THESIS 2011: Beggar-Thy Neighbor -(OPEN ACCESS - 37 Pages of 217)

>> GO - Sign Up for 2012 NOW >> SIGN-UP

FEBRUARY 2012: MONTHLY MARKET COMMENTARY - (Subscription Plan II)

The European Central Bank's (ECB) unprecedented use of a three year, low cost LTRO (Long Term Repurchase Agreement) policy initiative may have removed some of the short term pressures from the EU Banking crisis, but like the Greenspan PUT, the unintended consequences are not yet fully understood. One is the moral hazard which is fostering financial "games" to be played with reckless abandon. Some of the mischievous and cunning games are frankly questionably as being even legal! But then, nothing is illegal if the regulators and those organizations charged with surveillance are not bothering to investigate. Extend > Pretend > Bend is the new approach. MORE>>

FEBRUARY 2012: GLOBAL MACRO TIPPING POINTS -(Subscription Plan III)

The World Economic Forum's 2012 Risks Report, the IMF's Global Financial Stability Report and our proprietary Aggregated Global Risk Level Index (AGRLI) all suggest global macroeconomic risks are increasing. The consensus findings are that the center of gravity of Global Macro issues are a combination of Chronic Fiscal Imbalances and a Global Governance Failure.    MORE>> EXPANDED COVERAGE INCLUDING AUDIO & MONTHLY UPDATE SUMMARY

MARKET ANALYTICS & TECHNO-FUNDAMENTAL ANALYSIS

FEBRUARY 2012: MARKET ANALYTICS & TECHNICAL ANALYSIS - (Subscription Plan IV)

The market action since March 2009 is a bear market counter rally that has completed a classic ending diagonal pattern. The Bear Market which started in 2000 will resume in full force when the current "ROUNDED TOP" is completed. We presently are in the midst of of a "ROLLING TOP" across all Global Markets. We are seeing broad based weakening analytics and cascading warning signals. This behavior is typically seen during major tops.  This is all part of a final topping formation and a long term right shoulder technical construction pattern.

MORE>> EXPANDED COVERAGE INCLUDING AUDIO & EXECUTIVE BRIEF

FEBRUARY 2012: TRIGGER$ (Subscription - Plan V)

TRIGGER$ publications combine both Technical Analysis and Fundamental Analysis together offering unique perspectives on the Global Markets. Every month “Gordon T Long Market Research & Analytics” publishes three reports totalling more then 380 pages of detailed Technical Analysis and in depth Fundamentals. If you find our publications TOO detailed, we recommend you consider TRIGGER$ which edited by GoldenPhi offers a ‘distilled’ version in a readable format for use in your daily due diligence. Read and understand what the professionals are reading without having to be a Professional Analyst or Technician.

TRIGGER$ ALERTS (SPECIAL 2 WEEK TRIAL AVAILABLE - TRIAL - 2 UPDATES PER WEEK)

2 WEEK FREE TRIAL Our Inter-Issue Updates and Alerts are Included with a Monthly Subscription to Triggers. Between issue publication receive updates on Technical Analysis, Economic Analysis and anything note worthy for your trading and investing.

• Technical Analysis Alerts would include hitting potential Trigger Points, Pivots orsome progression that requires you immediate attention.
• Economic Analysis Updates alert of any fundamental economic events that may have impact on the markets and what to expect.
• Inter-Issue Updates and Alerts allow us to keep current with the markets and provide a more fluid and stable ongoing market evaluation.

Technical Updates occur twice a week, Alerts as the markets dictate. Sign-up now

>> LONGWave >> VOLUME & VOLATILITY December 12th, 2011

EURO EXPERIMENT :  ECB's LTRO Won't Stop Collateral Contagion! Released December 27th, 2011
I would argue that the problem short term is a shortage of real collateral and that US dollar cash, versus 'encumbered' cash flow, is now king. It is clear that the rampant advancing Collateral Contagion will quickly eat the futile LTRO attempt like ravenous wolves. A well circulated Tweet from PIMCO bond king Bill Gross said it all: " What does LTRO stand for? 1- A shell game; 2-Cash for trash; 3 Three-card Monti; or 4. All of the above." Here is the stark reality of what forced the ECB to offer unprecedented three year loans at absurd rates and most alarmingly, the acceptance of collateral that no other financial institutions will accept. The ECB has sacrificed its balance sheet in yet another EU "kick at the can". MORE>>

