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Albertarocks
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I was born and raised in southern Alberta and graduated from the department of Structural Engineering Technology at S.A.I.T. in Calgary. My background is mainly in construction management although I spent 10 years selling real estate where I gained some very valuable knowledge about how... More
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  • Hindenburg Omen Blog - April 24, 2012 127 comments
    Aug 23, 2012 9:14 AM

    This is the continuation of a discussion on the Hindenburg Omen which was originated by our friend John Lounsbury over 2 and a half years ago. Again, we offer a great big "thank you" to John for having maintained this series of instas for over a year and a half, until I finally learned how to create one by myself and take this endeavor off his hands.

    The preceding blog can be read here. For further reference, or to read about actual Hindenburg events we have covered including the near misses which occurred in the "week before" and the "day of" the flash crash, the entire series began with John's original post which can be found here.

    First of all, I offer my sincere apologies to readers for having accidentally reverted the last insta on the HO topic back to 'draft' form. I didn't realize I had done that. However, I 'do' remember having come into the editing room to update the chart. SA had made a few changes to the editor, changes which I'm not particularly enamoured with, and since I no longer write articles nor instas on SA, when I ventured in here I wasn't quite as familiar with the surroundings as I had been originally. Bottom line... I didn't notice the final "publish" button way, way down at the bottom of the page. I didn't click it. Needless to say I'd prefer not to think I'm an idiot, but when the evidence for that conclusion builds it's time to sit yourself down and give it some thought.

    (click to enlarge)

    [My friends were saying the link to the last insta quit working. I need to think a few things over.]

    .

    In any case, thanks to the notification from FPA and the persistence and patience of our friend K202 we were able to get the previous insta back on line. Special thanks to those two fellas... Mark for his "staying on the case" and FPA for having gone to the trouble to contact SA to find out what the problem was. Thanks guys :-)

    ==============

    Here's the latest 'picture' of what the NYSE is doing and showing where the HO stands from the perspective of whether or not it's obeying the rule that its 50 day moving average must be rising. As you can see, that moving average turned lower last week and the NYSE is struggling mightily to get back above its price of 50 days ago (orange line):

    [Click here for a for a live and updating version. I try to keep it updated each day.

    .

    Obviously it's been very quiet in here in recent weeks, a reflection of the fact that there has been very little to report about on the HO front. The numbers of new 52 week highs had been rising normally throughout the early stages of the rise off the November low. But as we got into the first week of February the average number of new highs began to decline markedly. In the chart below, we smooth out the statistics a little bit by focusing on the white 7 day moving average of new highs:

    [Click here for a version which updates each day shortly after the market closes.]

    .

    Really, there nothing overly ominous with the chart above other than the fact that the numbers of new highs had begun to deteriorate markedly in early February even as the markets chugged ever higher. Obviously that divergence had to lead to 'something', either an improvement in the market internals where more stocks suddenly started to turn higher - OR - a correction in equities. Normally it would be the latter and that's indeed what occurred this time as well.

    .

    The question staring all of us in the face today is whether or not the correction has run its course and we head higher from here. The chart above, as well as many other charts pertaining to market internals could indeed support the notion of higher prices from here. But since that's not the purpose of the Hindenburg Omen indicator, we won't try to answer that question in this particular room. Besides, ever since Goldman Sachs purchased the rights to "logic" and has banned it's use, nobody knows where the markets are headed. Nobody but god that is and he's not telling... he's too busy at the helm of the FED, carefully guiding the good ship Earth into the iceberg that lies dead ahead. And of course, as was the case for the Titanic, I fear that the "rudder hard-a-port" command is going to arrive way too late.

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Comments (127)
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  • FocalPoint Analytics
    , contributor
    Comments (5972) | Send Message
     
    LOL on that picture!
    24 Apr 2012, 12:28 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » It's an iceberg.
    lol
    24 Apr 2012, 12:33 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4160) | Send Message
     
    "ever since Goldman Sachs purchased the rights to "logic" and has banned it's use, nobody knows where the markets are headed" - LOL, brilliant !
    24 Apr 2012, 12:38 PM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    serene reflection w/ a tube (medicinal or not) and a cup o joe - classic lol
    If only the Bernank would sit down for reflection in such a fashion.....

     

    Massive insider selling (so I read) portends a less than rosy pic of the mkts IMO
    24 Apr 2012, 02:01 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » "Massive insider selling (so I read) portends a less than rosy pic of the mkts IMO."

     

    I hadn't heard that. Thanks... it's important.
    24 Apr 2012, 02:12 PM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    I've been seeing it (huge insider selling) elsewhere

     

    today per Hussmans at the end of his article
    ....particularly in the face of numerous hostile syndromes, near-panic insider selling, speculation in new issues, and broad divergences in market internals, all of which we are now observing.
    http://seekingalpha.co...

     

    also early april article
    http://bit.ly/I6YPp9
    24 Apr 2012, 02:34 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Thanks DD. None of us can keep tabs on 'everything'. Sometimes I think it would one hell of a lot of fun if all of us could get together and rent a nice (big) office/condo overlooking a beautiful marina from about the 4th floor and trade and work together as a team. Seriously, I think that would be awesome.

     

    Beautiful marina #1 - http://bit.ly/K6L9bz
    Beautiful marina #2 - http://bit.ly/K6KFSV
    24 Apr 2012, 02:40 PM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    #2 best marina i've seen in (days...years?)
    24 Apr 2012, 03:50 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Agreed! I think the two marinas would go together very nicely.
    24 Apr 2012, 04:07 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    I'm also partial to marina #2. Somehow the water looks bluer to me, or something like that. I'm not sure I can explain it here.
    24 Apr 2012, 07:08 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    I have to agree with everyone else. I would prefer to dock in the second marina. LOL
    4 May 2012, 12:48 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » By the way folks, as early as a year ago I published an article about the ratio between AAPL and the NDX, wherein I showed how when that ratio turns lower that'll more or less be 'all she wrote' for equities.

     

    I've updated it a couple of times, the most recent being on April 16th, here:
    http://bit.ly/J7uALZ

     

    That ratio is just getting crushed. So unless we see something we've never seen in the history of AAPL, equities aren't going any higher. That being said... you know Goldman.
    24 Apr 2012, 02:15 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Considering that we haven't met here for quite a while, I might as well fill you in on how the market internals performed today. At the close, the NYSE had produced 66 new highs which as you can see by the chart above is quite anemic. One could argue though that the numbers are way down there and with a decent recovery in the market, they could begin to climb rather sharply.

     

    On the other hand, there were only 26 new lows established today. However, one statistic that really makes me sit up and take notice is the fact that there are 117 stocks that are all within 2% of attaining a new low of their own (on top of the 26 that did so today). It's been quite a while since we've seen that many that are so close.

     

    And lastly, as luck would have it, unless the NYSE rises by another 58 points tomorrow (0.73%) the HO is going to remain switched off. As of this very moment it is "out of commission" (again... referring to the orange line in the uppermost chart).
    24 Apr 2012, 04:27 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - Just let GS know; 58 point should be very doable if they put their mind to it, however illogical it may seem, or perhaps because it is not logical makes it more likely.
    24 Apr 2012, 07:10 PM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    Just signing in to keep in the notification stream.
    25 Apr 2012, 05:05 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Just a quick report on a rather red day.

     

    With 40 minutes to go in the session there are 120 new 52 week highs and 39 new lows. (the HO required 85 of each today).

     

    But the ironic aspect is that the HO also switched off once the NYSE went below 8077.14, which also happened today. It's no surprise that the 50 day moving average rolls over at market tops or corrections, but it's also a requirement that it be pointing higher in order for the HO to be 'live'. So the HO has to issue its signal just before that MA rolls lower.

     

    We're right in the HO's ballpark but it's going to take a pretty good surge in the NYSE tomorrow to switch the HO back on. I get a feeling it's not going to happen. Too much of a bounce is required I think in light of the fact that today's action is very bearish. The outlook doesn't look good.
    3 May 2012, 03:24 PM Reply Like
  • jhooper
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    Comments (5805) | Send Message
     
    Is this saying the HO might work well with sudden moves, but it could miss a slow grind down?
    3 May 2012, 03:31 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » No not necessarily, it can work with either. For example, even if the NYSE were to remain perfectly flat for the next 10 days, that moving average would still turn higher due to the action of 50 days ago and 49 days ago and 48 days ago, etc.

     

    But yes, your comment is also true. It's more likely that the MA would remain pointed higher even if we had a horrible sudden down move. Then the question would be whether or not enough highs were attained on such a day. These are some of the reasons this thing doesn't issue a signal very darned often.
    3 May 2012, 03:37 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    AR: I'm thinking the HO is having a tough time because so much liquidity has left the NYSE.

