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**bsteadman** · 02-07-2013, 06:12 PM

Sign of a financial Armageddon?

Canada Free Press
Doug Hagmann
2/7/2013

Excerpt:

If you’re like me, you’re just a “regular” person whose lack of understanding of the stock market is enough to keep you away from it. For me, it’s a spectator sport that’s rigged at the highest levels in favor of the “initiated ones,” or as Gerald Celente calls them, the “white shoe boys.” If you’re like me, you probably don’t have any insider channels of information that would permit you to make $100,000 in the short span of ten months from a single $1,000 investment in cattle futures, the way Hillary Rodham Clinton did in 1994. Okay, so take me to task because the stock and future markets are two separate trading venues, but you get the idea.

But just as you needn’t stick your hand in a blender to know it’s going to hurt and leave a mark, you don’t need to be a financial genius to know that certain market trades indicate an insider foreknowledge that something bad might be headed this way. One case in point is the odd put options on airline stocks just before the attacks on September 11, 2001. You know, the trades that according to the Keene Commission were merely coincidental and not out of the ordinary at all. A “put option,” by the way, is a “bet” made by someone that a particular stock or asset is going to lose value by a certain date.

Lest you still cling to that outlandish conspiracy nonsense and continue to feel that something is still amiss with the 9/11 put options, rest assured that the crack investigative husband and wife team known as “Snopes” has determined that you are in need of a cup of steeping hot passionflower tea and a strong pharmaceutical to pull you back into the reality of Oz. Their source, of course, is none other than the Keene Commission Report itself. Go figure.

An ominous contemporary warning

Something happened this week that brings back haunting memories of the 2001 put options of airline stocks, except this “bet” is against the entire U.S. economy. This week, an anonymous trader bought 100,000 put options on the ETF, which is an acronym for an exchange-traded fund. One commonly traded ETF is XLF, which, in the most unscientific and basic terms, is a group of funds that is like a barometer for the stock market.

Now, such trades involving ETF-XLF are common, except when the put options (bets that the value of an asset is going to go down) are so large and so significant that they scream of insider knowledge with big flashing lights and arrows. This is one of those. In this case, it is a bet against the stock market, although this is admittedly a rather oversimplified explanation - but you get the idea.

According to professionals who watch this activity for a living, normal single trades involve maybe 500 contracts at most. That’s why certain professionals took notice of an order this week of 100,000 put options, or 200 times the high trade volume of 500. It become even more curious when one considers that the trader is “betting” that the market will take a significant hit by the end of April. (The put options are dated for April 20 and 25, 2013, right around Hitler’s birthday, for those of you who follow things like that.)

At this point, I could mention that the VIX, or volatility index (a/k/a the fear index) is at historical lows and a bet like that recently made is actually contrary to the trend, thus making the “bet” even more curious, but I’ll spare you the market talk that I barely understand. I will, however, tell you this. I contacted a stock broker yesterday with over 25 years of experience in the market and asked about this put option. He said that he is aware of this activity, and told me that someone is risking a lot of money betting on a major stock market correction.

“A crash?” I asked him. “Explain it to me,” I pleaded.

“Shhhh, we don’t use that term,” was his reply, as he opened his desk drawer and grabbed a bottle of antacid tablets. “Someone seems to know something. I’ve never seen anything quite like this,” was his reply. “Well, maybe once. Remember those put options before 9/11?”
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View the complete article at:

http://www.canadafreepress.com/index.php/article/52961

**bsteadman** · 02-16-2013, 03:25 PM

Wal-Mart shares tumble on leaked memo citing sales weakness -- Chicago Tribune

Wal-Mart shares tumble on leaked memo citing sales weakness

Chicago Tribune
Copyright © 2013, Reuters
2/15/2013

Excerpt:

Shares of Wal-Mart Stores Inc fell 2.1 percent on Friday after Bloomberg quoted a mid-level executive's email as saying the world's largest retailer had the worst sales start to any month in seven years in February.

Wal-Mart executives blamed the poor sales performance on increased payroll taxes as well as delayed tax returns, Bloomberg said.

Higher payroll taxes this year are seen as a potential problem for Wal-Mart and other discount retailers that try to attract lower-income customers who have less disposable income.

