Bottom or Another Leg Down

[Old Tusk]

Curious about what everyone is thinking.

[snoblind]

I don't have a clue.

[ricepig]

I don't have a clue.

Ask me next year, haha. I'd say bottom, until we take out the previous lows.

[HawgWild]

I don't have a clue.

Me either.

[JoeyCapital]

Put me down for "a brief stop on the way down". It may take awhile, but the equity markets can only be this much ahead of the actual economy for so long. The jaws are gonna close.

[Old Tusk]

I've got all kinds of clues, but no idea what they are telling me. Lol

[aristotle]

I think it's another leg down from here. We test the lows from Oct 2014 in my opinion.

On a related note, Gulf state sovereign wealth funds are redeeming and liquidating positions to make up for a cash shortage. $71B alone being extracted by the Saudis.

http://www.cnbc.com/2015/09/27/financial-times-saudi-arabia-withdraws-overseas-funds.html

OPEC may end up blinking before long on it's 'choke them out' policy.

[aristotle]

Yikes. Not a good time for the worst NONFARM print of the year. Major miss.

The FED is stuck.

Open question to the board. Which happens first?

1. FED raises rates.
2. FED introduces more QE.

[je100]

Yikes. Not a good time for the worst NONFARM print of the year. Major miss.

The FED is stuck.

Open question to the board. Which happens first?

1. FED raises rates.
2. FED introduces more QE.

Since I can't see the FED raising rates for the foreseeable future, I'll take number two.  Cause, they can't just 'do nothing', right?

[aristotle]

Since I can't see the FED raising rates for the foreseeable future, I'll take number two.  Cause, they can't just 'do nothing', right?

Definitely not forever.

[theFlyingHog]

Buy Volkswagen.









Disclosure: this poster is long VW

[JoeyCapital]

Buy Volkswagen.









Disclosure: this poster is long VW

That avi is the new league leader, btw.

[aristotle]

http://www.cnbc.com/2015/10/13/ex-feds-fisher-fomc-members-have-egg-on-their-face.html

This is why I cannot buy into the stock markets right now. This unprecedented pickle the FED finds itself in. I think former Dallas Fed Chair gets it and I agree with his point. Their uncertainty is spooking the markets. The lack of assertive leadership and fracturing among members erodes confidence. If they don't move to raise rates, this confidence will continue to erode and they will have to come up with new methods (neg rates or more QE?) to deal with this lack of price inflation. If they do move, we will likely see a shock across EM currencies, many of which are trading at or near all time lows against the dollar already. It's the EM currency rout that is the elephant in the room to me.

[HawgWild]

Let's turn the light on that elephant and raise the rate. Too much drama surrounding these meetings. Never been this low, this long.

[aristotle]

Well,  here we are 3 months later. Raising a measly .25% on the interest rate (but telegraphed months/quarters in advance) has had serious effects around the globe. The Yuan-USD peg is in trouble (along with all other pegs like Saudi Arabia) under the pressure of dollar strength. The rate hike intensified it exponentially. The equity markets are hitting those 2014 lows. Now the elites at Davos are calling for more QE already while the FED holds steady.

Where do we go from here in the next 12 months, prognosticators?

[HawgWild]

Dimon's not calling for QE. He said, in essence, that the .25% increase was a non event. Same for .5% & .75%. He recalled when Volcker raised the rate 2.0% on a Sunday with no advance warning.

[aristotle]

Dimon's not calling for QE. He said, in essence, that the .25% increase was a non event. Same for .5% & .75%. He recalled when Volcker raised the rate 2.0% on a Sunday with no advance warning.

Dalio did.

http://www.cnbc.com/2016/01/20/bridgewaters-dalio-feds-next-move-toward-qe-not-tightening.html

Crazy Cramer's calling them out.

http://www.cnbc.com/2016/01/20/cramer-fed-rate-hike-good-for-nothing.html