Friday, October 24, 2014

GDXJ weakly chart

Here's the GDXJ versus GLD weakly candles:

1. I guess this November and December are shaping up to be like last year's November and December?

2. Why is volume up 10 times over the past year? Anyone have any idea at all why this should be? It's not just the ratio chart: GDXJ volume itself is up like 10 times in the past year. Is this just bots arbing an otherwise dead market for junior gold equities? Are bots the only people left holding junior miners?

WHAT IS THE MARKET PIDDLING ITSELF ABOUT? An interesting poll at vixandmore

Vixandmore - here's what people are worried about. I've decided to start following Bill Luby again, now that I have a clue what $VIX actually means.

And he posted something last week that was very interesting. This chart:

shows you how mind-numbingly stupid this market was last week.

Let's go through the stupidism one at a time:

21.6% of people were scared of the end of QE and the "Fed safety net".

That's because they don't understand that the end of QE means monetary normalization, which is a good thing. And it means Janet Yellen has decided the US economy is strong enough to start taking the training wheels off, which is a good thing (as long as you're not one of those clowns who thinks he's so much smarter than Janet Yellen). So 21.6% of the market are morons.

But wait!

Another 15.5% of people were scared of the Ebola virus.

That's because they don't understand that Ebola only spread in Dallas because Presby Hospital's management were criminally incompetent assholes (really, in my country they would be under investigation right now) who forced nurses to use insufficient equipment. Trust me, the CDC is now coming down on the entire health care industry like a ton of bricks.

So 37.1% of the market are morons.

But wait!

Another 15.2% of people are scared because TA.

They're also morons. No explanation required. If they're scared based on the 200SMA, they're simply morons.

So 52.3% of the market are morons.

But wait!

Another 9.4% of people are scared because of a weak US economy.

They're also morons. Read New Deal Demoncrat and Calculated Risk, and get yourself some real economic data instead of the bullshit that that fucking clown Joe Kernen spouts out of his ignorant Republican mouth on CNBC.

So 61.7% of the market are morons.

OK, the next 7 things in the list are things you might want to be worried about. But only 38.3% of the market are worried about them.

Thus, by math, the market had 161% more fear in it than it should have had.

Some Friday reading

Bloomberg - sharpest $VIX drop in like evarrr. Quote:
Investors flocking back to equities are asking what changed to ignite a plunge that erased $2 trillion from American stock values. While falling oil prices spurred a 20 percent drop in energy producers, cheaper fuel is now underpinning a rally in airlines and railroads that is approaching 10 percent. Data showed gains in home sales and consumer confidence and earnings from Apple Inc. (AAPL) to Morgan Stanley exceeded analyst estimates.

“It’s not like we suddenly had a different macro-economic picture,” Justin Golden, a partner at Lake Hill Capital Management LLC in New York, said by phone. “The markets started to roll over and there was forced panic.”
There's a difference between rational expectations and irrational panic.

FT Alphaville - now that everyone's a volatility seller.... Izzy Kamizzy has decided that all of a sudden it's interesting to question the buying of short $VIX ETPs. It would be nice to see some real data and some in-depth discussion of the topic of XIV's market cap and its effect on volatility; a lot of the VIX blogs (like vixandmore) did go into the details a few years ago, but the trade is a lot larger now. I personally think it's really just an arb between short-term irrational fear and long-term rational expectations. After all, why should $VIX spike to 30 just because Presby's management are assholes?

Reuters - stagnating Eurozone seeks to persuade Germany to haha you're kidding me. Germans are two things: cement-headed, and happy to suffer as long as it makes other people suffer more.

Men's Journal - how to get rich on pot stocks. Yeah, they've figured out that junior mining execs are shady characters.

Zerohedge Stupid Headline of the Day



And yet Izzy Kamizzy thinks it's a bad idea to short volatility.

Analysis of a lesser-known poem by Dylan Thomas

Here's a lesser-known poem by IKN's fave, Dylan Thomas:

S Club
Gettin' down tonight, a come on, yeah
Gettin' down tonight, uh huh, everybody
Get down tonight

S Club (there ain't no party like an S Club party)
Gonna show you how (everybody get down tonight)
S Club (there ain't no party like an S Club party)
Gonna take you high (shake your body from side to side)

Finally Friday night
Feelin' kinda good, lookin' alright
Gotta get movin', can't be late
Gotta get groovin', just can't wait (ho!)
Get the feeling (get the feeling)
Push the ceiling (push the ceiling)
Player hater (player hater)
Get ready everybody 'cos here we go!