"In case you haven't seen a sales report these days, February (month-to-date) sales are a total disaster," Jerry Murray, a Wal-Mart vice president who works on finance in the U.S. logistics division, said in a Feb. 12 email to other executives, Bloomberg reported. "The worst start to a month I have seen in my (about) 7 years with the company."

The weak February sales start came after a disappointing January, according to an email from Cameron Geiger, senior vice president of Wal-Mart U.S. Replenishment. Geiger's email was also quoted by Bloomberg. The replenishment department works on moving products from distribution centers to stores.

"Have you ever had one of those weeks where your best- prepared plans weren't good enough to accomplish everything you set out to do?" Geiger asked in a Feb. 1 email to company executives. "Well, we just had one of those weeks here at Walmart U.S. Where are all the customers? And where's their money?"
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View the complete article at:

http://www.chicagotribune.com/busine...,2509701.story

**bsteadman** · 02-17-2013, 02:51 PM

The Bernanke shock and Germany’s gold repatriation

Resource Investor
Peter Schiff
2/4/2013

Excerpt:

The financial world was shocked this month by a demand from Germany's Bundesbank to repatriate a large portion of its gold reserves held abroad. By 2020, Germany wants 50% of its total gold reserves back in Frankfurt — including 300 tons from the Federal Reserve. The Bundesbank's announcement comes just three months after the Fed refused to submit to an audit of its holdings on Germany's behalf. One cannot help but wonder if the refusal triggered the demand. - (bold, underline and color emphasis added)

Either way, Germany appears to be waking up to a reality for which central banks around the world have been preparing: The dollar is no longer the world's safe-haven asset and the U.S. government is no longer a trustworthy banker for foreign nations. It looks like their fears are well-grounded, given the Fed's seeming inability to return what is legally Germany's gold in a timely manner. Germany is a developed and powerful nation with the second largest gold reserves in the world. If they can't rely on Washington to keep its promises, who can?

Where is Germany's Gold?

The impact of Germany's repatriation on the dollar revolves around an unanswered question: Why will it take seven years to complete the transfer?

The popular explanation is that the Fed has already rehypothecated all of its gold holdings in the name of other countries. That is, the same mound of bullion is earmarked as collateral for a host of different lenders. Since the Fed depends on a fractional-reserve banking system for its very existence, it would not come as a surprise that it has become a fractional-reserve bank itself. If so, then perhaps Germany politely asked for a seven-year timeline in order to allow the Fed to save face, and to prevent other depositors from clamoring for their own gold back — a 'run' on the Fed.

Now, the Fed can always print more dollars and buy gold on the open market to make up for any shortfall, but such a move could substantially increase the price of gold. The last thing the Fed needs is another gold price spike reminding the world of the dollar's decline.

Speculation Aside

None of these theories are substantiated, but no matter how you slice it, Germany's request for its gold does not bode well for the future of the dollar. In fact, the Bundesbank's official statements are all you need to confirm the Germans' waning faith in the U.S.

Last October, after the Bundesbank had requested an audit of its Fed holdings, Executive Board Member Carl-Ludwig Thiele was asked in an interview why the bank kept so much of Germany's gold overseas. His response emphasized the importance of the dollar as the world's reserve currency:

"Gold stored in your home safe is not immediately available as collateral in case you need foreign currency. Take, for instance, the key role that the U.S. dollar plays as a reserve currency in the global financial system. The gold held with the New York Fed can, in a crisis, be pledged with the Federal Reserve Bank as collateral against U.S. dollar-denominated liquidity."

