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Joseph Stuber

 
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  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    MI

    It's not going to fall until we get some heavy sell volume - a catalsyt that people actually understand. They will understand this situation better in a day or two.

    I hope you made money on it. Did you "buy the dip"? And did you take your profit before the close?

    JS
    Mar 27 06:05 PM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Has anybody seen the 10 year - down 7 points. The only market not reflecting this situation yet is the stock market. 10 year at 1.84.
    Mar 27 12:49 PM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Con

    "nowhere in my comments did I say won't. I said didn't. I just think we tend to attribute deliberate actions to decisions where I think it is more a case where policymakers are making choices where there are no easy choices and where they are failing to properly calculate the risks or failing to fully take into account the potential for unintended consequences."

    I agree with that statement. You are right that there are no easy choices. I think it applies to the Fed and Congress. The difference, as I see it is that Bernanke is pretty smart as is Draghi. I think both are thoroughly frustrated with fiscal policy mis-steps, recognize that monetary policy has not worked and resolved to shift to a new plan - unannounced.

    By the way I also agree completely with this statement. I don't think we are that far apart here:

    " It was deliberate policy aimed at reversing an out of control inflation spiral and was not a policy aimed at orchestrating a crash, although he certainly knew a hard landing would likely result. He made the correct and difficult decision that few would have had the guts and patience to carry out."

    JS
    Mar 27 12:38 PM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Con

    "I was a very active Fed analyst back in the early eighties. Volcker was not trying to engineer a crash"

    I was too. It is all supposition I suppose. I started as an analyst in '72. Inflation was a problem and it was the result of excess leverage provided by easy money. It was out of control and the banks were loaning almost purely on the safety net created by inflation. Land values and real estate in general were skyrockecting.

    This was going on but real economic growth wasn't going on. If you were trying to orchestrate a controlled deleveraging you wouldn't allow the huge shock that occured when Volcker took his foot off rates. I still believe that Volcker allowed and facilitated a huge rate spike to stop the bank lending that was creating inflation.

    It was a runaway problem and needed serious and immediate attention. It was intentional - in my opinion - and the Fed knew what would happen - a lot of bankruptices and deleveraging. It was over almost as fast as it started and it was good policy.

    JS
    Mar 27 12:08 PM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Contrarian

    I doubt they will let us know. Volcker didn't but the idea that the Fed won't resort to such tactics is wrong They have before and they will again.

    To think that Germany won't borders on denial. They aren't Keynesian in their thinking. It is all just supposition any way at this point.

    In fact, I think that at some point we will see a new Bretton Woods system in place after the fall out and I think all this is being orchestrated to that end. Our current one world economy has no coherent fiscal and monetary system that works. We are in the second decade of going nowhere and that has not gone unnoticed by those in power.

    Anyway, just watch as it evolves over the next few days.

    JS
    Mar 27 11:21 AM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    MI

    Pay close attention to volume today. The story is gaining momentum. Capital controls remain in place after banks open. Money already left through branch facilities outside Cyprus after the "capital controls".

    I can't go belly up as I have a lot of money in cash. The rest is short the market. Risk/reward and captial preservation are the keys here.

    Good luck with your VIX puts.

    JS
    Mar 27 11:05 AM | 1 Like Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Tack

    Your faith and trust in our leaders is . . . . I don't know what it is actually.

    At some point they have to recognize that policy hasn't worked. You can believe that our leaders won't orchestrate a deleveraging scenario but I don't because I remember when they did.

    I had a number of houses under construction in the early 80's and financed with 6 month construction loans. It was in the same time frame as the Hunt brothers corner on the silver market. The loans were at 8%.

    It was a period of failed policy and stagflation - no growth but inflation. Volcker ORCHESTRATED an economic contraction. My short term 8% loans were renewed at 23% - the housing market crashed, bankruptcies filled the courts and the excess leverage was wiped out in a flash. Thereafter, we started the most impressive bull market run ever that lasted almost 2 decades.

