Money Flow Trading Method along with Risk Management

Hi! Benjamin:

"A" player they knew what is going to happen to the US economy & Brexit was destruction. They lower the value by creating the distraction, I believe they accumulated tons of money. Now the balloon is full with air waited to be explored.(Trash talk lol)

Bud Fox: But why do you need to wreck this company?
Gordon Gekko: Because it's *wreckable*, all right? I took another look at it, and I changed my mind.

The point is ladies and gentlemen that greed, for lack of a better word, is good.
It's not a question of enough, pal. It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another.

I need your little help, I thought you would be the right person to ask. I need a clear picture about seasonal tendencies. What are the key months for professional accumulation and the reason behind it?

Regards,
RD-007

Let's compare with the charts of GJIA

Quoting BenjaminIs

Disliked

A MUST WATCH - HIGHLY RECOMMENDED - About 31 Minutes and please post your feedback after so I know that you understand what was said. Thank You. Benjaminis https://www.youtube.com/watch?v=k6M8gRBRziU#t=59

Ignored

To sum it up the clip.

USA has $20 trillion in dept.
Pension plan is filled with bad depts.

Asset going to need to be market down.
When this comes down, just numbers on you statement, not as much value as you may think, you will not be able to use it.

If people are in trouble financially, they will go to get money from their stocks.
But you will not be able to sell your stocks. Will get minimal money back.
Will soon not have same purchasing power then now.

There will be a possible trade war.

Options for buying gold & silver.
Choose Silver over Gold. Silver will not be confiscated. Silver very undervalued.

Everything rely on credit.
Credit will becomes very scares or not available.
This is very bad for US. Citizens will become bankrupt and would not be able to recover.

http://www.marketwatch.com/story/us-...teid=rss&rss=1



Stock market stuck in waiting game ahead of Trump news conference


Bloomberg:U.S. stock futures traded flat early Tuesday, a sign the market is cooling down ahead of a much-anticipated midweek news conference by President-elect Donald Trump.
Big earnings news due at the end of the week, specifically from banks, will also likely provide some guidance for investors, said some observers.
Dow Jones Industrial Average futures YMH7, -0.06% slipped 2 points to 19,826, while S&P 500 futures ESH7, -0.02% rose 0.75 point to 2,265.75. Nasdaq-100 futures NQH7, +0.02% traded up 3 points at 5,025.25.

ADVERTISING

The Nasdaq Composite COMP, +0.19% finished at a record high for the second session in a row on Monday, adding 10.76 points to 5,531.82.
But the other main indexes pulled back amid new-year caution that has taken hold of some investors. Bulls had been pushing up stocks on the prospect that Trump’s policies will stimulate economic growth. The Dow industrials DJIA, -0.38% not only failed to make it to 20,000 on Monday, but retreated further from this highly anticipated mark, closing off 76.42 points 19,887.38, while the S&P 500 index SPX, -0.35% slipped 8.08 points to 2,268.90.
Read: Goldman’s Hatzius says investors could get blindsided by Fed hikes this year

The next triggers for stocks: Trump will hold a news conference on Wednesday, his first since July.
“If Donald Trump succeeds to cheer up investors at this week’s conference, we could see a fresh rally in the U.S. stocks and the U.S. dollar. Therefore, the upside risks prevail in the U.S. markets,” said Ipek Ozkardeskaya, senior market analyst at London Capital Group, in a note to investors.
Read: Here’s why Trump’s inauguration could mark a near-term top for stocks
More evidence of pre-Trump news conference nervousness could be found in the dollar DXY, +0.21% which pulled back somewhat on Wednesday. The dollar has been rising on hopes that the new administration’s fiscal stimulus will boost the economy, but some analysts believe that bet may have been pushed as far as it will go for now.
Beyond Trump, what the market is looking for is confirmation of valuations at current levels for stocks, and the only way to get that will be the earnings flow, said Peter Cardillo, chief market economist at First Standard Financial in a telephone interview.
“Basically Friday, we have two bank stocks coming up, and if they beat expectations both top and bottom line, I think we could see the Dow finally hit that 20,000 mark,” said Cardillo. J.P. Morgan Chase JPM, -0.21% and Bank of America Corp. BAC, +0.18% are among banks due to report Friday.
Economic docket: No major economic reports are due for release Tuesday. The National Federation of Independent Business said its optimism index jumped 7.4 points to 105.8, the strongest reading since 2004. Data on job openings and wholesale inventories for November are scheduled for release at 10 a.m. Eastern.
There are no Federal Reserve officials scheduled to speak Tuesday.

Stocks to watch: Shares of Valeant Pharmaceuticals International Inc. VRX, +12.12% shot up 12% in premarket action after announcing a couple of deals. Late Monday, the pharmaceutical group said it would sell its Dendreon cancer unit to Chinese conglomerate Sanpower Group Inc. for $818.8 million in cash.
Also Monday, Valeant said it has agreed to sell three skin care brands to French cosmetics giant L’Oreal SA OR, -0.50% for $1.3 billion.
Ascena Retail Group Inc. ASNA, -24.29% warned Tuesday that it will report a wider-than-expected loss after disappointing holiday sales led to increased promotions. The company said sales at its Ann Taylor unit fell 8.2% between Nov. 19 and Jan. 2.
Alphabet Inc.’s GOOGL, +0.00% Google is said to be in talks to sell its satellite business Terra Bella to startup rival Planet Labs Inc.
Click For Sound
Alibaba founder Jack Ma met with President-elect Donald Trump on Monday to discuss U.S.-China business relationships and efforts to create more jobs in America.
Alibaba Group Holding Ltd. BABA, +0.72% said it would team up with the founder of China’s Intime Retail (Group) Co.to take the department-store owner private, in a deal worth 19.8 billion Hong Kong dollars ($2.6 billion). Shares of Alibaba rose slightly in premarket trading.
Read: Alibaba promises Trump 1 million jobs, but don’t believe it
Yahoo Inc. YHOO, +0.44% could be in focus after plans were disclosed Monday afternoon in which Chief Executive Officer Marissa Mayer and co-founder David Filo resigned from the board of directors. Yahoo shares rose mildly in premarket action.
Other markets: European stocks SXXP, +0.10% traded mixed, while Asian markets ADOW, +0.33% mostly declined.
Oil prices CLG7, +0.21% showed signs of a rebound after a 4% drop on Monday, while gold prices GCH7, -0.30% eased slightly.
Read: Stock-market bulls may get scorched by ‘Icarus trade’ in 2017

Good Morning Rocky007

We are in new territory now as all previous patterns and perceptions are about to change. The inauguration of the 45TH President of the United States of America changes the STATUS QUO of the last 8 years. Look at China now and Europe now and the FED now and add to that all the other GEOPOLITICAL events around the world and new patterns will develop and we now are in the Winter Season and in the next 90 days or at least until March 31, 2017 , we need to watch and observe these changes. Just read the last few pages here from page 50 to this page and you will clearly understand what I just said. It is very nice to see you post here and I welcome your questions and hope for your success.

I am going to add to what I just said. We live in a sick world and what has happened is best expressed in the following words that I did not write however agree with. After we all read the words and the thoughts around them it will be easy to see what is about to continue. The masses finally understand the game and their power and so now the STATUS QUO is OVER and not one human can predict the FUTURE with certainty.

Nine hundred thirty five Lies

935 lies. Two groups that keep track of the media counted them. The Bush gang lied 935 times between Sept. 11, 2001, and March 19, 2003, to justify the invasion of Iraq. Bush lied 259 times. The biggest lie was that Iraq had "weapons of mass destruction." And that Saddam Hussein worked with al-Qaida. Why is the number of lies important? There were 935 opportunities to question the liars. The 935 lies are proof that the entire U.S. ruling class is responsible for the conspiracy to wage war on Iraq.


The millions who marched against the war knew these were lies. You did not have to be Einstein. Or Lenin. Bush, Cheney, Rumsfeld, Wolfowitz led the war conspiracy. But the entire ruling class and its institutions colluded. The Pentagon went along willingly. The State Department presented the false statements to the United Nations. Congress voted the funds.


No major corporate media questioned or challenged these lies. The influential New York Times and the Washington Post supported the war drive. Nor did the media allow war opponents to expose the lies.


In January and February 2003, mass mobilizations tried to stop the war. No major ruling class politicians or business figures participated in these protests. Not Kennedy. Not Brzezinski. Not Soros. The vast majority of the super-rich ruling class wanted the profits and plunder from a quick U.S. victory in Iraq.

The military-industrial complex bid for contracts. The strategists wanted U.S. control of the world's energy sources. If they saw any dangers, they kept quiet.
But they made a big mistake. They were blinded by greed. There was no “quick victory.” There is much suffering by Iraqis, yes. But the occupation has been a debacle for U.S. imperialism.

They made the same mistake Hitler made invading the Soviet Union in 1940. And that Washington made sending its army to Vietnam in 1967. The U.S. rulers underestimated the Iraqis' willingness to sacrifice and fight rather than submit.

The liars are exposed. We must thank the heroic Iraqi resistance for exposing them.
John Catalinotto - International Action Center - USA

Commentary From Benjaminis: Look what we all experienced up to November 8, 2016 in the US Election. Look at where we are now. There now is awareness. Just to make it very personal, I was always a democrat. I always was a liberal in Canada. Now I understand what the LEFT has done. I would consider myself to be more of a Republican than a Democrat even though I am neither since I am a Canadian. The POINT is that just as I have learned after 70 plus years of an incredible life, "When Anybody Says Something About The Other , They Most Likely Are Speaking About Themselves. I used to respect Bernie Sanders and Michael Moore and many others. Now I see what they really stand for and that is clearly their own agenda. These words that I use is very relevant especially today. Stay tuned because we ALL are in this together and in many ways you have the answer to your original question. The X Ray today will CHANGE tomorrow just like the Charts will CHANGE Tomorrow and the STATUS QUO will change Tomorrow and rest assured WE will see Spring again once the Real Winter ends. I would welcome and appreciate anyone who has an opinion to offer one. There is no right opinion since things will now unfold REGARDLESS of what we each think. JUST FOLLOW the Money Flow and PROTECT YOURSELVES at All Times.

Now to the opinion of Zerohedge done much better than I myself am capable of expressing.

http://www.zerohedge.com/news/2017-0...ops+to+zero%29

Submitted by Charles Hugh-Smith via OfTwoMinds blog,
Sorry, pal, you're evil. Self-righteous indignation counts for nothing in the strict accounting of real progressivism.
Dear Self-Proclaimed "Progressive": I love you, man, but it has become necessary to intervene in your self-destruction. Your ideological blinders and apologies for the Establishment's Neocon-Neoliberal Empire are not just destroying your credibility, they're destroying the nation and everywhere the Empire intervenes.
While you squandered your political capital defending zero-cost causes like "safe spaces on college campuses," the Empire was busy killing, maiming and making refugees of women and children in Syria. President Obama and his Neocon crew (former Secretary Hillary Clinton included) aren't fools; they rely on drones and proxy armies to do their dirty work.
Neoliberalism is the Establishment's core ideology, and by supporting Bill Clinton and Barack Obama, you furthered, defended and rationalized the Empire's neoliberal expansion and exploitation. Neoliberalism's Big Lie is transforming everything into a market makes everyone richer.
The dirty little secret of Neoliberalism is that the markets it creates are rigged in favor of Elitist cronies. If you can set aside your "progressive" blinders for a moment (Bill and Barack could do no wrong for 16 long years of neoliberal exploitation), you might learn that the Presidents and party you supported ushered in the era of neoliberal pillage as public-private partnerships, Philanthro-Capitalism, and rigged markets that enriched the elitist Establishment you defend at the expense of the bottom 95% non-elites.
You defended "higher education," which was simply a code word for stripmining the bottom 95% via student loans to pay outrageous salaries for under-assistant deans of student affairs and fund lavish expansion projects.
http://www.oftwominds.com/photos2016...loans5-16a.png
You embraced the Corporate Media's absurd "fake news" witch-hunt, when the biggest purveyors of fake news/Imperial Propaganda are the "liberal" media you unhesitatingly believe with all your heart because it reinforces your sense of moral superiority. Never mind that the mainstream "liberal" media is owned by corporations that are in bed with the Establishment and the Empire.
http://www.oftwominds.com/photos2016...-ownership.gif
You were silent when your "progressive" president engaged in a global Murder, Inc., and your former secretary of state bragged "we came, we saw, he died." Your sputtering excuses for Imperial over-reach, extra-judicial murder and the destruction and displacement of entire populations is a travesty of a mockery of a sham of real Progressivism.
Wake up, Self-Proclaimed "Progressives": you're apologists for an Evil Empire. Your devotion to the Democratic Establishment that has mastered the art of bleating politically correct speech acts while destroying entire nations renders you the classic useful idiots, on par with those who defended Stalinism and the Soviet Gulag because "it was the right thing to do."
While you devote your energy to "resisting" Trump in completely empty gestures, you did nothing to resist the imprisonment of tens of thousands of young men of all ethnicities in America's War on Drugs Gulag.
http://www.oftwominds.com/photos2016...opulation2.gif
While you championed your fake-Progressive presidents and party, wealth and wage inequality soared. Did you not mind because you and your household benefited from neoliberal skimming and scamming?
http://www.oftwominds.com/photos2016...ution10-15.jpg
How many of your self-proclaimed "progressive" peers are in the 5% who came to do good and stayed to do well?
http://www.oftwominds.com/photos2016...ality3-16a.jpg
You have the luxury of supporting ObamaCare because somebody else is paying the bills. It may be a corporation, the state, a government agency, a university, a foundation or the taxpayer, but your support of neoliberal skims and scams doesn't cost you anything.
http://www.oftwominds.com/photos2016...costs6-16a.jpg
You are a hypocrite because you only engage in causes that don't cost you anything. Prove to us that you've been questioned or arrested by the F.B.I. for political action against the Empire, and you will have earned credibility. If you don't have any skin in real resistance, then your support of politically correct speech acts is cost-free and therefore meaningless.
I am sorry to be the one to tell you, but your unquestioning support of a neoliberal- neocon president, party and candidate makes you as evil as the empire you support, via your silence, rationalizations and absurdly empty gestures in favor of cost-free political correctness.
You have surrendered principled action in favor of a self-righteous belief that indignation makes you better then everyone else. Sorry, pal, you're evil. Self-righteous indignation counts for nothing in the strict accounting of real progressivism.
Your claim to moral superiority based on indignation makes you the moral equivalent of the "conservative" married preacher who is sleeping with the church secretary and skimming church funds. His claim to moral superiority is based on indignation, too.
By supporting a corrupt, self-serving elitist Empire of privilege and power, you are an enemy, witting or unwitting, of truth, justice, self-determination and liberty.
If you want to become a real Progressive, it has to cost you. You will have to abandon the Establishment you belong to, the party you support and the cheap veneer of self-congratulatory fake-progressivism you project.
You will have to throw yourself on the gears of the stripmining, protecting-the-privileged autocratic war machine you have supported by your silence and your rationalizations. To quote Mario Savio's famous extemporaneous speech during Berkeley's Free Speech Movement:
"There's a time when the operation of the machine becomes so odious, makes you so sick at heart that you can't take part! You can't even passively take part! And you've got to put your bodies upon the gears and upon the wheels, upon the levers, upon all the apparatus -- and you've got to make it stop! And you've got to indicate to the people who run it, to the people who own it -- that unless you're free the machine will be prevented from working at all!"
Memo to Self-Proclaimed "Progressives": "safe places" on campus don't count.
The truth is, you are an embarrassment to real progressives. You should be ashamed of your empty claims to the high moral ground. If you are incapable of feeling ashamed for your self-congratulatory self-righteousness, then you are truly lost.
Look, I know you want to "do the right thing." You want to encourage and support truth, justice, self-determination and liberty. To follow your better instincts, you're going to have to admit that you've been conned, and that you've been a loyal passive puppet of an Evil Empire.
The "right thing to do" is to recognize the Neocon-Neoliberal Empire as the enemy of truth, justice, self-determination and liberty and withdraw your consent. If you still don't get it, maybe these essays will help:
Moral panic over fake news hides the real enemy – the digital giants
America was a 'stan' long before Trump Paul Krugman et al conveniently forget that corruption, cronyism and contempt for the rule of law long predated Trump.
Authoritarian Neoliberalism and the Myth of Free Markets
We need to pull together, not self-divide into ever more fractious camps. The oldest and most successful Imperial strategy is divide and conquer. Don't fall for it.

