Best of the Week
Most Popular
1.UK General Election BBC Exit Polls Forecast Accuracy - Nadeem_Walayat
2.UK General Election 2017 Seats Final Forecast, Labour, Conservative Lib-Dem, SNP - Nadeem_Walayat
3.UK General Election 2017 Forecast: Conservative 358, Labour 212 Seats - Nadeem_Walayat
4.Theresa May to Resign, Fatal Error Was to Believe Worthless Opinion Polls! - Nadeem_Walayat
5.UK House Prices Forecast General Election 2017 Conservative Seats Result - Nadeem_Walayat
6.The Stock Market Crash of 2017 That Never Was But Could it Still Come to Pass? - Sol_Palha
7.[TRADE ALERT] Write This Gold Stock Ticker Down Now - WallStreetNation
8.UK General Election Results Map 2017 vs 2015 vs Opinion Polls - Nadeem_Walayat
9.Orphaned Poisoned Waters,Severe Chronic Water Shortage Imminent - Richard_Mills
10.How The Smart Money Is Playing The Lithium Boom - OilPrice_Com
Last 7 days
Grenfell Fire: 600 of 4000 Tower Blocks Ticking Time Bomb Death Traps! - 22nd Jun 17
Car Sales About To Go Over The Cliff - 22nd Jun 17
LOG 0.786 support in CRUDE OIL and COCOA - 22nd Jun 17
More Stock Market Fluctuations Along New Record Highs - 22nd Jun 17
Understanding true money, Pound Sterling must make another historic low, Euro and Gold outlook! - 22nd Jun 17
Green Party Could Control Sheffield City Council Balance of Power Local Election 2018 - 22nd Jun 17
Ratio Combo Charts : Hidden Clues to the Gold Market Puzzle - 22nd Jun 17
Steem Hard Forks & Now People Are Making Even More Money On Blockchain Steemit - 22nd Jun 17
4 Steps for Comparing Binary Options Providers - 22nd Jun 17
Nether Edge & Sharrow By-Election, Will Labour Lose Safe Council Seat, Sheffield? - 21st Jun 17
Stock Market SPX Making New Lows - 21st Jun 17
Your Future Wealth Depends on what You Decide to Keep and Invest in Now - 21st Jun 17
Either Bitcoin Will Fail OR Bitcoin Is A Government Invention Meant To Enslave... - 21st Jun 17
Strength in Gold and Silver Mining Stocks and Its Implications - 21st Jun 17
Inflation is No Longer in Stealth Mode - 21st Jun 17
CRUDE OIL UPDATE- “0.30 risk is cheap for changing implication!” - 20th Jun 17
Crude Oil Verifies Price Breakdown – Or Is It Something More? - 20th Jun 17
Trump Backs ISIS As He Pushes US Onto Brink of World War III With Russia - 20th Jun 17
Most Popular Auto Trading Tools for trading with Stock Markets - 20th Jun 17
GDXJ Gold Stocks Massacre: The Aftermath - 20th Jun 17
Why Walkers Crisps Pay Packet Promotion is RUBBISH! - 20th Jun 17
7 Signs You Should Add Gold To Your Portfolio Now - 19th Jun 17
US Bonds and Related Market Indicators - 19th Jun 17
Wireless Wars: The Billion Dollar Tech Boom No One Is Talking About - 19th Jun 17
Amey Playing Cat and Mouse Game with Sheffield Residents and Tree Campaigners - 19th Jun 17
Positive Stock Market Expectations, But Will Uptrend Continue? - 19th Jun 17
Gold Proprietary Cycle Indicator Remains Down - 19th Jun 17
Stock Market Higher Highs Still Likely - 18th Jun 17
The US Government Clamps Down on Ability of Americans To Purchase Bitcoin - 18th Jun 17
NDX/NAZ Continue downward pressure on the US Stock Market - 18th Jun 17
Return of the Gold Bear? - 18th Jun 17
Are Sheffield's High Rise Tower Blocks Safe? Grenfell Cladding Fire Disaster! - 18th Jun 17
Globalist Takeover Of The Internet Moves Into Overdrive - 17th Jun 17
Crazy Charging Stocks Bull Market Random Thoughts - 17th Jun 17
Reflation, Deflation and Gold - 17th Jun 17
Here’s The Case For An Upside Risk In The Global Economy - 17th Jun 17
Gold Bullish on Fed Interest Rate Hike - 16th Jun 17
Drones Upending Business Models and Reshaping Industry Landscapes - 16th Jun 17
Grenfell Tower Cladding Fire Disaster, 4,000 Ticking Time Bombs, Sheffield Council Flats Panic! - 16th Jun 17
Heating Oil Bottom Is In.(probably) - 16th Jun 17
Here’s the Investing Reason Active Funds Can’t Beat Passive Funds—and It Worries Me a Lot - 16th Jun 17
Is There Gold “Hype” and is Gold an Emotional Trade? - 16th Jun 17
The War On Cash Is Now Becoming The War On Cryptocurrency - 15th Jun 17
The US Dollar Bull Case - 15th Jun 17
The Pros and Cons of Bitcoin and Blockchain - 15th Jun 17
The Retail Sector Downfall We Saw Coming - 15th Jun 17
Charts That Explain Why The US Rule Oil Prices Not OPEC - 15th Jun 17
How to Find the Best Auto Loan - 15th Jun 17
Ultra-low Stock Market Volatility #ThisTimeIsDifferent - 14th Jun 17
DOLLAR has recently damaged GOLD and SILVER- viewed in MRI 3D charts - 14th Jun 17
US Dollar Acceleration Phase is Dead Ahead! - 14th Jun 17
Hit or Pass? An Overview of 2017’s Best Ranked Stocks - 14th Jun 17
Rise Gold to Recommence Work at Idaho Maryland Mine After 60 Years - 14th Jun 17
Stock Market Tech Shakeout! - 14th Jun 17
The #1 Gold Stock of 2017 - 14th Jun 17

