2008 Is Starting Again - Stock Market Crash Incoming

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Has it crashed yet?

its started yes. 2 steps down 1 step up. won't be a continuous waterfall pattern but it's coming down make no mistake.

tomorrow will be a green day (200+ point gain due to G20 meeting with china) but it will end the week in the red.

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pay attention people. the smartest people in the room are sounding the alarms. price action alone is not an indicator of good things to come..

The Treasury yield curve just inverted, sounding the alarm for recession

The bond market is beginning to sound the alarm of a recession, with an inversion in U.S. Treasury yields occurring on Monday for the first time since 2007.

The yield on the 5-year Treasury note fell below the yield on the 3-year note, meaning that investors were being paid more to hold U.S. government debt maturing in three years than comparable bonds maturing in five years. It’s not the major curve inversion that investors watch for — the 2-year note holding a higher yield than the 10-year note, which has preceded every U.S. recession since World War II — but it portends that the market is headed in that direction, analysts told Yahoo Finance.

Ian Lyngen, head of united rates strategy at BMO Capital Markets, said the inversion of 3- and 5-year yields has strengthened his belief that an inversion of the 2-year and 10-year yield will happen in late 2018 or early 2019.

“This solidifies not only my flattening bias but I think it will lead many players in the market who [expected the yield curve to steepen] to capitulate on that,” Lyngen said.

U.S. Treasury yields rose early on Monday after a deal between the U.S. and China to hold off on new tariffs. Shorter-dated yields rose faster than longer-dated yields, pushing the curve to invert between the 3- and 5-year yield.

The yield curve inverted between the 2- and 10-year yield before the recessions of 1981, 1991, 2000 and 2008. It has preceded all nine U.S. recessions since 1955, with a lag time ranging from six months to two years.

Analysts have pointed out that although many associate a yield curve inversion with recession, the phenomenon is a reflection of the kind of economic conditions that predict a market bust rather than being the cause of them.

An inverted yield curve is a sign investors think the government is less likely to pay back debt it owes in two years than what it owes in a decade — or in this case, the government is less likely to pay in three years than it is in five. Market analysts have pointed to everything from the increase in U.S. debt to cyclical factors like the market running out of steam as reasons for a downturn.

The combination of higher bond yields and the looming threat of recession is adding to fears about slowing global growth, investors said. It could also have implications for the Federal Reserve’s interest rate policy.

Fed Chair Jerome Powell said in a speech last week that U.S. interest rates were now “just below” the level that could be considered neutral and signaled that the Fed would stop raising rates. Investors viewed that as a stark turnaround from his remarks in October that the central bank was “a long way from neutral.”

Cameron Crise, macro strategist at Bloomberg LP, called the inversion “potentially the first shoe to drop in the end of the rate cycle.”

“Mind you, there can be a long delay between the first inversion of the curve and subsequent rate cuts, as the last cycle showed,” Crise said in a report for Bloomberg. “Still, it’s more evidence that we’re in the ‘late 2005’ analogue of the current Fed campaign.”

Fed officials have not spoken much about the possibility of a yield curve inversion, but earlier this year a number of members of the Fed’s rate-setting committee said it was a development they were watching.

“One of the most pervasive relationships in macroeconomics is that between the term spread — the difference between long-term and short-term interest rates — and future economic activity,” the San Francisco Fed’s Michael D. Bauer and Thomas M. Mertens wrote in March.

Atlanta Fed President Raphael Bostic even said in May that it was his job to prevent the curve from inverting, joining a number of other U.S. central bank bosses who had openly voiced concern about inversion.

https://finance.yahoo.com/news/treas...194921816.html

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just the start folks. the end of a 10 year bull market. hold on tight.



https://www.bloomberg.com/news/artic...s?srnd=premium

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"I don't look at recessions as a bad thing. I mean, it's bad for America. It's bad for the people that are unemployed. It's usually an opportunity for J.P. Morgan." - Jamie Dimon

What a charmer.

https://www.cnbc.com/video/2018/12/0...mie-dimon.html

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Job growth falls short of expectations

https://www.cnbc.com/2018/12/07/us-c...-expected.html

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U.S. Stock Market Exodus Is Second-Biggest Ever

Investors rushed out of U.S. equity funds in the second-biggest weekly exit on record, according to Bank of America Merrill Lynch, as the market sell-off pushed traders to seek safe havens.

U.S. stock funds bled $27.6 billion in the days through Dec. 12, which includes last Friday’s plunge in the S&P 500 Index that capped the worst week for the gauge since March, according to BofA’s note, which cited EPFR Global data. This is the second-biggest redemption since February’s spike in the VIX volatility measure, according to Jefferies Financial Group Inc.

