well for Churchill when he took Keynes advice to go back to the gold standard, didn’t it?
Keynes was adamantly opposed to going back to the gold standard. It was Montagu Norman, the head of the Bank of England, and his crowd that convinced Churchill to return to the gold standard.
Keynes advocated government injected liquidity in times of economic distress; Treu…..but he also recommended and even assumed that governments would save up for a rainy day in times of largess, aaaaand that governments would be managed astutely enough to generate fund balances that could be used for said “rainy day”.
Our politicians have failed us on all of the above counts.
So……was Keynes an ass? Did he have no clue regarding that which he spoke about? No. I consider him slightly misguided in the same way that I view Hayek and other “soup nazi” type economists. There is a happy medium between the two.
As for the tape so far today, I think it is the beginning of the descent back to reality. Much de-leveraging and unwinding has to be done yet and until the housing mess, the CDO’s and swaps and derivatives and all that other make believe BS is sorted out and accounted for, we will not put in the true bottom. The Fat Bottomed Girl has yet to sing…..http://www.youtube.com/watch?v=-D99n9f3vU4&feature=related
I’m watching the VIX, it opened @ 20 back on May 23rd and dropped from there. If we start trading over 20 to 21- gotta wait things out
What happened to all of those glorious McJobs that are supposed to support middle America?
Evidently McDonalds created every single job last month.
Then proceeded to slash 10,000 of those created.
Can’t a fella make a mortgage payment on “dollar value meal sales” anymore?
Sure you can.
It’s just that the standard “middle class” mortgage will from henceforth be be for 30 years on a 14×70 single wide modular house that depreciates in value like a car.
be be …..damn twitch in the trigger finger……..
Getting to a QE 3 will be a process not a one week flish….maybe that’s in progress, but they’re going to have to scare the hell out of people to get enough political buy-in. That could be starting also. We’ll see. BTW…FIG.
Agree with Gravestone, this is going to take a while to get the calls for the FED to do “something”.
Oh Mr. Fly time to put on a surgical glove reach down between your arss cheeks and pull the PPT buy signal out of your arss.. acutally keep it there where it belongs cuz as of right now its as valuable as a handfull of used toilet paper, acutally blow your nose with it first and then discard it..
Your mother sleeps with goats.
And where the fuck is your track record?
And where the fuck is your track record?
(this was worthy of a two_times)
I gave all three in this little interlude of levity a thumbs up.
Jolly good volley and return on both counts.
Last I checked, today is not Tuesday. Or is it? Is today Tuesday? Damn it, what day is today?
The fact is that the market, with the help of QE2, has been pricing in a FULL recovery, waiting for 500k job explosions. but it’s just not happening. 50k jobs (how many from McDonald’s again?) just won’t cut it.
Last year this time Mr. le Fly was fuming at what he preceived as market manipulation, then he started to accept and roll with it, now he’s counting on it, as are many others. But can it be done? How long can you keep a market acting like times are great when they’re just not?
That’s the trillions dollar question
You now we had this sort of economy in the 90’s . Clinton went into his the election for his second term with what was called a jobless recovery. He only won the vote because he had Bob Dole as his opponent.
It was only in 97 and beyond that we experienced serious growth. 95/96 were actually shitty years.
Everyone should take a big breath and be patient.
Stocks? they can go down some, sure.
I’m with you J. I keep hearing people wanting to compare March 2009 to present with 2001 – whatever. For some reason I keep going back to the mid 90’s for correlation.
Political parties change hands in the White House, debt ceiling issues, sovereign debt (ala Russia in 1998), etc. The similarities are there if others would open their eyes.
That comment is on FIRE!
Yesterday, Fly said:
“And, my urinal shadows are telling me to “get long son, get long”
Fly, today your urinal shadows only reflect that you are hung like a hamster.
Fly said yesterday:
“Those who are betting against me will be turned into dust tomorrow”
Fly. It looks like it is you and your hamster hammer that are headed for the dust bin.
Today, Fly says:
“get scared”
Fly, you are starting to make Cramer look consistent.
I have not deviated from my position at all. If you don’t want my opinions, don’t read.
today hasn’t ended yet.
Baron
The day is not over. As for being left in the dust. Just wait
I don’t get the logic. If QE2 is done – supposedly the reason there were 250K+ jobs – and a melt up in the stock market – and QE3 is off the table, the market will still melt up?
If the jobs report was good they say the market goes up. If the jobs report is bad they say the market should go up anyway. The trend was “get scared, sell, melt up, chase stocks higher” because the fed was printing money. Now they aren’t yet the belief is the same scenario will play out.
There is an excuse for everything. Yesterday 54K jobs would have been seen as a disaster. Today it’s seen as, well, could have been worse.
I don’t understand how the markets work when the game seems rigged by the government and its acolytes. There was a time, it seems, when you could at least believe in the data. Now the data just results in psychotic responses. Kill the dollar! – so my stocks can go up! To a plebe, one with barely a toe dipped into the stock market sewage, that seems incredibly retarded. I’m beginning to think the neanderthals screaming to hold gold and silver will be vindicated, and more right than they are now, in the future.
You got it Chris, if the FED is done, its go time because its all awesome pie, if not the FED comes back and pumps, cannot lose. It’s a mindset that was formed in 2009 and many traders have made their career on it.
no one wants to admit it,on any uncertain terms that the recession that really begun on march of 07, has now turned into the second “great depression”. denile is not a river in jordan
Egypt man. Brush up on your geography. This here is a high class joint.
The question is, do you buy now for the afternoon rally? Or wait for the Euroweenies to puke it up into their close?
Just bought back all the calls I sold against WNR. I also bought some WNR.
Selloff isnt even close to being over yet. We have another 500-700 pts of Dow Jones downside left.
STFU
Urinal Shadow says- Watch GS. It knows.
QE 3, or whatever other name they may call it, is an absolute certainty. Without more QE, there is no money to monetize bonds. If there is no money to monetize bonds, then the bond market crashes.
The jobs number, whatever it is, is always fabricated. Also remember, that a manufactured market crash could be used to give the Fed justification for QE3. QE3 means that the money train keeps chugging along for the Primary Dealers and their Wall Street banks. The rest of us are left trapped in trains that have already careened off the tracks.
Shut up. You have lost favor.
Douché!
Agreud.
The jobs number is fabricated by “doctoring” the data to skew it the way they want it to read while still retaining at least some semblance of believability.
The same holds true for inflation numbers. They could best be illustrated by a comparative ratio such as listed below.
government inflation data : reality = Hillary Clinton : Kate Upton
I’m just sayin……..
These Republicans are really milking this +54k jobs report
Cramer actually makes a lot of sense nowadays especially after the financial crisis.
Q3 is a given. It has nothing to do with the jobs, commodities, economies, and any other bs. It is strictly based on home prices. With home prices at 2001-2002 level, most banks including WFC and JPM are smoked.
But, they will probably give this thing time to sort itself through first. If we are still at this level next year, Q3 is imminent.
JPM.GS,BAC are saying something here, like yesterday AM when debt downgrade hit.
What they are saying is: Nibble on me.
I did, but tried MS instead of GS.
added $RIMM puts, as a market hedge but overall “Nortel Networks” type short into earnings.