    It was orchestrated, deliberate and for a purpose as Volcker saw it as the only way to move back to real growth. Believe what you want but that is what happened.

    JS
    Mar 27 10:42 AM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    We now hear that a lot of money was moved - apparently after the "capital controls" were in place - and the banks can't fund even the 40%. Fox is now reporting that money is moving out of Eurozone. Can you see how this is evolving.

    This is really spooky and not a good situation and more importantly, it is by design and that is what people can't get their head around. The algos are still in full play today but they will be overwhelmed at some point. This is so obvious.

    This is going to be an orchestrated crash and by design.


    JS
    Mar 27 10:06 AM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Tack

    That wasn't the point of my statement. Everybody knows iPhone sales suck now but you couldn't hear anyone saying the same when the stock was at $700 or $650. Actually $650 was still in full buy the dip, this company is the best in the world, this stock is a bargain mode. Same at $600.

    Finally when the stock hit $550 we started to get some explanaitons for why. How I ask was that useful. Please don't tell me why the stock broke after it has come off 25%.

    Todays broad market is being talked of in the same manner that Apple stock was being discussed before the crash. Cyprus is going to provide that high volume push back against the algos and this rally is over.

    GREK is down 25% from its Feb highs - 10% or so in the last 2 days. Cyprus is bankrupt. UK banks are in trouble. The euro is being driven down aggressively. At some point and soon this information will be explained in the mainstream media and people will get it but if you wait for the news you will be to late. They only explain things after the fact as if they knew all along.

    The value in an analyst is to seek out inflection points and make the call ahead of the turn - not after the fact. It is risky and sometimes one has to bear the brunt of criticism for a while, eg in the comments above but I don't care. I will call it as I see it.

    JS
    Mar 27 09:59 AM | 1 Like Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    MI

    Actually my S&P call is not 500 - I said we would test and possibly take out the 2009 lows. That is in the 670 range on the S&P - not 500.

    Re-read the post above though. There is a lot to consider here. Primarily the structure of the markets as far as players is key here. There are no buyers at these levels - just short term algos. If there is no one to bid the price higher and there isn't then when a catalyst is provided this thing will crash and big. Sentiment will shift and everyone will run for the exit at the same time. Just listen to an old man. It is going to happen.

    This is a big deal with Cyprus and the thick headed traders will understand it but after the fact. Greece markets are down big - the euro is falling and that is a government sponsered push to the downside. Now the talk is 80% haircut on the bad bank depositors.

    I won't have to change my mind as I am not wrong - repeat I am not wrong and I am not making wild guesses.

    JS
    Mar 27 09:33 AM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    MI

    We are much closer to the collapse than many think. I am listening to Fox and Bloomberg tonight and hearing the same things I have said in this article and the previous one - that is, Cyprus could start a bank run throughout the EZ and that won't be bullish for stocks. This is really happening but no one has been reporting it.

    For what it's worth here is my thinking. Recent volume is extremely low. The bulls won't sell on a modest pull back as they believe in the Bernanke put. The VWAP algos are buying the sell offs and the bulls are just sitting and waiting.

    This market won't break on bad news because traders have seen the market shrug off bad news. The market won't sell off until the evidence becomes so overwhelming that it can't be ignored.

    Low volume pull backs can be faded sucessfully by the algos and so we won't sell off until we have a broad market, high volume sell off in a short period of time that pushes back on the algos and overwhelms them with sell side volume. At that point the algos retreat will add to the sell off and the Bernanke put is over.

    That is going to take a sentiment changing catalyst - something to big to ignore. The fact that Cypriot bank deposits were confiscated would have - in any other enviornment - turned this market on a dime. It may still do that as people learn more and understand better the dynamics of the situation.

    Another possible sentiment shifting catalyst is the 1st quarter GDP which could easily print negative and we could also see a revision downward on 4th quarter and know within a few weeks that we are in recession. This is not certain but entirley possible.