Thiele's statement can lead us to only one conclusion: By keeping fewer reserves in the U.S., Germany foresees less future need for "U.S. dollar-denominated liquidity."
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View the complete article at:

http://www.resourceinvestor.com/2013...d-repatriation

**bsteadman** · 02-19-2013, 01:58 AM

Gas Prices Surge To Highest Ever On This Day At Fastest Pace In Four Years

Zero Hedge
Tyler Durden
2/18/2013

Excerpt:

Despite being weeks away from the start of the driving season proper, gas prices - at the pump - have been surging recently. With premium now over $4 nationwide (over $5 in SoCal - up 25 days in a row), this is the most expensive gas has ever been for the second week in February despite gasoline being relatively well supplied. Gasoline futures have ripped higher as unplanned maintenance, refinery closings, and rising crude oil prices (seemingly more central bank liquidity-driven than middle-east tensions) have impacted wholesale price expectations (and thus retail). The 44c rise is the fastest in four years and the year-to-date surge over 12% (outpacing stocks) is almost four times faster than average. What is more worrisome is the fact that seasonally the next month or two are when the biggest price spikes occur - which coupled with the tax-hike drag, will inevitably eat into people's spending habits and sentiment.
- (bold and color emphasis added)

Gas Prices at the pump are the highest on record for this time of year...
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View the complete article at:

http://www.zerohedge.com/news/2013-0...ace-four-years

Chart: Historical Retail Price of Gasoline

http://gasbuddy.com/gb_retail_price_chart.aspx

**bsteadman** · 02-19-2013, 01:41 PM

Investors Finally Shed Fears*

Comfort Level Is Increasing That Another Major Market Meltdown Isn't Lurking

Wall Street Journal
Tom Lauricella
2/19/2013

View the complete article at:

http://online.wsj.com/article/SB1000...361498800.html

My comments:

(1) * HEADLINE ARTICLE - Section C: Money & Investing

This might be considered a 'contrary indicator' signifying excessive 'bullishness'. Some market internals, such as the 'Percent of Stocks Above Their 40 Day Price Moving Average', are now starting to deteriorate, perhaps indicating future problems.

How biz media is often a contrary indicator

http://www.talkingbiznews.com/1/how-...ary-indicator/

(2) I note that the stock for Monster Worldwide (MWW) has been hitting lows of below 5.5 on repeated occasions since the middle of last November. It closed down 5% on Friday to reach a low of 5.32, which is a little lower than it was in March 2009 at the bottom of the 2008 'financial crash'.

The recent, poor performance of this key 'job market related' stock is certainly NOT an encouraging indicator of global recovery in the near future.

http://ir.monster.com/phoenix.zhtml?...&p=irol-irhome

**bsteadman** · 02-21-2013, 01:13 AM

The S&P 500 dropped about 1.25% today, 2/20/2013, on higher than normal volume, which is certainly significant. This is the biggest single day drop for the S&P 500 since November 14th.

The "Percent of Stocks Above Their 40 Day Moving Average' dropped by about 10.5% today. (Closing Values: 70.28 % on 2/19/2013, 62.87 on 2/20/2013 - an absolute drop of 7.41%)

Other indicators of Market health also appear to be deteriorating.

Only time will tell if this is the start of a simple correction, or something more ominous.

SPDR S&P 500 Stock Chart

http://finance.yahoo.com/q/bc?s=SPY&...=on&z=l&q=l&c=

Fed Officials Divided on Future of QE

http://www.cnbc.com/id/100476177

**bsteadman** · 02-22-2013, 12:50 PM

Payroll Tax Whacks Spending

Firms Adjust as Resumption of Levy, Expensive Gas, Stagnant Wages Bite Consumers

The Wall Street Journal
Shelly Banjo, Annie Gasparro and Julie Jargon
2/21/2013

Excerpt:

Wal-Mart Stores Inc. WMT +1.49% on Thursday joined a parade of retailers, restaurants and consumer-goods companies worried about the economic impact of the recently restored federal payroll tax that has left Americans with less money to spend.

The world's largest retailer, Burger King Worldwide Inc., BKW -0.34% Kraft Foods Group Inc. KRFT -0.80% and others are lowering forecasts and adjusting sales and marketing strategies, expecting consumers with smaller paychecks to dine out less and trade down to less expensive purchases.

The expiration of the payroll tax cuts that knocked 2% off consumers' take-home pay is having an impact, these companies say. It will ding a household with $65,000 in annual income $1,300 this year, and shift $110 billion overall out of consumers' hands, estimates Citigroup C -2.05% .
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View the complete article at:

http://online.wsj.com/article/SB1000...889335274.html

**bsteadman** · 02-23-2013, 08:14 PM

The REAL Fiscal Cliff

Money and Markets
Martin D. Weiss, Ph.D.
2/23/2013

Excerpt:

Complacency in Washington has now reached such an extreme that even the warnings of our highest officials are mocked, ripped apart, or simply ignored.

