Ghost of 1987 crash spooking the markets

Friday is the 30th anniversary of Black Monday, the 1987 stock market crash, the largest one-day crash in the history of the Dow percentage wise. Continue reading

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Stocks taking October in stride while whistling past the grave yard

As the first week of October slips by, global stock trading show no signs of whistling past the grave yard.

Daily records in the US have become an inside joke in newsrooms. Continue reading

Bitcoin thrives on dollar weakness

As bitcoin has recovered some of its JPM chief Jamie Dimon/China crackdown attack of last week, it awaits the next onslaught.

Trading roughly a $1,000 off its almost $5,000 high earlier this month the cryptocurrency has better resolve than other currencies including the US dollar.

The dollar has lost roughly 10% of its value against other currency this year. Trading near a high of 94 on the WSJ dollar index, today it stands at 85.3. The chart is one long slope down with no peaks since January.

Funny how this metric never comes up in Federal Reserve meeting or discussions. Cheapen the dollar to spur growth is not a sound basis to build a recovery. But Wednesday when the Fed announces its rate decision, we will not hear anything about the dollar’s worth vs. world currencies.

So how much of the roughly $3,000 price gain in 2017 can be attributed to dollar weakness? I would say it can take credit for almost half the gains as more sophisticated investors sought a hedge against a depreciating dollar. Especially the Chinese, which have their yuan pegged to the dollar.

Look for bitcoin to rise further after the Fed holds rates on Wednesday. This will give you more of an indication of who is using bitcoin as a hedge.

Stock answer is we don’t know about next 6 months

How can the equity markets trade looking six months out — as is the traditional metric — when it doesn’t know what the next six minutes will bring?

The Dow Jones traded down 274 Thursday on, pick your poison:

  1. Terrorist attack in Barcelona,
  2. White House finance chief Gary Cohen’s departure.
  3. Algos in control since its August
  4. All of the above

It has to be near impossible to be able to formulate an earnings picture looking out the next quarter, when a 140-character tweet can throw all the analysis into the trash bin.

Here’s a analyst’s note on Friday morning, explaining very succinctly what he is up against when figuring direction of the market:

“In a week where we started by worrying about nuclear war, markets have quickly moved on from this, with yesterday’s weak session more of a response to fears that Mr Trump’s strategy for the economy and business is falling apart and later the terrible terrorist attack in Barcelona,”
Deutsche Bank analyst Jim Reid.

So off of that note we haveĀ  stocks marginally down for the week. I say that’s not a bad performance even without mentioning the civil unrest in Virginia last weekend.

July jobs report bigger than Mueller’s motions

Friday’s job number of 209K beat the Street’s 180K estimate with hourly earnings ticking up 0.3% as mid-year raises kick in.

Equity futures markets are up 60 points on Dow unchanged from prior, despite the news out of Washington of a special grand jury being impaneled.

The dollar also strengthen on the job news.

The fact that the markets shrugged off Special Counsel Robert Mueller’s actions, speaks more to the continued DC gridlock, which the equity markets see as a buying opportunity.


I would like to acknowledge the passing of a great newspaperman and researcher Jim Marrs.

Marrs was a prolific writer with 14 published tomes and his book, “Crossfire” was used by Oliver Stone for his film, “JFK”.

Marrs was a cub reporter in Dallas on the day of the assassination and worked tirelessly for many years talking to sources within the Dallas police department and Secret Service to construct an alternative narrative to the events on Nov. 22, 1963.

Marrs taught a course on the Kennedy assassination at the University of Texas at Arlington.

Marrs was 74 years old at the time of his death.