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Today I received this letter from the completely lame, insanely-high-commissions brokerage that my employer uses to administer our 401-k program. Click on the link to read it; I don't want to gobble up space and bandwidth by posting it directly.
I will add that a major concern I have is that our government, which has become quite accustomed to extreme interference with the markets, will step in to "rescue" everyone during the resumption of the tumble. As a person who hopes to profit handsomely from the downturn, my concern is that the government is going to specifically target the bears in a show of populist activism.
So here we have the SEC suspending the use of leveraged and any inverse ETFs at major brokerages. It's starting with the 401-ks, but how long do you think it'll be before more "help" is on the way?
So where does this leave me, then? Well, I've got $375,000 in this account, and nothing to do with it. So – mission accomplished, SEC – there's $375,000 in buying power that wants to buy ultrashort ETFs that has been neutered. Multiply that by tens of millions of accounts, and you've taken a lot of selling pressure off the market!
You've also created a situation where people will be helpless to sustain the value in their accounts, because their choices will be (a) cash; or (b) bullish equity positions.
The snare drum you hear in the background is the musical prelude to a big shift in currencies. If, as I anticipate, the EUR/USD starts to tumble (while, naturally, the dollar soars), we'll have everything we need for equities to start falling to pieces.
One of the charts from EWI's Short-Term Update, shown below, tells the story superbly. Notice how the slope (err, not "Slope" slope, but the regular slope), represented by the series of diagonal lines, gets decreasingly steep. This implies to me a tipping point that has either taken place or will take place in the near future.
I would also add that today is the first day in a while that the big profits that showed up in my account at the opening bell stuck around for the entire day. The only short position I closed was FXP, early in the morning; otherwise, I'm still short virtually across the board.
I'll probably do a post later tonight. I need to – what else? – catch up on my charts.
Bar time is usually reserved for Fridays, but as we give August a swift, painful, permanently debilitating kick in the ass as it runs out the door, I thought I'd let Bo serve up some beverages for the crew. Plus I thought it was Friday, and I have no idea why.
A week or two ago, someone here published an outstanding article about why even those who thought natural gas was going to move higher shouldn't touch UNG with a ten-foot poll. It seems that advice was well-founded. People keep trying to catch this falling knife, and it seems to have no bottom at all.
OK, it’s pretty evident that Disqus’ new rollout was a disaster. I’d gladly go back to the old version at this point. Avatars are getting scrambled. IPs are confused. The “instant update but you can’t see any other new posts unless you press F5” is really for the birds.
I didn’t ask for these new “features”. I thought the auto-refresh was pretty cool (if it actually worked as designed), but……………I’ve written to the co-founder and told him to please get this straightened out. Because Typepad has a perfectly good comments system too.