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Puetz Crash Windows - Time to buy Puts ?


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#1 DrBubb

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Posted 24 February 2009 - 04:40 AM

Puetz Crash Windows

Eight of the greatest crashes in financial history:

...occurred six days before to three days after a full moon
that occurred within six weeks of a solar eclipse.

- - - - - - - - - - - - - - - - - - - - -
..
chart : 1929-1933 stock prices ... Current : SPX-2007/12 : SPX-2008/9 : Daily-2009


A subscriber reminded us today that we are in the Puetz window for a market crash.

For newer subscribers we will simply note that Steve Puetz did extensive research on market crashes and found that what he called the eight greatest crashes in financial history all occurred within a few weeks of a lunar eclipse and within six weeks of a solar eclipse. A solar eclipse occurred at the end of January and a lunar eclipse occurred on February 9th.

As most subscribers know, our line in the sand was what we called the hidden support level on the S&P 500 which was clinging by its fingernails at yesterday's close. Those fingernails appeared to give way today and it is but one more reason to anticipate a very negative resolution.

(from Peter Eliades)

This one worked brilliantly !

Feb/Mar 2009 Puetz "Crash window" / SPY chart ... w/o notations
= = =

MORE on Puetz Crash Windows: (June 13, 2001, By Paul Shread):

Several years back, a cycle watcher named Steve Puetz attempted to see if eclipses and market crashes were somehow related. He studied eight of the greatest crashes in financial history, from the Holland Tulip Mania of 1637 to the Nikkei of 1990. He found that market crashes tend to occur near full moons, and that the greatest number of crashes start after the first full moon after a solar eclipse, when that full moon is also a lunar eclipse. Puetz found that all eight crashes occurred six days before to three days after a full moon that occurred within six weeks of a solar eclipse. The odds of that being a coincidence, Puetz calculated, are less than 1 in 127,000.

Puetz was not saying that so-called "Puetz windows" always lead to crashes, but that if a crash is going to occur, a Puetz window would be the likely time frame in which it would happen. Puetz windows tend to occur every year or two, while crashes are rare events.

The interesting thing about this summer is that two Puetz windows will occur very close to one another, according to cycle watcher Heinz Blasnik. The first window is June 21-July 5, and the second is July 30-August 7. If a significant top is going to occur in the market this summer, those are the likely windows, Blasnik says.

It is interesting to note that a Puetz window with a total lunar eclipse occurred from July 1-July 16 last year. July 17 turned out to be a major secondary top in the Nasdaq (4289), and the start of a sharp, 18% pullback in the index. However, the Nasdaq's relentless sell-off did not begin until the index marked a second, slightly lower top on September 1 at 4259. A second Puetz window, with a full moon that was not a lunar eclipse, occurred from July 31-August 15 last year.
Another Puetz window (albeit two days longer than the required six-week interval between solar eclipse and full moon) occurred in August-October 1998, right before the plunge to the lows of the Asian crisis. Others in January and July 1999 coincided with relatively mild pullbacks (10%-15% on the Nasdaq).

Whether lunar and solar cycles can affect individual or mass psychology is a subject that has been debated for centuries. Stock traders have long had a saying, "Sell the full moon, buy the new," and it is remarkable how often new and full moons can mark a turn in the market within a day or two.

/source: http://www.internetn...icle.php/783611

== ==
LINKS :
This thread's quick link :: http://tinyurl.com/PzCrash
Nasa's Eclipse timing .. :: http://eclipses.gsfc...ov/eclipse.html
Lunar cycles ............... :: http://www.usno.navy...ces/phases-moon
L-Cycle length varies... :: http://individual.ut...lunar/index.htm
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#2 Dubai

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Posted 24 February 2009 - 04:50 AM

I do find it a little disconcerting that people seem to be relying more on astrology these days than sound financial acumen. Oh.... rolleyes.gif

#3 DrBubb

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Posted 24 February 2009 - 05:26 AM

QUOTE (Dubai @ Feb 24 2009, 12:50 PM) <{POST_SNAPBACK}>
I do find it a little disconcerting that people seem to be relying more on astrology these days than sound financial acumen. Oh.... rolleyes.gif

What makes you so sure that understanding astrologic cycles are not a useful part of "financial acumen"?
Many wise and wealthy people think it is. Do you know better than they do?