S Club (there ain't no party like an S Club party)
Gonna show you how (everybody get down tonight)
S Club (there ain't no party like an S Club party)
Gonna take you high (shake your body from side to side)

O-oh O-oh! Throw your hands in the air
O-oh O-oh! Like you just don't care
O-oh O-oh! There's a party over here
O-oh O-oh! There's a party over there

Tina's doing her dance
Jon's looking for romance
Paul's getting down on the floor
While Hannah's screaming out for more (ooh hoo!)
Wanna see Bradley swing
Wanna see Rachel do her thing
Then we got Jo, she's got the flow
Get ready everybody 'cos here we go!

S Club (there ain't no party like an S Club party)
Gonna show you how (everybody get down tonight)
S Club (there ain't no party like an S Club party)
Gonna take you high (shake your body from side to side)

O-oh O-oh! Throw your hands in the air
O-oh O-oh! Like you just don't care
O-oh O-oh! There's a party over here
O-oh O-oh! There's a party over there
O-oh O-oh! Throw your hands in the air
O-oh O-oh! Like you just don't care
O-oh O-oh! There's a party over here
O-oh O-oh! There's a party over there

Ghetto boys, make some noise!
Hoochie mamas, show your nanas!

S Club (there ain't no party like an S Club party)
Gonna show you how (everybody get down tonight)

S Club (there ain't no party like an S Club party)
Gonna show you how (everybody get down tonight)
S Club (there ain't no party like an S Club party)
Gonna take you high (shake your body from side to side)

I especially like the phrase "Hoochie mamas, show your nanas", which remained unsurpassed in the lexicon of Western literature until K.R. Sebert's reactionary stanza

I'm fresher than that Gucci
the boys they want my coochie
I say 'no, I'm no hoochie'.

I for one am happy to see the children of today learning about the need for hoochie mamas to show their nanas, instead of refusing boys their coochies as the leftists of today would suggest.

Next week, we'll continue with an analysis of William Adams' "I'ma be a brother but my name ain't Lehman, I'ma be a bank, I be loanin' out seamen", a biting commentary on the class tension between capitalist and proletariat that informs and mediates today's merchant seafaring.

IKN on Augusta Resources - the SEC goes after the minnows again

IKN - a snippet of mining gossip. Quote:
IKN hears that one of the lawyers deeply involved with the HudBay (HBM) takeover of Augusta (AZC) is about to have nasty things happen to him because the US SEC has caught him with his fingers well and truly in the cookie jar, trading shares of AZC with insider knowledge. And yes, IKN knows the full name of the naughty boy.
IKN's on the road again, doing due diligence on a couple Peruvian distilleries with strong growth prospects, so I'll add the following:

Augusta was the one that had that Rosemont property in Arizona that the environmentalists from Save The Scenic Santa Ritas were opposing.

While insider trading by lawyers is bad and all, the SEC should really look at how the environmentalists issued that news release last November that caused the stock price to tank based on wholly false and misleading information.

My blog - the time when the Save The Scenic Santa Ritas group issued a press release with false and misleading information about AZC.

What's worse? A lawyer who makes $100K on a side trade with insider info, or an environmentalist group who wipes a hundred million off a company's market cap by issuing a press release with falsified material information that induces shareholders to sell at a loss?

Now, I'm not in favour of insiders making money trading on inside information, and I also work to protect the environment. But if the SEC wants to be serious about protecting the integrity of the capital markets, I think it should do what it takes to get at the heart of this SSSR story from last year.

Hey, after all, maybe the Save the Scenic Santa Ritas group were simply stooges being paid by some company who wanted to buy out AZC at distressed prices? We'll never know if it never gets investigated, right?

Friday videos: Asobi Seksu

If you like both The Sundays and sh**g*z*, then you'll probably like Asobi Seksu:

I say "if you like", because Slowdive actually asked them to re-form to play a show with them in Boston last Sunday.

