A new study of the 2008 collapse has joined economics and network theory in a graphic depiction of inevitable failure...
Bar-Yam’s team traces the financial sector’s collapse-inducing economic centrality to the dissolution of Depression-era economic reforms, especially the 1999 repeal of the Glass-Steagall Act. Glass-Steagall had separated deposit banks, where most people keep their savings, and which handled mortgages, from investment banks.
Thus freed and enlarged, the financial sector became the prime source of capital for major parts of the U.S. economy. When the housing market collapsed, the rest followed. Even if housing stayed healthy, it was probably only a matter of time before something else crashed the system, said Bar-Yam
Ribs Without Smoke
CONVENTIONAL wisdom holds that pork ribs taste best when cooked outdoors on a grill or smoker. Conventional wisdom hasn’t experienced the sweet-sour balsamic-glazed St. Louis-cut spare ribs at Animal in Los Angeles. The restaurant’s chefs, Jon Shook and Vinny Dotolo, prepare them in a way that most barbecue purists would never order, much less eat: baked in the oven.
Government Shut Down Will Screw You Out Of Better GPS
Here’s how the shutdown will screw you out of your upgraded GPS.
The Pentagon’s ability to buy and test stuff is all screwed up by the shutdown. It’s not totally catastrophic: the Defense Department will have to dip into its acquisition budget from fiscal 2010, the last time a budget was passed, in order to continue work on its experimental projects.
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And in more Boulder real estate news, realtors are still calling to see if we want to make an offer, ANY OFFER, for properties we had seen.
Thanks Denise.
ReplyDeleteMeanwhile on my side of the pond, the ship keeps sinking merrily.
"France's budget gap widened 28% in the first two months of the year, as extraordinary items, including a EUR1.4 billion cash advance to Greece in January, weighed on the result, the Budget Ministry said Friday."
We're just getting started to reap the fruits of EU leaders' "extraordinary" masterpiece...
I think we could use a government shutdown here too, but just for the top officials. If these clowns could shutdown their mouth for at least one month, THAT would be extraordinary.
U$DX wants to hold on to 75.20.
ReplyDeleteICan
Morning all! TLT sub-90 again.
ReplyDeleteWow, this is truly incredible. Am I being a tad tin-foil-hattish to think that something is amiss here?
ReplyDeletehttp://www.huffingtonpost.com/2011/04/07/david-prosser-wisconsin-supreme-court_n_846431.html
Bucky in trouble.
ReplyDeleteICan
From Cobras blog -
ReplyDeleteInstitutions are net buyers:
http://bbs.cobrasmarketview.com/
SLV continues it's parabolic daily march upward. 39.20.
ReplyDeleteFor a counterpoint on the budget:
ReplyDeletehttp://www.huffingtonpost.com/jeffrey-sachs/the-peoples-budget_b_846573.html
@Dss:
ReplyDeleteGood post. My ribs are baked as well, but I finish them on the grill. The oven is a very very slow oven, 200F, using Bullseye original, taking all day, turning 2X and basting both times. The finish is 5 minutes max.
I think I'll go to the wet market before work tomorrow and get some ribs. Yum.
I can't get Bullseye original here. I brought a gallon from Costco before I moved, and I still have about 1/4 left.
ReplyDeleteTaibbi weighs in:
ReplyDeletehttp://www.rollingstone.com/politics/blogs/taibblog/tax-cuts-for-the-rich-on-the-backs-of-the-middle-class-or-paul-ryan-has-balls-20110407
This is the money passage of a great post by Taibbi, IMO. He eviscerates Brooks, whose article I could barely get through in its entirety without wanting to hurl.
ReplyDelete"The last ten years or so have seen the government send massive amounts of money to people in the top tax brackets, mainly through two methods: huge tax cuts, and financial bailouts. The government has spent trillions of our national treasure bailing out Wall Street, which has resulted directly in enormous, record profit numbers – nearly $100 billion in the last three years (and that doesn’t even count the tens of billions more in inflated compensation and bonuses that came more or less directly from government aid). Add to that the $700 billion or so the Obama tax cuts added to the national debt over the next two years, and we’re looking at a trillion dollars of lost revenue in just a few years.
