More Federal Reserve manipulation to the benefit Wall Street.

[Que]

The administrations new pick for Federal Reserve chair, Janet Yellen, has signaled the stock market that the Fed will continue to hold rates artificially low so that the cost of borrowing to fund stock market purchases is much lower than the risk involved, insuring continued inflation of stock prices.

Between that and oil prices stabilizing together with consumers having more discretionary money because of lower gas prices, the Stock market rallied nicely today. Not to the extent of regaining all the lost ground when the Fed announced it was going to taper off QE and quit pumping completely phony money into the economy, but a nice rally, none the less.

December is historically when many large investors look to shore up positions or take profits before the stocks go ex-dividend for tax reasons. Anticipated dividends are already priced into the stock, but that portion of the profit is considered capital gains because the dividend is not received.

So good job. administration for continuing to allow the large players to borrow at essentially nothing to duel speculation. What could possibly go wrong with that?

Here is a reasonably good right up from the ultra-conservative cNBC:

http://www.cnbc.com/id/102280480

U.S. stocks rallied on Thursday, with the Dow industrials climbing more than 400 points for the first time in three years, as investors applauded the Federal Reserve's pledge that it would be patient in increasing interest rates

Speaking about the fact that this rally gives back the losses that should not have happened because of falling oil prices:

"The reality is markets were hit with we're not sure what's happening and why, as oil has been acting as something akin to a global interest rate. The good news is the Fed is aware of what is going on, and they want to be friendly, so people are hopefully in better cheer," said Jack Caffrey, equity portfolio manager at J.P. Morgan.

"Seasonally it's a time of good flows into equities. If anything, seasonally the behavior over the last two weeks was an anomaly," said Caffrey of the market's recent slide.

Now lets see... what major political event happened in the past month that might account for the huge upswing in investor confidence? Oh, right. The Republicans gained control of The Senate.

The CBOE Volatility Index, a measure of investor uncertainty, fell nearly 14 percent to 16.81.

All very good news, the most sluggish recovery in history has to eventually rebound, doesn't it? Let's all hope:

Thursday data had jobless claims falling by 6,000 to 289,000 last week, the lowest since early November.
And, the Conference Board's index of leading indicators advanced in November for a third consecutive month, signaling the U.S. economy is picking up steam heading into the new year.

____INDEX_______________________Value______$ Chng____Prcntg

• DJIA Dow Jones Industrial Average___17778.15_____421.28_____2.43%
• S&P 500 Index__________________02061.23______48.34 ____2.40%
• NASDAQ Nasdaq Composite Index____4748.40______04.08_____2.24%

Looks like we might eventually need that pipeline after all:

After rising to $58.73 a barrel, West Texas Intermediate turned lower, losing $2.36, or 4.2 percent, to $54.11 a barrel.

Gold futures for February delivery added 30 cents to $1,194.80 an ounce on the New York Mercantile Exchange.

Stock market up without a corresponding decline in gold futures? Investors must be anticipating inflation. The very thing low interest rates are supposed to curtail.

Altogether, good news for those that support the administration's efforts to reward Wall Street for all of the campaign cash they gave.

 

[RobDownSouth]

Fallacy of the Small Sample, anyone?

Stock market up without a corresponding decline in gold futures? Investors must be anticipating inflation. The very thing low interest rates are supposed to curtail.

Your "analysis" is based on a one-day sample?

Gold is near a four year low in price but you use a one day sample to decide investores are "anticipating inflation"?

That's pretty fucking stupid, even for you.

#SchmottGuy

 

[Que]

Your "analysis" is based on a one-day sample?

Gold is near a four year low in price but you use a one day sample to decide investores are "anticipating inflation"?

That's pretty fucking stupid, even for you.

#SchmottGuy

Fair enough, and it was an insignificant rise at that, you could also point out. The point I am making is that for stock prices to go up, money has to flow from some other investment, and it was not flowing out of gold futures today.

I appreciate you taking the time to actually read all that and make an insigtfull comment.

Another factor I overlooked, that is actually really good, solid, economic news (even though, like gold it is both a one day sample as you correctly point out, and a minor rise) was that US currency also traded higher. That is an anti-inflationary indicator and shows world-wide investors are anticipating actual growth, not just more monetary supply manipulation.

 

[Que]

I deliberately led with a left-leaning source. For financial news both Adre and I head to the WSJ.

Here is a WSJ article about the unusual good news of the stock market and the dollar both strengthening:

http://blogs.wsj.com/moneybeat/2014/12/18/yellen-has-something-for-everyone-as-stocks-dollars-both-rally/

 

[KingOrfeo]

I deliberately led with a left-leaning source.

CNBC?!

 

[unregistered]

 

[Que]

Two Fox business analysts who came over from CNBC have said they were under gag orders at CNBC on business information that made President Obama look bad, that reporting such information was "disrespectful to the President." Do get a clue.

Bear in mind that anyone to the right of Fidel is a reactionary to KO. It is hard to find people that know something about business and be anywhere as left leaning as he would prefer.

I simply meant not a Murdoch owned enterprise. WSJ is my preferred source for stok market info, but they would discount the paper read by everyone that actually is involved in the stock market.

 

[unregistered]