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The official "ASX is tanking!" panic thread

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I'd like to retract my previous comment about going Long today, after News and the US rally overnight.
Still 10.30am Aus employment numbers start dropping, followed by China house prices (?) Then after our Bell the GB Inflation numbers drop which caused anxiety in the Markets last week.
 
Mohammed Hazabig'un said:
I'd like to retract my previous comment about going Long today, after News and the US rally overnight.
Still 10.30am Aus employment numbers start dropping, followed by China house prices (?) Then after our Bell the GB Inflation numbers drop which caused anxiety in the Markets last week.
Click to expand...
the XJO ( top 200 ) is up 77 points currently

looks like we are in BAD news is good news cycle again ( the economy is so bad official rates are less likely to rise and some chance of more QE , at least in the traders' minds )

so let's NOT retract your earlier prediction , but just look in wonder at the Bizarro world we are in

cheers
 
ASX 200 up a percent almost, then 10.30am first numbers dropped and it retreated:

Westpac–Melbourne Institute Leading Index of Economic Activity​

This report examines movements in the leading indicator of economic activity in Australia. It is designed to anticipate and identify turning points in the economy.

The Index is a summary measure and includes information from:

  • Local financial, housing and labour markets
  • Consumer expectations about activity and unemployment, and
  • International economic activity.
Down from 0.3% to -0.2%


Employment numbers 11.30am
 
AUD
Wage Price Index (YoY) (Q1)
Act: 2.4% Cons: 2.5% Prev.: 2.3%

AUD Wage Price Index (QoQ) (Q1)
Act: 0.7% Cons: 0.8% Prev.: 0.7%

China House Prices (YoY) (Apr)
Act: 0.7% Cons: Prev.: 1.5%

Enough for the RBA to go further than .25 next Meeting? Let's see what Mr Market says.
 
they are firmly caught between a rock and a hard place

arguably 0.25% ( increase ) is not enough , but in the mid-term too much
AND they did it to themselves ( as well as the fall-out of the rise during an election campaign if the LNP wins the election , especially if they have to resort to a coalition of several independents to retain power )
 
the problem is debt levels in the system

given all the ways you can get credit now ( compared to the 1970s )

how do you calculate the debt levels ( waves of forced sellers would quickly unravel the economy ) in this climate of multiple bubbles

and ACTUAL inflation is liable to be at least double the official rate
 
divs4ever said:
the problem is debt levels in the system

given all the ways you can get credit now ( compared to the 1970s )

how do you calculate the debt levels ( waves of forced sellers would quickly unravel the economy ) in this climate of multiple bubbles

and ACTUAL inflation is liable to be at least double the official rate
Click to expand...

And why is debt an issue?

From a 'trading' perspective only...I will ignore the economic issues.

Because the level of debt is a leveraged number on the base money supply, M2, which means in an unravel, there is not enough cash to settle the debt.

This would be bad, but it is compounded by the leveraging of that debt by derivatives. $1.4Quadrillion. Most of which is in the form of SWAPS. These are not traded on any exchange and therefore have no margin attached to them and are totally opaque. This magnifies the issues as counter-parties cannot quickly or easily be identified, exacerbating a credit event.

Again, the issue is now an appalling lack of dollars to settle in cash, losing bets.

Why do you think the USD is near highs? There is a tremendous demand for dollars to settle losing bets currently.

This leads directly to a liquidity event.

When the liquidity event hits...the Fed and other Central Banks are (i) behind the curve again and (ii) will require an even larger amount of liquidity to be created in an attempt to stem the bleeding out of market players.

So large in fact that the USD runs a true risk of hyper-inflating to destruction. The liquidity event I believe will be triggered in the Euro. The ECB cannot recapitalise its Balance Sheet in the same was as the Fed and BoJ. As such, a credit event in any one of a number of basket case economies can create that liquidity event which will spread faster than covid across all bourses.

Central banks (Fed) cannot raise the FFR to levels necessary to combat inflation. The FFR would need to be 10%. Currently it is 0.5%

The US markets will bottom out somewhere between 80% and 90% loss. The choice is now a death spiral deflation or a hyper-inflation. Both have less than desirable outcomes.

Screen Shot 2022-05-19 at 7.35.19 AM.png

jog on
duc
 
ducati916 said:
And why is debt an issue?

From a 'trading' perspective only...I will ignore the economic issues.

Because the level of debt is a leveraged number on the base money supply, M2, which means in an unravel, there is not enough cash to settle the debt.

This would be bad, but it is compounded by the leveraging of that debt by derivatives. $1.4Quadrillion. Most of which is in the form of SWAPS. These are not traded on any exchange and therefore have no margin attached to them and are totally opaque. This magnifies the issues as counter-parties cannot quickly or easily be identified, exacerbating a credit event.

Again, the issue is now an appalling lack of dollars to settle in cash, losing bets.

Why do you think the USD is near highs? There is a tremendous demand for dollars to settle losing bets currently.

This leads directly to a liquidity event.

When the liquidity event hits...the Fed and other Central Banks are (i) behind the curve again and (ii) will require an even larger amount of liquidity to be created in an attempt to stem the bleeding out of market players.

So large in fact that the USD runs a true risk of hyper-inflating to destruction. The liquidity event I believe will be triggered in the Euro. The ECB cannot recapitalise its Balance Sheet in the same was as the Fed and BoJ. As such, a credit event in any one of a number of basket case economies can create that liquidity event which will spread faster than covid across all bourses.

Central banks (Fed) cannot raise the FFR to levels necessary to combat inflation. The FFR would need to be 10%. Currently it is 0.5%

The US markets will bottom out somewhere between 80% and 90% loss. The choice is now a death spiral deflation or a hyper-inflation. Both have less than desirable outcomes.

View attachment 141849

jog on
duc
Click to expand...
since you are 'trading ' ( trying to make a regular income from portfolio movements ) i would assume your platform , would try to tempt you with a margin loan ( my trader buddy has one for sure )

over the last 12 years , i have observed several exciting events when the lender ( a BIG bank ) got nervous and started issuing margin calls , the epic one was during a road trip ( so patchy mobile signal ) when the message came through said buddy had to find a bank branch ( only ONE in Sydney for that regional bank ) and send funds to the account of the trading platform

turns out the buddy was only 20% into buffer at the time , and the bank had over-reacted

little events like that might make the market move a little more than usual
 
So the game plan for today is we get in early or wait for the Unemployment numbers to come out at 11.30am which will be good and may temporarily halt the blood flow, before the arteries reopen?

My only question isn't how, it's how much!
 
i NORMALLY have my orders in early hoping for a snap down ( and not followed by a plummet )

a fair chance stop-losses will be tripped , but with the recent rally a smaller chance of blanket margin calls

but those are just my guesses

by 11.30 am i will be delighted or bored
 
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