You push a policy like that in the middle of a shaky economy, of course we’re going to have debt problems. But the issue is being presented as if the debt comes entirely from growth in entitlement spending. It’s bad enough that middle-class taxpayers have been forced in the last few years to subsidize the vacations and beach houses of the idiots who caused the financial crisis, and it’s doubly insulting that they’re now being blamed for the budget mess.
But the icing on the cake comes when a guy like David Brooks – like me a coddled, overcompensated media yuppie whose idea of sacrifice is raking one’s own leaves – comes out and calls Paul Ryan courageous for having the guts to ask seniors to cut back on their health care in order to pay for our tax breaks."
Morning folks, happy shut down day!! I'm encouraged to see that the market is not up 200 on the news.
ReplyDeleteFed officials - in damage control mode. If they see commodities getting out of hand and they say no more easing, if they see market tanking, they say more easing.
ReplyDelete"Dallas Fed's Fisher opposes any further easing". marketwatch.com
ICan
India - earnings may lag sales growth - on higher financing and material costs. So, EPI down.
ReplyDeleteICan
Genesis, a land development co in Calgary - GDC.tsx has agreed to be acquired by another co. Jupiter at $5.80. Trading at 5.05 now. Yesterday around $4.25.
ReplyDeleteDisc. I own a small amount. Anyone interested do your own due diligence. I just found out because I wanted to get rid those shares I own since 2009. Some profit for me though.
ICan
Portugal says "hell no" to "starting point" in austerity discussions:
ReplyDeletehttp://www.calculatedriskblog.com/2011/04/europe-update-austerity-in-portugal.html
Is the mortgage re-fi boom over? Seems that way.
ReplyDeletehttp://www.calculatedriskblog.com/2011/04/mortgage-lenders-lay-off-workers-as.html
@Rock,
ReplyDeleteW - on SU.nyse ?
ICan
I actually thought this was a good post over at ZH:
ReplyDeletehttp://www.zerohedge.com/article/guest-post-devolution-consumer-economy-part-ii-rising-costs-declining-wages
Manny,
ReplyDeleteThat Wisconsin vote thing is very weird, to say the least. I am sure that there will be more investigations.
Manny,
ReplyDeleteThese loony left wingers are so crazy:
"It is the People's Budget put forward by the co-chairs of the 80-member Congressional Progressive Caucus. Their plan is humane, responsible, and most of all sensible, reflecting the true values of the American people and the real needs of the floundering economy. Unlike Paul Ryan's almost absurdly vicious attack on the poor and working class, the People's Budget would close the deficit by raising taxes on the rich, taming health care costs (including a public option), and ending the military spending on wars and wasteful weapons systems."
Great link! At least someone is trying to do the right thing in Washington.
ICan,
ReplyDeleteCobra's charts on the institutions are so interesting to me. I wonder what information he uses to compile them.
Rock,
ReplyDeleteThat rib article was too hard to pass up. Hard to do ribs here in the winter as the grill is buried so I am going to have to try this method.
Rock,
ReplyDeleteTo not be able to get some favorite items like barbeque sauce must be the most difficult thing about being overseas. At least it would be for me.
Ground hog day, another new high in oil.
ReplyDeleteAnd silver.
ReplyDeleteManny,
ReplyDeleteTaibbi nails it, as usual.
We don't have an debt problem, we have a revenue problem. That needs to be repeated to counter balance the misinformation (as usual) coming from the the "con"servatives.
Damn, will have to check that one out!!
ReplyDeleteManny,
ReplyDeleteYou are on fire today with the links!