For example, Larry P. has made some truly brilliant calls using his "pattern recognition" techniques, which include astrology as part of the timing mix.

I tend to add other technical tools, like moving averages, cycle, elliott wave patterns, and volume analysis into the mix of tools that I use.

I like to keep an open mind. This idea has been researched extensively, and is still worth testing IMO
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#4 DrBubb

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Posted 24 February 2009 - 05:32 AM

QUOTE
FIRST THINGS FIRST ,
THESE CRASH WINDOWS ARE NOT ALWAYS DOWN MOVES IN STOCKS

Many times, these windows mark great turning points. A good example of the Turn windows, I show below.

I'll begin with the theory under the Puetz Window. Let's see how accurate it has been for calling market turning points.
I call these turning points because that is really how I see them.

Under the Puetz Window theory, this is what you look for:

[b]The Market will be at a ( Turning ) high point on the First Full Moon following a Solar Eclipse when that Full Moon is also a Lunar Eclipse. From this Full Moon / Lunar Eclipse peak a ( Trend change will begin ) Down Trend will begin and it will end 6 Days BEFORE to 3 days AFTER a Full Moon that is within 6 weeks of the Solar eclipse.[/b]

I placed my take on this in Red. We are looking for a TREND CHANGE:
UNQUOTE
. . .
Crash Comparisons

More Moons, etc

2005

Another Sept-Oct. collapse

Note from Arch Crawford


/more: http://www.tradersaf...ASH OF 2008.htm


= 2/
02/09/2009 CRASH PREDICTIONS and the Puetz window:
Quote
"I figured out what the significance of Feb 9 is, since no one here has spilled the beans. It's the Puetz crash window. Puetz studied the eight greatest crashes in financial history and "discovered that all eight crashes occurred six days before to three days after a full moon that occurred within six weeks of a solar eclipse. The odds of that being a coincidence, according to Puetz calculation, is less than 1 in 127,000"

/more: http://www.godlikepr...ssage723308/pg1
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#5 Dubai

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Posted 24 February 2009 - 05:44 AM

QUOTE (DrBubb @ Feb 24 2009, 06:26 AM) <{POST_SNAPBACK}>
What makes you so sure that understanding astrologic cycles are not a useful part of "financial acumen"?
Many wise and wealthy people think it is. Do you know better than they do?

For example, Larry P. has made some truly brilliant calls using his "pattern recognition" techniques, which include astrology as part of the timing mix.

I tend to add other technical tools, like moving averages, cycle, elliott wave patterns, and volume analysis into the mix of tools that I use.

I like to keep an open mind. This idea has been researched extensively, and is still worth testing IMO


Now now....! Read before you leap......I believe that there's a lot more to Astrology than meets the eye.

What I find disconcerting is that it's becoming "accepted" in circles that would normally dismiss as TFH any notion that planets which are millions of miles away can influence day to day events.... i.e. financial circles.

The reason I find it disconcerting is that this fact has made me realise that a lot of the "mystery" behind high finance is just total bullsh1t and spin. They should have become politicians. Oh..... rolleyes.gif

#6 DrBubb

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Posted 24 February 2009 - 05:52 AM

I have a completely open mind towards astrology.

In fact, astrology comes in many different packages, and so does financial astrology.

Frizzers spent a faior amount of time testing the timing ideas of Arch Crawford, and was disappointed with the results.
I have been listening to Larry P., and it certainly looks like hos forecats beat random chance by miles, but even he
would not claim to get it right all the time. He admits to have several "misses" each year.

So dont expect any tools of this nature to be fool proof.
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#7 DrBubb

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Posted 24 February 2009 - 05:53 AM

Feb. 9th Lunar eclipse:
http://en.wikipedia....9_lunar_eclipse
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#8 Ologhai Jones

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Posted 24 February 2009 - 08:26 AM

QUOTE (DrBubb @ Feb 24 2009, 05:52 AM) <{POST_SNAPBACK}>
I have a completely open mind towards astrology.

In fact, astrology comes in many different packages, and so does financial astrology.

Frizzers spent a faior amount of time testing the timing ideas of Arch Crawford, and was disappointed with the results.
I have been listening to Larry P., and it certainly looks like hos forecats beat random chance by miles, but even he
would not claim to get it right all the time. He admits to have several "misses" each year.

So dont expect any tools of this nature to be fool proof.


I like to believe that I always have an open mind to firm and objective evidence. I'm unaware of any firm and objective evidence that astrology is able to predict the future (perhaps someone could provide some?), and, if there is a 'core' truth to astrology, then it seems a shame that many (and it feels to me as if it's most if not all) practitioners are unable to fathom that core truth[1].

If even a person that you might consider to have discovered some truth in astrology 'would not claim to get it right all the time' then where is the evidence that the technique is better than just educated guessing?

Something that is true shouldn't be false sometimes.

When astrology can consistently (and exclusively) make predictions to within the same bounds of precision that, say, General Relativity or Quantum Electrodynamics can, then it will certainly be worth taking seriously.

While something only looks like another great example of how the human mind is constantly seeking for patterns (whether they're there or not), then I think it should be treated with scepticism.

Open mindedness is an absolute must, but I don't think it's close-minded to require good evidence.

[1] Presumably, if astrologers really knew what was going on, then all the predictions in newspapers and magazines would always agree with each other, and there'd be no need for those predictions to be so vague and fuzzy.

#9 DrBubb

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Posted 24 February 2009 - 08:44 AM

QUOTE (Ologhai Jones @ Feb 24 2009, 04:26 PM) <{POST_SNAPBACK}>
I like to believe that I always have an open mind to firm and objective evidence. I'm unaware of any firm and objective evidence that astrology is able to predict the future (perhaps someone could provide some?), and, if there is a 'core' truth to astrology, then it seems a shame that many (and it feels to me as if it's most if not all) practitioners are unable to fathom that core truth[1].


Read the TURN thread!
And go back and listen to his commentary at the time. Larry P. nailed it !
And he attributes a good part of his success to astrological indicators.
But he doesnt say they work 100% of the time, they simply improve the odds dramatically.
If you are a good trader, that;s all you need - an improvement in the odds.

QUOTE (Ologhai Jones @ Feb 24 2009, 04:26 PM) <{POST_SNAPBACK}>
IWhen astrology can consistently (and exclusively) make predictions to within the same bounds of precision that, say, General Relativity or Quantum Electrodynamics can, then it will certainly be worth taking seriously.


Frankly, that's a ridiculous test. Anything that can make a significant improvement in my odds
of success, I am happy to use.

If you look around, you can find some books and articles on "the scientific basis for astrology."
I have read some of them, and some of the astological tools do actually stand up to statistical
scrutiny. Search the web. I think one of the names you should use in your search is something like
"Guigolyn" or "Guigolin" perhaps you can find the reference, and report back, if you are interested.

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#10 Ologhai Jones

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Posted 24 February 2009 - 09:22 AM

QUOTE (DrBubb @ Feb 24 2009, 08:44 AM) <{POST_SNAPBACK}>
And go back and listen to his commentary at the time. Larry P. nailed it !

'Nailing it' from time to time isn't evidence. Do you know how many times he didn't nail it?

Out of a population of at least tens of thousands of economists and traders trying to spot patterns, the fact that some of them appear to be able to 'nail it' sometimes isn't evidence that they necessarily know what they're doing. (Although, of course, I'm not saying that they don't know what they're doing -- only that some of them 'nailing it' isn't evidence that they necessarily do.)

QUOTE (DrBubb @ Feb 24 2009, 08:44 AM) <{POST_SNAPBACK}>
If you are a good trader, that;s all you need - an improvement in the odds.

If a trader (your use of the adjective 'good' is somewhat redundant I think wink.gif) finds something that definitely increases his or her chances, then I agree that it's worth pursuing. But that's a definite 'if'.

