SP 500 and NDX Futures Daily Charts - Bow Wow

Today was another dull day, with a dead cat bounce off the lows of the past couple of days.

Tomorrow will tell us if this is a real rally back, or just reflexive dip buying.

The FOMC minutes were the big tickle today, showing that the Fed will stay on a steady taper pace to end QE in October.

Some of the Fed members noticed that the markets seem 'complacent.'

Wow. What a surprise. Floating higher on a bubble of easy money, hand delivered to some.

Have a pleasant evening.

Gold Daily and Silver Weekly Charts - The 'Independent Fed' - Deutschland vs Brasilien

Gold and silver were hit by a trailing stop boogie woogie this morning, a half feeble effort to shake out the long who are running their stop loss orders a bit close.  These sorts of things do not bother us because we have an intermediate to longer term investment horizon, right?  lol.

Otherwise gold and silver finished largely unchanged on the day.

Much more interesting than this lazy Summer trade is the World Cup game in progress, with Germany dominating Brazil, 5-0.   The Germans unleashed a four goal torrent in a six minute period of the first half.  I thought one of the goals was a replay.   Brazil has not allowed five goals in an entire World Cup series since 1998. 

Well you know what they say, lucky in the World Cup, unlucky in holding on to your gold reserves.

We *might* see some precious metals action in the latter part of July in the metals, based on some things the BRICs may be doing and some derivatives related events, but I am not overly excited about it yet.  The Fed has the markets in hand it appears. 

In response to a couple of emails I would like to take a minute to remind you all again that the Federal Reserve system is owned by their member banks, who receive a 6% dividend for their shares from the profits that the NY Fed makes on its market operations.

It is not a government entity.  It operates under the license of the law passed in 1913.   The Fed has not always existed, and the central bank in the US has an interesting and sometimes controversial history.

Although the government has some oversight, which the Fed peddles hard on their own websites, and can take measures if they have the will for it,  the Fed is a private institution with a significant amount of its market power concentrated in New York.  The Fed has its own level of 'opaqueness and independence.'   One can debate whether this is a good thing or a bad thing, or just a thing.  But I did want to reiterate that popular misconception.

For now this is the dog days of Summer, and a good time to do work outside, and to spend time with your family if you can.

We had a quick lesson in apartments for rent in Brooklyn, as our number one son will be starting graduate school in the NYC area this Fall. The rents and house prices in the NYC metro area, including Manhattan, Brooklyn, Queens, and the Jersey area around Hoboken and Jersey City, are in a barking mad real estate bubble related to the rebound in the financial sector jobs and profits.

I am hearing of many places being purchased and then left vacant as 'stores of wealth' by overseas investment money.  And this is not even as intense as the things I am hearing from friends in London.   House prices in the NYC are back to pre-financial collapse levels and beyond in many areas according to Zillow. 

Have a pleasant evening.

 

SP 500 and NDX Futures Daily Charts - Alcoa Kicks Off the 2Q Earnings Season

After the bell Alcoa beat earnings and revenues to kick off the second quarter earnings season.

It was interesting to hear Matt Miller and Barry Ritholtz on Bloomberg TV extrapolating a strong year for the SP 500 stocks off this one result.  And it was funny to see Julie Hyman correct Barry's mistake about the increase in Alcoa's revenues, which were flat year over year.  She is often a breath of fresh air in the fog of endless jawboning.

I did take off the short position I had put on US equities on Thursday. It was a fairly cynical bet on a standard 'wash and rinse.' Now we can see if anything more significant develops, but for now its the same old, same old.

Have a pleasant evening.