Only Taibbi can make me laugh so hard but he has never written more true words:
ReplyDelete"All of these smug little jerks look alike to me – from Ralph Reed to Eric Cantor to Jeb Hensarling to Rand Paul and now to Ryan, they all look like overgrown kids who got nipple-twisted in the halls in high school, worked as Applebee’s shift managers in college, and are now taking revenge on the world as grownups by defunding hospice care and student loans and Sesame Street."
SP500: short term update
ReplyDelete==
* The index has been forming a neat ascending triangle on the 10minutes charts, with first point being the low printed on March29th morning.
* Triangle potential is 16 pts
* Bearish scenario:If we break the triangle on the downside (around 1330) target is 1314
* We want to see good volume to confirm the break
* The move would probably lead to a retest of the significant 1312 support
For the bullish scenario (break of 1339 resistance) well... try CNN.
Same comment as 1:59 with pics at CA
ReplyDeleteWolfie,
ReplyDeleteNice chart and analysis.
Looks lower-high-ish to me.
ReplyDeleteVix is soaring.
ReplyDeleteLots of support at the 1321-1310 ES level. Let's see if this bounces or goes through.
ReplyDeleteNice call, Wolfie!
ReplyDeleteSorry, I meant to type 1321-1320 level.
ReplyDeleteAAPL continuing to be sold.
ReplyDeleteThks Denise. May well find good support soon..
ReplyDeleteBut I'll side with@Manny,2:41PM on this one.
ReplyDeleteA very shallow lower high, nearly a top. Maybe we can coin this lower-high-with-hints-of-top-ish-ish:p
@dss(12:47)
ReplyDeleteI don't know if I understand what you mean. Institution buy/sell from stocktiming.com? See his first page on the intraday thread.
Busy today, be back.
ICan
I don't know if it's been mentioned here, didn't take time to go through the comments yet.
ReplyDeleteBut it seems noteworthy to me that we've not seen any big move either way since March21st.
March21st +1.5% open 1281.65 close 1298.38
Seems to me this grind up has been lacking conviction: over the last 12 trading sessions we've had a VERY tight range of daily perfs,between -0.36% and +0.93%.
Maybe that rings a bell to some fellows with more experience than me here. My feeling is just that this doesn't bode well for the 1300s.
@dss: I totally agree with you about Taibbi. An infuriating, but hysterical, article. Brilliantly written.
ReplyDelete@dss: I nibbled on some VXX the other day.
ReplyDelete@WolfStreet:
ReplyDeleteOil is crossing 113/barrel. Oil is headed north, and as we know, that has a pretty negative effect on the market.
For awhile, look for a pop up at open from the overnight, then a down day. May not end negative, but I think the weekly will end negative for a few weeks, until somebody gets a handle on this oil deal.
The other thing is volumes are extremely light, so the plunger team can be very effective right now, the window is still at 0%, and you can buy a lotta stock at 0% interest. The problem is the Fed's balance sheets are becoming more transparent, so the plungers gotta be careful.
As I said yesterday, we're closing this week lower, which is looking on the weekly chart (spy) like we're starting Eve.
I put on a tiny position of SDS this afternoon so I am in your camp Manny and Wolfie.
ReplyDeleteI honestly think some of these scoundrels love the theatrics of all this crap. Hollywood for ugly people indeed.
ReplyDeleteI had thought there was no way we'd have a shutdown, but now am starting to think maybe they'll go through with their little ego trips here.
http://www.nytimes.com/2011/04/09/us/politics/09fiscal.html?hp
@ICan:
ReplyDeleteSorry, I had to take a call for a few hours. Yeah, midnight to 3AM. (Dss, *THAT* is the hardest thing about being overseas.) Having a look at SU, I think it's still hanging in it's slow up channel it started, my computer says the 15th. It was in danger yesterday of breaking below the channel, but today, it's solidly back in.