ECB - GREEK BOND SWAPS

Greece sets date for €200bn debt swap 02/18/12 FT

Could ECB Greek Bond Swap Trigger Ratings Default? 02/18/12 WSJ

• The ECB won’t book any profits or losses on its bond swap, but that might be enough to be considered default. If, for example, the ECB purchased the bonds at 50 cents on the dollar and the new bonds are now worth what the ECB paid that would mean the new bonds are worth less than the face value of the original bonds. While the ECB would come out without making or losing money, to ratings firms that would be considered a reduction in the value of the bonds and should theoretically trigger a default.
• If the ECB debt swap doesn’t trigger a default by Fitch, S&P and Moody’s, the expected private sector bond exchange could easily clinch that distinction for Greece.
• The private sector bond swap aims to cut the value of the bonds currently outstanding by half, which would be a clear loss for bond holders and meet ratings firms criteria for default.
• A second avenue for a downgrade to default could come if Greece’s parliament passes legislation introducing a so-called collective-action clause and retroactively applying it to outstanding debt. The clauses say that if a certain portion of bond holders agree to a debt restructuring every single bond outstanding is subject to the same restructuring.
• S&P said earlier this month that even retroactively adding that clause whether it is used or not could be enough to consider Greece in default because it is materially changing the terms of the debt.

ECB Concludes Greek Bond Exchange 02/18/12 WSJ

• The European Central Bank has completed an exchange of Greek bonds it bought starting in 2010 for new bonds from the Greek government that shield the central bank from incurring losses, paving the way for a massive debt-relief operation Monday.
• The swap applied only to the roughly €50 billion in Greek bonds purchased via the ECB's nearly two-year-old bond-purchase program.
• The operation doesn't include the estimated €12 billion in other Greek bonds held by individual central banks as investments.
• National central banks that hold Greek bonds separately from the ECB's Securities Market Program, or SMP, will have to negotiate individually with the Greek government to protect those bonds against losses.
• The ECB's bond swap aims to draw a clear legal distinction between those bonds bought by the central bank as part of its monetary policy, and €200 billion in bonds held by private creditors, which are due to be restructured, slashing their value.

ECB considers losses on Greek bonds held by national banks 02/18/12 Reuters

ECB avoids forced losses on Greek bonds

• ECB to Exchange Greek Bonds 02/17/12 WSJ
• Germany, Bank Ease Tensions on Bailout 02/17/12 WSJ A debt restructuring and second bailout for Greece appeared likely to go ahead, as German officials scrapped an idea to pressure Greece by withholding part of the bailout and the ECB developed a plan to protect its holdings of Greek bonds from the restructuring.
• Europe’s Central Bank Is Said to Ready Swap of Its Greek Bonds 02/16/12 NY Times
• The ECB is swapping Greek bonds for new ones of equal structure and nominal value, to avoid losses in a debt restructuring, according to Bloomberg. And Germany wants euro-area finance ministers to avoid a two-step vote on a €130 billion bailout for Greece, when they meet in Brussels on February 20
• ECB avoids forced losses on Greek bonds FT
• Completed ECB Bond Exchange Is "Biggest Screwing Of Our Lives" 02/17/12 Zero Hegde DOW JONES REPORTS THE ECB GREEK BOND SWAP IS NOW DONE. THIS MEANS THAT EACH AND EVERY EUROPEAN BOND THAT YOU OWN IS NOW SUBORDINATED TO THE ECB AND THE EUROPEAN UNION. IF THEY CAN SWAP THEIR BONDS FOR NEW BONDS WITH DIFFERENT TERMS, NO CAC CLAUSE IN THIS CASE, THEN THEY CAN SWAP THEIR BONDS FOR ANY TERMS AND CONDITIONS THEY LIKE WHILE THE BONDS OF PRIVATE HOLDERS ARE HELD TO THE ORIGINAL INDENTURE. THE EQUITY MARKETS MAY RALLY ON THIS NEWS BECAUSE THEY ARE FOCUSED ON A DEAL GETTING DONE BUT ANYONE IN FIXED INCOME SHOULD NOW CONSIDER RETCHING UNDER THEIR DESKS AS WE ALL JUST TOOK ONE OF THE BIGGEST SCREWINGS OF OUR LIVES THAT MAY WELL NOT BE A SINGULAR EVENT.