The turmoil in stocks, which has erased as much as $4 trillion in U.S. equities since the end of September, continued this month as traders feared that a global economic slowdown will curb earnings growth and end the equity bull run. Investors enter 2019 searching for assets that would bring returns after 2018 saw both fixed income and stocks disappoint.

Instead of U.S. equities, market players flocked to Japanese and emerging-market equity funds, in addition to government bonds as global equity funds saw a record weekly outflow of $39 billion, according to BofA. Investment-grade bond funds also set a historical precedent with an $8.4 billion redemption, the data show.

U.S. equities have fallen so much that the S&P 500 Index is now trading near the lowest valuation since early 2016. That’s quite a contrast compared to a year ago, when the gauge was at the highest forward price-to-earnings ratio since 2002.

The negative sentiment surrounding U.S. stocks showed no signs of dissipating on Friday as S&P 500 futures fell. Trade concerns were fueled by Apple Inc. saying a Chinese ban on sales of the iPhone will force it to settle a licensing battle with Qualcomm Inc., an outcome that may end up harming the country’s smartphone industry.

https://www.bloomberg.com/news/artic...s?srnd=premium

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Down another 500 points on the DJI today.

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annnnd down another 500 points again today...

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LOL CNBC is full of people attacking short sellers and the algos. none of these fuckers were complaining about algos when they were helping to pump the market. now they are all surprised that an over extended market is now crashing hard. now they are talking about "doing something about these short sellers and algos" because they were too stupid to see the crash coming and they are losing their shirts.

i told you guys weeks ago about SQQQ. hint for peeps that don't understand.. it's a 3x leverage inverse ETF that bets against the Nasdaq. so if the nasdaq is down 30% SQQQ is up 90%.

the stock market is no longer being supported by free money aka near zero interest rates therefor profits are being taken and they are leaving the market.

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trump keeps talking about potentially firing the chairmen of the fed. i love it, trump is making everything worse. the fed is not there to prop up the stock market. their job is to keep the economy healthy. the market is not the economy. people seem to get that confused. if the fed had kept interest rates next to nothing the crash that comes will be even harder then it is now. borrowing and credit would continue to explode giving the impression that everything is fine when in reality the bubble is getting bigger and bigger. increasing interest rates is the only thing that can save this massive bubble. the fed is absolutely doing the right thing.

chuck you talk about the bitcoin bubble and you were correct. but the current market bubble propped up by low interest rates for the past 10 years is pretty god damn bad as well. i think we are going to see the DJI in the 18k range by the time this market dump is over. that's almost a 20% further drop from here...

just to give you an idea of how much further that is to fall I marked it on the chart in the link below. we will probably have a few bounces up before getting there but ultimately i think it will fall to the 18k level of support before the bear market is over.

https://www.tradingview.com/x/Ix3Sd7vk/

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LMAO @ the trump admin. they keep trying to "calm the market". they don't seem to understand that everytime they try to "calm the market" it sends out a single loud and clear that the trump admin is very concerned behind the scenes. it's hilarious watching these dipshits stumble over themselves only making the panic in the markets worse and worse. LMFAO. they could not handle this any worse.

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The Treasury secretary put out an alarming—and confusing—press release on Sunday evening

Imagine having a runny nose, itchy eyes, congestion, and a sore throat, and your doctor telling you that you shouldn’t worry about cancer—she consulted her colleagues and they’re certain it is not cancer, and if it were, they could fight it.

This is roughly what happened on Sunday evening, when Treasury Secretary Steven Mnuchin put out a press release on calls he held with executives from the country’s largest banks. Mnuchin’s statement assured the public that they had not been having liquidity problems or “clearance or margin” issues—the sorts of things you would worry about if the country were on the brink of a financial crisis.

The markets have been suffering from something like a nasty cold of late, with a major correction in stock prices due to rising interest rates, trade tensions, the government shutdown, and slowing global growth. But the surprise holiday readout, which came with a heads-up that Mnuchin would be holding a call with some of the country’s top financial regulators as well, unnerved and puzzled investors, bank executives, politicians, and economists. What was the Treasury secretary thinking? Who thought we were tipping into a financial panic? None of the possible explanations are very reassuring, though it seems that Mnuchin was trying to be.

Option one: The Treasury secretary was speaking to an audience of one. Mnuchin is under enormous pressure from President Donald Trump, who is upset about the market sell-off and mad at the current Federal Reserve chairman, Jay Powell. The press release was perhaps an attempt to show Trump that Mnuchin was doing something, anything, to talk the markets back into stability.

It makes some kind of squint-and-see-it sense. Mnuchin used Twitter earlier in the weekend to reassure the markets that Trump was not going to fire Powell, who has continued to tap up interest rates as the economy continues to grow at a decent pace. Mnuchin wrote that Trump told him he “totally” disagrees with Fed policy, calling it “an absolute terrible thing to do at this time.” But he said that Trump had informed him, “I never suggested firing Chairman Jay Powell, nor do I believe I have the right to do so.” The readout might be a further effort to keep Trump calm by showing him that everything is fine and his Treasury is taking action.