QUOTE (DrBubb @ Feb 24 2009, 08:44 AM) <{POST_SNAPBACK}>
Frankly, that's a ridiculous test. Anything that can make a significant improvement in my odds
of success, I am happy to use.

I don't agree. One of the tenets of Quantum Electrodynamics is that the fundamental nature of the universe is probabilistic, and the predictions it makes are specifically probabilistic also.

In the words of Larry Pesavento, "Patterns, even the astrology patterns are right now." Even? EVEN? Are they such a long-shot than when they happen to seem correct that Larry P himself will say 'even' they are correct?

QUOTE (DrBubb @ Feb 24 2009, 08:44 AM) <{POST_SNAPBACK}>
If you look around, you can find some books and articles on "the scientific basis for astrology."
I have read some of them, and some of the astological tools do actually stand up to statistical
scrutiny. Search the web. I think one of the names you should use in your search is something like
"Guigolyn" or "Guigolin" perhaps you can find the reference, and report back, if you are interested.

If I look around, I can find books and articles that assert just about anything I can imagine (and probably a lot of things I can't).

If you think you've found an article that rigorously scrutinises astrological methods and shows them to be statistically significant, then by all means post a link.

#11 DrBubb

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Posted 24 February 2009 - 09:47 AM

(i Found this reference):

Scientific Astrology??
--------------------------------------------------------------------------------
So this guy, Michel Gauquelin, came up with some statistics that seemed to prove there to be some actual scientific basis for astrology, in that there was a significant correleation between times of birth and levels of success in certain occupations. His work can be accessed quite widely on the Internet, but if you want to know more, start with the Wikipedia Page on him.

/see: http://en.wikipedia....ichel_Gauquelin

From Memory, the book I read about this was called, "the Cycles of Heaven".
When I had more space, I used to collect books about cycles.

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#12 DrBubb

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Posted 23 July 2009 - 01:08 AM

Here it comes again...
QUOTE (DrBubb @ Feb 24 2009, 12:40 PM) <{POST_SNAPBACK}>
A subscriber reminded us today that we are in the Puetz window for a market crash.


SPX : update : SPX-2008/9


QUOTE (Perishabull @ Jul 22 2009, 03:14 PM) <{POST_SNAPBACK}>
It does look compelling.
From NASA;
"During the year 2009, two solar and four lunar eclipses occur as follows:

* 2009 Jan 26: Annular Solar Eclipse
* 2009 Feb 09: Penumbral Lunar Eclipse
* 2009 Jul 07: Penumbral Lunar Eclipse
* 2009 Jul 22: Total Solar Eclipse
* 2009 Aug 06: Penumbral Lunar Eclipse
* 2009 Dec 31: Partial Lunar Eclipse"

9th February and 7 July this year are dates that marked turns following the close or the start of a turn in price

"During the year 2008, two solar and two lunar eclipses occur as follows:
* 2008 Feb 07: Annular Solar Eclipse
* 2008 Feb 21: Total Lunar Eclipse
* 2008 Aug 01: Total Solar Eclipse
* 2008 Aug 16: Partial Lunar Eclipse"
I have to go to work so don't have time to check out how these went last year.

NASA eclipse website - http://eclipses.gsfc...ov/eclipse.html


There's more to look at that just the Eclipse dates ( !! )
The other factors: sentiment, and chart patterns have to line up too.

I nailed the low back on March 5th. Here's the Podcast that proves it:
5th March 2009 Call LISTEN: http://globaledge.podbean.com/ (97 downloads as of today)
Charts for above : http://www.greenener...?showtopic=6075

This GEI Conference call examined the case for an early March low in stocks.
ĒDrBubbĒ hosted, and gave his case for expecting a near term low in global stock indices. Comparisons were drawn with lows in 1974-75, and the point of the ďbig breakoutĒ in late 1996, when Fed chairman, Greenspan, threw caution to the winds, and lightened up regulations for banks, touching off a speculative boom which lasted a decade. The world will take a long time cleaning up the mess from massive expansion of credit, a dotcom bubble, a housing bubble, and the resulting crash.

