Money Supply
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Started by Richard - March 22, 2018, 7:15 p.m.

The money supply figures come out each Thursday and with today's numbers I can tell you that they are still going down and going down hard. It is no wonder that the stock market is acting the way it is and it is not because of some trade deal or the nonsense you hear on TV. The FED controls the markets and the FED WANTS a major slow down and the FED Always gets what it wants.

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By Richard - March 30, 2018, 9:16 a.m.
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The money supply figures came out against yesterday and they are Sh*t. We are still heading lower and so will everything else in this world. Oil can not and will not advance with numbers like this. Bonds could do well but only as a trade.

By TimNew - March 30, 2018, 9:45 a.m.
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By Richard - March 30, 2018, 9:13 p.m.
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I am not sure how to read this chart but I personally use 13 week, 26 week and 100 week moving averages and they are not doing good.


By TimNew - March 30, 2018, 10:04 p.m.
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It's just the raw monthly M2 numbers for the last couple years.

To me, it doesn't appear to be supportive of the idea of a downward trend.  More like a lot of variance that seems to be modulating towards the mean..  Or,   stability..  Highest highs,  lowest lows..   Ya know....


But ICBR.



By Richard - April 1, 2018, 1:01 p.m.
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Sometimes when you reply to me, I am not sure if you are just being a big dick head and annoying me or you really do not see the errors in your ways. Looking at hard core data and trying to decipher it is ludicrous. I have 30 years of weekly data on M1 and M2 and as much M3 as I can find. Then I do a 4 week moving average and then I take the 13 week moving average of the 4 week moving average for a double smoothing and I do the same with the 26 and 100 week moving averages and I can tell you, without a doubt, that the 13 week has plunged and is pulling down the other two moving averages and that many years of following this indicator, it does produce results. Perhaps not pin point accurate results that one can day trade with, but the type of data that you can tell we are headed for a slow down and this slow down will affect the financial markets. The best that I can do for you with a chart is this chart here. The chart itself is raw data and you can not tell what is happening, but the bottom has the ROC indicator and the ROC = Rate Of Change, is clearly showing the M2 is increasing slower then it was before. If you still do not understand then I give up and you either believe me or you do not.

chart
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By Richard - April 1, 2018, 1:01 p.m.
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By Vandenplas - April 1, 2018, 3:24 p.m.
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Good luck with that.  I can't recall his ever being wrong, without an excuse.

By TimNew - April 1, 2018, 9:24 p.m.
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Trying to understand here..


You claim money supply is dropping.


I show data that indicates that is not true.


You then claim that money supply is  not growing as fast as it was/should.


And that makes me a dickhead?


This is a trading forum Mr Head.  (Is Dick short for Richard?) And you are entitled to you opinions.  Even if you've been bullish oil since it was 130...  And you have some sort of notion that the Fed, inexplicably wants  an economic  slow down  for which you cannot explain...


 


By Lacey - April 2, 2018, 11:24 a.m.
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Nobody has been More wrong than you Richard, regarding the price of oil.  By your own admission, you have lost a ton of money. Now your back with an even higher target for oil, but have money  supply working against your thesis. Did you ever think we would be pulling out of Syria?  Still think we will back Israel in an attack on Iran?  You take out Israel, maybe a 1000 years of peace in the  Mideast!


By cutworm - April 2, 2018, 10:27 p.m.
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Are we only to hear from those who never are wrong about the markets? And who is that person who is never wrong? Richard at the least gives some reason as to why he believes the way he does. I don't much agree with some of his ideas but am glad to listen to a different view. If we all thought the same we would not need a forum.

By TimNew - April 3, 2018, 3:36 a.m.
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I agree we need a variety of opinions on the forum.  Without that, there is no real discussion or exchange of ideas.


Where I disagree is calling someone a dickhead when they point out the data does not appear to support your conclusions.

By JP - April 3, 2018, 9:49 a.m.
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It would be nice if there were someone in some sort of a position of authority at the forum who would consistently encourage rational discussion while discouraging gratuitous name calling and other boorish behaviors (perhaps through the use of temporary, or even permanent, revocation of posting rights). 

By Richard - April 3, 2018, 3:56 p.m.
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1) I never called Tim a DickHead. What I stated is in black and white for all to read. I was annoyed that I was looking at solid data and you were using charts that nobody could decipher, but I did not directly call you a dickhead.

2) The "Rate of Growth" of M2 is dropping but it is still positive and growing. While this may have been a point you were trying to correct, the fact is that in numerical terms, so that fancy words to not confuse people, as recently as last Oct 2017 the 13 week moving average was growing at 8.0% yoy and as of the last reporting period, it was down to 2.4% growth yoy. To me this is a large drop in the growth rates and worth reporting and in my opinion, the NUMBER ONE reason the stock market is correcting. Stocks do NOT hit new highs when M2 growth rates are down to these levels.

3) Trading has been my only source of income for 16 years, so while I may have lost money betting on oil, I only lost money that I previously gained or won.

4) I was not bullish on oil at 130. I was bearish. Oil made a low down to $33.xx into Feb 2009, and I was not bullish until 2011. I became bullish primarily because I thought Israel was going to attack Iran. I no longer think that and any projections about oil do not need a war, but I would not be surprised if a war does happen.

5)With growth rates dropping on M2, increases in Oil will be hard to achieve also, but I do not believe that M2 will be acting this way forever. At some point the FED will start increasing M2 growth rates but until it happens, the stock market is going to have a hard time advancing and as we can see, as soon as I made this post on the money supply, it did drop.

By TimNew - April 3, 2018, 6:40 p.m.
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That's true.  You offered 2 choices.  Either I am a dickhead or I am wrong. There is  a 3rd option,  but I'd not be surprised that it escapes you. Even after you changed your tune mid discussion and admitted the growth had slowed.  Quite different from your original claim that M2 was shrinking.


And BTW,  you were loading up on long options when  oil was a lot higher than it is now while predicting prices well north of 200.   You want to blame a "shrinking" money supply for your continued flawed prognostication.  Go ahead.

By Richard - April 5, 2018, 7:44 p.m.
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The money supply numbers came out again and they went up a decent amount. More than average for sure but the numerical averages are barely responding. The 13 week did go up a lot, but it was still from a very low level and the 13 week is still below the 26 week and both are below the 100 week. The 100 week moving average still went down for the week. This could be a turning point for the FED, but we will not know for sure for a few more weeks. It is tough to actually trade using the money supply figures most of the time as they only help on rare occasions like two week ago when they were still dropping and I knew that the market was not ready to rally and sure enough the next day we went down a lot. Right now they are saying that the economic number are going to come out weak in the months ahead, even if today is a turning point. 

Jobs report
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By Richard - April 6, 2018, 9:13 a.m.
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Todays weak jobs report was totally predictable

By Richard - April 12, 2018, 5:22 p.m.
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the money supply figures just came out and they are still very weak. I seriously doubt that the stock market can rally to new highs until this situation is corrected and the figures are increasing at a much faster rate for many weeks. They only come out once per week and today was not good enough so this is bad news for stocks/economy and commodities in general.  As an example -  One of many things I record are what the FED claims is the 13 week moving average for M2. I do this the First Thursday of each month. We peaked at 8.0% YOY growth on 3 October 2016 and have been declining since. Currently we are at 2.4% YOY growth rate for the 13 week moving average for M2. That difference is HUGE!!! Theoretically (economic growth + Inflation = M2 growth).  . . OR (M2 growth - inflation = economic growth) with M2 at 2.4 and inflation at maybe 1.8, that means economic growth should be under 1% in the future. Of course we would need these weak growth rates to continue for a few more weeks but clearly M2 growth is important

By Richard - May 10, 2018, 4:44 p.m.
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the money supply figures just came out and they are still very weak. Nuff Said . . .

By metmike - May 10, 2018, 6:49 p.m.
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By Richard - May 17, 2018, 8:29 p.m.
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todays number did increase a normal amount, but not enough to help the moving averages and the long term moving averages are still growing but at a slower and slower rate. I am putting GNP growth still positive and not in recession territory but below 2%. I do not see the Stock Market moving to new highs with these numbers and oil will also have troubles moving higher at the pace it has had in the past couple months. Brent hit $80 today and backed off.

By Richard - May 24, 2018, 4:38 p.m.
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This weeks money supply just came out moments ago and this week we had a respectable increase in M2. This increase did move the 13 week average but the 26 week barely moved and the 100 week average is still falling. We will need several week of number like today before we are moving forward. Until then economic numbers could be soft and today it was reported that weekly jobless claims jumped some 20,000. This should have been expected based on previous M2 numbers. I hope the FED is done trying to squeeze M2, one can only pray.