    Bulls should recognize that their side of the trade is not supported by anything but algo trades that buy the sell off. We have stayed in this range for 2 weeks now without taking out the S&P highs. We may do that tomorrow but that is not my point - my point is that markets go up when demand for stocks are high and traders are willing to bid the price up in order to buy them. You just don't have that going on here. The only buy side volume is from the algos and on very modest sell offs and they don't hang around long enough to push the market past their mean target.

    We won't break down until a catalyst is provided but consider that the whole Cyprus deal was intended to break the euro. When that didn't happen on Monday we got the Dijsselbloem remarks that turned the market down. In other words the EZ/Germans/ECB/IMF, et al want the euro down and it is going to happen. Dijsselbloem remarks weren't stupid as many think - they were deliberate and accomplished their purpose - at least on Monday.

    This is a major shift in rhetoric and a major shift in policy. Bernanke and the Fed are onboard with this and no longer pushing the markets (my opinion).

    The playing field has changed and traders need to read between the lines and recognize this. There are tons of warnings that will seem obvious after the fact. I am not always right but I am right a lot and when others miss the call. Here is what I said about Apple on September 18. I went short Apple the Monday following the Fed QE3, Sept 17 I think:

    "Does anybody give any thought to the idea that a global slow down is really happening. I think there are a lot of factors that are about to cause the public to run for cover.

    I think iPhone sales are going to suffer. Price has to play a part here."

    AAPL was at 699.78 on the close that day. It's high close was 700.99.

    Here's my gold and dollar call on October 9:

    "Seems to me the trajectory of the dollar is higher in spite of current monetary policy. Perhaps I am a little simplistic here but short of an agreement to set the price of gold how does the price of gold go up if the dollar gains in value?"

    GLD was 170.99. Its high close was 173.61.

    Neither of these two calls were very popular at the time and they were met with a lot of negative - your stupid - comments similar to the ones I am getting here.

    Here is what I said back in January on the S&P:

    "For the moment the momentum is higher and I don't discount the possibility of stocks testing the all time highs at 1576 on the S&P"

    The S&P was 1502 on the close when I wrote that. I was already short at 1475 so my timing wasn't perfect on my trade but it looks like my call on the possible high could be very close.

    I only offer these as evidence that I am not alway wrong on my contrarian calls and you might want to at least consider the possibility that I might end up being right on this one too. I do think when this market turns it is going down hard and fast.

    JS
    Mar 27 01:43 AM | 1 Like Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    contrarian

    Excellent recitation of what has occured, what is likely to occur and why.

    "it looks like a very broad distribution top that dates back to 2000."

    Agreed on every point - they are the same points I have been making for several months now.

    JS
    Mar 27 12:02 AM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    ba1k3es

    This is from my forecast article written January 25:

    "If you have read Part 1 and Part 2 of this 2013 forecast you know that I see a rapid and steep recalibration in stock prices beginning in the first quarter of 2013. For the moment the momentum is higher and I don't discount the possibility of stocks testing the all time highs at 1576 on the S&P - a possible blow off top - before reality sets in and stocks rapidly recalibrate and the dramatic divergence between stock prices and economic reality correct.

    Mind you I am not suggesting there is a high probability of this occurring. The truth is I can see a capitulation sell off occurring at any time. We are already up 6.2% on the S&P on the year and 12.7% from the November, 2012 lows. In part 1 of this series I made mention of the risk/reward in holding stocks for the all time highs. My best case scenario for 2013 is a range basis the S&P of 1600 on the high side and 1260 - the 2012 lows - as the low side."

    JS
    Mar 26 05:34 PM | Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    mattm

    I am good with Macro Investor as he has a point of view based on reasonable logic - even if it is wrong. I am getting a little tired of you though. How old are you anyway?

    JS
    Mar 26 04:53 PM | 3 Likes Like |Link to Comment
  • A Pending Market Crash Waiting For A Catalyst - The EU Delivers [View article]
    Nope.
    Mar 26 04:43 PM | Likes Like |Link to Comment
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