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#13 DrBubb

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Posted 23 July 2009 - 06:31 AM

Under the Puetz Window theory, this is what you look for:

The Market will be at a ( Turning ) high point on the First Full Moon following a Solar Eclipse when that Full Moon is also a Lunar Eclipse. From this Full Moon / Lunar Eclipse peak a ( Trend change will begin ) Down Trend will begin and it will end 6 Days BEFORE to 3 days AFTER a Full Moon that is within 6 weeks of the Solar eclipse.

That suggests some sort of Peak on the Lunar eclipse day (Aug. 6th), and then a crash into a day which is 23 - 31 days later, that is: the first week in September.

This chart should cover the period involved:

Aug/Sep.2009 Puetz "Crash window" / SPY chart ... update


I also went back to look at the previous one :
Feb/Mar 2009 Puetz "Crash window" / SPY chart ... w/o notations

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#14 PJohnP

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Posted 23 July 2009 - 07:35 AM

QUOTE (DrBubb @ Jul 23 2009, 07:31 AM) <{POST_SNAPBACK}>
I also went back to look at the previous one :

I like that second chart. If I understand it correctly I now know that in the first few days of September we face a statistically-increased chance of the market moving either up or down. I'll arrange my affairs accordingly.

And I must take more seriously the idea of statistical correlation, without accompanying theoretical explanation, being the key to understanding life, the universe and everything. There's an almost perfect match over the last half millennium between the increases in white sugar consumption and life expectancy. I must start taking sugar in my tea.

Of course idiotic stuff like astrology can affect markets. If enough people believe in it and act accordingly, it becomes self-fulfilling ... and wise traders can take advantage of that. Surely that's how we should be using it? Now, where's my Old Moore's Almanac?
Tantum religio potuit suadere malorum.

"When people stop believing in God, they don't believe in nothing, they believe in anything."

#15 DrBubb

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Posted 23 July 2009 - 07:41 AM

QUOTE (PJohnP @ Jul 23 2009, 03:35 PM) <{POST_SNAPBACK}>
I like that second chart. If I understand it correctly I now know that in the first few days of September we face a statistically-increased chance of the market moving either up or down. I'll arrange my affairs accordingly.

And I must take more seriously the idea of statistical correlation, without accompanying theoretical explanation, being the key to understanding life, the universe and everything. There's an almost perfect match over the last half millennium between the increases in white sugar consumption and life expectancy. I must start taking sugar in my tea.

Of course idiotic stuff like astrology can affect markets. If enough people believe in it and act accordingly, it becomes self-fulfilling ... and wise traders can take advantage of that. Surely that's how we should be using it? Now, where's my Old Moore's Almanac?


Given the overbought condition of the market now,
The thing to do may be to look for a high now, or on around the Aug.6th Lunar eclipse,
and Buy Sept. puts.

Until I did this work, I had focussed on Aug. and Dec.2009 puts, and expected the top to be now-ish.
These historical patterns make me think the top may be delayed until Aug.6th (or so), and/or we may
see a secondary top at that time. If instead, the market dives fast into a Low on Aug.6th, I will be
tempted to grab some profits then.
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#16 DrBubb

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Posted 23 July 2009 - 04:06 PM

YELNICK MENTIONS NEOWAVE COUNT, may be changing - that's a BAD thing !

Monday, July 20, 2009

The Problem With Breaking the June 11 High

There is a lot of commentary on the prior few posts about Neely having to change his count if the Jun11 high is exceeded. Here is what he had to say about it this morning (emphasis added):

Itís amazing the number of emails Iíve received lately trying to talk me out of my bearish scenario or asking what it means if Juneís high is exceeded (which means they think Iím wrong). That alone favors my preferred scenario, but a move above Juneís high is not a good thing, itís a horrible thing. It means the bear market will last for years and economic conditions will get much worse than originally thought.

This would put him in more alignment with Prechter's view, of a bottom in 2014 (+/- a year or so, with 2012 at the earliest); or if the government continues to intervene like FDR did in the '30s, this might stretch even longer, to 2017 - 2020. Currently Neely expects a rapid drop to the long term bottom, maybe as early as Jan 2010 (six months!).