     

    Just a couple weeks ago, Duncan Niederhaur(sp?), head of NYSE/Euronext, IIRC, was bemoaning the fact that a large amount of trading had moved to dark pools.

     

    And, Bob Pisani, of CNBS is always noting how anemic the volume is as well.

     

    Has the originator of the HO ever addressed this change? maybe that's why it's having such erratic behavior?

     

    Wondering, wondering,
    HardToLove
    3 May 2012, 03:40 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » I don't know H.T. The entire world of investing has been so distorted by the greedy orcs of New York that I wouldn't doubt anything. As I speculated yesterday, it would be very unlikely that today's 'bounce' would bring the HO back on line. And now we're getting dangerously close to having some serious H&S patterns confirmed which portend much deeper prices. And the HO will not have gone off. As I stated over two years ago , I'm not waiting for the HO, lol.
    4 May 2012, 10:01 AM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    I'm not either - long 700 (SPXU), too early, but I'm positioned.

     

    Today they are doing well for me. Wit 3x inverse to (SPX), I'm showing nice gains today.

     

    SPX below a key support of $1375 ATM.

     

    HardToLove
    4 May 2012, 11:28 AM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10802) | Send Message
     
    AR: Greetings. Just checking in after a fairly lengthy hiatus. What did you make of this month's correction?
    30 May 2012, 10:59 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Hi Robert. My apologies for the delay in getting back to you but apparently I'm guilty of the "lengthy hiatus" thing as well.

     

    The general consensus amongst technicians and Elliott Wave people is that since the move down off the April 2nd high is a 5 wave structure, it is a "motive wave", meaning that it is an impulse in the direction of the larger trend. In a nutshell, barring a miracle the top is behind us and the markets are almost assuredly heading lower for a long, long time to come (measured in years not months).

     

    You may or may not know but several of the studies I've done are targeted toward trying to identify whether or not the big deflationary scenario is upon us. Today I can say that my conclusion is "yes indeed, it started over a year ago".

     

    In the article that has become fairly well known now as the "CRX study" which I originally wrote in May, 2011, I was pointing out that I "suspected" that the deflationary scenario had already begun. Then I wrote an updated version on Jan. 2 of this year wherein I described that things were unfolding such that it was becoming conclusive that the deflation had indeed started. You can see that latest version here if you like:
    http://bit.ly/LEKHFk
    Since than it has just progressed.

     

    I'm glad to hear you say this month's "correction" because that's exactly what the upward move was... a correction of the longer term trend which is now "down". I was surprised by today's action to be honest (Wed., June 13) because the upward correction should take a 3 wave form. Arguably that 3-wave form hasn't completed yet.

     

    "IF" the market does turn higher over the next few days (like I think it should but doesn't look like it will), I'd say the maximum upside target for the S&P would be 1360-65... tops. But judging by what the futures are doing as I type this, I don't even know if the market has an ounce of upside left in it. It's a mess.

     

    Hope you are well and once again, I apologize for taking so long to answer your question. It's not like I don't like ya or something, lol.
    13 Jun 2012, 07:43 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    AR, Just check out your CRX study and I loved it.
    14 Jun 2012, 10:01 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Nice! Thanks for checking it out DG. I think the logic behind that study is pretty... what's the word? 'Logical', lol.

     

    I've been meaning to write another article on a topic that is beginning to intrigue me but can hardly find the time. But what I want to know is whether or not we're going to be seeing the following, and I suspect we are: I suspect that the US dollar is going to rise (deflationary for Americans). So obviously I also think the Euro is going to tank but I also suspect that it could be at a rate faster than the commodities will fall when the US dollar rises. The net result that I suspect is that while Americans are going to be experiencing deflation, most other countries, especially Eurozone countries are going to be experiencing 'inflation' in terms of things like oil because their currency should be falling faster than oil is falling (as a proxy of all commodities).

     

    So for Europeans, I think the shi... poop is about to hit the fan in that they're going to see their currency tank relative to most others, yet still experience inflation in spite of the fact that commodities prices should also be falling (in US dollar terms). All at a time when their real estate market should be decimated over the next 2-3 years. The worst of all worlds. Inflation for things they need like food and fuel, but deflation in things they already own, like 'everything they own including their homes'. Therefore, I see the US dollar and gold rising at the same time. People think that can't happen. But it can happen and 'did happen' in the first half of 2010.

     

    Geez dude... I haven't seen you for so darned long. How've y'all been? (did I say that right?, lol) How's your son doing? How are "you" doing?
    18 Jun 2012, 10:44 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - Enjoyed the two articles very much and am in agreement as well. I have actually been expecting a deflationary cycle and have been thinking that it has already begun. I hadn't thought about how long the cycle might last...five years is longer than I had considered, but there is some sense to that possibility.

     

    BTW, if I were to want to trade goat eggs, just where would I find a futures exchange that trades them? Does Switzerland have a futures exchange? LOL
    18 Jun 2012, 12:25 PM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10802) | Send Message
     
    AR: Greetings. I thoroughly enjoyed the article. Thanks. Very thought provoking.
    20 Jun 2012, 05:11 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    Me plowing on. Son is doing fine too. He just got meritoriously promoted to Sergent. Thanks for asking. How are things at the AR ranch?
    29 Jun 2012, 07:02 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » All the cattle died. Other than that pretty good I guess.
    2 Jul 2012, 03:21 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    Hell of a BBQ party I guess.
    11 Jul 2012, 05:57 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (5972) | Send Message
     
    I also just checked out the CRX study and loved it too. Thanks Rocks.
    14 Jun 2012, 03:40 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Thanks for reading it FPA. I think it makes pretty good sense and judging by the attention that article got on Global Economic Intersection, so do a few other people. John told me that it became the #1 most read article in it's 'category' for the entire half-year out of all such articles he published. That sure surprised me but obviously it was a 'pleasant' surprise. I could sure use a few more of those I can tell ya, lol.

     

    Hope you are doing real well buddy.
    18 Jun 2012, 10:49 AM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    "I am not good at wave counting and have been deked out by EWT more times than by the last alley cat I tried to catch for dinner."

     

    For our non-hockey aware brethren, think of "deked" as "head faked".

     

    And AFAICT, there's no way to avoid it with all the "natural" economic laws being violated by those with power trying to reverse that which Mises avers can't be reversed - a collapse of a credit bubble once begun.

     

    As always AR, a thorough and enlightening article with full consideration of all the factors.

     

    SA is the poorer for having lost your constant presence.

     

    MHO,
    HardToLove
    18 Jun 2012, 01:16 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    "... I also fully expect that any bounce would take on a 3-wave form".

     

    If we got a motive wave, rather than corrective, I would be absolutely floored since I do believe strongly that Mises has it right. On that thesis, the only motive waves we should see should be to the down side, in the longer term, with only sub-waves having any "motive" up waves in them.

     

    But EWT is definitely not my forte and I profess ignorance, other than a very general understanding - like you, the traditional TA stuff holds more promise for me.

     

    HardToLove
    18 Jun 2012, 01:21 PM Reply Like
  • jhooper
    , contributor
    Comments (5805) | Send Message
     
    It would depend on the ECB being unleashed. If France and Greece and the Spainairds can turn enough Germans, then the ECB could be unleashed. When this happens, the EU will finally have the massive taxing mechanism they have lacked to tax the general populace and transfer that wealth to the financial markets. This will create a risk on trade that will finally be derailed when either the subsidies stop (the ECB stops growing its balance sheet), or inflation stops it for them.

     

    This will be good for their exporters, and good for the US. Whatever we import will be cheaper, thus freeing up income to be spent on other things. The additional consuming will be good for earnings and thus equities, people will leave safe havens like the US treas thus causing their yields to go up, and we will get another stimulus bubble (the same effect we saw during the housing bubble, and the subsequent QEs combinded with fiscal stimulus). But like those other bubbles, a burst will come. It will come when people slow down their buying because of inflation, or it will come when the subsidies via the easy money creation end.

