When Does the Rally Die? (Today???)

Reader Note:  We will be direct and to our points this morning due to lightning storms rolling through our part of East Texas this morning.

Perpetual Rally?  No, or course not.  But, in our Aggregate Index work, we were anticipating a high of 23,723.38 and at the close Wednesday it stood at 23,747.95 about 24.6 points higher than the upside minimum target.

We don’t make specific projections about anything, since we’re watchers and not “advisors” but we know from history that all previous rallies have gone up, then had some kind of a correction.

The correction ahead will be interesting.  If we get a mere pullback and then another rally that carries us to new highs, then odds are pretty good that the market will go up over summer and then tank in 2020.  However, since there’s w way to squint at the market just so, this recent rally, since the day after Christmas, looks better as a B wave (or a wave 2) and if that’s the case, then a further 20-percent down may be in the cards.

Too early to tell, but with the news events starting to pile up, it has become an amusing guessing game.  Look at what’s coming up:

  • New figures on Employment are just ahead.  When unemployment moves up half a percent from a significant low, that’s a pretty useful indicator that a recession is ahead.
  • A.I. and job automation continues to evolve and no one is really addressing (at the policy level) where the next set of new jobs will be coming from.  You know, you can only get so far making up “jobs” by creating hysteria’s (climate, sex-pref, gender-change, and social media) just so long.  Then, the fads pass and there’s that terrible sinking feeling.
  • CNN is trying to say the Robt. Mueller fishing and hooker expedition should be out with a report next weekThe Hill is already soft-peddling it and possibly anti-climatic..  Thing is, if that dissed the Donald hard, then the republicans could have  a fool’s foot race with hats in hand.  Which would be in response to the democrats who seem, in our view, ready to go with a “Thelma & Louise” kind of ticket.  Or, a Grampa the Socialist and Jokeahautus.  The politics of today are just insane. Glad to watch from a distance.
  • Data will spill out of other quarters as well, at the ripples of GovDown continue3 being blamed, by among others, Southwest Airlines, for faltering bottom line performance.

These things alone seem to hold potential for the market to briefly sober-up.  More interesting thought are the antics of society outside the hard work, make money and have fun area.

By the way, before I forget, you can get a lot more detail than  what’s in the mainstream on the “domestic terrorist story” by looking up the case number detail and lo and behold, the Feb, 14 FBI agent notes are here.  When you read the notes, please note how much seems to stem from email surveillance…  And look how central the suspect’s use of Tramadol is….which leads us to wonder is this a serious plan afoot, or someone under opioid influence?  More to come out in court, we suppose…

Anyway, that’s our first glance at the headlines that might shape the market, but the Fed Minutes our yesterday were less than worrisome on the inflation front.  As Bloomberg put it “Fed Minutes Show Officials Unsure on Need for Rate Hikes in 2019.”  No surprise for our Peoplenomics.com subscribers.  This has been pretty obvious since our report “Bernanke et al on L4L”  (Lower for Longer) rates piece on the 16th.

We’ve had this gnawing in the pit of the stomach that the Fed maybe got ahead of itself.  Especially when other countries are also adopting the L4L approach.  Example in this Retuers Exclusive: China central bank sees benchmark rate cut as last resort, may use other tools – sources.

OK, that was the foreplay for today’s action up through about 7:15 Am Central.  Markets, that had been showing a higher open, got cold feet and the Dow is looking a bit down… so let’s watch how the data releases roll out, shall we?

Fresh Data

From Census:

New Orders New orders for manufactured durable goods in December increased $3.0 billion or 1.2 percent to $254.4 billion, the U.S. Census Bureau announced today. This increase, up two consecutive months, followed a 1.0 percent November increase. Excluding transportation, new orders increased 0.1 percent. Excluding defense, new orders increased 1.8 percent. Transportation equipment, up four of the last five months, led the increase, $2.8 billion or 3.3 percent to $90.2 billion.
Shipments Shipments of manufactured durable goods in December, up four of the last five months, increased $2.1 billion or 0.8 percent to $259.7 billion. This followed a 1.0 percent November increase.”

Also for your dining pleasure, the new Philly Fed report:  It says some indicators are suggesting weaker conditions:

After release, Dow futures were down 34.

