"Stare deeply at the Dow"
The price action of the major averages is eerily reminiscent of this time last year - down January, up February, down early March, then straight up through July. It's tempting to think that we are seeing a repeat. Worse yet, based upon lamestream headlines, one would be led to believe that it's deja vu all over again.
And then we remember that a few things have changed since last year:
Oil and commodities have collapsed
The dollar index has gained 25%
The Global Dow peaked last July and is at the same level it reached 15 months ago
Emerging Market currencies have been monkey hammered
24 global interest rate cuts year to date
Carry trades are getting monkey-hammered a la 1997
Deflation has spread globally
High Yield (Junk bonds) peaked in June
Gold is at a five year low
30 Year U.S. interest rates hit an all time low
The Baltic Dry Index is at an all time low
Utilities, Energy, Construction, Industrial machinery sectors have all rolled over hard
Biotech and airlines went parabolic
Dow with price range of average stock. Not confirming the February top:
Distribution: Institutions selling to Etraders
Down Volume as Ratio of Total Volume
Bulk shipping costs
U.S. future deflation expectations. Visualized
30 Year Treasury Yields Since 1975:
Those believing the headline lies and bullshit have been sold down the river. Again.