     

    The thing to watch now is how Europe will finally get the ECB to print, or some other back door approach at taxing the general populace to transfer the wealth to the financial markets thus delivering another bubble to us.
    18 Jun 2012, 03:15 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    jhooper - Let me see if I understand what we're thinking will happen here. I'd like to add a little detail to the discussion and let ya'll correct me where I'm misinterpreting. Like always, there will be some equities that will do very well in a US deflationary period due to a rising US$ while other equities will be hurt by it. Commodity suppliers should get hurt because of falling prices (it really depends on where the resources are located and distributed to/from to determine the FX impact), heavy commodity users should prosper due to lower input costs (at least here is the US; nations that do not peg their currencies to the US$ could get hurt badly; again it depends on the where/to/from). This effect will last until the US$ comes under pressure from inflation as velocity of money begins to kick in (assuming that the Fed is unable to unwind the carry trade that is using cheap US$ fast enough). As inflation begins to rise to higher than tolerable levels and the US$ starts losing its value (several years from now) as Treasuries will likely loose another notch or two on the credit scale. Until then, we may still be in risk on mode for equities, but at some point inflation and rising interest rates becomes bad for equities, too. From that point forward I would want to be out of equities (or at least reduce my exposure and generate some cash for better uses), with a few exceptions again (probably PMs and a few other assets that benefit from inflation and have less dependence on increasing demand; very few). At some point in this stage we should find the real bottom and go fishing for some long-term survivors paying good dividends and those financially sound companies that are likely to rebound the most from oversold positions.

     

    The problem is that this whole deal could take a decade to play out. But being on the right side and riding the waves in the right direction should prove tricky, but lucrative if it can be done well. This is basically what I think has been said to some extent in bits and pieces within this thread and the QC, if I'm piecing it all together correctly.

     

    How'd I do?
    18 Jun 2012, 11:21 PM Reply Like
  • jhooper
    , contributor
    Comments (5805) | Send Message
     
    "go fishing for some long-term survivors"

     

    If the US and Europe stay on their current tack, I would say the above statement is crucial. There is the real economy that always exists, and then there is the bubbles that gov consumption subsidies create. When gov isn't employing these subsidies, it becomes easier and easier to find winners because economic opportunity grows by leaps and bounds. When gov is applying the subsidies, we experience a bubble period that makes it look like we are growing by leaps and bounds, but people that don't do the hard work get taken when a bubble burst. Even after the bubble bursts, life goes on, and people still eat, buy clothes and shelter, and even entertain themselves. If you find the winner equities that can withstand the bubble and still provide these things, you can avoid getting creamed like the people who fell for the illusion created by the bubble.

     

    I think you understand my perspective, but let me elaborate a bit more. This approach has really helped me since 2008.

     

    A gov is a gov because it is given a grant of force by the populace to use that legitimate force to protect the people from illegitimate force. The only tool a gov has is force. As such, the ability of a gov to grow an economy is only limited to its ability to purge markets of force, thus creating a free market (free of force).

     

    A central bank is not necessary to this end. A welfare state is not necessary to this end. Rules to regulate voluntary transactions (transactions not based on force) are not necessary to this end. In fact they are in direct contravention to this end. Gov uses its force to force transactions that would not occur voluntarily. In other words it subsidizes consumption. Subsidized consumption pollutes nature's signals about efficient capital creation, otherwise known as prices. Too much money isn't the cause of inflation. Its gov force that subsidizes the creation of money that causes inflation. Money creation is no longer tied to capital creation, thus the ratio is distorted and the money gets diluted.

     

    In short, the only tool gov has with regards to improvement to capital creation is coercion, and coercion is the absolute worst tool to improve capital creation. The only tool the ECB or the FED has right now is to coerce people via the subsidized creation of money mediums into purchasing gov debt when they would not do so voluntarily. The reason they wouldn't voluntarily is because they have no confidence in the business plans of these govs because the plan basically rests on subsidizing the consumption of people whose income does not justify their consumptive level. Nature always punishes this. It is not an ideology. It is physics.

     

    A central bank could create money in proportion to capital creation (which gold could not), if the central bank were limited by prices. A central bank is not limited by prices because it was created by gov force in an effort to coerce capital creation. If capital creation could be coerced, the slave states would be the richest in the world.

     

    A central bank is just a consumption subsidy for financial markets. Central banks don't really create money, they create taxes. Those taxes are used to transfer purchasing power from consumable assets to financial assets.

     

    When the ECB (or any central bank created by gov force) starts printing, a portion accommodates capital creation, but most of it provides subsidies to financial markets. So whenever they start talking about deposit insurance, or euro bonds, or a more accommodative ECB, what they are saying is they are devising the taxing mechanism to transfer wealth from the general populace to their financial markets.

     

    When they do this, not only will they subsidize their exporters, they will subsidize the US. It will subsidize earnings for companies and their equities, thus attracting people into risk on. This means safe haven assets have fewer bidders, thus the yield goes up.

     

    The reason this doesn't last, is become no new capital creation source (new income via new technology) has been found to pay for this additional forced consumption. In other words, what pays for this is capital erosion. People lose the purchasing power their savings should give them via inflation or a lower return on their savings (CDs no longer pay 5%, they pay 25bps).

     

    The macro outcome of this is a massive burning of capital, and when you debit capital the offset is a credit to assets (like Spanish and US real estate just saw). This entry shrinks the balance sheet. In other words the balance sheet recedes. A recession. The bubble created by gov coercion (dep insurance, CB printing, euro bonds, etc) will always lead to a recessionary period.

     

    This is what Europe is attempting to do right now. They are experiencing recessionary pressures, because the coercion of their gov policies have induced capital erosion via taxing people from the capital creation abilities and using that taxation to create consumption (aggregate demand). They simply don't have the technology to create the income to pay for these consumptive levels, and nature is punishing their collective balance sheets for it (their assets just don't have the worth they need them to).

     

    So what's their basic plan? They are going to double down on their capital erosion policies. How in the world are they not going to avoid the law of physics?

     

    They are going to print. The printing will be a tax. The tax will be transferred to the financial markets. The tax will subsidize exports by subsidizing sovereign debt which subsidizes consumption not paid for by technology (income). Risk on assets will inflate, and yields on their sovereigns will go down and those in the US will go up. People in the US will pay less for imports, which is a tax break for them. So they can buy more of other things which will be good for those equities. Commodities will rally, because the "risk on" will be interpreted as the problems being fixed, and that the economy is coming back. Of course, who is paying for all this? The average citizen of Europe (EU). The purchasing power of their savings will erode, and then at some point their purchasing will be seriously curtailed.

     

    When that happens, the bubble collapses.

     

    So what I am looking for is the taxing mechanism that will kick the bubble off. Maybe its the ECB printing. Maybe it will be the ECB directly injecting capital into the banks. Maybe it will be Euro bonds that are used to inject capital into the banks. Whatever it is, it will be a mechanism to force people to buy financial assets that they really didn't want to. In other words it will be a tax. As long as you recognize this as subsidies and don't get fooled by the risk on effects, you have a chance of protecting yourself.
    19 Jun 2012, 09:34 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    Very well put. Thank you for sharing your thoughts.
    19 Jun 2012, 09:50 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » This is just a heads up my friends, that the Hindenburg Omen is at long last about to come back on-line. Barring a huge selloff over the next few days the HO should be back in service this week after having been "disallowed" from issuing a signal since May 3. I find this to be very interesting since in my humble opinion it's starting to look like a fairly hefty bounce might be in the offing. If I'm not mistaken the action in the semi's is sure supporting that theory at least. We'll have to see how this week unfolds but according to some of the EW experts out there, the action over the next few days is going to go a long way toward answering the question about whether or not "the big one" has started.

     

    I've been speculating that "if" the power brokers had any plans to issue more QE before the election they were going to need a very visible and scary excuse to do so. That would imply a stock market pullback so scary that the unwashed masses would be begging for more QE rather than fighting it. But as each day passes it appears to me that those in charge are quickly running out of time in order to pull that off. We're too close to the election I think, to allow a market pullback, the ensuing issuance of more QE and then the mighty market surge just in time to save the President's sorry ass. In fact, I doubt the "mighty surge in equities" that would be absolutely essential would even materialize at all, given the decreasing effectiveness of each consecutive tranche of 'added liquidity'.

     

    Anyway, stay tuned because I think the markets are about to become very exciting one way or the other. My personal hunch, for what it's worth, is that the market is about to head higher and perhaps just keep on going until the day after the election.
    22 Jul 2012, 01:51 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    "... that the market is about to head higher and perhaps just keep on going until the day after the election".

     

    For me, that would be a lot scarrier than having a decnt movement of the markets to reflect reality of reducing GDP growth, jobs numbers, ...

     

    If one believes that the longer we defer the needed adjustments the more severe the adjustments will be ...

     

    We might be in for a whole lot of pain.

     

    HardToLove
    22 Jul 2012, 02:34 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Agreed HTL... if the monsters just goose the market right up until the election in order to ensure the election of the incumbent, then they'll just be doing more of the same old same old... making things worse and worser and worst. Like I mentioned though, according to the EW experts we're "right there" at the point where the market is likely to reveal it's plans. If the markets tank tomorrow and close the day near a low, we're likely in for deep trouble "right now". On the other hand, if they put on a pretty good surge this week, then it's entirely possible that there's a lot more upside than we'd like see. I know that sounds strange to say "more than we'd like to see", but for the reasons you mentioned, more upside in this case wouldn't be a good thing in the long haul.

