Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Adjusted Monetary Base Updated

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You know, around here we beat the Fed up pretty good; and rightly
so.  But the FRED (Federal Reserve Economic Data) website is top notch
and I just love going there and rummaging around.

Not only do they have nominal data graphs but you can ratio disparate
data to come up with your own analysis, as I did recently with the
London Gold Fix divided by the Monetary Base.  More people should get
used to doing their own work instead of listening to the talking heads
all over the internet, and know-it-all bloggers too for that matter. 
Work will set you free.

The links to FRED are over on the right side bar of the main page,
including a handy graphic that updates CPI, Unemployment, 10 Year
Yields, GDP, Industrial Production and Payrolls.  It’s really cool,
although the Fed does not (yet) allow for creating your own widget with
your own desired data.  If it did, I’d be all about the money supply and
other things that tattle on the Fed and its operations.  But it’s all
there on the site anyway, so do consider becoming acquainted with it if
you have not done so yet.

So here’s the latest BASE update:

money base

It is still in consolidation but I have highlighted the little tick
higher after QE3, which was still encumbered with Op/Twist.  The latest
data show a tick higher still.

A new inflationary phase would have to start somewhere and breaking this consolidation would be a good start.

Biiwii.com, Twitter, Free eLetter, Notes From the Rabbit Hole

Risk vs. Reward Post Turns Into a Ramble on Bernanke

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The general operating plan has been toward a market that can drag on
into spring with a bullish bias.  But in the short-term, over bought
markets can continue to correct.  I have taken profits on some
overbought global positions and would like to watch for re-entry.

sector sentiment

Interestingly though, the various ‘Gold Bugs’ data compiled by Sentimentrader.com
show an embattled sector that has scrunched even further to the left on
the graph above and is the lone item sitting in a good risk vs. reward
stance.

(more…)

Long-Term T Bonds Are Making a Signal

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The signal would be toward inflation.  This is crazy talk I know. 
The Fed is going to get all austere and end QE.  Yes, it must be true;
they said so in yesterday’s delayed expectations management exercise.

usb

This is a flipped over view of the Continuum AKA our monthly view of
long-term interest rates.  Maybe the most recent red arrow on the chart
will not result in an inflationary phase this time.  But then again, didn’t the Bond King think that it would be different ‘this time’ in spring, 2011? *

What if it is not different this time?  I give all due respect to
Prechter because I happen to believe he is due respect.  Indeed, I think
EWI are forecasting a top in T bonds as well.  So we must realize that
there could be a scenario where T bonds top out and yet deflation
ensues.  But if the Continuum is to continue, 2013 could turn out to feature obvious signs of inflationary excess before all is said and done.

* Bond King Bill Gross famously shorted the bond just before it
began a huge rise in a flight to the safety (ha ha ha) to US T bonds. 

http://www.biiwii.com

Gold and Silver Updated

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Yesterday I made a post with the provocative title Silver is in a Bear Flag in response to some bullish headlines and well… silver’s Bear Flag, which remains intact and viable by daily chart.

A favorable bigger picture risk vs. reward situation was also
highlighted for gold and silver in that post.  Among the reasons for
this:

  • Technical upside potential appears greater than downside.
  • The inflation-dampening Operation Twist is now put in the rear view
    mirror in favor of good old fashioned T bond and MBS Monetization.
  • The Commitments of Traders structures are improving.
  • Sentiment – especially among gold newsletter writers tracked by Mark Hulbert – is in the dumps and contrarian bullish.

Importantly, there is also the value proposition
of gold, which has not changed throughout the long and bullish
consolidation these last 1.5 years.  By the graph below, courtesy of the
St. Louis Fed, it has not changed since the beginning of the secular
bull market either.

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