"Biggest short position in the S&P futures in 3 years ( $45 billion, notional ) combined with the smallest long position by the hedge-fund "community" in 8 years . . . makes for a breakout to new highs." I agree completely that large hedge fund short positions (combined with commercial longs) were the reason for today's huge squeeze.
Yep, everyone thinks the market is going into a free-fall, but it NEVER goes into free-fall when the majority expects it to.
Bond yields just aren't high enough to cause any kind of switch from stocks to bonds. Only stupid FCB are willing to own bonds at the current rates. Inflation has to keep increasing to keep servicing all the debt. A constant monetization process resulting in even more credit and debt. Farmland is a screaming bargain in this situation. Not only do you protect your wealth and get the rising land values you also get a dividend because it can produce something that is also going up in price. Bernake keeps talking how they can keep inflation expectations contained when clearly markets are expecting more inflation.
I agree with Poh Poh and been saying it for almost a year now even though honestly I've been short all that time and lost a ton of money . I think the reason is inflation too myself . jake
As the dollar falls in value the markets need to go up. Stock buybacks with cheap debt is also helpful to many blue chips in my opinion. If you buy leverage(options) in companies that sell product overseas, you'll be taking advantage of the dollar's decline with easy leverage. It's a win win right now in my opinion. Cheers.
The market is boring me this monday am. It's consolidating, and one has to find that rather bullish. Now i'm just waiting to see how close the S&P can come to 1600 by Friday where the open interest peak is. Its occured to me that since companies are reporting this week, and specifically Google on Thursday, i believe, that the S&P might only have to rise to 1580 or so by Thursday to have a chance to settle very near 1600 on Friday morning! Hey, 1580 is only about 25 points from where we are this moment, and we've still got three and a half trading days until Thursday's close. Oh, oh, i find myself "intellectualizing" about the market -- something FXTRADERWILL has warned us against. Well that's what happens when its a boring market day, I am likely to backslide into "intellectualizing". My apologies TRADERWILL.