By Michael Ashton
One thing is certain these days. By sitting on my hands, I’m missing a lot of tradable swings! I am not too disturbed by this fact, since I am probably almost as likely to trade them poorly as well, but we are most definitely in a trader’s market. Whatever your sense of the current economic environment makes you bullish or bearish, the value of corporate claims is not changing weekly by 140 S&P points. From the October 4th lows, stocks closed higher today by 12.4% (from the October 3rd closing low, the gain is only 9.8%!).
Are people really investing in this kind of crazy market? It scares me to death, and I’m a professional! (Then again, with all of the effort that officialdom has put into soothing us, perhaps it’s only the professionals who are really scared.)
Intraday Wednesday, the Dow erased its loss for the year before falling back. That sounds impressive until you remember that it was up 10% on the year as recently as July 21st. Volumes were fairly low and the Vix declined but remained above 31. 10-year Treasury yields rose to 2.21%, with 10-year TIPS yields at a hearty 0.23%. Copper and precious metals rallied; grains and energy declined.
The FOMC minutes from the September meeting were released today. There were some interesting items in there, aside from the somewhat crazy assertion that “most FOMC officials said inflation appeared to have moderated.” (see chart)
Moderating inflation, according to the Fed. This is core CPI, year-on-year.
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