Moody's Warns 17 Banks Could Be Downgraded — Credit Suisse, UBS And Morgan Stanley Could Fall 3 Levels 02/16/12 BI

• Moody’s Warns Big Banks of Possible Credit Rating Cuts 02/16/12 NY Times The ratings agency is reviewing 17 global banks, including Morgan Stanley, Citigroup, Goldman Sachs, Bank of America and Credit Suisse, for possible downgrades to their long-term credit ratings, dulling optimism caused by a monthlong rally in which major banks have recovered some of last year’s losses. Moody’s said it was weighing the risks to the institutions’ investment banking models and exposures to its capital markets business, which include trading securities and underwriting stocks and bonds.
• Moody's Places Big Banks' Ratings on Review 02/16/12 WSJ

CHINA TO SUPPORT EU

China Bolsters Rhetorical Support for Europe 02/15/12 WSJ China's central bank pledged to increase its holdings of euro-denominated assets, bolstering Beijing's rhetorical support but stopping short of a specific investment plan.

• Rumor Regurgitation Time: China To The Rescue... All Over Again 02/15/12 Zero Hedge
• Europe Is Loving These Comments By China's Central Banker 02/15/12 BI

Europe Faces Larger Bill for Greece 02/18/12 WSJ

EU - DOWNGRADES

Moody's Downgrades Italy, Spain, Portugal And Others; Puts UK, France On Outlook Negative - Full Statement 02/14/12 Zero Hedge

• Austria: outlook on Aaa rating changed to negative
• France: outlook on Aaa rating changed to negative
• Italy: downgraded to A3 from A2, negative outlook
• Malta: downgraded to A3 from A2, negative outlook
• Portugal: downgraded to Ba3 from Ba2, negative outlook
• Slovakia: downgraded to A2 from A1, negative outlook
• Slovenia: downgraded to A2 from A1, negative outlook
• Spain: downgraded to A3 from A1, negative outlook
• United Kingdom: outlook on Aaa rating changed to negative

In other news, we wouldn't want to be the company that insured Moody's Milan offices

GREECE - Drama: A Greek Tragedy

Athens faces tough bail-out terms €130bn deal imposes unprecedented controls on Greece 02/17/12 FT

• Berlin keeps unearthly hush on eurozone crisis In learning to be a leader, Germany can still be clumsy and insensitive 02/17/12 FT
• ECB avoids forced losses on Greek bonds
• Berlin split on Greek bail-out
• Uncertainty surrounds Greek rescue deal
• IMF to the rescue
• Scepticism at talk of Greek default

Greek rhetoric turns into battle of wills 02/16/12 FT Venizelos talks of ‘forces’ pushing Athens out of euro

• Scepticism at talk of Greek default
• A personal journey to the heart of Greece’s darkness
• More on leaked Greek debt deal
• Does Germany want Greece out?
• Eurozone contraction smaller than feared

Cracks in Agreement in Greece, Finland, Germany, France; Of Duct Tape, Glue, Rubber Bands 02/14/12 Mish

• Greek economy spirals down as EU forces final catharsis Telegraph A Greek default and traumatic ejection from the euro moved a step closer last night after eurozone finance ministers cancelled a crucial meeting...
• Greece faces tough job to seal rescue 02/14/12 Reuters Greece's creditors will take a net loss of 70 percent, two of the sources
  

EU tries to finalise €130bn Greek bail-out 02/13/12 FT - Signs that Germany and allies may not approve deal

• Greek cabinet reshuffle expected
• UK and France named among EU’s ‘imbalanced’ economies
• Willem Buiter Greek concerns will resurface soon

Greece passes vote as violence erupts Austerity deal paves way for €130bn bail-out 02/13/12 FT

• Greece Passes Sweeping Cuts Lawmakers Approve Unpopular Plan to Secure Bailout as Rioting Grips Athens. 02/13/12 WSJ

The Troika Gave The Greeks An Offer They Can't Accept 02/12/12 BI

The Cost Of The Combined Greek Bailout Just Rose To €320 Billion In Secured Debt, Or 136% Of Greek GDP 02/12/12 Zero Hedge

