Category Archive: 7) Markets

Main Author John Henry Smith
John Henry Smith
John Henry Smith of Grail Securities specializes in the U.S. stock market and offers a unique and powerful advisory service to private investors, institutional investors, and SME asset managers, who are seeking to consistently beat the market. All our strengths are at your disposal to provide stock market research and recommendations with the only aim of growing wealth. To achieve this we develop with you a customized investment strategy in terms of your risk and return preferences.

The Real End of the Bond Market

These things are actually quite related, though I understand how it might not appear to be that way at first. As noted earlier today, the Fed (yet again) proves it has no idea how global money markets work. They can’t even get federal funds right after two technical adjustments to IOER (the joke).

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Bitcoin Bottom Building

Defending 3,800 and a Swing Trade Play. For one week, bulls have been defending the 3,800 USD value area with success. But on March 4th they had to give way to the constant pressure. Prices fell quickly to the 3,700 USD level. These extended times of range bound trading are typical for Bitcoin Bottom Building in sideways ranges.

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FOMC Minutes: The New Narrative Takes Shape

Nothing the Fed did today, or has done up to today, has changed the curves. Eurodollar futures and UST’s, they are both still inverted. The former sharply inverted. The only thing that has changed since early January is the narrative – and not in a charitable way. It is treated as a positive when it is a pretty visible signal about deteriorating circumstances.

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LIBOR Was Expected To Drop. It Dropped. What Might This Mean?

Everyone hates LIBOR, until it does something interesting. It used to be the most boring interest rate in the world. When it was that, it was also the most important. Though it followed along federal funds this was only because of the arb between onshore (NYC) and offshore (mainly London, sometimes Caymans) conducted by banks between themselves and their subs (whichever was located where).

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Insane Repo Reminds Us

It was only near the quarter end, that’s what made it so unnerving. We may have become used to these calendar bottlenecks over the years, but they still remind us what they are. Late October 2012 was a little different, though. On October 29, the GC repo rate for UST collateral (DTCC) surged to 52.6 bps. The money market floor, so to speak, was zero at the time and IOER (the joke) 25 bps. We also have to keep in mind the circumstances of that...

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The Bear Market Hook

Has a Bear Market in Stocks Begun? The stock market correction into late December was of approximately the same size as the mid 2015/early 2016 twin downturns, so this is not an idle question. Moreover, many bears seem quite confident lately from an anecdotal perspective, which may invite a continuation of the recent upward correction.

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A Global Dearth of Liquidity

Worldwide Liquidity Drought – Money Supply Growth Slows Everywhere This is a brief update on money supply growth trends in the most important currency areas outside the US (namely the euro area, Japan and China)  as announced in in our recent update on US money supply growth (see “Federal Punch Bowl Removal Agency” for the details).   Nobody likes a drought. This collage illustrates why.   The liquidity drought is not confined to the US – it...

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Swiss stock exchange could lose EU access in January

An EU Commission document has revealed that, for now, not enough progress on the Swiss-EU framework agreement has been made to renew the ‘financial equivalency’ status of the Swiss stock exchange in Europe.

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Gold and Silver Hold Firm as Stocks and Oil Lower in to US Holiday Weekend

Key Gold and Precious Metals News, Commentary and Charts This Week. Gold and silver traded sideways this week as we saw stock markets take some heat and undo most of the recent recovery from the October sell off. Oil has sold off and is now at levels that we haven’t seen since 2017.

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The Intolerable Scourge of Fake Capitalism

All is now bustle and hubbub in the late months of the year. This goes for the stock market too. If you recall, on September 22nd the S&P 500 hit an all-time high of 2,940. This was nearly 100 points above the prior high of 2,847, which was notched on January 26th. For a brief moment, it appeared the stock market had resumed its near decade long upward trend.

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Pushing Past the Breaking Point

Schemes and Shams. Man’s willful determination to resist the natural order are in vain.  Still, he pushes onward, always grasping for the big breakthrough. The allure of something for nothing is too enticing to pass up.

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Eastern Monetary Drought

Looking back at the past decade, it would be easy to conclude that central planners have good reason to be smug. After all, the Earth is still turning. The “GFC” did not sink us, instead we were promptly gifted the biggest bubble of all time –  in everything, to boot. We like to refer to it as the GBEB (“Great Bernanke Echo Bubble”) in order to make sure its chief architect is not forgotten.

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Are Credit Spreads Still a Leading Indicator for the Stock Market?

Seemingly out of the blue, equities suffered a few bad hair days recently. As regular readers know, we have long argued that one should expect corrections in the form of mini-crashes to strike with very little advance warning, due to issues related to market structure and the unique post “QE” environment.

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Special Edition: Markets Under Pressure (VIDEO)

What does Alhambra Investments think about the 1300 point drop in the Dow Jones Average this week? Alhambra CEO Joe Calhoun has some thoughts.

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US Stocks and Bonds Get Clocked in Tandem

At the time of writing, the stock market is recovering from a fairly steep (by recent standards) intraday sell-off. We have no idea where it will close, but we would argue that even a recovery into the close won’t alter the status of today’s action – it is a typical warning shot. Here is what makes the sell-off unique:

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Video with Michael Strobaek: Discussing economic growth and investment strategies

What shape are the markets in right now? This month, Credit Suisse Global CIO Michael Strobaek discusses growth in the global and Swiss economies and explains the right investment strategies during the growth phase.

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Four trouble spots. Four pleasant surprises.

August looks back on positive economic and market developments. In retrospect, the first half of the year was soothed by many pleasant surprises, including much-discussed trouble spots that never flared. Read about four perceived market crises.

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Digging into Wealth and Income Inequality

The assets of U.S. households recently topped $100 trillion, yet another sign that everything is going swimmingly in the U.S. economy. Let's take a look at the Federal Reserve's Household Balance Sheet, which lists the assets and liabilities of all U.S. households in very big buckets (real estate: $25 trillion). (For reasons unknown, the Fed lumps non-profit assets and liabilities with households, but these modest sums are easily subtracted.)

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Anticipating How Welcome This Second Deluge Will Be

Effective federal funds (EFF) was 1.92% again yesterday. That’s now eight in a row just 3 bps underneath the “technically adjusted” IOER. If indeed the FOMC has to make another one to this tortured tool we know already who will be blamed for it.

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The Stock Market is Stretched to Double Tech-Bubble Extremes

Leuthold Group has sounded the alarm on a valuation metric that shows the S&P 500 is twice as expensive as it was at the peak of the tech bubble. This development could have large implications for stock investors of all types, particularly value traders who make their living by finding discounts in the market. With the stock market within shouting distance of an all-time high, traders are readying their Champagne bottles. Just don’t tell them about...

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