Benjaminis

EXCELLENT KeepCalmfx

We need to be aware to not be surprised. It only takes a few minutes to do this as the reading is all that is needed. When the North America Markets open in 41 minutes the Money Flow will start. I will soon post a report that I just heard on CNBC now has been published by Bill Gross. That in effect states that if the 10 Year US Bonds go over 2.60%, then it is official , The Bond Bubble has BURST. Well it has already burst. I will find and post the article however we here already understand the issues as it has been discussed here fully.

Hour Chart from Finviz on US 10 Year Bonds.

http://finviz.com/futures_charts.ashx?t=ZN&p=h1


Benjaminis

I put this information on my post 990 of January 8, 2017 , just two days ago. It is so important to read again and understand as today is the day for HARD COLD TRUTHS so with that being my theme this morning, I post it again completely.

http://financialrepressionauthority....eter_boockvar/

AND NOW TO FINALIZE WHAT THE TRUTH IS FROM YET ANOTHER KNOWLEDGEABLE SOURCE.

I will listen to the Podcast later on and in the meantime here is the written commentary clearly written.

FRA is joined by Peter Boockvar and Yra Harris in discussing their expectations for 2017, along with predictions for Europe and the global debt crisis.


Yra Harris is a recognized Trader with over 32 years of experience in all areas of commodity trading, with broad expertise in cash currency markets. He has a proven track record of successful trading through combination of technical work and fundamental analysis of global trends; historically based analysis on global hot money flows. He is recognized by peers as an authority on foreign currency. In addition to this he has Specific measurable achievements as a member of the Board of the Chicago Mercantile Exchange (CME). Yra Harris is a Registered Commodity Trading Advisor, Registered Floor Broker and a Registered Pool Operator. He is a regular guest analysis on Currency & Global Interest Markets on Bloomberg and CNBC. He has been interviewed for various articles in Der Spiegel, Japanese television and print media, and is a frequent commentator on Canadian Financial Network, ROB TV.


Prior to joining The Lindsey Group, Peter spent a brief time at Omega Advisors, a New York based hedge fund, as a macro analyst and portfolio manager. Before this, he was an employee and partner at Miller Tabak + Co for 18 years where he was recently the equity strategist and a portfolio manager with Miller Tabak Advisors. He joined Donaldson, Lufkin and Jenrette in 1992 in their corporate bond research department as a junior analyst. He is also president of OCLI, LLC and OCLI2, LLC, farmland real estate investment funds. He is a CNBC contributor and appears regularly on their network. Peter graduated Magna Cum Laude with a B.B.A. in Finance from George Washington University. Check out Peter’s new site at www.boockreport.com.

2017 OUTLOOK
There’s going to be this tug-of-war over Trump and the tax and regulatory policies he hopes to pass and initiate, and financial conditions that will continue to tighten in the interest rate perspective. Since November, the focus has been on the positives of Trump, and when people start looking at the details, people will have to acknowledge that what got us to record highs in the stock market was QE and zero interest rates. At some point we’ll have to shift back to interest rates and the uncertainty of what Trump will pass and the offsets in terms of tax policy.


What you failed to see materialize was a lot of year-end tax selling, except for losses. This is not a Reagan phenomenon. There are so many vast differences, mainly the debt load piled on the US and global economy. For every 100 basis point increase in interest expense is $470B. Despite all this excitement over the corporate tax income cut, there’s not enough attention being paid to the potential offsets. There’s a potential border adjustment tax, and a credit addicted economy where they may be taking away the deductibility of future interest expense.


Debt has to be serviced. It’s not all coming due in this year, but we don’t know how much of it is floating. If Trump changes the tax code, a lot of people will see when interest deductions will not be part of the equation anymore, just how great the impact will be on corporate earnings. If Trump doesn’t get these offsets, the corporate tax rate isn’t going to make it to 15-20%. People are going to start digging into the details of the Trump plan, and they’re going to realize there’s no free lunch here. Because of the size and depth of the deficit, he can’t just cut taxes. There’s going to be an offset, and that’s what people have to start paying attention to.


FISCAL DEBT DRIVING US DEBT
Entitlement obligations are now at 10% of GDP and rising. This trend is expected to escalate, give then trillions of unfunded liabilities obligated toward entitlement. On the private side, corporations have taken out about $620B for the share buybacks, and if rising interest rates begin to reverse that trend, that’s a big factor that could have the markets going in the other direction.


We’re seeing some political maneuvering from Trump, who’s controlling his narrative. We’re about to see the difference between campaigning and governing, and the reality of the latter.

KEY THEMES GOING INTO THE NEW YEAR
Rising inflation; slowing growth

US growth is still around the 2% level, but the question for 2017 is how much of the positive sentiment numbers that we’re seeing in manufacturing etc. is hopes and how much is actual improvement in business activities. Right now it’s still hopes, and GDP for 2017 is still going to be around the 2% level and we’re not going to see the benefits of Trump until 2018. Inflation levels are moving higher, partly due to the rate of change of the base effects of the decline in energy, on top of high prices of medical care and rent. We’re seeing inflation expectations rise in Europe and the US, and it gets down to how the Fed responds to that.

Interest rates may mug the markets and trump over reality. What got us here was QE, negative interest rates, and zero interest rates in the US. To think that that can reverse with no pain, and somehow fiscal policy will offset that, is delusional.

Commentary from Benjaminis - GREAT ONE WORD DESCRIPTION - DELUSIONAL.



THE PROBLEM OF GERMANY
The most important area is going to be the Euro.