     

    On a different topic, here's a link to an incredible website I discovered this morning about "The Great Revealing: US Marshals Expose Biggest Scandal in History". It's possible the bankers are in fact going to lose it all... all their wealth, all their control. Pretty amazing stuff contained in this link:
    http://bit.ly/LH3qmd
    22 Jul 2012, 02:49 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - I highly doubt that much more than has already been revealed will come out and that only a few European banks will actually get relatively small fines. The current Administration has no inclination to uncover any cabal that is likely financing its re-election bid. The Justice Dept. will make political hay about how tough they are and how they just caught and punished the big bad banks, settle for meaningless fines of a few hundred million, and then everything will be back to business as usual. The Administration can claim that it has dealt with the big bad bankers for the sake of luring more votes by those who hate the bankers. It will also accept huge contributions from the same bankers for not letting this thing get too far out of hand.

     

    The other thing that struck me was that most of the top 50 on the list were either banks or financial institutions that manage mutual funds and pension funds. All that money that they are "making" is actually controlled by the mutual funds and could be withdrawn or moved by the many individuals who actually own that money and are temporarily entrusting it to those managers. Yes. They do exert some control, but all the profits are not automatically flowing to the bottom lines of the managers. They are extracting a portion of it all each year in management fees, but the bulk of the increases still flows to the individual account holders.
    22 Jul 2012, 04:09 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    I'll tell ya' AR, the blog would be a lot better if they would avoid the words that smack of "sensationalism". Lot's of meat there, but the words keep distracting me as I think of snake oil salesmen.

     

    But lots of good stuff, regardless - thanks for the link.

     

    HardToLove
    22 Jul 2012, 04:49 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    I think the prosecutions will be drug out until after the elections. There simply is not enough time. If reelected BO will be ready to trash the banks good over this to finish off the USS Titanic. JMHO
    22 Jul 2012, 04:53 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    Did you se the link over in the QC about the moves that will cripple money-market? A ZeroHedge article,, IIRC...

     

    Ah!

     

    http://bit.ly/MO8792

     

    HardToLove
    22 Jul 2012, 04:54 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    HTL, It had the exact same impact on me. Great stuff over flavored with a bit too much sensationalism but still lots of good stuff.
    22 Jul 2012, 05:05 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    I agree that the word choices made could have been better and would hold more readers if downplayed more to seem more factual than sensational. Don't get me wrong by my earlier comment. I do suspect that a cabal may exist, but the way the blog went about exposing it just didn't hold enough water for me. That Swiss paper made a good point about the concentration of power, but I though that whole idea got dragged out more than necessary. I'd really like to have had more snippets from the Marshal's report about the wrongdoings that are likely to go to trial. If it's all about the manipulation of LIBOR rates, that has already gotten about all the press I expect until a verdict comes down. There would need to be a lot more than that "little" scandal because the media has already downplayed it and swept it under the proverbial rug.

     

    It's kind of like the gun running to Mexico fiasco that has been silenced by the Administration and the Media. We thought that would be a big deal but it seems to be just about gone with the wind now. It shouldn't be dead, but it nearly is already. The republicrats are waiting to see if BO is likely to get elected before trying to use it as a means to undermine his re-election prospects. But, with the Senate still controlled by the Demicans it doesn't seem likely that a last minute impeachment move will happen either. Just my opinion.
    22 Jul 2012, 05:27 PM Reply Like
  • tripleblack
    , contributor
    Comments (13490) | Send Message
     
    I believe if (big if) they ever really dig into what happened when, the "why" and "how" will be more interesting than the "who".

     

    I wonder just how much these bankers really know about how their LIBOR system works - or how their computers respond to their own version of quantmonkey operators (reference: high frequency traders and the Flash Crash)?

     

    It would be darkly humorous but decidedly UNfunny otherwise should we learn that the bankers are telling the truth, and we are looking at another HFT story with no easy answers and loads of scary mysteries...
    22 Jul 2012, 11:03 PM Reply Like
  • jhooper
    , contributor
    Comments (5805) | Send Message
     
    If you think about it, the attempt to manipulate interbank borrowing rates downward is really an attempt to improve the credit profile of a bank, which means the ability to facilitate more lending.

     

    In other words, this is an attempt to lower interest costs for banks, thus freeing up credit, thus facilitating more lending.

     

    Sound familiar?
    23 Jul 2012, 10:13 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » As advertised, the big burst higher on the NYSE today did indeed bring the Hindenburg Omen back on line. If you click on the link beneath the chart at the top of the page you can see that price on the NYSE is now higher than it was 50 days ago. That "automatically" ensures that the 50 day MA is mathematically pointed higher now.

     

    However, on my own blog somebody sent me a link today to an article written by Arthur Hill (for StockCharts) wherein he too declares that the HO has issued a signal. There had been others, like http://bit.ly/MJz9EV

     

    Again, I reiterate that unless the rule regarding the 50 day moving average has been altered and I didn't get the memo... they are all wrong.
    http://bit.ly/P59EYZ

     

    So in consideration of the fact that Arthur Hill is a technical analyst of near legendary status, I sent him an email this evening inquiring as to whether or not he can confirm that Mr. Meikka has indeed altered the rule yet again. I dare say I seriously doubt that he did. However, since I'm fallible and it's my style to be deadly accurate, I am more than willing to be proven wrong. Hopefully Mr. Hill will get back to me asap as requested.

     

    In the meantime... that little "unknown" regarding 'the rule' is a moot point as of this evening anyway since the HO "absolutely is" online now. The only question that remains is whether or not it issued a signal recently due to a rule change that I'm unaware of. I doubt it... but we're going to find out soon hopefully, providing Mr. Hill gets back to me with some sort of confirmation.

     

    On a different topic, I also published an article earlier this week regarding the NYSE Summation Index (NYSI) and the fact that it has issued a major sell signal. You may be interested in reading that one:
    http://bit.ly/MJzkzT
    27 Jul 2012, 01:38 AM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    I am interested in what Mr. Hill has to say. I saw other reports of HO signals but I will await the becon signal from my good friend in Alberta to agree.

     

    I will be up your way next year for a bear hunt AR. I will let you know the specifics as I get them.
    27 Jul 2012, 05:27 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » I wouldn't be surprised if it takes a while for him to get back to me DG... if he does at all. I'm almost positive he's wrong. Come to think of it I should shoot off an email to Tom McClellan as well, since he knows Jim Meikka personally. Yeah... I'll do that right now.

     

    HANG ON... I just got off the phone with Tom McClellan. I'm happy to report that I am correct. All recent reports of the HO having issued a signal are based on improper knowledge of, or interpretation of, the rules.
    27 Jul 2012, 12:20 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4160) | Send Message
     
    Much thanks for your great lengths and efforts AR.
    27 Jul 2012, 09:24 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » I've just posted an update on the HO topic on my own blog, but basically it says the same thing I've posted here:
    http://bit.ly/MPUpHh

     

    It's in no danger of issuing any signal today.
    27 Jul 2012, 12:07 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    Good work AR!

     

    Nothing like good old tenacious "sweat equity" to dig the real stuff out of the morass.

     

    HardToLove
    27 Jul 2012, 12:36 PM Reply Like
  • The_Hammer
    , contributor
    Comments (3957) | Send Message
     
    AR,
    do you use the NYSI in combination with the HO indicator?
    27 Jul 2012, 01:00 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    Check out the chart at the top of the column. He is using the NYSE composite index ($NYA).
    27 Jul 2012, 01:53 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Yes... the HO pertains "only" to the NYSE.
    28 Jul 2012, 12:32 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Things are moving fast. Although in recent days the number of new 52 weeks lows were too low, today they are just right. The odds of getting an "initial" HO signal today appear to be very high. I'm just refining an article I wrote many months ago that I was going to publish on this day... so hang in there. More to follow. Don't worry, when I publish that article on my own blog I'll post a link here as well. At this moment there are

     

    80 new 52 week highs (82 are required)
    52 new 52 week lows (82 minimum required)
    2 Aug 2012, 12:44 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    As always, looking forward to it.

     

    Thanks for remembering us out here in the hinterlands!

     

    HardToLove
    2 Aug 2012, 01:08 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » You're welcome H.T.

     

    By the way, it appears the WSJ is possibly messing with their data now. Earlier they were showing the numbers as seen in my comment above. Now they're showing only 75 highs and 50 lows. This is not possible... once a new high has been attained it cannot be retracted. It either hit a new high or it didn't.

     

    Wait... now they're back to showing 82 highs and 53 lows. Makes one wonder what they're up to doesn't it?
    2 Aug 2012, 01:20 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    TPTB are impossing their will. Presently they are negotiating price so the numbers will fluctuate until a price is settled on. LOL
    2 Aug 2012, 01:38 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Hi there buddy. On a totally different topic, I wonder if you would entertain a request from an old friend (me)? And I ask it with all the respect and love I can muster. Regardless of your reply, I'll still love ya, lol.

     

    About that bear... would you consider sparing him and taking a moose instead? In my humble opinion there's no such thing as a bear "hunt" up here since bears walk through the streets of towns up here. Not this "town" I live in, but mountain towns. Mooses on the other hand... there are so many of those big buggers up here that they're the #1 cause of traffic deaths to humans in Newfoundland. I'm serious. There's one moose for every 4 people over there and cars are slamming into them every week. And they're delicious, lol. Thanks for thinking about it.
    2 Aug 2012, 01:51 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - Reminds me of when I was a teenager up on the Canadian border waters of northern Minnesota. There were a couple of years when it got really dry and there just weren't any berries. The bears would roam around the resort all the time looking for a trash can to rummage through. I occasionally would brush up against one as we past each other on a path. We only had one that got brave enough to break into a cabin and become a hazard to people. We had to shoot that one.

     

    In the fall my dad would ask me to guide hunters interesting in bears. I didn't like doing it. My first question to the "hunters" was always. How many pounds, male or female, and what color: brown, black or cinnamon. They would look at me funny and make their choices. Then I'd go out alone to locate and rouse one that fit their description, return for the hunters, and we'd go out and get the bear. It just wasn't very sporting and I quit after one season and only two "hunts."

     

    I've got some great bear stories that really happened if we ever get together.
    2 Aug 2012, 02:53 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Great story K202... glad to hear it. What a great way of getting your point across to the hunters. It's not a "hunt" at all. And again, I say that with a ton of respect for my friend DG. Please don't be offended DG... I love ya.

     

    "I've got some great bear stories that really happened if we ever get together."

     

    So do I, lol. I look forward to the day we can exchange those tales in person. Beer will be on me. You do realize beer is free in Canada, right? At least at my place it is :-)
    2 Aug 2012, 03:20 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    I took a moose up there about 2 years ago. I even wrote an insta on the economics of moose hunting. See below. Sorry about the bear hunt but it is already paid for and they will not give back the money. I have no idea what the hunt will be like but It wont be in town I am sure. Keeping those buggers afraid of humans will however possibly keep some of the folks in those towns a bit safer up there. Also remember this ....sometimes the bear wins!!!

     

    http://bit.ly/ONVgJ9

     

    Moose hunt link below

     

    http://seekingalpha.co...
    8 Aug 2012, 09:51 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » It looks like what we're going to get today is a very near miss. At present there are 97 new lows with 85 required (that number fluctuates from between about 80 and 85 each day depending on how many issues are 'unchanged'). And there are currently 61 new lows with the same 85 required as the minimum. With the market now wanting to bounce, a signal is unlikely.

     

    In that case (no signal today) this will be my last post here today. I'm way overdue for a nap and I have to leave as soon as I wake up. But I'll be back tomorrow. In the event there 'is' a signal today, the nap is gonna have to wait. I'll let you know right here... today... if the signal 'does' happen. Otherwise, see you tomorrow.
    2 Aug 2012, 03:34 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Hi there gang. Lol... it seems kinda goofy to refer to us as a "gang" since I think the rules dictate that there must be at least 6 members in order to qualify as a "gang". But what the hell, you've been loyal followers of this blog since day one, and I've been loyal to you for the same period. So in that regard, I love ya and you're definitely in my "gang". :-)

     

    The more I watch this HO, the more I realize how brilliantly it was designed. It has become obvious to me that it doesn't go off very darned often for a reason. Today's ramp is a great example of that... as is the entire pattern since the early June low. Even though that pattern has been choppy as hell, up then down then up then down then up then down, it's still corrective looking with lots of "overlap", meaning that it's the opposite of an "impulse". A terrific impulse can be seen in the action down off the March high. If you click on the link to the chart at the top of the page (I've put that link just below this paragraph) you can see where I've identified what an "impulse" looks like... a 5 wave pattern as well as a "corrective" pattern. What these patterns suggests is that the market really wants to go down, not up.
    http://bit.ly/srUr5f

     

    Regardless... the market has clearly been in recovery mode since the June lows. IOW, even though the action has been extremely choppy, the market 'is' still moving higher. It seems the HO isn't ready to issue a signal for that reason. How interesting this is. On a side note, and just for interest sake, at this moment there are still enough stocks hiding there within 2% of achieving a new low that the HO could go off at any time if the market decided to surrender all of today's gains. I certainly don't mean to infer that any such thing will happen, just making note that in spite of today's miracle, the market is still very fractured.. In any event, the Hindenburg Omen is likely to issue it's signal "when the time is right" and not before.

     

    When we consider what it's measuring, we need to keep in mind that it's not some sort of everyday toy indicator. This thing is serious. It is potentially warning of a market decline on a scale we don't normally think about in our day to day monitoring of market action. It's talking about moves the size of this:
    http://bit.ly/QL8u9q

     

    In that chart, the red arrows show the size of the declines that the HO is normally talking about. The yellow arrows show where the HO actually did go off. Remember also, that I was reporting here about how incredibly close it came to actually going off the week before, and the "day of" the flash crash

     

    I'm not sure why I went to the trouble to show this info today but if nothing else, I guess I just wanted to remind about what the few of us remaining are actually watching here.

     

    It appears pretty clear that the HO has no intentions of issuing any signal today. Yesterday was close (20 new lows short of going off), but for now... all is calm. On the surface.

     

    Have a great weekend my friends. See ya next week most likely :-)
    3 Aug 2012, 11:59 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - Thanks for the update post. I always check when I get an alert from this blog. I may not always comment, but I'm monitoring just as I bet a dozen or more others in your "gang" do.
    3 Aug 2012, 12:28 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4160) | Send Message
     
    Thank so much AR
    3 Aug 2012, 12:29 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2028) | Send Message
     
    Well said, K202. I'm part of the silent gang but tracking here nevertheless.
    Thanks AR,
    mj
    3 Aug 2012, 12:30 PM Reply Like
  • Stilldazed
    , contributor
    Comments (2117) | Send Message
     
    Thanks AR,
    Still lurking and listening.
    3 Aug 2012, 08:02 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Are ya still dazed? lol

     

    Glad you're still here :-)
    6 Aug 2012, 12:10 PM Reply Like
  • Stilldazed
    , contributor
    Comments (2117) | Send Message
     
    Still dazed and confused. :-) and proud to be here.
    6 Aug 2012, 07:13 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (5972) | Send Message
     
    Also lurking... :)
    3 Aug 2012, 08:05 PM Reply Like
  • jhooper
    , contributor
    Comments (5805) | Send Message
     
    I'm crouching behind a rock.
    3 Aug 2012, 09:02 PM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    AR - - -

     

    You are definitely leading a gang, there are 7 likes for your comment. Now if that were to grow some you could be leading a mob.

     

    And all we need are few more trading algos to be implemented. With some more Knight Capital - like stocks in play the number of new lows will be no problem.

     

    Have a great weekend.
    4 Aug 2012, 12:29 AM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    AR - - -

     

    Now 11 likes! A mob?
    7 Aug 2012, 03:12 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    Bakers dozen now. Maybe your gang should be called the dirty dozen.
    8 Aug 2012, 09:55 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - Here is a link to the Hoisington Investment Research. Check out the QTR 2 Review and Outlook under Economic Overview tab. Very interesting reading about interest rates.

     

    http://bit.ly/MhTKyU
    7 Aug 2012, 03:21 PM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    thanks for the link k2 - very interesting....excerpt;
    It is often said
    that economic conditions would have been much worse
    if the government had not run massive budget deficits
    and the Fed had not implemented extraordinary policies.
    This whole premise is wrong. In all likelihood the
    governmental measures made conditions worse, and the
    poor results reflect the counterproductive nature of fiscal
    and monetary policies.
    7 Aug 2012, 10:48 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Thanks for the link Mark. I haven't been able to read it with focus yet, but I did read the first 1/3 so far. I need to read things like that when the markets are closed in order for any of it to sink in, lol.

     

    But I 'did' notice this opinion that I wholeheartedly agree with:

     

    "Three recent academic studies, though they differ in purpose and scope, all reach the conclusion that extremely high levels of governmental indebtedness diminish economic growth. In other words, deficit spending should not be called “stimulus” as is the overwhelming tendency by the media and many economic writers. While government spending may have been linked to the concept of economic stimulus in distant periods, such an assertion is unwarranted, and blatantly wrong in present circumstances."

     

    When the FED uses the word "stimulus", it reminds me about how the government sponsored propaganda machine also coins other words, such as "insurgents" and even "tearists" (as Bush would pronounce it) to color them in a light that justifies the government's actions. And by "government", I mean those who control government by having purchased the traitors in Congress. And of course by that I mean the ruling fascist oligarchy led by the banking criminals.

     

    Indeed, QE can hardly be honestly referred to as "stimulus". In reality (and I'm sure every reader here knows this, I just want to reiterate it) the printing of more money to cure the problems caused by an overabundance of debt by purchasing "more" debt is hardly stimulating. It's effect is the complete opposite...it's is a panic attempt to stem a total deflationary collapse of the entire existing debt structure. NONE of that money enters the system in a stimulating fashion by being loaned out into the productive corporations of America. Instead, it all gets sopped up buying more time and nothing else. Stimulus? Man, talk about a propaganda machine.
    8 Aug 2012, 02:46 PM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    DigDeep - - -

     

    The biggest shortcoming of the extraordinary policies is the object of their "affection". The benefit went substantially to the banking class, to keep insolvent oligarchs afloat, and too little went to the real economy that can both produce goods and services as well as buy them.

     

    The "financial class" greatly increased income throughout this entire disaster while the "Main Street class" lost ground.

     

    I fault the implementation much more than the economic principle.

     

    If the same amount of money had been directed to individuals and goods and services producing businesses, the stronger banks would have retained more performing assets and survived while the weaker banks would have been reorganized, as is the way capitalism is supposed to operate: the efficient prosper and the inefficient fail.

     

    Instead the decision was made to prop up the insolvent and preserve the inefficiency.

     

    Federal deficits are a vehicle for the creation of money and, after so much money had disappeared into a black hole of bad debt, some replacement money was needed. What was wrong was that a significant amount of the new money was poured into the same black holes. The black holes should have been abandoned and allowed to consume themselves and burn out while the matter in the "normal universe" should have been given an opportunity to recover.

     

    Yes, some mortgagees should have failed and been foreclosed - there were egregious positions taken by borrowers as well. Yes, some businesses should have gone under - not every business can succeed.

     

    But the travesty is that after a few failures and managed failure avoidances, the mass of the banking oligarchy was allowed to survive unpenalized, unrepentant and to go on to unprecedented growth, consolidation and further enrichment of the executives who managed the financial debacle. Everybody else must pay, but not the Wall Street deities.

     

    DigDeep and AR - I apologize for such a long rant so far off the HO topic.
    8 Aug 2012, 02:57 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    But a good rant, none-the-less.
    8 Aug 2012, 03:03 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Apologize? No way you have to do that Johnny. I did the same thing. Obviously we have opinions on the topic and they don't seem to differ by much, lol.

     

    That was a great rant. Loved it and man I couldn't agree with you more, in every single aspect.
    8 Aug 2012, 04:29 PM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    my head was going up and down the entire read - thanks John... except one question;
    When you say
    "Federal deficits are a vehicle for the creation of money" wouldn't that have 'debt' / UST's attached to that deficit? Hence no new net money created - as the UST's pull liquidity out of current capex.....?
    8 Aug 2012, 06:17 PM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    DigDeep - - -

     

    I have to do a deep data analysis of that question. On the surface the data seems to say that cap ex goes up when government deficits go up and cap ex comes down when federal deficits go down.

     

    I want to do one of my careful analyses of what correlates with what, what are the lead are trailing times for things that correlate and does correlation really have a relationship to causation.

     

    A lot of people will tell you what the result of such questions will be but they often speak from the viewpoint of their theory rather with data analysis.

     

    So I am going to ask you to postpone that discussion until I have done a little research project.
    11 Aug 2012, 01:58 AM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    Off task from AR's HO blog....for anyone interested - from John's econintersect blog - Derryl Hermanutz has a few interesting (fascinating to me) macro articles about the deficit and debt;
    http://bit.ly/OUnvDw.
    8 Aug 2012, 09:37 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Dig Deep (and everyone else of course), since we're going off-topic a bit, here's something that I'm really quite proud of but admittedly rather amazed by. Travel Alberta has been putting out a series of promo videos, but I've seen none of them on TV other than two or three different little 30 second ones. Those ones are really pretty too. But I wonder if these are being aired elsewhere in the world because we're not seeing the majority of them up here?

     

    In any case, I was pleasantly surprised to see the stunning photography work that has been done to put these videos together. But I can confidently state that the beauty in them is not exaggerated. Images like this have been burned into my memory since I was just a tyke. I was raised with this and have just gotten used to it. But I assure you, the older I get the more I'm coming to realize that I've been spoiled my entire life and didn't even know it. All these little videos carry the catch-phrase "Remember To Breathe" (as in "takes your breath away"). Yes, even the women in Alberta are as pretty as the ones in this video, lol Well... a lot of 'em.

     

    I hope you can enjoy a little self indulgence here. Respectfully submitted :-)
    http://bit.ly/S4JfNs

     

    And one more shorter one with different music, making me wonder exactly how many of these there are:
    http://bit.ly/S4IMe6

     

    I hope you like 'em. BTW, I hope nobody has the idea that going off-topic here is taboo. All comments are more than welcome, especially during these slower times with the HO.
    9 Aug 2012, 11:50 AM Reply Like
  • DigDeep
    , contributor
    Comments (2356) | Send Message
     
    fantastic beauty
    the landscape as well!!!
    all good
    9 Aug 2012, 12:06 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Thanks for accepting it in that light Dig Deep. I don't mean to be tooting the old horn if you know what I mean. It's just that the videos were so well produced and so pretty that I'm even impressed myself. I was just hoping my friends could enjoy something pretty in this goofy world. I meant it as a kind of a little 'gift' rather than any sort of horn-blowing. Mind you, I guess subconsciously I've always been aware of this province otherwise I probably wouldn't be using the 'username' that I do. I honestly just picked that name one day when in a panic to come up with a username so that I could submit a comment that I really wanted to submit in a hurry. But I accidentally became recognized with the name and got stuck with it. Anyway, thanks.
    9 Aug 2012, 12:14 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    Great videos AR but just a bit to much SNOW!!!!
    10 Aug 2012, 03:47 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » That's one of the prices we have to pay in order to have a fair number of waterfalls and fresh lakes I guess :-)
    13 Aug 2012, 12:27 PM Reply Like
  • The_Hammer
    , contributor
    Comments (3957) | Send Message
     
    notification. False alert?
    Date on the article changed to Aug 23
    Can't find any new comments or info.
    23 Aug 2012, 10:27 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » No worries Hammer... it must have changed when I edited it yesterday to remove some of the noise. What I did was to remove the link to that chart I'd put up there to show the difference between "Impulsive" and "corrective" action. I felt that it was distracting from what the chart is really up there for, to provide focus on the 50 day MA and what it's doing.

     

    The market is producing a very small number of new highs and new lows, so small in fact that the HO hasn't been threatening to issue a signal. Nonetheless, just the fact that it's producing so few of each, and that they're basically somewhere near equal, the market is actually pretty weak. Hang in there... and thanks for the comment. You gave me an opportunity to explain the date change, even though I wasn't aware that it would be changed with an edit.

     

    Have a great weekend.
    24 Aug 2012, 01:39 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Good day folks. I thought I'd just drop in to confirm that I'm still alive and on the job. Today is probably fairly representative of what's been happening behind the scenes over in HO land.

     

    The number of new 52 week highs for today stands at 85 (with 84 required). The number of new lows currently stands at 20 with the same minimum of 84 required. Just as a matter of interest, there are also another 94 issues that are within 3% of putting in a new low of their own.

     

    So on a day like this, when the number of new highs has been met but the number of new lows is probably far enough away that we wouldn't see an initial HO signal, we can still take away this good information. It's simply revealing to us that once again a supposedly strong stock market is producing a very anemic number of new highs at a time when the 50 day moving average is still climbing. It's the fact that that average is still climbing that defines that this is still a bull cycle. We don't want to see this type of weakness in a bull cycle that's for sure.

     

    So that's about it. I just wanted to give you a little alert that the market is slumming around in the HO's neighborhood. Nothing more than that... just a heads up.

     

    I hope you're having a great week and that none of you have diarrhea.
    28 Aug 2012, 02:30 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    Good to know your didn't become a meal for the bears.

     

    HardToLove
    28 Aug 2012, 02:46 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Nope, that hasn't happened to me since I got divorced. But it wasn't a bear it was a dragon.

     

    [Just kidding, my ex is a wonderful gal. I just like to use the word 'dragon' in that context sometimes because I tink it's funny.]
    28 Aug 2012, 03:02 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    As long as she's not in earshot it's funny. =>8-O

     

    HardToLove
    28 Aug 2012, 03:06 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    And she never reads this post. If she does he wont be tinking or tinkling.
    28 Aug 2012, 04:57 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Just a short note to let you know that the results of the new highs and new lows appear to be on track to almost duplicate those of yesterday.

     

    New highs currently sit at 104 which is of course very weak for a market that is still supposedly on bull mode as witnessed by the 50 day MA. New lows are currently sitting at 22 which is no big deal either. But these numbers are nearly identical to yesterday's. At least they're consistent.
    29 Aug 2012, 03:05 PM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10802) | Send Message
     
    AR: Greetings. Thanks.
    29 Aug 2012, 05:21 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Ok, today's type of banker induced insanity is one thing that really gets the Hindenburg Omen all tingly. We're less than two hours into the trading day and the market has been all over the map with swings that years ago (before banks were allowed to participate and thereby ruin the entire global stock markets system) were absolutely unheard of.

     

    But the effect it has on individual stocks does not go unnoticed by the HO. So... so far today the minimum number of new highs has been attained. 81 are required and 91 have been recorded. The minimum number of new lows required is also at 81 but only 12 have been entered into the books. With 100 more sitting right there within striking distance, all it would take now is another reversal and a sell-off to end the week. I have no idea whether or not that will happen but I wouldn't be one bit surprised after seeing this morning's shenanigans. After all, what exactly did Bernanke offer the markets this morning, a new and mighty round of QE? Of course not, just like the past 3-4 chances he's had to either crap or get off the pot.

     

    So stay tuned. Without making any prediction whatsoever, I'll just say that the HO does not like the bankers today.
    31 Aug 2012, 11:23 AM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    Sitting on the edge of my seat. September is coming tooooo (said in a ghostly whisper).
    31 Aug 2012, 11:56 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » And then spooky October.
    http://bit.ly/PGhMA6
    31 Aug 2012, 12:22 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    If the last two years are any indication, the drop in the S&P is running a few weeks late. So it's about time for the HO to start showing some *possibilities*.

     

    VIX is still pretty low, but climbing and the word is that the VIX *futures* several months out are *very* elevated.

     

    So, with %DJT backing the recent weakness in the $DJI, prospects look pretty decent for a down trend.

     

    The reduction in GDP growth (not just in the U.S. either), known for some time, is apparently accelerating (DOH! As if we didn't know this 6 months ago) based on both adjustments and forecasts.

     

    Given this, the VIX futures make sense.

     

    Monetary policy, resulting only in liquidity increases, can't support fundamentals, especially in light of continued de-leveraging, even it's slowed a bit.

     

    MHO,
    HardToLove
    31 Aug 2012, 12:24 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » HTL, you know what's really concerning from my perspective is the recent economic data. All over the world it's relatively bad, except for the U of Michigan survey of course which is just another arm of the propaganda branch. That particular university gets such whopping truckloads of cash from the banks every year as "gifts" that it's no surprise to me at all that they release the numbers just as they're told to release them. Just as Bernanke gives whatever speech he's told to give.

     

    But what's concerning me even more is that this morning Canada also released some important data and as is often the case it blew expectations out of the water. http://bit.ly/QJJSQz

     

    I mean relative to nearly any other country in the world Canada really is doing well. But for those Canucks who have their focus on the Canadian data alone, it all seems rosy when nothing could be further from the truth. You have no idea how difficult it is for me to convince my fellow blubber-eaters that we too are going to get slammed upside the head so hard one day that we won't even know what hit us. The degree to which 'my people' (lol) think the problems in Europe will 'stay in Europe' is just mind boggling. I feel like Paul Revere would have felt when he realized that all his fellow countrymen were trying out their new ear plugs that day.
    31 Aug 2012, 12:47 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    AR: "all politics" and, I suspect, "economics" are "local" to the average citizen.

     

    I believe, IIUC, that Canada's banking system has been better controlled and Canada may not suffer as badly as others though. Still suffer, certainly some, but just not as bad as your idiot cousins south of the border who seem to have lost the attributes which made them a powerhouse to start with.

     

    I suppose we'll eventually return to "the path", but not without a lot of kicking and screaming as reality drags us back into her arms.

     

    MHO,
    HardToLove
    31 Aug 2012, 01:44 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Yeah, yesterday all 5 of Canada's major banks reported earnings and all 5 of them were just crazy profitable, the RBC even reporting record earnings. So BNN had a few guests on and interviewed some people on the street about whether or not they were happy about the banks being so profitable up here.

     

    The general consensus was that "yes, it's better than having a country full of failing banks like the European banks but it ticks us off to no end that a fairly good chunk of those profits come as a result of the banks absolutely gouging their customers".

     

    The truth lies somewhere in between. The banks up here actually generate a relatively small percentage of those profits from gouging. But man, are they every greedy and disgusting about it. One bank (I forget which one) actually earned 36% of its profit from, you guessed it, equities trading. But I suppose that's better than Goldman or Citi who's profits are almost 'all' from equities trading and the cheating and manipulation that they pull off in order to achieve those profits. The rest of the Canadian bank profits actually come from real banking operations such as "interest revenue from loans to their customers" as well as a whole whack of offshore investments and holdings. Real banking! Wow! It's nice to know that a small bit of that still exists somewhere in the world I guess.

     

    EDIT: I guess that I should have mentioned that their exposure to European debt is limited and they're very aware of the risks involved. Which is also why Angela Germany was so incensed at Jim Flaherty when she insisted that Canada help support Europe and his reply was something akin to "That'll be the day. Get your act together and get your damned spending under control. Call us once you've taken care of that and we 'might' talk then." She was furious and he couldn't care less.
    31 Aug 2012, 01:57 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    I'm not sure that "spooky" is the right word for that pic!
    31 Aug 2012, 02:21 PM Reply Like
  • doubleguns
    , contributor
    Comments (8197) | Send Message
     
    I bet if you found that waiting in your bedroom you would be scared to death.
    31 Aug 2012, 04:35 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    You know what really worries me? When I look at the S&P EPS chart relative to the GDP growth chart. It looks to me as though EPS may be hitting a peak in the cycle, especially with slowing GDP growth. This is a fundamental assessment, more or less, so it may not belong in the discussion here. If EPS growth really slows or even begins to fall...look out! Cost cutting has pretty much run its course, so now the bottom line has become dependent upon top line growth; and demand seems to be slowing down. Top line growth needs to rise faster than inflation or the bottom line will flat line from here on, imho. It's just one more data point to consider.
    31 Aug 2012, 02:28 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    AR - This video provides what looks like a pretty good technical analysis from my point of view. I just thought you might be interested and would appreciate your views on it if you have the time.

     

    http://bit.ly/RhPQCN
    4 Sep 2012, 02:40 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    Knowing that we have been in a very extended period of low volatility (the market almost feels normal from that sense) I am considering getting into a position in VXX. I realize that it is best held short term, but I plan on legging in if it continues to fall by selling put options to lower my cost. I don't know if the market will go up one more time or if it will give us the corrections we are looking for sooner rather than later. But I do feel fairly certain that the market volatility is likely to spike from current levels which would send the VIX higher and the VXX ETF would naturally follow. It shouldn't matter whether the market goes up or down, eventually it will move with some conviction created by a break either in support or resistance. Either way the VIX will increase when it does.

     

    So, here is my strategy: I buy 100 shares of the VXX ETF at about $11.43 (current price). The 52-week low is $11.02 and the 52-week high is $59.18. I then sell an October put option with a strike price of $11 and collect a premium of $1.02. If VXX closes below $11 on October 19, 2012 I get put an additional 100 shares at $11, but my cost basis on these new shares is really $9.98 ($11 - $1.02). This will bring my cost basis on the full position down to $10.71. This will happen if volatility remains very low and stock edge up or down very slowly. Either way, I don't care because I am just waiting for volatility to return so I can profit.

     

    If the VXX closes on October above $11 but does not move much, I still own the original 100 shares and keep the $1.02 premium which effectively lowers my invested capital to $10.41 ($11.43 - $1.02). Then I sell another put for November or December and collect another premium. I can keep on doing this until the market decides to move, which it will eventually (at least it always has in the past). I'll just keep adding to my position and lowering my average cost basis or I'll just keep collecting the put premiums and continue to lower my invested capital. Considering that the return for a 45-day holding period (if the put option expires worthless) is 9.27% it seems like a good income stream to me. The return is calculated on the cash required to be held in my account to secure the put. I figure that the position in VXX is a separate investment that just sits there until the market starts moving. I'll be collecting premiums every month or two at a similar rate on the same cash sitting in my account as I watch the puts expire and then initiate new positions shortly thereafter.

     

    AR - I'd really like your opinion on this strategy. I realize that the VXX ETF has a downward bias over the long term. I did take a look at periods when the market moved up or down quickly over the past few years and the moves in VXX were pretty impressive, generally 10 to 30 points in a matter of weeks. Talk me out of this if you think I'm crazy.
    4 Sep 2012, 03:02 PM Reply Like
  • H. T. Love
    , contributor
    Comments (17774) | Send Message
     
    K202: Good plan. But don't forget that the $VIX is a futures-based mechanism and right now contango causes negative roll yield. So the longer you hold the more times you get hit with that negative roll yield.

     

    A side effect of the futures expirations is adjustments to the $VIX, VXX and others that track it. There are some likely some additional losses incurred in that process as well. A *careful* examination of the prospectus and any discussions about the $VIX is certainly warranted, IMO.

     

    So I would suggest looking at the futures contracts dates and values to: roll in *and* out at strategic points, adjust your strategy on the puts to account for that.

     

    Just an FYI: a well known TA from a big firm did a piece on CNBC some months back that said $27 was likely. Someone asked my opinion and I told them it wouldn't get there anytime soon and would have trouble breaking through several prior resistance points.

     

    So far that gal has been wrong, but this late in the year without a correction of significance yet, she may end up being correct - she was just early.

     

    I've not done a deep dive recently and things could be different now.

     

    MHO, remember that I'm early on the learning curve,
    HardToLove
    4 Sep 2012, 05:50 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    "So far that gal has been wrong, but this late in the year without a correction of significance yet, she may end up being correct - she was just early."

     

    That is my thought, also. I don't expect $VIX to get to $27 either. I would be happy for it to go to $15 if I had averaged in near $10. But you are right that I need to get a good handle on how VXX is calculated. I understand the downward bias due to the rolling, but there is an adjustment that I need to get my head around.

     

    Thanks
    4 Sep 2012, 10:05 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Sorry for the delay in getting back to you MB. Selling theta has been a strategy that I've been using for a while too, but naked. IOW, sometimes I sell naked puts and naked calls on the same instrument and just let them expire worthless in the hands of someone else. That's what banks do and it works for them, so why not? When the market is relatively stable, the puts might increase in value one day but the calls decrease by a slightly greater amount... and vicey vercy. So I've been doing that when the markets are basically going nowhere, which is what seems to be happening 80% of the time. Today being a bit of an exception of course. The HO won't be going off today, lol.

     

    Having said that though, on a day like today, although the puts that one might have sold are pretty much worthless now in the hands of someone else, the calls can spike more than they should with all the excitement, even though the $VIX has tanked. That type of trading uses up a lot of margin too, so on a 'percentage of the total account basis' it's not nearly as lucrative as other strategies I've used in the past, but it's relatively safe. The losses won't likely be huge but neither will the gains.

     

    I think your strategy could work very well and I've been thinking about employing something nearly identical once the day arrives that TZA and SPXU look like the ones to buy. Judging by today's action though, now that Europe has been saved by the Draghi Queen, those bearish ETFs might come into vogue about 8 years from now. Seriously, if Bernanke moves along the same general path that Europe is dreaming of doing, and announces more QE as well, we might as well just walk away from the broken stock markets, buy gold and relax for the rest of our lives.

     

    Speaking of which, if the NF Payrolls show a great improvement tomorrow, there surely won't be any more QE on Sept. 12th. If they're horrible, Helicopter Ben will probably announce something "wonderful", Obama will win, gold will continue to accelerate higher and so will the markets I guess. The sky's the limit right? What a horrible situation either way. The Fed has painted themselves into a corner where they're gonna lose either way. 1000 on the S&P with no QE or $3000 gold and $200 oil if he decides to do the same fairy dance that Draghi is doing. God what a mess.
    6 Sep 2012, 12:22 PM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10802) | Send Message
     
    AR: Greetings. http://seekingalpha.co... Draghi's statement seems to be all fluff and no substance. He set no limits on volume, rate or date. In fact there are no specifics at all! More drivel from people who have no idea what to do but are charged with doing something. Thus more can kicking is the rule and to be expected. He, like the Bernanke, is delaying and praying that governments around the globe will suddenly stumble onto the solution to this mess. IMHO the extend and pretend method has just about reached it's limit and something, probably Italy or Spain, will have to give. Greece is a done deal and already baked in but when, not if, the larger PIIGS reach the same point things will break quickly and drastically. Got dry powder?
    6 Sep 2012, 02:24 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » A new insta has been posted. Time to freshen things up. Now that I think about it this is probably a good time to take my monthly bath as well.
    http://seekingalpha.co...
    8 Oct 2012, 02:49 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    You take one EVERY month? Did you know this interesting fact about the 1500s?

     

    Most people got married in June because they took their yearly bath in
    May and still smelled pretty good by June. However, they were starting
    to smell so brides carried a bouquet of flowers to hide the body odor.
    Hence the custom today of carrying a bouquet when getting married.
    8 Oct 2012, 03:59 PM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » WOW, I never knew that. Thanks for the interesting bit of trivia.

     

    Imagine that, at one time buying flowers was a defensive mechanism that women employed. Today it's a defensive strategy that men employ.
    8 Oct 2012, 04:20 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    I don't think that men can actually employ it as a defensive mechanism as much as an attempted "red herring" distraction. Mess up - buy some flowers!
    8 Oct 2012, 04:27 PM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    Where I grew up it is similarly cold as Alberta and October was the last bath of the year until April. It was not considered healthy to bathe when the weather was icy :-)
    10 Oct 2012, 01:33 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » LOL.... no more baths from October until April.

     

    So John, have you ever been able to find out which of your ancestors was a Canadian? :-)
    10 Oct 2012, 02:23 PM Reply Like
  • John Lounsbury
    , contributor
    Comments (3974) | Send Message
     
    AR - - -

     

    Two connections:

     

    1. I grew up in the Northeast Kingdom of Vermont about 30 miles from the Quebec border. As a child I saw several -40 degree F thermometers broken and once a -50. My bedroom was unheated, second floor over an unheated first floor. When the outdoor temps went below zero I expect that my bedroom temp was no more than 20 degrees warmer. There were times when I undressed and dressed again in the morning buried within the bed for weeks at a time. My mother was raised in Illinois, though, and made me break the Vermont law and take baths all winter.

     

    2. My family dates to colonial times and about as many Lounsburys were Tories as Patriots - so I have a lot of distant cousins in the maritime provinces (and a few in Ontario) descended from those who fled during the revolution.

     

    Those are my two connections to Canada.
    12 Oct 2012, 02:30 AM Reply Like
  • Albertarocks
    , contributor
    Comments (2230) | Send Message
     
    Author’s reply » Wow! I have to admit John, although I've seen those temperatures outdoors I don't recall our home getting that cold 'inside'. But it was very uncomfortable to say the least. It was a little old bungalow formerly owned by my mother's mother. It must have been built in about 1920 I'd say. I believe we had a 'gravity' furnace in the 'dugout' earthen basement as well as a little natural gas burning heater in the living room. I remember as a 7 or 8 year old watching the cat sprawled out comfortable as all get out while lying on the floor underneath the burners of that stove. I also remember very clearly wishing I could crawl under there with the cat and just stay there all day because I absolutely 'did not' want to go to school.

     

    About that same year, one Sunday there was some sort of get-together for families on a backwater pond of the Oldman River called "the Keyto". I was skating on that pond and while looking at my feet and marveling at how fast I could go, I skated right into a hole in the ice that had been blocked off by the adults but I crashed right through the barrier and into the drink I went. I was saved by a great big 300 pound guy named Red Kennedy who also broke through the ice to get to me. But the water was only 5-6 feet deep so he could reach the bottom although I couldn't. He must have been fast as lightening because before I knew it I was standing naked with a blanket wrapped around me in front of the big bonfire that the adults already had going, trying not to freeze to death in wet clothes. It was at least 20 below outside. My little incident actually made national news, lol. I never did find out how Mr. Kennedy got out of the water but I assume about 9 other men hauled him out, one of whom would surely have been my father. Kennedy was a 'big' dude.

     

    My great grandfather moved to the Boston area somewhere around 1850 from Ireland. His son, my grandfather, was born in the Boston area as was my father. But my dad had had enough of Massachusetts by time he was 3 years of age, so he moved to Alberta and brought his parents and siblings with him (over 100 years ago now). So I had a bit of a connection to the USA as well.
    12 Oct 2012, 04:01 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (4824) | Send Message
     
    Your dad got a really early start in life. "by time he was 3 years of age, so he moved to Alberta and brought his parents and siblings with him"

     

    Imagine deciding to move when you are just 3 years old! People matured much earlier back then, eh?
    12 Oct 2012, 04:28 PM Reply Like
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