The Party Is Over

Discussion in 'Trading' started by THE-BEAKER, Jun 8, 2007.

  1. well reality is suddenly arriving on everyones doorstep this morning.

    the cheap money that has provided the boom for the last few years by the greenspan fed is over.

    most of the major banks and investment houses have made the worst call in history on the prediction of us interest rates.

    goldman was calling along with all the others for 75 basis points of cuts in 2007 alone.

    pimcos bill gross has just come out and said for the frist time in 25 years he is a bond bear instead of a bond bull.

    he also apparently has made more money on his stamp collection than pimco did on their bond portfolio and this guy is the supposed king of the bond market.

    these are serious statements.

    this market has not even priced in a rate hike in ths us its now just unchanged.

    the fact is the fed has created a sleeping monster that has awoken with a bad hangover.

    the cheap money for hedge funds and private equity groups to leverage and trade will be gone.

    it amazes me that people on the fed and other politicians that have chosen to ignore inflation when the man on the street was telling them everything costs more.

    i think the problem they have is they are detached from reality.

    how do they know how much a pint of milk costs when they earn excessive wages and employ housekepers and the like to do all their shopping.

    their making decisions based on a life that is not effected by inflation.

    well the reality hit home this week my friends.

    i predict a rate hike out of the fed in the next few months and more next year.

    i predict the stocks will have no choice but to go lower as well.

    the stocks will typically lag behind until they are 100 percent there is no rate cut although some twat on cnbc was still talking about one last night.

    the good thing about all of this is that this move is only in its infancy and there is plenty of time to put the right trades on.

    im buying puts on us treasuries all the way down.

    if someone like pimco starts and is turning his book around then there is more downside potential here.

    heres to higher rates and the bond market meltdown.
  2. Like the party was over Spring 2004, Oct 2005, May 2006 and Feb 2007 :confused: Or is it really over this time :confused:
  3. The only thing that is fact is that the markets go up and the markets go down.
    All else is irrelevant.

    Traders trade - Investors sit.
  4. i think this time its real.

    the 10 year puzzle will be answered.

    maybe they wont jack the short end rates up but they certainly will in the back end and long dated instruments.

    i follow mar 08/mar 09 us eurodollars and they did 12 basis points yesterday.thats a huge move out there.

    theres smart money out there on that curve and that suggests to me that the bigger picture is changing.

    i suggest buying puts on ths us 10 year.

    goldman last week bought 100,000 puts for a 4 full point lower handle.

    the jp morgan client survey summed it up this week.

    record longs and no shorts.
  5. "Gas Prices Gnaw at Consumer Confidence
    Friday June 8, 4:31 am ET

    Confidence Tumbles to 10-Month Low as Gyrating Gasoline Prices, Housing Woes Gnaw at Consumers

    WASHINGTON (AP) -- Consumer confidence tumbled to a 10-month low as gyrating gasoline prices and persisting problems in the housing market gnawed at people's sense of economic well-being.
    The magnitude of the drop shown in the latest RBC Cash Index was surprising given the healthy state of the nation's job market, which is usually an important factor coloring consumers' perceptions of how the economy and their own financial fortunes are faring."

    "Treasuries Extend Slide, Pushing Yields to Near Highest in Year

    By Agnes Lovasz and Kevin Lim

    June 8 (Bloomberg) -- U.S. Treasuries dropped, pushing 10- year yields to the highest in almost a year, on expectations central banks will raise interest rates around the world.

    The benchmark 10-year note extended declines after slumping yesterday by the most in more than three years. Global debt markets have been sliding since New Zealand unexpectedly raised borrowing costs yesterday, stoking concern other central banks will follow as world economic growth quickens.

    ``There will be another selling wave,'' Kornelius Purps, a fixed-income strategist at Unicredit Markets and Investment Banking, said in Munich. ``Investors shouldn't try to catch the falling knife. They'll wait until it reaches the floor.'' "
  6. I'm short ZB GBL and EUR futures since weeks but am looking to cover soon. I wouldn't bury the stock market for years to come without an actual

    a) Implosion of earnings (corporate scandals would help, too)
    b) Actual US Fed rate hikes, not only fear of hikes. The ECB hikes don't mean much (so far) because the Ebond futures priced in a move to 4.5% for quite a while now.
  7. toc


    If US can do these:

    +Reduce the Half Trillion annual defense budget by $100B
    No single or combo of 2-3 powers joined together can dent US might.

    +Reduce annual spending $50B on prison industry by 25B
    Send prisoners to Mexico/Panama even China.

    +Tax the top 10% rich by additional 2% annually.

    +Tax Corporations earning more than 10% ROI by another 2%
    In last few years Oil companies have made killings so they got to contribute towards national treasury also.

    +Go after the Dirty Money parked in Swiss and Carrebian banks
    Quarter to Half Trillion in tax revenue right there.

    +Strive to Balance the Budgets each single year.

    Items like these can easily build upto $500B in annual savings of which $200B goes to interest service and rest $300B goes to service the debt principal. In 7-8 years US will be flaunting positive balance sheet again.

    I think the ship can still be turned around without causing the severe dollar depreciation and resulting global economic chaos.
    :D :D :D :D :D :D
  8. Daal


    yeah because exxon's 40% tax burden ain't enough. plus taxing oil companies produce no effect on gas prices of the soon to be bankrupt US consumer, rolleyes
  9. toc



    you miss the whole picture, i said tax the ultra successful companies....oil was just a current example. Higher taxes will provide extra revenues and let me tell you, these oil companies are lobbying and conspiring against the 'humble and now in shambles'................. US consumers by not investing their windfall into making their operation more efficient and thus bringing the oil prices down.

    There is a saying that money is the root of all evil.......i do not agree totally but sure do partially.........the above mention of the oil cabal deeds is a good example.

    Folks like Bill Gates and Warren Buffet need a mention too, who have promised 95% of their wealth for the good causes. Hopefully, the greed of the others does not squander and misuse their kindness and rather put it to work with efficiency and long term benefits.
  10. Daal


    yeah because almost half of the nation's output ain't enough rolleyes
    #10     Jun 8, 2007