Posted on 11/10/2009 1:29:22 PM PST by blam
Rosenberg: Something Big Is About To Happen
The Pragmatic Capitalist
Nov. 10, 2009, 12:59 PM
David Rosenberg notes the incredible lop sided trading environment. The dollar short/long equities trade has become the no-brainer trade and is beginning to appear crowded. David notes:
Looking at the latest Commitment of Traders (COT) report, we can see some pretty interesting (and potentially disturbing) trends taking place (data for November 3rd):
The only areas where the speculators (non-commercial accounts) are net short are in Treasuries and in the U.S. dollar. Everything else has massive net speculative longs and hence near-term vulnerable to a reversal.
There is still a NET speculative short position in both the 10-year Treasury note of 85,551 contacts (on the Chicago Board of Trade ). There are 95,648 net short contracts on the long bond too.
[snip]
(Excerpt) Read more at businessinsider.com ...
GLD
Please explain in layman’s terms. Correct me if I am wrong, but it sounds like Commodity investments are where people are putting their long term confidence in? The dollar, Bonds, etc are in big trouble and will soon drop? Is that the gist of it?
Help!
What does that mean?
What should I do with our 401K?
Is $oro$ pulling strings again?
Someone a lot smarter than me will be by shortly to explain it to all of us. (Often times, this is the reason I post an article.)
There are lot of conspiracy theories here concerning the economy since Obama was elected. It seems America was inching along towards socialism just fine ‘without an abrupt downward spiral. Why provoke the masses (sheeple)? Wouldnt the Soros types be afraid of of sparking a revolution that could backfire on their internationalists schemes? To quote a Marxist:
“Revolutions are fueled by empty stomaches” Che
Like any investment, diversify.
Not only is something big going to happen, its going to happen sometime.
Sometime in the future, something is going to happen. You can bet on it.
Thanks! That is great advice!
Diversify is the only financial advice you should take from anyone on a message board. For anything else, hire a professional.
Avoid at all costs people who say the opposite (put all your money in xx..)
I can tell you what I did ... moved my money to a China fund and a Latin America fund. I have recovered all of my loses and I am positioned to take advantage of a declining dollar and rising oil prices that will result.
The problem is that when we have let the professionals help, we’ve lost money.
We have to keep on top of things.
A hint about where to put the money is always good.
Can someone tell me what this means? It doesn’t sound good to me.
We are doomed anyway.....ABORTION....GAY RIGHTS....FACISM.....God will NOT be mocked.
Hell!.......Look at silver!...If that's not manipulation nothing is!.....but Bill Butler has been explaining that for Yrs!....Do your own DD and let me know what u think???
Hell!.......Look at silver!...If that's not manipulation nothing is!.....but Bill Butler has been explaining that for Yrs!....Do your own DD and let me know what u think???
Does anyone think there will be a black swan between now and the 2010 elections? You know, Reischtag (sp?) fire-type thing?
Repeat After Me.... "There Is No Carry"
From this morning's open (there have been many essentially-identical charts over the last months...)
You can argue anything you'd like, but this - the chart of the SPX cash and the dollar, overlaid - put the lie to any claim that "there is no carry" at play.
Today, as with many days before (and I'm sure will be since) is stunning evidence that indeed there is a monstrous carry being perpetrated against the dollar and our nation, Bernanke knows it, and there is exactly one way to stop it.
Remove enough liquidity so as to cause short rates to rise where it becomes unprofitable - 2% should do it.
Bernanke is causing this trade to be intentionally put on, and the only people profiting from it are the big banks that can borrow at or near the fed funds rate.
You and I are forced to borrow (if we want to, which we'd be nuts to do) at 29.9% on our credit cards.
This is just another means by which the big banking oligarchs steal your money America.
There is no actual "rally" in the stock market as a consequence of fundamental improvement in the economy. Rather, the "rally" is a consequence of the dollar carry trade - a destructive Godzilla that has infested our capital markets as a direct and proximate result of Bernanke's and Geithner's policies.
It is good and bad, low confidence in government owned securities like treasuries, more confidence in private sector investments.
I read into this that investors are expecting the government to screw up a lot of stuff but businesses to streamline and deal with the issues to remain profitable. It probably implies a continued higher unemployment rate as that would be lower expenses for businesses.
This is just my opinion/guess.
>>We are doomed anyway.....ABORTION....GAY RIGHTS....FACISM.....God will NOT be mocked.<<
Hence my tagline.
Are we the newest emerging market?
Agreed.
You've got to take all your money OUT OF xx.
I might as well be reading Chinese as to read that artical.