The only way out of some of the mess that they’re in is for Germany to have higher inflation.

Right now with the Deutschmark 10% lower, the German current account surplus is about 8.5% of GDP. And yet, there’s nothing they can do about it because Germany is tied into this weak economic consortium, and they’re benefitting from it with phenomenal growth. The weaker the Euro goes, the more benefit Germany gets anyways. This is the year where Germany will have to decide if they’re going to be the transfer agent for all this growth. The operative question for this year is: who guarantees the ECB’s balance sheet?


We’re going to see firsthand the fallacy of demanding 2% inflation. Draghi doesn’t realize the epic bond bubble that he’s created. When you have huge amounts of negative yielding bonds in Europe and anemic levels of interest rates, and at the same time he wants 2% inflation. He’s desiring something that’s going to blow himself up.

Commentary from Benjaminis: BLOWUP !!!


As we head into 2017, Europe is going to become the centerpiece of the global financial system. It was a 50% decline in the value of Japanese and European banks that finally got them to realize flattening your yield curve into the ground is not a good idea. We are in the last inning of this last bout of monetary easing. People should not lose sight that interest rates, while still extraordinarily low, will move higher in the coming years and they should be prepared for that.


The markets are beginning to take some control. We’re going to get a rise in interest rates, and we have a very sensitive equity market.

As of 2015, of the profit pie, labour got the smaller share since WWII. That’s now beginning to shift, but there’s a lot of catch up on the labour side in terms of wages. While that’s good for earners, it’s not going to be good for corporate profits and companies will have to either slow down hiring or absorb those costs, or pass it on as higher prices.


EFFECTS OF CHINA
Right now non-performing loans in China are at 15-20% of GDP levels. China’s fallen into the same trap as the US, where it takes more and more debt to generate more GDP. This obsession with 6-7% growth has put them in this trap. The level of credit it takes to generate this level of GDP is out of their control.

Growth will continue to slow, and debt will continue to become a big problem, but China’s one big black box in the sense that they could throw a lot of things under the rug and keep it there in some controlled way. It’s very difficult to forecast how Chinese authorities are going to manage that.


If China were to implode and let their currency depreciate, then we’d have to change our scenarios because that could send a tidal wave of disinflation around the globe and they’ll just be exporting regardless of price. Their problem is far too much capacity, and unless they can miraculously shift their economy from an export oriented to a phenomenally domestic economy, and that won’t be an easy task with that debt load. If China makes the transition, food will be an important thing.


COMMODITY MARKETS FOR THIS YEAR
Gold’s going to trade where real interest rates are, and if you think Janet Yellen will be slow in raising interest rates in response to a rise in inflation, then you should be positive in gold and silver. It’s handled two rate hikes and a 14 year high in the dollar, and it’s still a hundred off the lows of last year. That was the bottom in this bear market, and higher prices are expected. With respect to emerging markets, Brazil and South Korea have good political direction and should be positive.


If you see the German inflation numbers, it’s obvious they’re debasing their currency as a way to bail out the EU.

BitCoin is up 150% year over year. Over the last couple of months it’s doubled. There’s something very wrong that BitCoin is doubling like that while gold is suffering. There’s a push for a non-fiat type currency. Right now they’re buying BitCoin, but the difference between gold and BitCoin is nonsensical.


The ECB will become the big issue for the German elections come September.

Commentary from Benjaminis: You saw where this information came from at the Top of the Article. This is information that you can take to the bank. Just make sure your bank is in your home !!! That is it for tonight. My long day is over posting here on our Thread of Knowledge.

This is what Bill Gross published today which I will still link later today when I find it. If you do not know who Bill Gross is please Google It !!!

BOMBS AWAY - BONDS AWAY

http://wolfstreet.com/2017/01/04/how...-massacre-get/

Worse “than the 1994 ‘Bond Massacre,'” with “sustained double-digit losses on bonds, subpar growth in developed markets, and balance sheet risks for banking systems….”
The backdrop: after 36 years of bond bull market, the amount of US bonds has ballooned to $47 trillion, up 24% from just ten years ago:

 

1. US Treasurys ($19.8 trillion),
2. Municipal bonds ($3.8 trillion)
3. Mortgage related bonds ($8.9 trillion)
4. Corporate bonds ($8.6 trillion)
5. Federal Agency bonds ($2 trillion)
6. Money Markets ($2.6 trillion)
7. Asset backed Securities ($1.3 trillion)

Bonds dwarfs the US stock market capitalization ($27 trillion). Bonds are a global phenomenon with even bigger bubbles elsewhere, particularly in NIRP countries, such as those in Europe, and in Japan. That’s why bonds matter. They’re enormous. And the damage they can do to investors is huge.
So how bad might the next bond bear market get? Paul Schmelzing, a visiting scholar at the Bank of England and an academic at Harvard where he concentrates on 20th century financial history, published an unpleasant scenario on the Bank of England’s blog. He doesn’t mince words:
[A]s rates reached their lowest level ever in 2016, investors rather worried about the “biggest bond market bubble in history” coming to a violent end. The sharp sell-off in global bonds following the US election seems to confirm their fears. Looking back over eight centuries of data, I find that the 2016 bull market was indeed one of the largest ever recorded. History suggests this reversal will be driven by inflation fundamentals, and leave investors worse off than the 1994 “bond massacre.”

To arrive at his conclusion, he classifies bond bear markets into three types:

1. The inflation reversal of 1967-1971
2. The sharp reversal or “Bond Massacre” of 1994
3. The steepening yield curve or “value-at-risk shock” in Japan in 2003.

He explains that “historically, inflation acceleration has been a solid predictor of sharp bond selloffs.” But other “prominent episodes appear less correlated with fundamentals, and can inflict similar levels of losses.”
http://wolfstreet.com/wp-content/upl...CEO-income.png
Type 1: The inflation reversal of 1967-1971 occurred as annual inflation shot from 1.6% to 5.9%, along with some pressures on the federal budget from the Vietnam War that pushed the deficit from 0.2% in 1965 to 2.8% in 1968. But even when the budget moved back into balance, Treasurys continued their rout:
The “inflation reversal” leaves bondholders particularly bruised, and is most clearly associated with fundamentals: namely a sharp turnaround in realized consumer price inflation (CPI).

Type 2: The Sharp Reversal of 1994, or the “Bond Massacre,” turned out to be short-lived. It wasn’t caused by inflation, fiscal policies, or Fed action. The Fed did begin to raise rates in May 1994, but the turmoil had started in Q3 1993 and peaked in early 1994. Instead:
[T]he dramatic increase in leveraged bond positions by both US hedge funds and mundane money managers set in motion self-reinforcing liquidations once uncertainty over emerging markets including Turkey, Venezuela, Mexico, and Malaysia – all of which experienced sharp capital flow volatility – put pressure on speculative positions.

Type 3: The value-at-risk (VAR) shock in Japan in 2003 occurred when fears spread that the Bank of Japan, which was already doing QE before it was called QE, would taper its purchases of Japanese Government Bonds. The yield curve, which had been extraordinarily flat, steepen sharply, as prices of longer-dated bonds sagged. These sagging prices hit banks, which hold large portfolios of JGBs, particularly hard. Their shares crashed to multi-year lows, and some received taxpayer bailouts:

[T]he sudden steepening of the JGB curve from the middle of 2003 posed a new set of challenges: calibrated risk management structures, known as “Value-at-Risk” models, required banks to shed JGB assets once their price started plummeting. Since most banks followed similar quantitative signals, and exerted a traditionally strong home bias in their fixed income portfolios, a concerted dumping of government bonds ensued.