As an historical note, the last three deflationary depressions that followed a credit bubble all ended their first phase down in around 3 - 4 years: 1837-1841, 1873-1875, 1929-1932. Hence 2007- 2010/11 would have been consistent. This reflects the rapidity which a market can adapt to changing realities. A lot of ink has been spilled over why the 1930s lasted so long; but it was clear that by the time FDR took over in 1933 a recovery was in progress, and a quite strong one (given how far we had fallen). The policy question is why we went back down.

Keynesians such as Krugman continue to argue that we did not stimulate enough, and that while FDR caused the recovery due to deficits, an attempt to go back to normal in 1937 (due to the apparent recovery) by lowering the deficit sent us back down. This argument is relatively easy to disprove, since the last two Hoover budgets (FY32 and 33) got us to around a 5% deficit per year, and FDR's first three budgets continued at around that level. In what respect were Hoover's stimulus insufficient and FDR's heroic? And even in 1937 spending continued to go up, albeit at a lower pace. More likely something else was going on, and a recent UCLA study found it in the ill-guided attempts by both Hoover and FDR to keep wages and prices high in the face of deflation. This prevented the market from clearing; high wages kept unemployment high, and high prices kept capacity underutilized. In any event, the record of massive stimulus is that it does not work and may deepen the problem if done poorly; just look at Japan twenty years after their credit collapse in 1989.

Monetarists such as Bernanke continue to argue that the Fed failed to provided sufficient liquidity. This comes out of Milton Friedman's trenchant work that blamed the prolonged and deep fall in the '30s on failures of the Fed. Yet in the heart of the recent crisis, Friedman's co-author criticized the policy reaction as fighting the wrong war: the problem back then may have been liquidity, but the problem today is bank insolvency. Liquidity helps avoid bank runs; but does not repair insolvency, which is due to overleverage and bad loans. At 30:1 leverage, a mere 3.3% of bad loans means you go insolvent. In this case, as asset values collapsed (real estate in particular), banks found they had insufficient collateral for their loans.

The problem is much worse in Europe than here: while our bank assets (loans) are around 2:1 of GDP, according to John Mauldin it is 4:1 in the Eurozone, 5:1 in the UK and an incredible 7:1 in Switzerland. We clucked at the "zombie banks" in Japan after their 1989 collapse, and yet have left our money center banks in the land of the living dead.

Yves popped over some thoughts which he might prepare in a guestblog later this week. He notes that markets outside the US are not confirming this rally, nor are currency or bond markets.

Regardless, if we break the SP956 pivot point, look for an enthusiastic piling on and a sharp rally. We almost hit it today. Potential turn dates for a summer peak center around the second week of August, after the coming lunar eclipse in the first week of August that follows an Asian solar eclipse this week.

/more: http://yelnick.typepad.com/yelnick/
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#17 DrBubb

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Posted 02 August 2009 - 12:48 AM

... from DrB's Diary, I thought it should be posted here too ...

QUOTE (Cuthbert Calculus @ Aug 1 2009, 04:01 PM) <{POST_SNAPBACK}>
Pesavento, who has bearish for quite some time now and whose calls have not been quite as miraculous as they were earlier in the year, has August 3rd - Monday - as a massive turn day.


Tom Obrien adds some real color to Larry's forecast...

THE TROOPS ARE DESERTING THE FRONTLINE.



Tom talks about all the "Gap-away" stocks, by which he means stocks that have suddenly shown big gaps down in recent days.

Microsoft / MSFT is a good example ... update


But there are many more: AMZN, Netflix, Yahoo, etc (he will provide a list on Monday)

These are (in my words) like troops deserting the front line of battle (for higher markets.)
The only thing that is holding the indices up, are a handful of stocks like...

Apple / AAPL ... update


And once these few breakdown, then the indices will collapse.