Market Oracle FREE Newsletter

The MRI 3D Report

Another Atrocious Stock Market Week Going Out With A Bang

Stock-Markets / Stock Markets 2016 Jan 15, 2016 - 05:33 PM GMT

By: John_Rubino

Stock-Markets

On days when lots of financial numbers are released, the normal pattern is for some to point one way and some another, giving everyone a little of what they want and overall presenting a reassuringly muddled picture of the economy.

Not today. A wave of economic stats flowed out of Washington, almost all of them terrible, while corporate news was, in some high-profile cases, shocking. Let's go to the highlight reel:


Retail sales fell again in December, bringing the 2015 increase to just 2.1% versus an average of 5.1% from 2010 through 2014. This kind of deceleration is out of character for year six of a gathering recovery, but completely consistent with a descent into recession.

The New York Fed's Empire State Manufacturing Survey index plunged to -19.37 in January from -6.21 in December. This is a recession -- deep recession -- level contraction. Not a single bright spot in the entire report.

U.S. industrial production fell for the third straight month in December, and the previous month was revised down sharply. Factories are already in a recession that appears to be deepening.

On the company-specific front:

UK resource giant BHP Billiton wrote down the value of its US shale assets by $7.2 billion -- two-thirds of its total investment -- in response to plunging oil prices. Now everyone is wondering who's next, and the list of likely candidates spans the entire commodities complex.

Chip maker Intel reported okay earnings but really disappointing margins and outlook. Its stock is down 9% as this is written mid-morning.

Walmart is closing nearly 300 stores and laying off most of the related 16,000 workers. It also cut its forward guidance aggressively.

There's more, much of it related to plunging oil prices and their impact on developing world economies. For countries that grew temporarily rich on China's infrastructure build-out, the end of that ill-fated program has produced something more like a depression than a garden-variety slowdown.

Now the panic is spreading. China stocks entered a bear market last night, oil is down huge, and as this is written (1 PM EST on Friday) the Dow is off 450 points. A tidal wave of terrified capital is pouring into Treasury bonds, and a smaller but still significant amount is moving to precious metals. Everything else is down varying shades of big.

Readers of a certain age will notice that this feels a lot like late 2007, when pervasive optimism hit a brick wall made up of subprime mortgages and credit default swaps. Everyone then headed for exits that were far too small to accommodate all the semi-worthless paper.

But this time around there are some big differences:

  1. In the 2000s the world's central banks weren't prepared for the scale of the carnage and had to improvise. Today they're already intervening in virtually every major market and so presumably have plans drawn up for the mother of all manipulations should 2008 come calling again. So we should expect some bold, experimental (let's just say crazy) monetary policies from major governments in the year ahead.

  2. The big banks are now seriously out of favor, so when their derivatives books blow up they might not be able to blackmail a sitting president with threats of martial law should Goldman and JP Morgan fail. Today that's an experiment that a lot of people would actually like to run, on the assumption that because the same number of factories, farms and hospitals would exist the day after such an event, real wealth would hardly change at all and mega-banks would be proven irrelevant.

  3. The world is vastly more indebted today, the carnage in commodities is global rather than sector-specific as with mortgages, and formerly rock-solid political systems like the eurozone and China are now unstable -- to put it mildly. A new financial crisis would energize fringe (i.e., anti-status quo) parties everywhere, vastly complicating the official response. In the US, another bust could easily result in a 2017 presidential race between Bernie Sanders and Donald Trump, neither of whom would favor bailing out the big banks.

And then of course there's the Middle East, which is now in end-to-end civil war.

Add it all up and, the picture is already grim, with lots more bad news in the pipeline. So it's not surprising that traders are nervous about going into the weekend with long positions in retail, tech, banks, commodities, or anything, really.

By John Rubino

dollarcollapse.com

Copyright 2016 © John Rubino - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2017 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife