12/16/10…cold

…not only the Midwest U.S. but another arctic blast is threatening to shut down most of Europe. Meanwhile, did the stock rally come to an end yesterday? Wait a minute…wasn’t Obama meeting with all those high-priced CEO’s (bet the Reagan Airport was about out of parking spaces for their jets), who were going to give him good advice for resurrecting the economy. With their tax cuts safe (personal) they should have been in good spirits to enjoy slurpie’s or whatever else was being poured.

NYSE Volume looked to be coming in at about 950M shares the same as the prior THREE sessions…but a surge at the end…on weakness took it to 1.11B shares…highest since Dec. 7th. Since the Dow plunged while that 200 million shares came into play that can’t be a good thing…can it? Whereas the average volume for the past 12 months has withered to 1.16B shares…miniscule after the 1.25B or so we had been averaging, for the quarter it stands as just 1.04B shares…and that is weak. So far this quarter there have been 24 sessions of less than 1B shares and just 11 above average (1.16B) share sessions.

Still we racked up 336 new 52 week highs while new lows swelled to 159…is this another indicator? Advance/declines were decidedly negative running from -1.6:1 on the Nasdaq to -2:1 on the NYSE while Breadth was -2.3x on Nasdaq and -3x on the NYSE.

TB is not betting against this rally but it seems correlation of asset classes in again in play with Gold’s luster fading.

Meanwhile bonds don’t even seem to benefit on selloffs as managers (?) re-allocate to stocks…for window dressing purposes?

The point is that this temporary stimulus ‘fix’ will be just that as we have learned nothing from the crisis…especially our banks who are reportedly sending out unsolicited credit cards again while restricting lending in other areas…when will we ever learn??? Never so long as Wall Street and politicians run the show. Meanwhile the people of Main Street are lashing out at the Fed…Obama…and anyone else they can blame…never realizing that the problem lies within…themselves?

. . . - - - . . .    . . . - - - . . . (S.O.S.)

Delaying the West Coast departure till Sunday turned out to be the right idea! Not only that but the backup flight would have been a mess.  

Drove across Nevada…weather was high 50’s and beautiful all the way and made Wendover by 5:30pm. Then across Utah, Wyoming and half of Nebraska…40-50’s and again sunny all the way, 29 degrees when we stopped at North Platte. Tuesday Nebraska, Iowa and up into Minnesota. Finally overcast and temp dropped to low 20’s until MN where it went to 13-15 degrees. Only bad part of trip was last 10 miles in Nebraska and frist 10 or so into Minnesota…roads had been plowed but icy strips in both lanes…saw three spinouts! No injuries. From there on in it was clear and DRY!

Made it in by 6pm…made use of the pressurized car wash at our condo…kids had put up a small tree and had the place very nice – and warm – for us. 

Snow is about 3 feet deep around our condo…in some places up to just above the bottom of the windows…a fun journey!

See…that wasn’t so bad…and to live in a winter wonderland??? Priceless!

TB

Trader Bill thinks it is clear to anyone reading these missives that they are merely commentaries...as he sees it...and do not necessarily reflect the views of anyone other than his own. Information is gathered from sources he has found reliable, but no guarantees of accuracy are implied. These are merely observations of events in the marketplace offering in an attempt to offer a non-mainstream viewpoint. Copyright TBD Capital LLC, December 16, 2010.

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2 Comments »

  1. LDH said

    You are a contrarian.. opposite of a snowbird. Hey, 10yr been crushed since the tax compromise. I cannot figure out if it is due to revised economic forecasts (upward by PIMCO and the i-banks), or bond vigilantes flexing some muscle as the stimulus and deficits continue, or if rates moving in sympathy with european sov. rates ( i doubt this, as i think we’d see flight to safety effect into UST’s). What do you think? LH

    • traderbill said

      Much of it is a reversal of the flight from stocks to bonds exacerbated by the swiftness of the stock rally. But the bond vigilantes come into play too as they loathe what the sovereigns are doing…can we blame them? David Kotak of Cumberland Advisors and others…including TB…believe that this will reverse itself yet again – although not likely all the way sometime in the next quarter. In the meantime, no fun for bondos! Thanks for your comments! TB

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