Posts Tagged ‘bond auction’

Here Comes the Debt Pushback (Where’s the Fed with the Firehose?)

Here Comes the Debt Pushback (Where’s the Fed with the Firehose?)

Courtesy of Jr. Deputy Accountant 

 Bernanke wobbles but he won’t fall down

Down go the dominoes. The out-of-the-loop financial media will probably blame this largely on the Fed ending its MBS program but let’s be honest about the real factor behind it: remedial economics. Surprise surprise; when the market is flooded with supply with few takers, you get bond auctions like we got last week.

It had to end at some point.


For more than a year, analysts have been warning that record sized debt sales by the US Treasury were at odds with a 10-year yield sitting comfortably below 4 per cent. This week, the yield on 10-year notes jumped from 3.65 per cent to a peak of 3.92 per cent on Thursday. On Friday it was 3.87 per cent.

I’m afraid someone has to point out the obvious here: credit markets don’t like getting the crack unceremoniously taken away, no more than the investors who have been buying into this ridiculousness thinking the free money will never end. Guess what? It’s over.

WSJ on last week’s wake-up call:

Mortgage investors got an unwelcome wake-up call last week after Treasury yields surged, a jolt that indicated that the Federal Reserve’s exit from the market may not go as smoothly as thought.

As the yield on 10-year Treasury notes jumped, yields on Fannie Mae’s benchmark 30-year bond followed, rising to 4.45% from 4.33%. That sent mortgage rates above 5%.

It was an unsettling surge as the Fed prepares to end its $1.25 trillion program of buying mortgage securities on Wednesday. Many in the market had come to believe the Fed’s exit would have little effect on mortgage bonds. They reasoned there were enough investors hungry for extra yield that they would step in to buy once the Fed left.

Here’s what I see… the skittish Fed, scared to death to let markets work out their own kinks lest they allow the cancerous bits to rot off (that might put Fannie and Freddie in an uncomfortable position), backpedals on its plan to start unloading MBSs and instead holds on to (and/or increases) its holdings to wait out the expiration of the first-time homebuyer credit in April, despite dismal numbers after the December extension. If you call 180,000 new…
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Zero Hedge

It's The Entrepreneur That Saves An Economy - Not The Fed

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Authored by Mark St.Cyr,

Once again via a stunningly dismal monthly “jobs” report we were shown just how inept the Federal Reserve is in its ability to deliver a qualitative as well as quantitative resolution to one of its core mandates. Only if you use the “math” now prevalent (as well as rampant) within economics can one look at any part of it and say “the economy is creating jobs” without bursting out in laughter, or, busting out in tears.

Yet, just when one thinks it couldn’t get any worse, all one needs to hear is an explanation fr...

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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.

To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Phil's Favorites

Fraudulent Medicare, Medicaid, EITC, Tax Refunds, etc. Total $1 Trillion Since 2003

Courtesy of Mish.

A huge chunk of your tax dollars every year goes straight into the pockets of crooks. Nearly one in three earned income credits (EIC) is fraudulent. And the numbers keep getting bigger every year according to the Government Accountability Office.

Please consider GAO: Feds Made Nearly $1 Trillion in Overpayments Since Fiscal 2003.
Government waste took a significant turn for the worse in fiscal 2014, rising dramatically to $124.7 billion from $105.8 billion in fiscal 2013.

Since fiscal 2003, “cumulative improper payment estimates have totaled almost $1 trillion,” the Government Accountability Office (GAO) said in a new report.

U.S. Comptroller General Gen...

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Market News

News You Can Use From Phil's Stock World


Financial Markets and Economy

Taking Intelligent Risks: How To Stay In The Trading Game (Trader Feed)

You have to risk money to make money.  You have to make sure you don't risk so much money that you can lose your stake and go out of business as a trader.  Bet too little and you never make a good return on your capital.  Bet too much and you court career risks.  So much of trading success boils down to taking intelligent risks.

Here is a useful calculation tool that can tell you the probability of hitting a drawdown threshold.  


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Chart School

SP500 Wyckoff Review

Courtesy of Read the Ticker.

Review of the SP500, pre Oct 2015, fire fighting the technical damage.

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NOTE: does allow users to load objects and text on charts, however some annotations are by a free third party image tool named

Investing Quote...

.."Your goals are to select only stocks that move soonest, fastest and farthest in bull or bear markets. Limited losses and let profits run."..

Richard D Wyckoff

..“Don’t try to buy at the bottom and sell at the top. It can’t be done except by liars.”..


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Kimble Charting Solutions

Opportunity Friday…What would you do with these Opportunities?

Courtesy of Chris Kimble.

Opportunities are knocking at our door friends! I’ve been sharing the Power of the Pattern with customers for the past 20-years. In my humble opinion, some really nice opportunities (based on price, momentum and sentiment) are forming for investors around the world. Below is two of the dozens of rare patterns I am seeing, that I wanted to share with you today.

What would you do with this opportunity?


As shared above, this asset has fallen around 35% of late. The decline has taken it down to its 4-year rising channel support l...

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Swing trading portfolio - week of September 28th, 2015

Reminder: OpTrader is available to chat with Members, comments are found below each post.


This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...

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Sector Detector: No rate hike translates into heightened wall of worry

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

The Fed’s decision to not raise the fed funds rate at this time was ultimately taken by the market as a no-confidence vote on our economic health, which just added to the fear and uncertainty that was already present. Rather than cheering the decision, market participants took the initial euphoric rally as a selling opportunity, and the proverbial wall of worry grew a bit higher. Nevertheless, keep in mind that markets prefer to climb a wall of worry rather than ride a crowded bandwagon, and I continue to envision higher levels for the markets after further backing-and-filling and testing of support levels (perhaps even including the August lows).


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Some Hedge Funds "Hedged" During Stock Market Sell Off, Others Not As Risk Focused

By Mark Melin. Originally published at ValueWalk.

With the VIX index jumping 120 percent on a weekly basis, the most in its history, and with the index measuring volatility or "fear" up near 47 percent on the day, one might think professional investors might be concerned. While the sell off did surprise some, certain hedge fund managers have started to dip their toes in the water to buy stocks they have on their accumulation list, while other algorithmic strategies are actually prospering in this volatile but generally consistently trending market.

Stock market sell off surprises some while others were prepared and are hedged prospering

While so...

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Baxter's Spinoff

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

Baxter Int. (BAX) is splitting off its BioSciences division into a new company called Baxalta. Shares of Baxalta will be given as a tax-free dividend, in the ratio of one to one, to BAX holders on record on June 17, 2015. That means, if you want to receive the Baxalta dividend, you need to buy the stock this week (on or before June 12).

The Baxalta Spinoff

By Ilene with Trevor of Lowenthal Capital Partners and Paul Price

In its recent filing with the SEC, Baxter provides:

“This information statement is being ...

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Mapping The Market

An update on oil proxies

Courtesy of Jean-Luc Saillard

Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself. 


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Watch the Phil Davis Special on Money Talk on BNN TV!

Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene


The replay is now available on BNN's website. For the three part series, click on the links below. 

Part 1 is here (discussing the macro outlook for the markets) Part 2 is here. (discussing our main trading strategies) Part 3 is here. (reviewing our pick of th...

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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

Thank you for you time!

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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