• EL-ERIAN: Even EU Leaders Know This Greek Deal 'Will Only Last A Few Months At Best' 02/12/12 BI
• Greek lessons for the eurozone 02/12/12 Gavyn Davies
• Greece and Portugal ought to go bankrupt 02/12/12 Wolfgang Munchau

CHINA

China Cuts Reserve Requirement Ratio for Banks 02/18/12 WSJ

• China Cuts RRR By 50 bps Despite Latent Inflation To Cushion Housing Market Collapse 02/18/12 Zero Hedge
• China SignalsIts ConcernOver Growth 02/18/12 WSJ

China tells banks to roll over loans Large part of local government’s $1.7tn debt burden extended

• CBRC weighs debt extensions China Daily The CBRC declined to say how much local government debt might be rolled over
  
• China extends loans to avoid mass default 02/12/12 FT

Chinese city forced into property U-turn Wuhu backtracks on plan to boost real estate after Beijing visit 02/13/12 FT

• Beijing office rents outstrip New York 02/13/12 FT
• Worries grow as China land sales slump 02/13/12 FT
• Beijing urged to bolster house sales 02/13/12 FT

Athens On Sunday Night - Pictures 02/13/12 BI

Athens erupts in violent protests MPs wait to vote on austerity deal as buildings burn

ATHENS IS ABLAZE: Parliament Prepares To Vote On Austerity

• Athens Burning As Police Runs Out Of Tear Gas 02/12/12 Zero Hedge

IRAN-ISRAEL

Israel accuses Iran over Thailand blast 02/15/12 FT

ISRAELI EMBASSIES ATTACKED IN THREE COUNTRIES, NETANYAHU BLAMES IRAN 02/13/12 BI

Iran Patrol Boats, Drones Shadow CVN-72 Abraham Lincoln As It Passes Through Straits Of Hormuz 02/14/12 Zero Hedge

CHRONIC UNEMPLOYMENT

Gallup Reports Unemployment in February Increases to 9%, Up From 8.6%; Underemployment Increases to 19% 02/18/12 Mish The U.S. unemployment rate, as measured by Gallup without seasonal adjustment, is 9.0% in mid-February, up from 8.6% for January. The mid-month reading normally reflects what the U.S. government reports for the entire month, and is up from 8.3% in mid-January.

Gallup also finds 10.0% of U.S. employees in mid-February are working part time but want full-time work, essentially the same as in January. The mid-February reading means the percentage of Americans who can only find part-time work remains close to its high since Gallup began measuring employment status in January 2010.

MAULDIN: The Truth Is It Doesn't Matter Who's President -- We'd Be Screwed Regardless

Taste for Subprime Bonds Returns 02/16/12 WSJ

Investors' belief that the worst is over for the U.S. housing market is fueling renewed interest in once-toxic mortgage bonds that were at the heart of the financial crisis.

The latest upswing has some money managers setting up investment funds dedicated to buying beaten-down mortgage bonds, hoping to reap fat yields while waiting for the housing market to turn

Bell Rings for Bond Bubble 02/14/12 Pento The mania behind the U.S. debt market has reached such incredible proportions that investors are now willing to lend money to the government at a loss

• Gross Buys Treasuries as Buffett Says Bonds Are ‘Dangerous’ 02/14/12 BL
• Ready for a bear market in bonds?02/14/12 Fleckenstein

Access to junk bond market revives LBOs ‘Walking dead’ companies get new access to funds

• Record global sales of junk bonds 02/12/12 FT
• Europeans turn to US junk bonds to renew loans 02/12/12 FT
• GRANTHAM: 'We Are Literally Running Out Of Superlatives To Describe How Much We Hate Bonds' 02/12/13 Grantham GMO Quarterly Letter

Bond investors face euro reckoning 02/18/12 FT

HOUSING

Economic Report of the President February 2012 White House

The Scariest Housing Market Chart Ever 02/18/12

1. We've never experienced anything on this depth,
2. If past busts are to be believed, then we're still a year or more from the bottom,
3. Housing busts are really rare in US history.

JAPAN

Japan Slowly Wakes up to Doomsday Debt Risk 02/18/12 Reuters

• Is Japan next? 02/18/12 Fortune Japan's debt levels have ballooned to a level that makes Greece look like a steward of capital. Wall Street has noticed, and it's placing its bets.
• Man Bites Dog: Bank of Japan Wants More Inflation 02/18/12 BL Japan's central bank has taken advice that Ben Bernanke offered...
• Japanese manufacturing - From summit to plummet 02/18/12 Economist
  

Bank of Japan Sprays World With Surprising ¥10 Trillion ($130B) Gift In Valentine's Day Liquidity 02/14/12 Zero Hedge - The Janapese central bank expanded their existing plan by ¥10 trillion, or about $130 billion. The facility, which includes low-cost loans, is now worth about ¥65 trillion, or $844 billion." The rub however lies in the total Japanese GDP, which at last check was $6 trillion (give or take), and declining. Which means this announcement was the functional equivalent to a surprise $325 billion QE announced by the Fed. What is ironic is the market reaction: the BOJ expands its LSAP by 18% and the USDJPY moves by 30 pips.

• Japan Announces $130 Billion QE Program, One Percent Inflation Target; 4th Quarter GDP Unexpectedly Contracts 2.3%; Lawmakers Threaten to Take Over Monetary Policy 02/14/12 Mish
• BOJ Adds to Monetary Easing After Contraction 02/14/12 BL

Japan’s GDP shrinks 2.3% in fourth quarter Economy squeezed by strong yen and low demand 02/13/12 FT

Oil Rise Threatens Recovery 02/16/12 WSJ

Rising gasoline prices are threatening to stall the U.S. economic recovery just as it appears to be gaining momentum. Oil prices have climbed sharply in recent weeks as mounting tension with Iran has raised the threat of a disruption in global supplies. On Wednesday, oil futures on the New York Mercantile Exchange rose $1.06 to $101.80 a barrel on reports that Iran had cut off sales to six European countries in response to the European Union's newly stepped-up sanctions. Iran's oil ministry later denied the report.

• Brent Priced In EUR At Record Highs 02/16/12 Zero Hedge

FUNDAMENTALS - EARNINGS

• SocGen fourth-quarter profits fall 89% French bank hit by fresh Greek writedowns 02/16/12 FT
• RBS plan puts 10,000 jobs at risk FT
• BNP Paribas Profit Hit By Greece 02/15/12 WSJ

• Yamaha's Rough Road Ahead 02/17/12 WSJ Yamaha Motor has taken many of the right turns to lessen its dependence on the stagnant Japanese market and reduce currency exposure, but the motorcycle maker is forecasting a profit decline of 37% in 2012.

Housing Agency's Reserves at Risk The Federal Housing Administration could exhaust its reserves over the coming year, which would require a Treasury infusion for the first time in its 78-year history.

Russia Dumps Treasurys For 14 Consecutive Months; China Slashes Holdings To Lowest In Over A Year 02/16/12 Zero Hedge - Two things bear pointing out: the very demonstrative selling of US paper by Russia continues, and is now in its 14th consecutive month (as has been reported here consistently), as total USTs in Putin's possession declined to a fresh multi-year low of $88.4 billion, half of the $176 billion in October 2010. Also confirming that the Asian anti-USD axis is now one which consists of at least Russia and China (and certainly Iran), was the stepwise dump of US paper by Beijing which sold $32 billion in US bonds in December, bringing its total to a new post 2010 low of $1100.7 billion. And lastly, this was not isolated to just these two: in December the grand total of US Treasury holding by foreigners declined from $4.75 trillion to $4.732 trillion. The question then is: just what are China and Russia buying (ahem stockpiling) with all the dollars that are not recycled back into Treasurys?

RETAIL SALES

Unadjusted January Retail Sales Post Biggest Sequential Plunge In History 02/15/12 Zero Hedge - The plunge from $459.8 billion in December to $361.4 billion in January, or -$98.5 billion in one month, was the biggest one month drop in retail sales in history. Now we won't say much on this topic, suffice to say that it would be far more useful if the BLS and Census Bureaus were to open up their models and explain in nuanced detail just what "old normal" adjustments they still incorporate into data sets. Because as many have already noted, seasonal adjustments used for data from 1980 to 2008 when "up" was the only allowed direction for everything, are completely irrelevant and misleading in the New Deleveraging Normal.

Conspicuous Correlation: Retail Sales January 2012 02/15/12 Paper Money - The U.S. Census Bureau released its latest nominal read of retail sales showing a 0.4% increase from December and an increase of 5.8% on a year-over-year basis on an aggregate of all items including food, fuel and healthcare services.

Nominal "discretionary" retail sales including home furnishings, home garden and building materials, consumer electronics and department store sales increased 0.47% from December and increased 4.86% above the level seen in January 2011 while, adjusting for inflation, “real” discretionary retail sales increased 2.23% over the same period.

Headline Retail Sales Miss For Third Month In A Row, First Threepeat Miss Since July 2008 02/15/12 Zero Hedge

Abercrombie & Fitch will shutter 180 stores in 3 years

US BUDGET

Budget Backs 'Buffett Rule,' Targets AMT Obama proposed that the widely criticized alternative minimum tax be replaced by the so-called Buffett rule, which targets the wealthiest Americans.

Obama Plan Takes Aim at GOP Policies Obama used his $3.8 trillion fiscal 2013 budget proposal to attack Republican policies, underscoring the political stakes this year.

• Saturday Mail May End
• War-Spending Cap Sought
• Data: Budget Crunching
• Washington Wire: Updates
• Complete Coverage
• In His Budget, President Obama Backs A 'Responsibility Fee' For Financial Firms 02/13/12 BI
• 4 Charts Summarizing Obama's 2013 Budget 02/13/12 Zero Hedge
• Peak Political Polarization As Obama's Budget Increases Rhetoric 02/13/12 Zero Hedge
• Obama Presents His 2013 Proposed Budget - Live Webcast 02/13/12 Zero Hedge

• Jeffrey Sachs An American budget for the rich and powerful
• Obama sets out his budget priorities
• FT Alphaville $1tn US spending cuts

Obama Proposes Massive Tax Hikes, Still Comes Up With $1.33 Trillion Deficit; Obama's "Race to the Bottom" Education Proposal; Dysfunctional Congress 02/13/12 Mish

NEWS ANALYSIS

• Politics trumps policy in Obama 02/13/12 CNN
• Budget quagmire revealed by Social Security disability program Samuelson

FOMC MEETING MINUTES

Fed rules out further easing to boost recovery - Some FOMC members say buys may be needed ‘before long’ 02/16/12 FT FED MINUTES

• Fed minutes: Members divided over more bond buys 02/15/12 BL
• FOMC Minutes: "More Bond Buying May Be Necessary" 02/16/12 Zero Hedge

• A FEW FED OFFICIALS SAID MORE BOND BUYING MAY BECOME NECESSARY. So (1-Few) did not see it as necessary
• FOMC PARTICIPANTS SAW `GRADUAL’ IMPROVEMENT IN LABOR MARKET
• FOMC OFFICIALS SAW `MODERATE’ IMPROVEMENT IN HOUSEHOLD SPENDING
• FOMC PARTICIPANTS SAW `DEPRESSED’ HOUSING SECTOR
• FOMC OFFICIALS SAID GLOBAL FINANCIAL STRAINS POSED BIG RISKS
• FOMC PARTICIPANTS FORECAST INFLATION WOULD REMAIN `SUBDUED’
• SOME FED OFFICIALS FAVORED QE IF INFLATION FALLS, GROWTH SLOWS

The Really Simple Argument For Why QE3 Is About To Hit 02/15/12 BI Below-target inflation and below-target unemployment. Why not do more?

• SF Fed President John Williams spells it out nicely: What does this tell us about where monetary policy should be now? Inflation in 2012 and 2013 is likely to come in around 1½ percent, below the FOMC’s 2 percent target. And clearly, with unemployment at 8.3 percent, we are very far from maximum employment. At the San Francisco Fed, our forecast is that the unemployment rate will remain well over 7 percent for several more years. This is a situation in which there’s no conflict between maximum employment and price stability. With regard to both of the Fed’s mandates, it’s vital that we keep the monetary policy throttle wide open. This will help lower unemployment and raise inflation back toward levels consistent with our mandates. And we want to do so quickly to minimize total economic damage. The longer we miss our objectives, the larger the cumulative loss to the economy.
• Is Qe Still Working - Gavyn Davies

Doug Kass: 'We're Doomed' 02/18/12 BI - "Or so says an updated look at George Lindsay's pattern," writes Doug Kass in his latest post on RealMoneyPro. Lindsay is one of the leading technicians in the business.

