Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Debt Saturation (by BKudla)

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I put this post together as a curiosity.  Per international data, the world has now created 4 times as much debt than the combined reserves and  M0, M1, and M2 in the world.  Out of these reserve and M numbers only $5 Trillion is circulating outside of the banking system.  There is 171,000 tons of gold or 5.5 billion ounces, or approx $6 trillion of value, in the world.  Total assets are valued at $241 Trillion.  The elites have taken us to the wall.

Exeter would be proud and alarmed at the same time.

2015-07-11_0636

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Healthcare Killed the Equity Star

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Going into 2016, the data points to a 9-11% increase in healthcare costs.  Let’s not get bogged down into who will bear this cost, let’s just agree it will not be good for Employers, consumers, and State Budgets.

The GDP of the U.S. is approximately $17 trillion.  Healthcare is 17% or approx $3 Trillion.  This increase transfers $200 billion additional dollars out of consumers (as a tax, or employers as a cost, or States as an expenditure).

This is on top of an expected flat to 2% revenue growth expected next year.  Consumers will stop spending on other things or take the tax and drop out, employers must grow $10 dollars of revenue for every dollar of the increase they will absorb, to simply keep EPS the same. At 8% of GDP for Employer portion of Health costs, that is $100 billion in new revenue.  That is nearly a 6% growth in Revenue just to run in place.

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The Bumpy Season is Upon Us

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As all know my specialty is the Volatility Trade, and the weekly chart gives me a good view of the climate.  It looks like it is paralleling last year somewhat.  I am looking at three more weeks of this, and maybe a SPY visit down to  the 190’s.  Then expect a late summer rally into mid September, for a nice fall swoon.  However, I will let my charts and signals guide me though. (more…)

Big Moves are Coming

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I follow four areas of the market very closely; volatility, miners, gold, and the SPY index, and everything smells of deflation.  I trade on the 2 and 4 hour, but I took a step back and looked at the monthly, weekly, and daily charts and everywhere I look it smells of lack of oxygen.

The broad market has a decreasing positive slope (8% y-t-d), and why not, you cannot continue to have 10-14% (from 2014) annualized growth rates with no GDP, Income, or fixed income rates.  The charade started with a relative yield trade, then a squeeze volatility trade, and now we are wrapping up the leverage the balance sheet trade.  The Central Banks and politicians have done everything except the right thing, and maybe because the  right thing is the hard thing.

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2015- The Year of Opportunity

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Happy New Year everybody.  Like everyone else,  I am reflecting on last year, and what the new year holds.  In my view, it will be a year of divergences and great opportunity.  Many people (the sheep and the hyper aware) are convinced that the crash is guaranteed for the U.S. in 2015.  But I hold a different view.

As the largest debtor, largest amount of debt denominated in our currency worldwide, and current account deficit holder, we will enjoy incredible advantages when the dollar carry trade unwinds. (more…)