Tom Obrien says there was a period like this at the top in 2000


QQQ (the etf for the Nasdaq-100/NDX) dropped by 34% in less than a month!
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#18 DrBubb

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Posted 02 August 2009 - 12:51 AM

QUOTE (DrBubb @ Jul 24 2009, 12:06 AM) <{POST_SNAPBACK}>
YELNICK MENTIONS NEOWAVE COUNT, may be changing - that's a BAD thing !

Monday, July 20, 2009 / The Problem With Breaking the June 11 High

There is a lot of commentary on the prior few posts about Neely having to change his count if the Jun11 high is exceeded. Here is what he had to say about it this morning (emphasis added):

Itís amazing the number of emails Iíve received lately trying to talk me out of my bearish scenario or asking what it means if Juneís high is exceeded (which means they think Iím wrong). That alone favors my preferred scenario, but a move above Juneís high is not a good thing, itís a horrible thing. It means the bear market will last for years and economic conditions will get much worse than originally thought.

/more: http://yelnick.typepad.com/yelnick/


Yelnick now sees a one-week sharp drop:
Friday, July 31, 2009

Stocks Should Decline Then Enter Final Rally

The sharp pop yesterday and fade since pretty well confirms the scenario noted a few posts ago of an end to a wave iv triangle with a thrust up, and now the end of that wave v thrust. A week long decline should follow. A drop to the range of SP933-950 is likely (50% to 38% retrace). The STU sees the whole pattern from Mar6 as a double zigzag:



The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#19 pyewackitt

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Posted 02 August 2009 - 01:00 AM

I'd be interested to know you're feeling on the next crash phase.

I think a lot of us have been a little surpised how the markets seem to have rallied strongly through the summer so far and especially Gold holding its own during the usual seasonal lull.

A period of months of dead cat bounciness was always to be expected after the lows earlier in the year but things seem to have remained relatively positive in the markets despite the FSN truism that 'Less bad is the new good'.

I'm sure many of us on GEI are expecting a pullback of substantial proportions because fundamentally little has changed, yes people are saving more... but there are ever more bankruptcies, redundancies, poor results to the city (except in banking... obviously... lol) and if the US is the leading indicator for European countries recovery is still a way off.

The real question to me is not so much when the next pullback is... but what the trigger is and what it impacts. By which i mean what will be the next 'Black Swan'? (Lehamann going down type moment) and, particularly if it is currency crisis in nature will it impact commodities as well as stocks?. Oil has risen significantly this year as expected and could well pull back, similarly PM's have stayed quite strong this year but if there is a major deflationary fear both could fall a fair amount yet as we saw back in Nov last year.

However with all the printing going on and the acceptance by all central banks of latent/stealth inflation i.e. real inflation rising but interest rates being kept low will commodities be turned to as a source of wealth with less governmental counterparty risk?

The stage is set for something to happen... the question is what will step out from the curtains...

#20 DrBubb

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Posted 02 August 2009 - 02:28 AM

QUOTE (pyewackitt @ Aug 2 2009, 09:00 AM) <{POST_SNAPBACK}>
The real question to me is not so much when the next pullback is...
but what the trigger is and what it impacts.
By which i mean what will be the next 'Black Swan'? (Lehamann going down type moment) and, particularly if it is currency crisis in nature will it impact commodities as well as stocks?. Oil has risen significantly this year as expected and could well pull back, similarly PM's have stayed quite strong this year but if there is a major deflationary fear both could fall a fair amount yet as we saw back in Nov last year....


The Trigger?
Awaking, after a period of having fallen asleep, and taking eyes off the true state of the economy.


Look: the "Breakers" are already hitting us (see above, Tom Obrien's "breakaway" gaps down).

If the leaders (like Apple/AAPL) break too, then the slide will be rapid.
Larry P. thinks the big turn will hit next week.

I dont want to seem condescending, but Lehman's was one of a dozen events that could have been used
to trigger the slide. The problem was not in Lehmans (it was a mere straw on the camel's back), it was in
the myriad of cracks in the system, that were sitting and waiting for a new piece of straw to hit them.

So it doesnt matter.
I wouldnt waste time trying to identify which specific bit of news will bring the house of cards down.
The market is now ready for a puff of wind from any direction.
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix




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