11/5/14…another day, another Congress…yawn!

Quote of the Day from the Friars Club Encyclopedia of Jokes: “Ever notice when you blow in a dog’s face he gets mad at you, but when you take him in a car he sticks his head out the window?” – George Carlin

Bloomberg Quote of the Day: “The music is not in the notes, but in the silence between.”

– Wolfgang Amadeus Mozart

Bloomberg Top Stories:

*U.S. Index Futures Advance With Dollar on Republican Win as Gold Weakens

*Republicans Profit From Americans’ Dissatisfaction Over Personal Finances – sure, they’ll help!

*Companies in U.S. Added 230,000 Workers in October, Topping View, ADP Says

*Ruble Weakens to Record as Russia Moves Closer to Freely Traded Currency

*Keystone Approval Sought by Senate Republicans Who Dare Obama to Veto It – veto it!

*Barclays Mulls Eight-Way Restructuring as Rules force Separation of Retail

*Gold Rally in Hands of Swiss Voters Weighing 1,500 Tons of Bullion Buying – what rally?

*Market Calm at Risk Before Draghi Speech After ECB-Fueled Volatility Surge – oh yeah!

*Falling Oil Imports to U.S. Revealed by Louisiana Part as Convenient Truth

*Hong Kong Victim Gave kisses on the Cheek at the Bar and Then Disappeared

*Republicans Gain Seven Seats in U.S. Senate for First Majority in a Decade – oh joy!

*Senate Republicans will Weigh How Far to Push Obama on Health Law, Judges

*Silicon Valley’s Pressure on Privacy Sets Up Arms Race With World’s Spies

*Billionaire’s Wife Who endured ‘Hell’ in Air Crash Funds Kids’ Burn Center

Tuesday’s Market Summary:

Ah another day of Russian Roulette…but wait aren’t the odds in that game 5 in 6? Yep, and people think those who play it are crazy! Perhaps for the size of the bet (all in!) but…

Yesterday, should count as a down day Led by Dow Utilities -0.7% the rest down 0.3-0.4%, except Dow Transports +0.4% and the Dow 30 up a whopping 0.1%. Volume rose to 3.92B shares, and A/D’s and Breadth were negative, and more so, for a second day. New 520 week highs slipped again to 316 but remain strong, while new lows rose to a strong 155. Most significant was the S&P VIX which rose slightly to 14.89 but the session high surged to 15.93!

Total NYSE Volume rose again to 3.92B shares from an average 3.53B vs 4.26B vs 3.63B vs 3.74B: average volume for October is 3.7B, or about 700M more than the recent average. Shares traded on the NYSE floor – affectionately referred to by TB as REAL volume: for October also slipped to 867M shares. Volume was above average at 833M shares vs 794M vs 1.04B vs 763M vs 823M vs 785M. For comparison purposes, for the prior 12 months it is a historically weak 712M shares…but thus far in October, 867M shares – including that HUGE 1.22B share day – highest since 9/19, followed by two more 1B plus days leading to options expiry!. The lowest was 10/6’s 696M share session. April 30 – September 30 we had just SEVEN 800M shares…for October 16, and FIVE 900M+ days.

A/D’s were negative: NYSE: -1.8x v -1.1x vs +3.3x vs +1.7x vs -1.3x; Nasdaq –1.3x vs -1.2x vs +2.3x vs +1.7x vs -1.2x. Breadth was similar: NYSE -2.3x vs -1.1x vs +4x! vs +1.5x vs -1.6x; Nasdaq -1.2x vs +1.4x vs +3.3x! vs +1.1x vs -1.5x. New 52 Week Highs declined again but remain high at 316 vs 416 vs 612 vs 351 vs 312 – their range for the year is now 39-612!!! New Lows rose to 155 vs 94 vs 137 vs 153 vs 86. The 2014 range is 24-1043!!! S&P VIX closed slightly higher at 14.89 +.19 for its 6th sub-15 close since peaking on 10/15. Still well below those bearish extremes that had a high of 31.06 (highest since 11/28/11!!!). The range however rose to 14.83-15.93! ending the string below 15 at just two which was lowest since 9/24. Remains bearish and well above 9/18’s 12.03 low close. The average of the past 12 months is 13.94, with a low of 10.32!…high close 26.35 on 10/14!

