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.

It’s All Out the Window Now

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It’s All out the Window Now

Excerpted from NFTRH 204:

In the run up to last Thursday’s FOMC announcement of open ended ‘asset’
(mortgage debt) purchases, ZIRP extension and Twist continuation, NFTRH
had been using the average US presidential election cycle, sentiment
backdrop and of course technical analysis to stay bullish (with
associated rising risk profile).  We had incorrectly minimized the
potential for QE right here and now in the interest of not running with
an increasingly over bullish herd and with respect to risk management.

Well, that is all out the window now because the US has apparently
conspired with Europe to jointly enter the currency depreciation
sweepstakes with the US springing out of the gate to a healthy lead. 
Sentiment is becoming dangerous, speculation is breaking out and
liquidity warning indicators like the Gold-Silver ratio, US dollar, US
Treasury Bonds, TED Spread and LIBOR have all been dispatched on a
southward journey in the interest of greed, speculation… and
desperation.  This is the moment of maximum hubris by Ben Bernanke and
powerful policy makers the developed world over.

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The Age of Boom & Bust Accelerates

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Like it or not, human will – and a hell of a lot of financial
chicanery – has created this bull market.  Powerful people, not duly
elected but rather appointed, are continuing to degrade the peoples’
money in the interest of keeping the system moving forward.

Here is the S&P 500 shown establishing a new technical objective
(hey, it’s TA and it does not care about right and wrong) after hitting
our long-standing target of 1460.  I had no clue why SPX was targeting
1460 other than the election cycle that NFTRH followed all summer.  But
now I (and you) have a clue, thanks to the DML (Dear Monetary Leader)
following up his Jawbone with action – very inflationary action.

s&p 500

When the inevitable politics of the ever-increasing divide between
the have’s and the used-to-have’s crop up people should remember the
massive and open ended asset bailout that was just kicked in.  Here I
have got to tip the hat to papa Gold Bug Jim Sinclair who, for all the
misery he takes was right on with his ongoing ‘QE to infinity’ mantra. 
This is the mechanics of why some are enriched and some are
disenfranchised.

The only time I have a problem with the ‘QE to infinity’ stuff by the
way is when it causes people to hang on during those extended phases
when deflation is the greater threat.  You know, the times like over the
last year when the inflation gun was being reloaded?

It appears that Mitt Romney spit in the eye of the monetary gods when
he tried to politicize the Fed and announced Bernanke’s probable ouster
by a would-be Romney administration.  The Fed showed him a thing or two
about politics, didn’t it?

Imagine the S&P 500 in a strong cyclical bull market, the economy
lukewarm but not in crisis (on the surface, anyway) and still the Fed
goes open ended and all in.  This is precedent setting and this could
well be the last play of the current system because if a massive asset
bubble results from this there will probably be no coming back from the
eventual crash.

Enjoy.

http://www.biiwii.com

Uncle Buck Woodshedded, PM’s Hit Pre-FOMC

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So the deflationary err… issue of the last year served to what?  Beuller?  Anyone?

‘Get the herd on the wrong side and lay the groundwork  for a coming whopper of an inflation!  Yes… very good.’

At least that is what we are led to believe Ben Stein’s economics
professor would have confirmed to the class.  It sure does seem handy
that the USD has been king since last summer and the mighty and ultra
safe (ha ha ha) US T bond has been the
safe haven in the investing world.  These are the areas in which the
Fed would seek to leverage the new found confidence in its
inflation-making machinery as they compromise these assets.  USD and T
bonds came to be so aggressively owned after all by the frightened
herds.

‘Why oh why is the stock market up??’ ask the despondent bears. 
That’s why; money is running to asset markets at the behest of the
Federal Reserve’s hints.

usd daily chart

USD daily chart, next support shown

I think it is wise to await the coming FOMC release before leaning
too heavily one way or another, given that asset markets have already
priced in some inflationary talk or action.  But it is obvious that
unless the Fed loses its mind and decides to do the right thing and
abandon its modus operandi of leveraging the currency in the name of
asset appreciation and economic sustenance (diminishing though it is),
the USD is earmarked for lower levels eventually.

The chart says it’s over sold.  It also says it is losing a support
zone.  The next support is noted.  The precious metals are getting beat
on a bit for the second day in a row.  This is expected and is a sign
that they love us.  Gold should not be rising into the FOMC release.

I still have concerns about the precious metals’ over bought status
and the CoT structure, but I also wonder if the hits on the PM’s are
clearing some of that short interest out.  We’ll see, but the main point
of this post is to note that there remains room in the US dollar, in T
bonds and indeed, in the entire ‘deflationary mock up’ to get an
inflationary operation under way sooner or later.

Will there be news?  Will stocks and precious metals sell or buy the news?  Today starts the clock ticking.

http://www.biiwii.com

The Show Must Go On

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For many years now, most of the world’s insight into the financial markets comes in a 5 second pre-commercial blurb near the end of the nightly news.  Some version of Brian Williams stating “… Wall Street closed today with the DOW up 25 on a well-received jobs report.  And in other news, a panda learned to wipe himself…”  No real shock that this disservice hurt millions of retirement accounts – delaying that beachside condo purchase in Bonita Springs – at least until the balance is “back up again”.

Logic would suggest at least some of these IRA/401k investors would pay a little more attention to financial media (albeit mainstream financial media), in an effort to avoid the financial illiteracy which was so costly the first time.  I continue to expect the herds of sheeple to maintain focus on Honey Boo Boo, however, the job of defeating one’s own ignorance is made more difficult by the mainstream data sources available.

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Deflation: As Good As Gold?

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It has been a year since gold began its downward biased consolidation out of the acute phase of the Euro meltdown and resulting hysteria.  In that time, the deflation case was released from the jail that had been a heightened public fear of inflation (the pinnacle of which was in spring of 2011, a time when bond king Bill Gross was very famously short long-term US Treasury bonds).

 

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