Kass observed that Lindsay's "Three Peaks and a Domed House" pattern has completed its upside move, which means we should be headed down.  You can read more about the pattern at Minyanville. Earlier this year, Doug Kass wrote that that S&P 500 could "eclipse the 2000 high of 1527.46 during the second half of the year."  However, he recently shifted his tone when be found out that Nouriel Roubini, Dr. Doom himself, turned bullish on stocks. "Caveat emptor!" disclaims Kass.

This Is STILL The Most Glaring Anomaly In The Market 02/18/12 BI - The S&P and the 10-year yield moved closely up until about last December, when the stock market started taking off, and the yield stayed low. It's not some iron law that they have to move together, but it is weird that there's a divergence, because as growth expectations and risk appetites rise, you'd expect a decreasing bid for Treasuries, and thus higher yields. And the fact that that hasn't happened remains strange. Everyone seems to think that yields must be too low, but it's pretty impressive how long this divergence has remained.

FINANCIAL STRESS INDEX

The Financial Stress Index Is Flashing A Caution Signal 02-15-12 Lance Roberts

Market Volume Hits Fresh Non-Holiday Decade Lows 02/14/12 Zero Hedge - Today's NYSE volume (16% below the year's average volume) is the lowest on Bloomberg data for a non-Holiday day in over a decade. ES (the e-mini S&P futures contract) also had a dismal day with the day's total just beating February 6th previous multi-year low (non-holiday) volume and 30% below the 50-day average volume.

SocGen: QE3 Is Coming Soon, But First The S&P Is Going To Tank 02/13/12 BI

From To Email Sent!You have successfully emailed the post. It Feels Like Something Is About To Happen

China set to become biggest gold market

Shifting Landscape in Presidential Race Subtly but significantly, two forces—an improving economy and the emergence of social issues as a prime topic—are converging to shift the ground beneath the 2012 campaign.

Interest Rate Swaps- The REAL Purpose of Gold & Silver Price Suppression IR swaps artificially support the bond market by creating massive demand for bond trades that are embedded into these swaps. Thus, this massive trading of OTC IR swap derivatives creates massive artificial demand (no end user is purchasing the bond...this is merely trading for trading's sake), which results in an artificially high price for said bonds, which means interest rates are suppressed and kept at severely and artificially low rates. This is how you can see 3.5% 30 year rates when actual inflation is running 8-10% annually- massive artificial demand for bonds due to unimaginable volume of IR swap OTC's trading back and forth among the treasury's proxies JPM, Citi, HSBC, etc.

• Derivatives Interest Rate Swaps, The Elephant In the Room: More Pieces of the Puzzle Rob Kirby (Reference - Dated)

The Farce-Hole Gets Deeper: Obama's "Robo-Settlement For Votes" Cost To Taxpayers: $40 Billion 02/17/12 Zero Hedge Plunging deeper into the farce-hole, the FT reports tonight that Obama's foreclosure settlement with the banks over their improper seizure of tax-paying US citizens' homes will in fact be subsidized by those very same US taxpayers. It is a hidden clause (that has not been made public yet) that allows the banks to count future loan modifications under the $30bn (taxpayer funded) HAMP initiative towards their $35bn agreement to restructure obligations under the new settlement. As the FT goes on to note, BofA will be able to use future mods made under HAMP towards the $7.6bn in borrower assistance it is committed to provide - which means, in a (as TARP inspector general Neil Barofsky describes) 'scandalous' turn of events the bank will receive payments for averting a borrower default and be reimbursed by the taxpayer for the principal write-down. We have much stronger words for how we are feeling about this but Barofsky sums it up calmly "It turns the notion that this is about justice and accountability on its head". Are the Big Five banks truly beyond the law?

• US taxpayers to subsidise $40bn housing settlement- Unannounced clause links Hamp payments with pact 02/17/12 FT

AIG buys back old mortgage securities

EM central banks seek to stall rising currencies 02/15/12 FT