Schmelzing concludes:
A pessimistic reader could certainly identify gloomy ingredients for the “perfect storm”: the potential for a painful steepening of bond curves, after a sustained flattening as in 2003, coupled with monetary tightening; and a multi-year period of sustained losses due to a structural return of inflation as in 1967.
But he considered the Type-2 “meltdown,” as it happened in 1994, less likely. At the time, highly leveraged bond positions and external shocks came together.

This time, there has been “progress on bank leverage regulations,” and “the current global capital flow cycle has already almost fully reversed from the cycle peak,” he writes.

Instead, it will more likely turn into a toxic combination of Type-1 and Type-2 bear markets:
Global inflation dynamics are picking up, at a time when Central bankers voice more tolerance for “inflation overshoots.” Though currently bank equity investors are cheering the steepening of yield curves, meanwhile, the 2003 Japan episode should fix regulators’ attention on the growing home-bias in government bonds.

Banks in some countries are particularly exposed to the VAR shock, including Italy, whose financial institutions hold 18% of their assets in Italian government debt, up from 12% in 2008. And “in most geographies,” banks hold these domestic government bonds mainly in “‘available-for-sale’ portfolio buckets, where they have to be marked-to-market.” That allowed banks to take the gains as central banks pushed down interest rates and inflated bond prices in recent years, but it now exposes them to losses and forced selling.

On balance, then, more than to a 1994-style meltdown, fixed income assets seem about to be confronted with dynamics similar to the second half of the 1960s, coupled with complications of a 2003-style curve steepening. By historical standards, this implies sustained double-digit losses on bond holdings, subpar growth in developed markets, and balance sheet risks for banking systems with a large home bias.

And that would not conform to the rosy scenario.

President-Elect Trump has been hounding certain companies with his drive-by tweets, to knock them around some, get their shares to sink, and cut some “deals.” And companies react. But there’s more to it than what’s on the surface. Read… Trump Tweets, Ford & GM Counter, their Shares Jump, the Peso Plunges, but the Jobs Won’t “Come Back” to the USA


Commentary from Benjaminis: So Now You Understand Why We Have Arrived At The COLLAPSE !!!

http://in.reuters.com/article/funds-...-idINL1N1EZ1P1

Bill Gross: Secular bear bond market to begin if 10-yr Treasury yield tops 2.60 pct

By Jennifer Ablan | NEW YORK

Jan 10 If the yield on the benchmark 10-year Treasury note moves above 2.60 percent, a secular bear bond market has begun, investor Bill Gross warned on Tuesday.

"Watch the 2.6 percent level. Much more important than Dow 20,000. Much more important than $60-a-barrel oil. Much more important that the Dollar/Euro parity at 1.00. It is the key to interest rate levels and perhaps stock price levels in 2017," Gross wrote in his latest investment outlook to clients.

The 10-year Treasury note yield was around 2.37 percent late

on Monday.

Gross, who runs the $1.7 billion Janus Global Unconstrained Bond Fund, said: "Happiness has dominated risk markets since early November and despair has characterized global bond markets."

The 100 basis point move in the 10-year Treasury yield from 1.40 percent to 2.40 percent has stemmed from the hope for stronger growth by way of Republican fiscal progress, reduced regulation and tax reform, Gross noted. He also said Treasury yields have edged higher on encouraged risk-taking as well as the potential for higher inflation and a more hawkish Federal Reserve.

"Are risk markets overpriced and Treasuries over-yielded? That is a critical question for 2017," Gross wrote.

Gross noted that U.S. President-elect Donald Trump "tweets and markets listen for now, but ultimately their value is dependent on a jump step move from the 2 percent real GDP growth rate of the past 10 years to a 3 percent-plus annual advance."

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Gross said 3 percent growth rates historically have propelled corporate profits to a somewhat higher clip because of financial and operating leverage dependent on higher growth.

"We shall see whether Republican/Trumpian orthodoxy can stimulate an economy that in some ways is at full capacity already," Gross said. "To do so would require a significant advance in investment spending which up until now has taken a backseat to corporate stock buybacks and merger/acquisition related uses of cash flow. I, for one, am skeptical of the 3 and more confident of the 2."

Gross said demographic negatives associated with an aging population are now more at risk due to rising interest rates, technology's displacement of human labor, and the deceleration and retreat of globalization, posing threats to productivity and GDP growth.

"Trump's policies may grant a temporary acceleration over the next few years, but a 2 percent longer term standard is likely in place that will stunt corporate profit growth and slow down risk asset appreciation," Gross said. (Reporting By Jennifer Ablan)

From my Post 1020 and that will do it for information as now in 9 minutes the Money Flow will start !!!

Nomi Prins: This is an Ongoing Financial Crisis


Nomi Prins while in Berlin, Germany in December 2016 joined investigative journalist Lars Schall to discuss what she has identified as an ongoing financial crisis. During the in depth conversation they highlight the indicators that signal we are in an ongoing financial crisis, how involved the big banks are in the existing monetary system and exactly why the next global financial crash will be the worst experienced yet.


Nomi Prins is the best selling author of All the Presidents’ Bankers and is currently working on her latest book, Artisans of Money. Prins’ is a former Wall Street insider who has worked previously at some of the largest banks in the world including Goldman Sachs, Lehman Brothers and Chase Manhattan Bank. She continues to be a strong advocate for Glass-Steagall Act legislation and financial reforms of Wall Street.


When posed with the question regarding the financial crisis that began in 2008, and what may be in store for the ongoing crisis she remarked, “If we look at why the problems of 2008 happened, it was because issues in the United States financial structure at the beginning of the 2000’s had not been solved. We had deregulation of the financial industry in 1999, which allowed banks to consolidate deposits and loans. It allowed them to participate in more speculative betting activities. After that, two years later, we had a minor recession where scandals filled in our energy, telecoms and banking sectors. We then had substantially lower rates stemming in 2002 and 2003 that made banks turn to find something else they could make a lot of money. That something else was subprime mortgages that had been repackaged and sold multiple times over. When we get to 2007 and 2008, all of that fell apart.”

“What is different now, and why it is worse, and why we are only in the first phase of a much bigger financial crisis is because we have had eight years of buildup. From the central bank’s perspective, they are coming in and subsidizing the system – what I call artisanal money – where you manufacture money, print it and do not separate banks, regulate them or reduce any real risks they impose on the economy. Now, we are falling from a height where even greater debt, capital and cheap money has all been pushed into the financial system. When we fall is in question, but that we will fall is definite.”


“In the wake of the crisis the Federal Reserve had a different role. That was to organize and coordinate its own monetary policy throughout the world. This began in the wake of the financial crisis in the United States, which was to reduce rates to zero and to adopt a massive quantitative easing (buying additional debt securities into the books of the Fed). It was not simply lending at zero, it was making money available in various ways to the big banks. It was also buying debt securities, effectively making money available to the government, all through the Fed in order to preserve the financial system and give the big banks liquidity needed to continue to be big. The Fed then exported this policy throughout the world. It became something that was coordinated with the Bank of Japan, the European Central Bank and others. This is what we are living through today.”