Some of the Fed’s most senior governors warn that their $85-billion-per-month bond buying frenzy is creating a new speculative bubble. But Fed Chairman Bernanke and his allies turn a deaf ear, vowing to plow ahead till kingdom come.

The Congressional Budget Office (CBO), the Government Accountability Office (GAO), the International Monetary Fund (IMF), and virtually every respected private research think-tank produce study after study of fiscal doom — all relegated to the junkyard of history.

The president warns of the sequester catastrophe beginning on March 1, just six days from now. But after so many apparent false alarms — about the looming debt ceiling shutdown in 2011 and the fiscal cliff of 2013 — he gets more shaking of heads and more rolling of eyes than the boy who cried “wolf.”

What’s ironic is that THIS time, precisely BECAUSE the warnings are falling on deaf ears, the real wolf is now prowling.

And not only is she likely to strike on March 1, but she’s also likely to continue striking for months to come.

According to The New York Times …

“Despite new calls from the White House … to enact a combination of tax increases and cuts to postpone the so-called sequester, the House is moving forward on a legislative agenda that assumes deep and arbitrary cuts to defense and domestic programs — once considered unthinkable — will remain in place through the end of the year.

“In the last showdowns won by the president, inaction was seen as intolerable. Had Republicans done nothing in 2011, a temporary payroll tax would have lapsed without offsetting tax cuts to ease the blow. On Jan. 1, every tax cut of the Bush administration would have expired at once had the Republicans not relented and let some taxes rise. This time, Republicans need not do anything and deep spending cuts they have demanded for years will go into force automatically.”

All that seems to matter is an escalation in the blame game.

This means that neither side is motivated to solve the problem simply because BOTH sides consider themselves politically immune to the fallout — as long as they can win the blame game.

What’s even more ironic is that even IF, as the president warns, 700,000 jobs are sacrificed … our military readiness is compromised … TSA employees are laid off … and economic growth is scrapped …

Barely a dent will be made in the federal deficit. Washington will STILL be running yearly red ink of close to $1 trillion dollars.

And here’s the most ironic aspect of all …

What no one seems to understand — whether among those issuing the warnings or among those ignoring them — is that the real fiscal cliffs, the real debt limits, and the real budget sequesters are not the ones artificially crafted in Washington by officials with a particular political agenda.

They are the fiscal cliffs, debt limits, and sequesters that are now threatening to emerge in the world’s BOND MARKETS!

These markets are the ONLY mechanism on the planet with the true power to bring an end to the spend-borrow-and-print epidemic that has swept the globe.

These bond markets — along with related debt markets — are far larger than all the stock markets of the world.

They are largely beyond the control of any central banker, minister of finance, or head of state.

And they are careening toward a real cliff even as we speak.

Surprised? You shouldn’t be because:

* It has happened before. For a blow-by-blow account of exactly how the U.S. government bond market fell off a cliff and forced a past president to deliberately smash the economy and effectively forfeit his second term, see “Bubble Bursting NOW!”

* It is happening now. For a clear description of how far and fast bond markets have already plunged — and why — see Mike Larson’s “Bond Forecasts Coming True — in Aces and Spades!”

* It’s only logical that it will continue to happen for months to come:

We have trillion-dollar deficits in the U.S. and similar deficits overseas.

We see absolutely nothing done to control them. So it’s only logical that bigger and bigger supplies of newly issued government bonds are hitting the market.

At the same time, we have bond investors who are fed up with weak-kneed politicians and afraid of big losses. So it’s only logical that the demand for those bonds continues to sink.

We have increasing bond supplies and diminishing bond demand. So what do you get?

Falling bond prices, of course — the real fiscal cliff!

Four Things That Happen

When Bond Prices Fall

First, interest rates go up. It’s automatic, built into the way bonds were created. The lower the price, the higher the interest rate.