The problem with this explanation is that it means Mnuchin risked roiling financial markets to placate his boss (which of course would only further anger his boss).

Option two: The Treasury secretary believes that the market correction is due in part to animal spirits—animal spirits he could quiet by reminding everyone that the financial system is in fine shape. Perhaps he anticipated further declines in stock prices due to the government shutdown, and wanted to calm the markets.

And it is true that the sell-off remains nothing more than a sell-off, at least in most economists’ and corporate executives’ eyes—a correction, not a crisis; a cold, not a cancer. Even if the bear market were a precursor to an economy-wide slowdown, that would not necessarily result in bank runs and liquidity panics and cratering financial firms.

But, again, nobody was worried about a banking panic before Mnuchin brought it up. “Can someone who understands markets please explain what Secretary Mnuchin did and why?” Brian Schatz, a Hawaii senator who sits on the banking committee, wrote on Twitter. “Because it seems like a bad look at minimum, and maybe more concerning than that but I honestly don’t know.”

Option three: Mnuchin has some troubling insider knowledge, and he wanted to broadcast to the markets that he is aware and in charge. Maybe some financial firms are teetering? Maybe rising interest rates and falling asset prices are straining some important market participants, and it just has not yet become evident in public reports?

Whatever Mnuchin was trying to do, he did not succeed in it, instead stoking market fears and sowing confusion. Perhaps the clearest takeaway is that Mnuchin and Trump’s Treasury lacks the expertise to communicate clearly and forcefully with the markets—no surprise, given how few experienced financial operatives Trump has hired and how many experienced non-political civil servants have fled Treasury during this administration.

If they’re communicating this poorly in the absence of a crisis, just imagine how disastrously they might perform in the presence of one.

https://www.theatlantic.com/ideas/ar...elease/578968/

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Worst Christmas Eve in stock market history.



Sent from my Moto G6 using Tapatalk

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down 650 points today..

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The President is both setting in motion a crisis while undermining the institution that needs to respond to that crisis.

Dec 25th - Bloomberg

President Donald Trump’s Christmas Eve tweet reiterated that he considers Federal Reserve Chairman Jerome Powell a thorn in his side, one I think Trump believes he needs to pull even if Treasury Secretary Steven Mnuchin claims otherwise. We need to start thinking about what happens if Trump tries to fire Powell. Short version: It would likely be an absolute mess.

The legal framework for firing a Fed chair remains subject to debate. Fed scholar Peter Conti-Brown argues that the President could try to demote Powell from Fed Chairman back to a governor, but that would potentially still leave Powell as Chairman of the interest-rate setting Federal Reserve Open Market Committee. How the Fed might react to such a situation is unclear.

From my perspective, the best case scenario for market participants is this: Powell steps down as chair and governor and is replaced by Fed Vice Chairman Richard Clarida. Equities tumble – maybe even go into free fall – while Treasuries surge. Clarida and his remaining Fed colleagues react by slashing rates at the January 2019 FOMC meeting, and maybe even sooner in an emergency meeting. The markets rebound, and the transition happens quickly enough that Main Street remains untouched by the gyrations on Wall Street.

The worst case scenario is that the Fed digs in its heels and chooses to challenge Powell’s firing in the courts as a way to preserve the independence of the central bank. That process could drag on indefinitely, creating a sustained “risk off” scenario in financial markets that would eventually create sufficient damage to the broader economy that hurts Main Street.

Even in the best case scenario, the Fed becomes another damaged institution. Arguably, it already is. There is a risk that at this point any action taken by the Fed to cushion markets or the economy will look as if policy makers are simply yielding to Trump’s demands. In other words, the appearance of independence may disappear if Trump’s antics create the uncertainty that necessitates a Fed response.

Hence, regardless of what happens, we are now well into uncharted and dangerous territory. It is not obvious that the government has the capacity to respond effectively to a financial crisis. That means that the Fed would have to shoulder an even greater role than in the last crisis. But now, the Fed may be less effective because of the damage inflicted by Trump.

Indeed, Trump appears to be both setting in motion a crisis while undermining the institution that responds to that crisis. Don’t underestimate how tense the situation has become. The risk that this downturn in stocks and other risk assets bear turns into something worse rises with each angry Trump tweet.

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one of the smartest minds in the market. give it a listen. even if you understand 25% of it you will be that much better off.

Druckenmiller on Economy, Stocks, Bonds, Trump, Fed: Full Interview

https://www.youtube.com/watch?v=HFAzZttioEk