When asked about the big banks and their involvement in the crisis she responded, “They were the same big banks that pushed the deregulation in 1999. They pushed deregulation of Glass-Steagall Act from 1933, which separated their functions, and was eventually repealed. It allowed them to consolidate their size, risk and complexity into one “house.” These are the same banks at the core of the financial crisis. They were the big six banks in the United States that include JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley. They are still the banks that, since the crisis, have become about 43% bigger in the total amount of deposits they hold. They’ve almost doubled in terms of the amounts of assets that they hold – relative to the amount prior to the crisis – and still maintain 95-97% hold on all of the trading assets that exist in the U.S banking sector. The bigger banks have become bigger since the crisis.”
https://dailyreckoning.com/wp-conten...rins-Lars-.jpg
She then remarked on the problematic standings of the U.S central bank, “The idea that the Federal Reserve is that it is technically not a government entity but it is not a private institution. It is somewhere in the middle. The reality is that it is constructed with shares and proportionally allocated by the banks that ultimately get help from the Federal Reserve. For example, the biggest banks have a higher percentage share of membership in the Federal Reserve than the smaller banks. When there is a problem they have a bigger call on that. Either the banks are very greedy, or they continue to require money that has no cost because they do not have the ability to function as financial institutions without that external help. Or both.”
https://files.admin.agorafinancial.c...ey-635x120.jpg
https://ads.agorafinancial.com/www/d...&cb=3dce04e65f
The interviewer then asked about the influence of China’s alternative approach to the West and the increasing Eastern shift following the 2008 financial crisis. Lars Schall noted an IMF report as saying, “The gold bullion component of monetary gold is the only case of a financial asset with no counterpart liability.”


To that, alternative currency discussion and the ongoing financial crisis Prins’ highlights, “One of the things that China has done is seek to establish itself as more of a dominant reserve currency. Up until October of last year China was not in the special drawing rights basket of the IMF. A standing in which the U.S dollar is still the supreme currency because it is the currency of choice. This means that most central banks have it in their reserve. To that extent the Federal Reserve, as a dominant central bank, has more control over global policy. It exerted that power in the wake of the financial crisis. China was not able to exert any of that. So what they did was find a new way to get into the SDR and have their currency adopted into more of a global reserve basis and come in at the middle reserve in the basket of currency players.”


“Gold is the other side of that. It would allow China to be able to maintain greater stability. Having gold is a way to get back to a more independent equilibrium. One element is central banks and currency… the other is to have something else to be used in the event of a crisis. It offers an element to create stability. In terms of buying gold, it is a way to move away from the dependency of the dollar.”


Speaking to the same perceived Chinese concern out of the West, when asked about accusations over concern over currency manipulation she noted, “It has been policy of individuals from both party lines to bash China as a currency manipulator. President Obama’s first Treasury Secretary and head of the Federal Reserve all had labeled China as a currency manipulator. Donald Trump has simply maintained this idea of blaming China for trade and deficit issues that the United States has experienced. Trade is the bigger issue. I see Trump continuing to go about potential bilateral and individual trade agreements. China will also continue to seek alternative trade options to the West.”


To see the full interview with Nomi Prins and Lars Schall click here.
Regards,


Benjaminis

HEADS UP EVERYONE PLEASE READ THIS AND THEN READ IT AGAIN - VERY VERY INFORMATIVE !!!

http://seekingalpha.com/article/4035...benign-circles

Summary
Money (cash + credit) is the foundation of the global financial system.
Trade affects exchange rates through the balance of trade. Countries sell goods in their home currency.
The US market will likely go on a tear higher from here (reflexivity). This will be accompanied by increased volatility in both directions.
Let's talk about currencies. The different types of currencies and the various roles they play in the global financial system.
Because this topic is complex and I don't want to get lost in the weeds, I'll be making broad sweeping generalizations while focusing on the key points that matter. My plan is to do this while trying not to bore you to death. Hopefully I'll be able to tie all this together and show you why understanding these things will have a significant impact on your P&L in the year to come.
Here we go…
Money (cash + credit) is the foundation of the global financial system. It's the oil that flows through the economic machine, greasing the gears of commerce and allowing markets to turn.
Money serves three primary functions: a store of value, a medium of exchange, and a unit of account.
All currencies are now fiat. Meaning, they have no intrinsic value. They are not backed by anything tangible.
Money is a system based on trust. This trust is complex and I'm not sure many people consciously think about it. It's predicated not only on our opinions and expectations surrounding the currency issuers' stewardship of its value, but the opinions and expectations of others as well.
A fiat currency is ultimately worthless if it's not fungible and others won't accept it as: a unit of account, store of value, or medium of exchange.
Since all currencies are fiat and not pegged to something fixed (there are pegged currencies but those are pegged to other floating currencies), their values, referred to as exchange rates, fluctuate relative to one another over time.
Like all market prices, exchange rates are driven by supply and demand. Currency supply and demand can be separated into two broad categories: fundamental and speculative.
Fundamentals are things like the trade and balance sheet of the currency issuer and its fiscal and monetary policies, such as its budget deficits and its control of the money supply.
Speculative demand is centered around expectations of the relative and future value of the currency. Think exchange rate trends, interest rate differentials, and relative local market opportunities.
To simplify even further. Currency supply and demand comprise three things:

1. Trade
2. Non-speculative capital transactions
3. Speculative capital flows

Trade affects exchange rates through the balance of trade. Countries sell goods in their home currency. For other countries to buy those goods, they have to exchange their currency for the seller's (exporter's) currency. And vice versa for when the country wants to import goods. This differential is referred to as the balance of trade. A trade surplus is an appreciating force on a currency and a deficit is a depreciating one.
Speculative capital flows are the buying and selling of currencies with no attached underlying asset. Speculative capital moves in search of the highest total return.
Total return is made up of: exchange rate differentials, interest rate differentials, and the local currency capital appreciation. Of the three, exchange rates are the most important because they tend to fluctuate more than interest rates or market returns. It does not take much of an exchange rate decline/increase to completely overshadow the return on interest rates or capital appreciation.
Non-speculative capital transactions refer to all other cross border capital transactions.
In the short term (months to a few years), exchange rates are driven by speculative flows. In the long term, economic fundamentals (trade + non-speculative capital transactions) dominate exchange rate movements. It's the dynamic tension between these two that comprise the trends and fluctuations of currency markets.
Here's one of the key points of the bigger picture I'm getting at, via George Soros' Alchemy of Finance:
Expectations about exchange rates play the same role in currency markets as expectations about stock prices do in the stock market: they constitute the paramount consideration for those who are motivated by the total rate of return.
And
To the extent that exchange rates are dominated by speculative capital transfers, they are purely reflexive: expectations relate to expectations and the prevailing bias can validate itself almost indefinitely… Reflexive processes tend to follow a certain pattern. In the early stages, the trend has to be self-reinforcing, otherwise the process aborts. As the trend extends, it becomes increasingly vulnerable because the fundamentals such as trade and interest payments move against the trend, in accordance with the precepts of classical analysis, and the trend becomes increasingly dependent on the prevailing bias. Eventually a turning point is reached and, in a full-fledged sequence, a self-reinforcing process starts operating in the opposite direction.
The point is that currencies are inherently reflexive.
Their tendency for large fluctuations make exchange rates the most important input in the total return equation. This means that as an exchange rate moves, it brings in speculators betting that it'll continue to move. And the longer the trend endures, the more reinforced this behavior becomes. Until, of course, the exchange rate diverges too far from fundamentals and the trend following bias weakens. Then the process aborts and works in reverse.
This is why some of the best trends (opportunities for profit) happen in the currency markets. It has a strong reflexive nature.
And this brings us to my second point. The dollar.
The US dollar is at 14-year highs after recently breaking out of its nearly two-year consolidation.
For the last three months, it has gone vertical without taking much of a breather. This trend is the most important trend in global markets right now. Its effects will be wide-ranging. Those of you who've been with us for a while know we often refer to the US dollar as the lynchpin of global markets. It's the main grease lubricating the global economic machine.
This is true when the dollar is in equilibrium. It's doubly true when it's trending.
And this is because in macro there's something called the core-periphery paradigm, put forth by Javier Gonzalez, in his book How to Make Money with Global Macro.
In this paradigm, global currencies can be divided into three subsets:

1. The reserve currency which is currently the US dollar.
2. Hard currencies, that come from countries that can lend to themselves at competitive rates. These tend to be net-importers of commodities. Hard currencies generally act as safe-havens during periods of risk-off.
3. And soft currencies. Soft currencies tend to be commodity producers. They are countries that have to borrow in other currencies at higher rates. These currencies depreciate during periods of risk aversion.

Since the dollar is the reserve currency it's the preferred medium of exchange for global trade. It's also why commodities are priced in dollars.
Global capital sloshes around the world in search of the highest total return. So when the dollar appreciates due to the sum of exchange rate differentials, interest rate differentials, and local currency capital appreciation, it attracts more capital (both speculative and to a lesser extent non-speculative). This creates the feedback loop.
But that money is coming from somewhere… that somewhere is the periphery.
A higher trending dollar is a depreciating force on commodities and commodity producers (soft currency countries). And a weaker dollar is an appreciating force on commodities and its producing countries.
Here's the following, again from Gonzalez, "Commodities rise for two reasons: investor flight to avoid a depreciating reserve currency and producers increasing their price to compensate for the depreciating unit of account."
By that same logic, commodities fall due to capital flight back into the reserve currency "USD". And also from producers decreasing their prices to compensate for the appreciating unit of account. They then increase production as well to make up for the now lower income due to unfavorable exchange rate differentials.
There are also other reasons - such as emerging market debt becoming more expensive when the dollar rises and the Fed's interest rate policy affecting rates throughout the world in addition to the amount of liquidity sloshing around.
Simply put, much of the world lives at the mercy of the dollar and the Fed.
Due to this core-periphery dynamic, Gonzalez points out:

1. On average, the cycles are longer at the core than at the periphery.
2. Cycles are longer at the core when the reserve currency is appreciating than when it is depreciating.

This is perfectly logical. A depreciating dollar equates to higher commodity prices. Higher commodity prices feed into greater inflationary pressures. And higher inflation results in the Fed raising rates; increasing the total return profile of US markets and holding US dollars.
So a stronger dollar not only attracts speculative capital flows but it also subdues inflation, which keeps real rates high and stays the Fed from tightening too much. Hence why core cycles last longer when the dollar is going up.
Hopefully you've stayed with me and haven't jumped to Twitter out of boredom because now I'm going to tell you why this is important.
Theme: Benign or Vicious Circle
The last few weeks I have been banging my head against the wall trying to understand the dollar dynamic at work. I think if I can understand this then I'll be able to make a lot of money in the coming year.
Here's why it has been hard. The recent rally in the dollar is confounding a lot of currency models. These models say that at the current interest and exchange rate differentials, the dollar should not be moving higher against many of the major pairs (can be otherwise stated as the dollar is either fair or overvalued).
A number of currency analysts that I have a lot of respect for have been saying that the recent move just "doesn't make sense".
When I first heard that my ears perked up. I've found in markets that when you hear people saying a move doesn't make sense, it generally means that the move is going to keep going.
Like Bruce Kovner would say, "I like to know that there are a lot of people who are going to be wrong." The "doesn't make sense" usually equates to "a lot of people who are going to be wrong".
On a short-term technical basis the dollar is overextended and I've been expecting a pullback. I think we'll see one in the next few weeks. And it could very well be a sizable one, lasting a couple of months. But my conviction on the longer-term dollar bullish thesis is growing. Though with the many unknowns surrounding the new incoming administration, there are a number of things that could flip my viewpoint.
We are approaching a giant macro crossroads and the Administration's and Fed's response over the next few months will determine where we head and whether the core (US) benefits or the periphery (NYSEARCA:EEM) prospers. Or as Soros would put it (and I paraphrase), "it will decide whether we have a vicious circle or a benign one".
A benign circle for the United States is when the dollar appreciates and the bull market at the core (US) is extended. A benign circle for the US is a vicious one for emerging markets and vice-versa.
Vicious or benign, if we're able to get our dope right, we should be able to capitalize on a lot of opportunity.
Let's run through each scenario so we'll know what to look for as things unfold.
Benign Circle: Stronger dollar/Core benefits
Let's go back to our total return equation of: exchange rate differentials, interest rate differentials, and local currency capital market appreciation to see how the dollar stacks up.
The chart below is of the real trade weighted US dollar. See how it tends to move from long periods of equilibrium and stasis to long periods of aggressive trends. That's due to the reflexive process kicking in.
https://staticseekingalpha.a.ssl.fas...dex_thumb1.jpg
These trends drive exchange rate expectations which drives the trend. It's a safe bet to assume that the exchange rate differential is a strong positive in the dollar total return equation. And it's becoming stronger.
Also notice that the symmetry in time between the last two dollar bull trends. The dollar bull market in the 80's started in 78' and ended in 85' (approx. 6.5 years). In the 90's it started in 95' and ended in 02' (approx. 6.5 years). The current dollar bull market started in mid-11'. If this bull market follows a similar temporal symmetry, the dollar should continue to rise until the end of this year.
https://staticseekingalpha.a.ssl.fas...eld_thumb1.jpg
The above chart (via Factset) shows the interest rate differentials. The spread between US rates and its developed market peers is now at record high levels. So we can say that interest rate differentials are a strong positive for the US dollar.
Lastly, we have local currency capital appreciation. Which means we need to check how the US market is doing relative to the rest-of-the-world (ROW).
https://staticseekingalpha.a.ssl.fas...rld_thumb1.jpg
This chart shows the performance of the S&P index over the EFA which is an ETF that tracks over 900 developed market mid-to-large cap companies excluding North America.
When the chart is trending down it means the ROW is outperforming the US and vice-versa for when it's moving up. As the chart shows, the US has been outperforming its developed market peers for over 8 years.
Local currency capital appreciation is again a strong plus in the dollar total return equation.
For those of you who've read Alchemy of Finance, Soros' arrowed equation would look something like this:
↑(e+i+m) → s↑ → e↑
Where e= exchange rate, i = interest rate differential, m = capital appreciation, s = Speculative capital flows. Up arrow means increasing (for those of you with an eye for detail I flipped the arrow on s, Soros used a down arrow to signify increasing speculative inflows which I think is confusing), and the side arrow is essentially an equal sign.
All the equation is saying - in an unnecessarily nerdy way - is that the dollars current total return picture is conducive to increasing speculative inflows which will lead to further trend strengthening (ie, reflexivity).
And then here is my additional logic chain we can add to this total return picture which will drive expectations for all of the above barring no intervention by the incoming administration.
The prospect of coming fiscal stimulus + the extended length of this bull market + the long period of time the Fed has stayed low on rates + historically high valuations and increasing speculation = greater propensity for Fed to raise rates at a faster rate than market is expecting = stronger total return for investors = more speculative inflows = higher USD exchange rate and USD asset/market prices = greater chance Fed becomes more concerned with asset bubbles than its inflation target which will stay low from a stronger dollar = reflexive loop = goldilocks economy/market for the core over the short-term = unsustainable benign circle in the long-term.
We can also apply this to the rest of the developed world.
Stronger dollar = low to lower commodity prices = lower inflation + low valuation + sluggish economic growth = lower rates for longer in ROW = widening US interest rate differential = stronger dollar = benign circle.
Do you follow? Are you picking up what I'm putting down?
Kudos, if so. If not, no worries just take what you get and read on. I'll sum up the important stuff at the end.
Here's Soros on the power of benign circles (emphasis mine):
The longer a benign circle lasts, the more attractive it is to hold financial assets in the appreciating currency and the more important the exchange rate becomes in calculating total return. Those who are inclined to fight the trend are progressively eliminated and in the end only trend followers survive as active participants. As speculation gains in importance, other factors lose their influence. There is nothing to guide speculators but the market itself, and the market is dominated by trend followers.
The logic chain as things stand now, bring us to a stronger dollar, a core bull cycle and a benign circle. This is the 98'-99' analog that we've talked about in past reports where the US market runs higher. In combination with a stronger dollar and stagnating commodities and emerging markets. It would put us around the early 99' time frame.
https://staticseekingalpha.a.ssl.fas...ies_thumb1.jpg
Soros said this about the benign circle that occurred in the early 80's.