Second, the cost of financing the deficit goes through the roof. The government must pay higher interest costs. They must borrow additional money to cover those costs. And then they must pay still more interest on the additional borrowings — a debt trap that strangles any institution or individual caught in its grip.

Third, the huge burden of interest costs siphons off funds — from defense, national security, and every other budget item. (This is the real sequester.)

Fourth, the supply of capital to keep the government running begins to dry up. The government finds it hard to borrow at ANY cost. (This is the real debt limit.)

I repeat: This is what happened before. And this is what’s on the way to happening again.

Skeptics Say:

“But the Fed Will Never Let That Happen.”

Poppycock! The Fed stepped up its bond buying to support the bond market last fall. It’s been buying $85 billion in bonds per month ever since.

But even as the Fed has been buying, global investors have been selling!

And in the battle between one central bank (no matter how powerful) and countless inflation-fearing investors in the open markets, who do you think wins?

The investors, of course!

That’s why bond prices have been going down ever since the Fed introduced its new round of bond buying last year. And that’s why they will continue to go down.

All this is with Fed Chairman Bernanke still standing firm against bond buying critics inside the Fed itself, still plowing ahead with his program!

Imagine what will happen if those critics gain influence and power … if the Fed begins to back off from its money printing binge … and ultimately, if it abandons its massive support for the bond market!

Bonds will collapse.
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View the complete article at:

http://www.moneyandmarkets.com/the-r...al-cliff-51506

**bsteadman** · 02-25-2013, 09:03 PM

The S&P 500 dropped 1.77% today on heavy volume. This is the biggest single day drop for the S&P 500 since November 7th.

The 'Percent of Stocks Above Their 40 Day Moving Average' dropped 20.14% today. (Closing Values: 60.73% on Friday 2/22/2013, 48.50% on Monday 2/25/2013 - an absolute drop of 12.23%).

The market internals are continuing to deteriorate.

I have access to records on the stock, MWW (Monster Worldwide, Inc.) going back to 1997. It closed today, down 3.44%, to reach 5.06, which I believe is a new, all-time low. As a possible broad indicator of near-future job market growth, this does not bode well for economic recovery any time soon.

**bsteadman** · 03-05-2013, 04:04 PM

The Last Time The Dow Was Here...

Zero Hedge
Tyler Durden
3/5/2013

Excerpt:

"Mission Accomplished" - With CNBC now lost for countdown-able targets (though 20,000 is so close), we leave it to none other than Jim Cramer, quoting Stanley Druckenmiller, to sum up where we stand (oh and the following list of remarkable then-and-now macro, micro, and market variables), namely that "we all know it's going to end badly, but in the meantime we can make some money" - ZH translation: "just make sure to sell ahead of everyone else."

Dow Jones Industrial Average: Then 14164.5; Now 14164.5

Regular Gas Price: Then $2.75; Now $3.73

GDP Growth: Then +2.5%; Now +1.6%

Americans Unemployed (in Labor Force): Then 6.7 million; Now 13.2 million

Americans On Food Stamps: Then 26.9 million; Now 47.69 million

Size of Fed's Balance Sheet: Then $0.89 trillion; Now $3.01 trillion

US Debt as a Percentage of GDP: Then ~38%; Now 74.2%

US Deficit (LTM): Then $97 billion; Now $975.6 billion

Total US Debt Oustanding: Then $9.008 trillion; Now $16.43 trillion

US Household Debt: Then $13.5 trillion; Now 12.87 trillion

Labor Force Particpation Rate: Then 65.8%; Now 63.6%

Consumer Confidence: Then 99.5; Now 69.6

S&P Rating of the US: Then AAA; Now AA+

VIX: Then 17.5%; Now 14%

10 Year Treasury Yield: Then 4.64%; Now 1.89%

EURUSD: Then 1.4145; Now 1.3050

Gold: Then $748; Now $1583

NYSE Average LTM Volume (per day): Then 1.3 billion shares; Now 545 million shares

View the complete post at:

http://www.zerohedge.com/news/2013-0...e-dow-was-here

Announcement

ITB - Trader has made HUGE BET something very bad will happen within the next 60 days

ITB - Trader has made HUGE BET something very bad will happen within the next 60 days

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