U.S. bond market closed a little better. The recent 12 month low yields (10’s 2.09%; 30’s 2.87%; and long TIP 0.83%), 10’s closed at 2.34% +1/16; 30’s 3.05% +9/32; and the long TIP 0.96% +5/16. Weaker overnight: 10’s 2.36% -1/4; 30’s 3.07% -1/2; and long TIP 0.98% -5/8. QE’s may end, but dump $4.3 trillion???…is there an App for that?  

Libor update: 0.232% 3 mos.; 0.328% 6 mos., both steady and just above new record lows! The Fed Funds rate has averaged 0.09% and is steady at 0.08-0.10%. T-Bills range from 0.03%, one-month, to just 0.10% one year!!! Foreign bond yields mixed, PIIGS lower (Benchmark is 10yr): Germany 0.83% +2; UK 2.25% +2; France 1.19% +2; Italy 2.41% -2; Spain 2.15% -2; Portugal 3.24% -6; Greece 7.84% –. 10/16’s close was 8.54%! – cycle low: 5.42%; Crisis high: 12.57%. Japan: 0.46% +3.

Gold traded in a narrow range and slightly weak all session. On Monday it declined to $1160.50. Yesterday’s close was $1167.70 -$2.10. So much for that recent high of $1255.60, highest since 9/10/14. The last 6 sessions have had prints below $1200 first time since 12/31/13 Last close above $1300 was on 8/15. 7/17’s session high was $1346.60, highest since March 19th!!! Res is at $1200 (psychological), then the 40 day at $1221, the 50 day $1231, and the 200 day at $1282. Recent high was $1392.60 on 3/17, highest high since 9/4/13. Jan. 2’s low was $1181.40 – A MULTI-DECADE LOW!!! Overnight it is tanking again with a new low of $1137.10 and is currently $1144.20 -$23.50!!! Silver remains weak and also put in a new low overnight of $15.12, more than a five year low and heading towards $14.65, a multi-decade low!!!

Crude closed weak for a 2nd session at $77.19 -1.59 but with a new intraday low of $75.84, lowest since 10/14/11!!! 10/25’s high was $84.83. There have now been 32!!! handles since peaking at $107.73 on June 13th at $107.73 highest since 9/19/13 (a huge down session which put it in freefall). The record high of $147.27 was on 9/30/08, the low since on 12/30/11 is $74.95: $93.60 is the midpoint!!! Recent rally high and close are $110.70 and $110.53 respectively. RES at the 40 day ($87.20), then the 50 day ($88.46), and lastly the 200 day (98.04), all accelerating to the downside. The range is now $75.84-$112.24 since 3/1/12. Overnight it is little changed but weak at $77.53 +.34 with a session low of $76.46.

European equities strong – Asia mixed: UK +1.1% vs -0.6% vs +1.1%! vs -0.6% vs +0.6%; France +1.6%! vs -0.6% vs +2.3%!!! vs -0.4% vs +0.1%; Germany +1.7%! vs -0.6% vs +2.1%!!! vs -1% vs +0.6% vs -1.6% vs +1.4%; Japan +0.4% vs +2.7%!!! vs closed vs +4.8%!!!!! vs +0.7% vs +1.5%! Hang Seng -0.6% vs -0.3% vs -0.3% vs +1.3%! vs -0.5% vs +1.3% vs +1.6%; Korea -0.2% vs -0.9% vs -0.4% vs +0.3% vs -0.1% vs +1.8%! India +0.2% vs – vs -0.1% vs +1.9%!!! vs +0.9%. U.S. equity futures rallying and near session highs: Dow +95 (range 117); SPX +12.40 (16); NDQ +27.50 (21 + 9 on gap up).

Some random thoughts:

…another election…another dysfunctional Congress…possibly less gridlock with the new ‘improved’ GOP Senate, but what will they pass? Will they approve presidential appointments or at least give them an ‘up or down’ vote?

No, Congress is not dysfunctional, TB has decided…it functions quite well in the interests of those who grease the palms of our ‘elected’ officials…and who disseminate all those mis-informational and dis-informational ads so we don’t know what is true and what is propaganda.

A prophecy: GOP will do exactly what it did when they had their last majority, and what Dems did when they got the majority: take it as a mandate…which it is not! They never learn…

Have a great day…another Congress…more of the same, right? …says a cynical TB!

TB

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