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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Mr.Creosote who wrote (44600)	11/1/2005 12:56:50 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

The commercial switcheroo is disconcerting if one is a bear, but of course it reflects last Tuesday position, and they've already really jammed the markets since. Unlike other futures, the equity COT is very volatile, and can change quickly. However, in general it looks like the Humpty inflationary boom trade of buying just about everything from bonds to energy to grains to metals, etc may be revived? Bares close watching, and more caution on anti-Humpty plays though. I'll be interested in this week's COTs on gold (for today) for instance. The counter to this is the liquidity picture. Message 21844445 Thursday FCB report will shed light on that, and if they are back big (but barely added to the auction yesterday in the face of large supply), might have to tone down the bear angle some. The Fed itself has been mostly backing rhetoric with action (less accomodation, or at least more neutral), and I have to consider that as well. Further a 4.27% return (and rising) on a T-Bill is superior competition to all the crap in the market and the prices paid for it. I'm trying not to get whipsawed the wrong way on every 1% drop and rally, but see your point, eyes wide open.

To: Mr.Creosote who wrote (44600)	11/1/2005 1:30:38 PM
From: russwinter	Respond to of 110194

4 week was so-so, FCB picked up a little more: 2.816 billion of 14.848, rate up 9 bp from last week's to 3.788%. Adler on this pre-auction, post 41: wallstreetexaminer.com FCBs held $1.77 billion of the expiring paper. Given that this auction will be 87.5% larger in size, the FCB's would need to buy $3.32 billion just to maintain an even keel. Anything less is likely to bring some liquidation pressure to bear, at the very least in the money markets, and likely in the stock market as well, although less directly. It's going to be very interesting to see if the Wall Street Examiner's FCB indicators goes to the sell side when the Fed releases the data Thursday evening. after see post 48 FCBs took down $2.82 billion of the 4 week bill. That's not enough. I think it's a net negative. Rate was up 9 basis points from last week. up 43 basis points from a month ago. And there are still people arguing that there's plenty of liquidity out there. Everything's relative. There still may be a lot of liquidity, but the excess must be shrinking fast, given how fast rates are rising.