I ain’t got a clue what it was talking about.
*The only areas where the speculators (non-commercial accounts) are net short are in Treasuries and in the U.S. dollar. Everything else has massive net speculative longs and hence near-term vulnerable to a reversal.*
Let’s start with this first sentence.
When there is talk of the COT, Commitment of Traders reports, people use them to try to read the tea leaves of how the over all market is positioned. This group that they are talking about, non-commerical, means the retail investor, which tend to get it TOTALLY wrong. And what are they doing, shorting Treasuries and the dollar. They also seem to be ‘massive net speculative longs’ which can mean gold and silver and other commondities.
So, this means that the banks, will let the retail investor take another large massive hit in the pocketbook, WHEN they decide it is time to crash the markets again. Dollar and Treasuries will go up, and the commodities will go down. Just like last fall.
In fact, current COT reports are that the gold and silver shorts are at extreme highs.
Diversify is always good advice.
And if I got any of this wrong, someone will be sure to correct me.
We are the newest dollar carry trade.
People use our cheap dollars to speculate and buy, until the dollar rallyies again.
We are the newest dollar carry trade.
People use our cheap dollars to speculate and buy, until the dollar rallies again.
No...the majority of sheeple have spoken! (the election!...Duh!)
How many empty stomachs in the USA???
we have just the opposite!..FAT DUMB AND HAPPY!! As Ben Franklin said...when 51% of the sheeple....
IMHO, it depends on how much your 401k lost during the last year and what, exactly, you want to protect yourself from...
If your goal is based on long-term confidence in the markets, thoughtfully diversify...as has already been suggested.
If your goal is to protect yourself in the event of chaos, buy and take delivery of as many gold eagles of all denominations and as many cases of 9mm ammo (even you don't own a gun) as possible. Either one will be a dominant medium of exchange for goods and services.
Sorry, I'm busy. ;-)
But not too busy to notice that this is a gust post: "(This gust post originally appeared at the author's blog)"
It seems to be saying that speculators are betting against the dollar and interest bearing securities, long term. They're expecting a further devaluation of the USD. Long term they are betting on equities and commodities.
It looks like The Pragmatic Capitalist, not Rosenberg, is happy to stand aside while the speculators wreak what havoc they will.
If I understand it, the dollar is very unpopular right now and the vast majority of traders are betting it will fall. That means they are selling US dollars and buying Canadian dollars, Australian dollars and euros. Except they don’t really have dollars to sell. They are selling someone else’s dollars and using the proceeds to buy foreign currencies.
It’s a risky situation. If the other currencies go up in value and the dollar goes down, they can sell the foreign currencies and buy back the dollars at a reduced price, profiting on the difference. But if the dollar goes up and the euro goes down, they may be forced to exit the trade at a loss. That’s called a short squeeze.
Even if a trader is right on the long term trend, a short-term rise in the value of the dollar may force him to sell at a loss. Selling at a loss in a short squeeze pushes the price up higher, prompting others to have to sell. As more and more people have to sell, the price spikes higher and higher.
Eventually you run out of traders needing to sell and the price returns to normal, but not until a lot of little pockets are empty and a few big pockets are full.
Its like the dollar is a rock. I have a pile of rocks. The short traders are pouring lighter fluid on them. Lots of lighter fluid. All it takes is a little spark and FOOM!
But 10 minutes later, they’re still rocks.
On the other hand, somewhere else something might not happen, which will cancel it out.
Unless you had all your money (a lot of it) in xx on May 5, and xx happened to be VNDA!
Unless you had all your money (a lot of it) in xx on May 5, and xx happened to be VNDA!
what is “xx”, that sounds like a hot inside tip, I need some of that.
Pioneer Aviation
Roll everything over into PC & Diversity ;-)
LOL
Love the quote.
Thus, real assets are rising (as measured by the declining dollar).
Denninger's post today explains it pretty well (see post 22 above) or click here.
We bought silver. We can’t afford gold.
Ammo is something that is quick and pretty easy.
Done!
That being said, nature abhors a vacuum, and this market sucks big time. It is long overdue for a massive implosive correction.
True dat, but the irony is, where's the wealth gonna run to this time? The dollar? The dollar suchs.
Where is the wealth going to run this time?
Now, that is the million, no, billion, dollar question, eh?
1) Buy land away from the city.
2) Plant large and diverse vegetable and fruit crops.
3) Store as much food and medicine as you can afford.
4) Buy and train with guns and ammo.
5) Have a good source of water and water purification available.
6) Count on the grid going down along with all other services.
That's reading between the lines, of course.
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