Thursday, October 23, 2014

Here's your dumb market headline of the day




Thursday morning news: Caterpillar, China, Diwali, rare earths and S Club 7

Things were up at the open, but have drooped as USD went up and oil & high-yield went down. As usual. Dunno if things are going to continue like this, but I added $10K in an S&P index ETF. I can always flip it out to short-vix if we get another fear spike.

And by the way, for all you in the press:

#1, it's stupid to blame a stock selloff on a lone nut with a gun in Ottawa. That has no impact on the economy.

#2. it's callous and ignorant to blame a stock selloff on a lone nut with a gun in Ottawa.

Now here's some news:

BI - Caterpillar Q3 earnings beat. Don't trust Sam Ro's take on it, though, because he's admitted he couldn't pay attention to the presentation because of all the awesome pictures of dumptrucks and stuff.

Gavyn Davies - China's slowdown is secular, not cyclical. Sure, though I still think it'll be more of a Korea slowdown, not a collapse. In any case, yes you can't extrapolate 8-10% growth forever: China's not going to overtake the US in per-capita GDP. Ever. In any case, figure out how much physical plant China still has left to build before they can compare to Korea in 2001.

Bloomberg - China vehicle sales forecast cut. To show you how stupid the spin has been, here's a quote:
Dong Yang, secretary general of the state-backed China Association of Automobile Manufacturers, said total passenger and commercial vehicle sales for the full year would likely hit 23 million units, or an increase of about 4.6 percent. In July, the group lowered its projection for the increase in China vehicle sales to 8.3 percent, or 23.83 million units, down from the 10 percent increase it predicted in January.
So if the forecast is for 830,000 fewer units sold, and sales are still up 4.6% year-over-year, you don't spin the article as doom & gloom and a validation of a China hard landing thesis.

FT beyond brics - It's Diwali! Time to give gifts.

Council on Foreign Relations - rare earths and national security. A report on rare earths, if you're still interested in them now, five years after they were cool.

Popsugar - S Club 7 are reforming. I know this will be exciting to IKN! He's their biggest fan! And there ain't no party like an S Club party!

Wednesday, October 22, 2014

BRENT COOK SAYS JUNIOR MINING SUCKS: here's what you need to know

Here's Cookie Monster saying that junior mining really sucks:

REASONS TO PUKE THE S&P 500: here's what you need to know

Here's today's reasons to puke the S&P 500 into nonexistent bids:

Calculated Risk - thirty one states had unemployment rate decreases in September. OMG unemployment decrease! Sell sell sell!

Calculated Risk - September LA port traffic: imports highest since 2006. OMG imports increasing! Sell sell sell!

Calculated Risk - AAII billings suggests robust construction ahead. OMG architectural billings up! Sell sell sell!

Liz Ann Sonders - market's on a roller coaster. Quote:
Helping with this objective analysis is SentimenTrader, who looked at every intermediate-term S&P 500 low of the past 20 years (there were 26 of them). They recorded the level of their comprehensive set of indicators on those dates, and compared them to the market's current condition. As of day's end last Thursday, 51% of their 85 indicators matched or exceeded the extremes set at other lows (it dropped a bit through Friday).
OMG objective analysis! Sell sell sell!

BI - Joey the Weasel defects to Bloomberg. Good riddance, Joey, and I won't be reading you or Bloomberg. Blodget, please try and replace him with someone who isn't a click-whore. And see if you can get Udland and Ro to leave too. Keep Mamta.

Sandstorm Gold


Remember when Sandstorm was such a great deal at twelve bucks?

Hey Nolan, have you figured out what's wrong yet?

Here's what I think the market's doing today

Here's what I think is going on:

The market is seeing oil go down today and has decided to sell, cos that worked so well the last time.

The market is seeing US dollar go up today and has decided to sell, cos that worked out so well the last time.

And maybe Pimco has gone back to dumping high yield.

So either we'll see more dumping tomorrow, or we won't.

I guess if we do, I can watch for a while and then go back to shorting $VIX. If it doesn't follow through after today, I'll just go buy more US index ETFs.

Might just see a higher low and that's it. I think people are beginning to cotton on that puking US equities is kinda dumb.