Inside of The PPT, I do crazy things. I build indexes and watch them closely, not so much different than an old man fireside with his kids. I built a 4g/smartphone index way before any of you asshats knew what 4g was, including Cramer. Well, one of my favorite index’s is The Risk Appetite Index, which consists of a variety of closed end muni, corporate and sovereign bond funds. Essentially, it should give users a heads up to shady shit, not so much different than the CDS market, only less sophisticated. You get what you pay for.
Here is a look at the RAI, during the “Flash Crash” period to date.
Now, let’s zoom into the recent activity.
(3 month)
(1 Month)
Why the sell off?
Answer: Since QE2 was announced, bonds have been getting hammered, sending yields ripping. This is of course the opposite of what the Fed is trying to accomplish. Remember, HIGHER YIELDS IS THE DEATH KNELL FOR AMERICA. TLT is now sitting with a 96 handle, after hitting $108, not too long ago. Over the past few days, as represented by PCK, California munis have been getting shredded. As a point in fact, munis across the board have been getting hammered, but none as bad as the Cali variety. As you should understand, sharp downside reversals do not bode well for sentiment and could lead to a panic, if not properly managed. Having said that, CSCO reported bad earnings today, blaming “developed governments and states” for the shortfall. Basically, European austerity is kicking in and our states are fucking broke.
However, things are peachy elsewhere. CSCO is flaunting flamboyantly gay growth in all BRIC nations. As you can see by tonight’s Asian session, they couldn’t care less about our “issues.” I look forward to banking more egregious coin tomorrow, as the pigs in Cali die a painful death. They are all a bunch of lazy, drug addled, spoiled leaches anyhow.
PCK (PIMCO California Bond Fund)
UPDATE: Details regarding the coming 12631 launch.
[youtube:http://www.youtube.com/watch?v=tVCFjo4lYro 616 500] Comments »