SU is a very interesting pattern. It is one of the Farley patterns, where a horizontal consolidation is followed by a breakout. Notice the Stochs on the daily chart were rising, while the price was holding/retreating slightly? I dunno how my TDAmeritrade StrategyDesk software knew, but it drew the price channel boundaries in an upward direction, even though the price was steady/falling. If I had been drawing them manually, I would have drawn them horizontal. Also, the relative strength is on the rise. I think if I were you, I'd hold on for a few days. I can put up a chart on a pic site if you want one, let me know tonite your time.
The thing I don't have a clue about is why oil stocks are falling, and the price of oil is going up. I can't remember if I commented or not, but of the 55 oils I follow, 25 are still in their up channel (some barely) and 30 have fallen out and are establishing a down-channel. SU was one still (barely) in its upchannel.
Manny,
ReplyDeleteIt is all about political posturing for their base. Shutting down the government is an appealing strategy as it allows both parties to blame the other. A win-win for them, while the fallout to the nation cannot be calculated.
Rock,
ReplyDeleteYou can post your chart for ICan anytime today, and then Emmy's post tomorrow won't be affected.
Everyone can then see your trendlines.
Wolfie 3:42
ReplyDeleteI keep a 7 day ma on the range of the S&P futures and it went from a high of 29.93 to a low yesterday of 10.29. Great example of the expansion/contraction principle. The last time the range contracted to this level was on 2/18/11.
Just a piece of the puzzle.
@MAnnwich:
ReplyDeleteMy last (I'm sure you're glad) comment for the evening:
I learned today how to completely avoid cap gains taxes when you sell your house.
Form a partnership with the buyer, and let him buy in to the partnership with your sell price of the house, and give him all the stock. Put the house in the partnership. Pay off the loan with his cash from the partnership, and walk away.
Perfectly legal. Good for the rich who pay cash for the house, because a bank may not loan a partnership any money, but who knows. There's a company here that will loan you $1.2 Million if you start a brokerage account with them with $200K. You could take that $1 Million and buy your house, invest the $200K through HSBC and get a guaranteed 6% (I forget exactly what I'm getting, but I commented on that before)on the RMB.
So that's how the rich can avoid yet more taxes. I may do that with my houses for my kids, form a partnership with them, put the houses in the partnership, then die. No estate tax.
Breaking of the trendline today is another piece of the puzzle.
ReplyDelete@Rock: Thanks for the heads up on that. Time to close some of these loopholes though, start from scratch and simplify the tax code entirely, don't you think? Not glad at all that's your last comment of the evening! Why would you think that?
ReplyDelete@Mannwich:
ReplyDeleteSorry, one more post. I think it's Newsweek that has a cover article "how to pay no tax" or something like that. White cover, red X. Maybe it was Business Week. Tomorrow on my way to work, I'm going to see if the version of that is in Asia.
@Rock: Sadly, it's clear that culturally we don't want to pay for things that we supposedly value and want. Someone else should always pay and sacrifice. It's the me-durst-last-always cultural rot if a truly selfish society. I'm now seeing where no group wants to sacrifice anything for the greater good. It should always be the other guy/gal. It's a recipe for disaster if you ask me.
ReplyDeleteTyping on iPhone blows - first not durst.
ReplyDelete@Manny,
ReplyDeleteIt is the style of tax avoidance that is practised in Greece, tax avoidance there has been raised to a real art form. No one wants to pay taxes but they all want the services that taxes pay for. It becomes a vicious circle when the rabble realizes that they are carrying an unfair share of the tax burden when others more well connected do not. Just like so many of our corporations, who whine about high corporate taxes even though they don't pay corporate taxes.
Taxes are for the little people!
Manny,
ReplyDeleteHere's the link to the Michael Lewis Vanity Fair article:
Beware of Greeks Bearing Bonds
Tax Collector No. 1—early 60s, business suit, tightly wound but not obviously nervous—arrived with a notebook filled with ideas for fixing the Greek tax-collection agency. He just took it for granted that I knew that the only Greeks who paid their taxes were the ones who could not avoid doing so—the salaried employees of corporations, who had their taxes withheld from their paychecks. The vast economy of self-employed workers—everyone from doctors to the guys who ran the kiosks that sold the International Herald Tribune—cheated (one big reason why Greece has the highest percentage of self-employed workers of any European country). “It’s become a cultural trait,” he said. “The Greek people never learned to pay their taxes. And they never did because no one is punished. No one has ever been punished. It’s a cavalier offense—like a gentleman not opening a door for a lady.”
