Posts Tagged ‘where the wild things are’

Where the Wild Things Are

This week, John Mauldin discusses our trash currency and the dollar carry trade. Could the dollar go bump in the night and jump up and bite you…? – Ilene

Where the Wild Things Are

where the wild things are Courtesy of John Mauldin, Thoughts from the Frontline

Where the Wild Things Are
It Is Not Just Japan
The Euro-Yen Cross and the Dollar Carry Trade
New York, London, and Switzerland

From ghoulies and ghosties
And long-leggedy beasties
And things that go bump in the night,
Good Lord, deliver us!

--Old Scottish Prayer

Where the Wild Things Are is a beloved children’s book and now a beautiful movie. But in the investment world there are really scary wild things lurking about in the hidden recesses of the economic landscape. Today we look at one of the unintended consequences of the Federal Reserve’s low interest rate policy.

For quite some time, I have been arguing that we are faced with no good choices, not just in the US but in the entire "developed" world. I see a low-growth, Muddle Through world over the next years (with a double-dip recession just to liven things up). However, that does not mean that we will lack for volatility. Things could get volatile rather quickly. Let’s quickly set the background.

It Is Not Just Japan

Let’s look at today’s interest rate picture. Yesterday, we had the bizarre occurrence of banks actually paying the government to hold their cash. Three-month treasuries yield a miniscule 0.01% in interest. If you opt to buy a one-year bill you get all of 0.26%. You can see the entire spectrum below.

jm112009image001

Look at the graph of the yield curve below. It is as steep as we have seen it in a long time. But that is almost the point. Banks are essentially getting free money. If you are a banker and can’t make money in this environment, you need to quit and find meaningful employment.

jm112009image002 

And that is part of the rationale that the Fed espouses with its low interest rate regime. Not only does it allow banks to repair their balance sheets, it also encourages investors to put money into riskier assets in order to get some return on their investments. Over $260 billion has gone into bond funds this year, and just $2.6 billion into…
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Zero Hedge

"Dear Jay Powell, How Stupid Do You Think We Are?"

Courtesy of ZeroHedge View original post here.

Authored by Sven Henrich via NorthmanTrader.com,

Let’s keep it simple shall we: 2019 remains a battle for control. The forces of intervention want to “extend the business cycle” as Jerome Powell likes to frame it by any means necessary and, as I outlined yesterday (Beginning of the End), they are throwing the kitchen sink at it. 2019 has been marked first by a recognition that the rate hikes and quant...



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Insider Scoop

Can Netflix Deliver A Hit After Q2 Subscriber Disappointment?

Courtesy of Benzinga

Netflix Inc (NASDAQ: NFLX) is scheduled to report its third-quarter results Tuesday, after the market close.

The consensus estimate calls for earnings of $1.04 per share, up from 89 cents per share in the year-ago quarter. Analysts, on average, expect the company to report revenues of $5.25 billion, up 31.30% year-over-year.

Over the past four quarters, ...



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Phil's Favorites

Traditional banks are struggling to stave off the fintech revolution

 

Traditional banks are struggling to stave off the fintech revolution

Shutterstock

Courtesy of Kamal A Munir, Cambridge Judge Business School and Hamza Mudassir, Cambridge Judge Business School

Traditional banks are haunted by financial technology – fintech – firms. Challengers such as mobile-first banks Chime in the US, Monzo in the UK and Germ...



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Kimble Charting Solutions

New Gold Bull Market? Not Until This Happens!

Courtesy of Chris Kimble

After a big summer rally, Gold peaked out at $1566/oz in September.

Since then, Gold prices have been consolidating between $1475 and $1550.

So what’s happening here? Enter the Swiss Franc currency…

In today’s chart, we look at a key indicator (and correlation) for Gold. As you can see, the Swiss Franc has an uncanny resemblance to Gold.

Both Gold and the Franc are testing heavy resistance at the same time.

Until both breakout at (2), odds are low that a new Gold bull market emerges with another big rally leg higher....



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The Technical Traders

Lots of Upside Ahead for the Metals and Miners

Courtesy of Technical Traders

Palisade Radio talks with Chris as he discusses his approach to trading and why technical analysis works for him. He focuses on the chart and price action and explains why investors need to follow a trading strategy that suits their personality.

He cautions that a broad sell-off is likely when stocks move into the next bear market. This liquidation will pull everything down, including gold, for a time. Afterward, he anticipates a massive rally in the juniors.

Time Stamp References:

...



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Chart School

US Economic Review 2019Q4

Courtesy of Read the Ticker

An investor must form an opinion of the wider economic risk, here is a small sample of readtheticker.com US economy review.


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Example of the first chart in the video.


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Fundamentals are important, and so is market timing, here at readtheticker.com we believe a combination of ...

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Digital Currencies

Zuck Delays Libra Launch Date Due To Issues "Sensitive To Society"

Courtesy of ZeroHedge View original post here.

Authored by William Suberg via CoinTelegraph.com,

Facebook is taking a much more careful approach to Libra than its previous projects, CEO Mark Zuckerberg has confirmed. 

“Obviously we want to move forward at some point soon [and] not have this take many years to roll out,” he said. “But ...



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Lee's Free Thinking

Look Out Bears! Fed New QE Now Up to $165 Billion

Courtesy of Lee Adler

I have been warning for months that the Fed would need new QE to counter the impact of massive waves of Treasury supply. I thought that that would come later, rather than sooner. Sorry folks, wrong about that. The NY Fed announced another round of new TOMO (Temporary Open Market Operations) today.

In addition to the $75 billion in overnight repos that the Fed issued and has been rolling over since Tuesday, next week the Fed will issue another $90 billion. They’ll come in the form of three $30 billion, 14 day repos to be offered next week.

That brings the new Fed QE to a total of $165 billion. Even in the worst days of the financial crisis, I can’t remember the Fed ballooning its balance sheet by $165 bi...



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Biotech

The Big Pharma Takeover of Medical Cannabis

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

 

The Big Pharma Takeover of Medical Cannabis

Courtesy of  , Visual Capitalist

The Big Pharma Takeover of Medical Cannabis

As evidence of cannabis’ many benefits mounts, so does the interest from the global pharmaceutical industry, known as Big Pharma. The entrance of such behemoths will radically transform the cannabis industry—once heavily stigmatized, it is now a potentially game-changing source of growth for countless co...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

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Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

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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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