AWK *(also worth knowing)

Strong quake hits Japan’s northernmost main island Hokkaido.  But with an initial 5.5 the 5.6 in Fiji last night was bigger.

EU countries back copyright reforms aimed at Google, Facebook.  Pay attention to this because in my next follow-on to my book Broken Web (2012) you’ll see this kind of IP reform as one of the few ways to slow abuse of copyright on social media.

Dow futures down almost 40, gold futures down $9 and Bitcoins demand $3,910 from modern tulipeers.

Cheeseburger on the road for breakfast as Ure makes a mad dash for supplies from the hardware emporium.  Does this explain why live hogs were down 6-1/2 percent this morning?… moron the ‘morrow.

17 thoughts on “When Does the Rally Die? (Today???)”

  1. I’ll take one pullback w/ a side of consolidation, on the way to new All Time High (s) later in the year.
    Meantime Bond Market and Precious Metals Markets aint buying it.

    The candied-ass Bankers and Brokers on Wall Street cant handle anything higher than .02% or they go Lehman. All the time whining like they got grain sand stuck in their panties.

    They keep screwing the pooch with multi Million and Billion dollar trades gone horribly wrong, and Taxpayers keep bailing them out against their will.
    Now of course it wont be taxpayers but Depositors, Stockholders and Bond Holders left Bailing-In the banks. Take Deutsche Bank..please, yes Derivatives are 1st in line during a in-solvency event.
    Bankers caught and being prosecuted for rigging markets yet again? – see JPM and Silver.
    Which Market (s) haven’t the Banks been caught lying,cheating and stealing in??

    Why do we Americans put up this Arrogance, Mockery and Abuse, as if we are conditioned as Slaves to accept predations on our Selfs and fellow Man/Woman, W.T.F. Over.

    • Fluoride, my friend. BS least common denominator television, music that glorifies the worst not best, lack of clearly articulated national goals, lying pricks in office, and an ultra rich that pulls strings through their “institut3es” and what have you… I mean come on, what could go wrong?
      Although so far my headline this morning is working out.
      But the race is long

      • Funny that you mentioned Flouride George. My dentist is a flouride freak. He gave me this prescription fluoride toothpaste to use each evening to brush my teeth. Says it works wonders. After brushing, you don’t rinse your mouth, just exporate it out. I told him that I heard flouride was a gov’t plot to get get rid of nuclear waste by giving it to the people in toothpaste. I think he thought I was nuts. So far I am not glowing in the dark.

      • George, What can an individual do, other than do one honest vote per election, keep his own house in order(no debt, etc.), and perhaps write the the “selected reps” that represent themselves? As an individual, I don’t see any clear way for me to save the USofA! It’s our country, but I can only act as one individual, and I neither listen/watch nor transmit on public media. Many of us can see the future darkly, but are unclear how to turn the ship of state away from the icebergs. Finding a bolthole abroad is an idea, but is that better than the devil we know? I hate fighting, but I will do so ferociously if I must, though fighting a losing battle alone is pointless. I’m not giving up, but I’m not wasting energy on random acts of anything until I’m reasonably sure of what I’m doing, or at least trying to do.

      • Mike..the whole idea is to keep the average person indebted to them.
        To force them to seek out federal programs so they can exist.
        Its all laid out neat and tidy in Adolph second book. Get the people dependant on programs for existence then promote an environment of greed and start taking the programs away and giving it to the wealthy.
        This way they get the support of the masses and can take everything away from those the didn’t have control over. Propelling the elite into the stratosphere.
        If it wasn’t so evil intended its actually quite brilliant.

  2. Hi, G –

    Here at the office (work) I noticed I’m on a cost reduction list. Layoff pending.

    That said, perhaps you could do a report for job-loss prep.

    I figured this companies demise was coming so am current as of last week on dental work. I’ll check-in with a doctor next week.

    I’ve been following you for awhile now so have zero bills – thanks for that! But still don’t think I can live on less than 10K a year. :)

    • Will do! Great idea. And yes, you can live on less than $10K per year, but you need a lot more than that to begin with. $10K of cash flow, not 10K net worth.
      But I have an update of that book in the works, but one of my consulting clients wants me to do a cyber security update of Broken Web…I need to grow another brain and 10 more fingers…

      • Yes.. It can be done.
        There’s a ton of things that all have to line up though. We lost all of our income for a year. Found out unemployment isn’t usually given out except if your on a seasonal position or your company is doing mass layoffs.
        All excess has to be stopped.
        Depending on your rent car payment..
        Those two alone can be more than ten grand.
        That’s how the vet. Ended up living in the back seat of his car. ( he still is.. I puzzled him off when I offered to rent a place for him and help him work out a monthly plan. I am not always the most sensitive person when I pose a proposition like that and he took it as an insult)
        That’s how the engineer that designed and managed the construction of deep sea oil drilling platforms for the oil companies ended up in the boat he’s in to living with us. A one two punch.
        The same thing with the can man that survived living in a dumpster.
        We were told when we lost our income that in order to get food stamps or heating assistance etc. We would have to sell our home if your car is newer than ten years sell it live on what you get.
        I worked day labor. A lot of it..sold plasma..twice a week.. A ton of part time. I survived and so shall you. But there will be a lot of changes huge changes. Anything you have extra will be gone or shut down.
        I have done jobs that mike Rowe the guy doing the dirtiest jobs show wouldn’t touch with a ten foot pole. The church I belong to has a welfare system but… They can’t help except for an occasional meal. Long term sucks the big one.
        Good luck.. I do know how the feeling of desperation is..been there done that. I will be having you in my thoughts and prayers.
        Most people don’t have a clue just how futile it all seems till they are there.
        We all take our positions in life for granted. The same thing with our health.
        My hopes are that your young enough to be able to locate a position quickly and your employer is willing to pay for the unemployment payments.
        I also pray that you don’t have small children..its that much harder with small kids.( that’s why all the programs revolve around families with kids)

    • Steve F, Want to save a lot of money? Try Samaritan Ministries – best program out there unless you are 100% filthy rich and can pay out of pocket for your healthcare. Don’t like Samaritan Ministries, try Liberty Health Share, or Medi Share. Don’t do Cobra or state continuation. Ditch the insurance scam; Go cold turkey. Work the programs, they work!

  3. G – get em while there hot..

    – Bitcoins/Litecoins
    – Palladium/Gold/Silver Coins
    -Socialist Govt. Representative
    – Russians

    George, U been around financial markets for 30-40 years gaining insight and knowledge, as has others on the board – What happens to Futures market when scarcity of Palladium causes force majeur?

    Lease rates for that stuff are astronomical, and near term/front month Future contract on Palladium costs more than same metal/amount does in the future = Backwardization. I have never seen anything like it…except Nelson and Bunker Hunt cornering Silver market back when I was a teen..selling junk silver @ $40/oz to subsidize my bag o weed habit.
    The one thing about this situation in Palladium market is Substitution – At what price point in underlying metal does it become economical to Switch to Platinum?
    Logistically speaking retooling, re-supplying has got be expensive. Something is afoot in P.M. markets,simmering just underneath the surface..hope its nothing but monkey mind running ape again.

  4. Maybe my plan for a FEB correction is on the way. I have accumulated half of my chip stocks & need a correction to buy the other half, then hold for URE INDEX 30,000, which will be the massive blow off before the crash.

  5. That link to the FBI link and details of that supposed domestic terrorist arrest is stamped 2-14-19. Didn’t that arrest just get dropped on the msm about the time Jussie S was on his way to indictment and then arrest? Suspicious timing if you ask me.

    I wonder if this guy was goaded into his role as a terrorist? And, did anyone note in public stories the use of term email “drafts”?

  6. You have offered most interesting food for thought this week.

    Music died 0055 02/03/59.

    Train 301 derailed 0100 02/04/19. 3 lost.

    ” ‘Cottonseed oil explains everything.’ …but I woke up this morning at 3 am.”

    Talk to The Count? “That’ll be the day”, said Big Bird.

  7. Off topic – When did bro become bruh? I see bruh all the time now. Ive never used it personally, but just curious when that term changed and why? Cant seem to find a reasonable explanation. Did it have something to do with pc culture and cultural appropriation?

    • linguistic stupidity of the masses. Don’t use it, it’ll cause brain damage. Except bruh is less male than bro and is part of the neutering of straight American males process if you really must know. Sheesh, do I have to explain everything? All a business model. Gender is a monetization…keep up!

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