@Rock,3:59PM. Thanks. Oil is quick becoming a problem for the economy indeed. But, as always with fundamentals, hard to time the impact on stocks.
ReplyDeleteI still have to read your Adam and Eve & Topping posts.Hope to do so this week end.
You nailed it, Denise. It's also how a society and country fall into a long, slow decline.
ReplyDeleteExcept in the U.S., only the little guy/gal is punished for doing similar things their so-called "betters" have been doing for years and decades. That's the issue.
ReplyDelete@Denise: Thanks for the feedback. While the lack of volume on the way up since we've passed 1300 hints at weakness, I think we still have to see a sell off on significant volume to confirm a change in trend.
ReplyDeleteAnd you're onboard too then. Good luck with the ETF;)
115!! UGh, here comes $5 dollar gas. $68 was my last fillup :-(
ReplyDelete@Thor: It's 2008 all over again. Or a variation of it anyway. Several crises lurking at our under the surface, the markets basically shrugging them all off (for the time being) and commodities going parabolic. '08. We all know what happened that year and the early following year, don't we? ;-)
ReplyDelete@Denise,4:26PM. I don't feel that trendline we broke today is very significant(if we're talking about the same line, the one that was also part of the triangle I've mentioned?). I prefer the fact that we've closed the week below 1330:)
ReplyDeleteAlso, I wouldn't want to sound too bearish short-term, since I'm not uberly so yet. Namely, I've had profitable trades on the long side these last few days.
The 1312 line is the one I'm eyeing with interest. That line being taken back, plus having at least one down day on big volume, would certainly awake the wild sleeping bear in me.
@Denise,4:25PM. Great example of the expansion/contraction principle. The last time the range contracted to this level was on 2/18/11.
ReplyDeleteI've never looked at this expansion/contraction concept, but I'm sure I'll encounter it somewhere down my trading path. I can only trust you on this one.
On those fine words, have a great evening all. As for Rock well,you're sleeping anyway. Enjoy your soon-to-come breakfast.
ReplyDeleteManny - hah, yes! I think it's going to be another couple years though. I know with all the shit going wrong, and things looking like they're teetering on the edge, that we would be just about ready to tank again. I still though, see some stuff getting better. I see the pick-up of the economy here in CA, we gained 100K jobs last month, the biggest number in 20 years. I also believe (for some insane reason) that the middle east is going to quiet down again fairly soon. Egypt has seemed to have gone VERY well so far, the fears of chaos were (so far) unfounded.
ReplyDeleteFor an even STRANGER reason, I think that this budget standoff will resolve itself, and that next time, with the 2012 budget, it will be smoother, the R's will know that the policy riders will not fly with the Democrats OR Independents.
BUT
I think starting next year, is when the state budgets are supposed to be much worse than this year. Plus, it will be an election year, so I think next year is when things start to crack open again.
We'll see though :-)
@Wolfie,
ReplyDeleteI always look at things intraday one day at a time, and what has to go right or wrong to prove or disprove my thesis. Then I look at the daily, and weekly stuff to see how it fits.
I am mildly short term bearish due to the fact that many of my indicators are not confirming the rally, plus many declines start with a trendline break.
I always have one foot out the door just in case...
Sunday I hope to have time to put together a comment on what I am seeing.
The concept of expansion and contraction that I follow is from Toby Crabel which is also where the NR4 and NR7 concepts come from.
http://www.mypivots.com/dailynotes/symbol/100/-1/sp500-cash-index
You can google or wiki him to learn more about him.