Reagan's benign circle was sustained by a differential in interest rates rather than inflation rates and there was an ever-growing trade deficit which was matched by an ever-growing inflow of capital. While in the first case it was possible to claim some kind of equilibrium, in the second case the disequilibrium was palpable.
The inflow of capital depended on a strong dollar and a strong dollar depended on an ever-rising inflow of capital which carried with it ever-rising interest and repayment obligations. It was obvious that the benign circle could not be sustained indefinitely.
Like Reagan's benign circle and Clinton's that followed, this market looks like it has tripped a strong reflexive function. A classic boom/bust sequence on multiple levels. One that could be extremely profitable in the short-term but dangerous in the long-term.
If this is the path we take then we want to remain concentrated in developed markets, particularly the US. We should look for stocks that will benefit from higher rates and not necessarily higher commodity prices. We want areas that fit around the Trump reflation/stimulus narrative and that are domestic focused; not vulnerable to higher exchange rates.
And of course we want to be long the dollar.
Vicious Circle: Lower Dollar/Periphery Benefits
The new administration rode a wave of populism into the white house. Trump's platform is centered around American interest first and doing whatever it takes to bring back jobs, especially in the rust belt.
Many of those jobs are manufacturing jobs. US manufacturers don't benefit from a rising dollar. Accusing China of artificially keeping the yuan weak in order to gain export share was a constant focus of the Trump campaign.
So it's not difficult to imagine a scenario where the dollar rises enough to cause the Trump administration to intervene and reverse it. Similar to what Reagan's Secretary of Treasury Jim Baker did in 85', with the Plaza Accord.
As President, Trump has the power to nominate members to the Fed's Board of Governors; including the chair and vice-chair. We should see these nominees shortly after he takes office. These picks and the amount of influence he chooses to exert over the Fed could have wide-ranging impacts on the dollar and equity market outcomes.
If any significant interventionism does occur, it will start up a short and vicious circle. Money will flow from the core to the periphery. Inflation will rise and commodities will run. And there will be some great trades to be made.
The following chart (via Meb Faber) shows global value against the S&P 500 36-month trailing performance. Like the chart I showed earlier, the US has been dominating the global investment landscape.
https://staticseekingalpha.a.ssl.fas...500_thumb1.jpg
Here's the following from Meb Faber:

But one regime sets the stage for the next, and now we find ourselves in an environment where US has outperformed everything since the 2009 bottom, but out performance alters values, and now the US is one of the most expensive stock markets in the world at a CAPE ratio around 27 (though nowhere near the peak valuation of 45 in 1999).
Foreign value has lagged badly, including three consecutive years of underperformance to the S&P in 2013-2015. This has pushed the CAPE ratio of the cheapest basket to a value of around 9 or 10, less than half the valuation of US stocks. (Actually it is almost a third the value of the US!) A global value approach is having a great year in 2016, and we look for that to continue for the foreseeable future.
So, maybe instead of chanting U-S-A, investors should be thinking C-A-P-E?
US valuations have only been higher two other times in history; 1929 and 2000. It's safe to say the rubber band is stretched and we'll soon enough see things revert back the other way.
This also means that if the dollar were to reverse, there are some amazing value opportunities outside of the US. Look at this chart below (via Greg Schnell) showing the CRB (Reuters/Jefferies Commodities Index) over the last 40 years.
https://staticseekingalpha.a.ssl.fas...dex_thumb1.jpg
The index is hanging around its 40-year low. Remember, commodities are a dollar story. But this chart shows how much potential mean-reversion could occur in commodities if the dollar were to reverse. We're talking a significant multi-year trend and a huge profit opportunity.
If the dollar turns, we'll buy up emerging markets and commodity linked assets hand over fist.
Summary:
Right now we are cruising along the benign circle road (stronger dollar) and our speed will only pick up barring any intervention. Since that's the road we're on, that's the road we need to game.
The way I see it right now (and this is liable to change) is that we'll see the benign circle play out completely and the Trump administration won't do anything until the trend has already exerted itself. This is for a few reasons.
1) The stock market is going to be moving higher. Sentiment is going to be positive. And his administration has a big To-Do list. There'll be little incentive for him to rock the boat. He may even see the stronger dollar as a global vote of confidence in his leadership.
2) We're seeing improving economic numbers from around the world. The optics on this improvement are being multiplied by the base effects we talked about in last month's report. The chart below shows manufacturing PMI numbers improving across the board.
https://staticseekingalpha.a.ssl.fas...PMI_thumb1.jpg
3) If this dollar bull market follows a similar temporal symmetry to the last two, it should last roughly to the end of 2017. Trump and the Republicans will be working on tax reform, cutting regulation, and planning infrastructure spending during that time. As long as the party keeps going the dollar will be out of sight out of mind for the administration.
If I'm right, the US market will likely go on a tear higher from here (again, reflexivity). This will be accompanied by increased volatility in both directions. European and Japanese stocks should also perform well, especially exporters who benefit from a weaker euro. Many of these are trading at depressed levels and will likely do well over the coming months.
Commodities likely won't go down right away from a stronger dollar. This is because the deflationary pressures of a stronger dollar are being counteracted by a bump in improving global fundamentals (ie, the above PMI chart). They may even trade slightly higher from here but there's a ceiling on how much further they can recover as long as the dollar remains strong.
There will be a lot of opportunity in markets over the coming year regardless of which way things turn. And needless to say, we'll be keeping a close eye on the dollar.
Side note: In 2013 and 2014 I made the vast majority of my profits trading currencies. Those also happen to be my best return years. The last two years trading in currencies have been a losing proposition with no trend to play. That's how these things typically move. From stasis to trend. We've had nearly two years of consolidation in the dollar. That's a good deal of fuel for the next leg up. A move that I think we'll be able to make a killing on if we execute correctly. I expect the dollar to retrace over the next few weeks to months due to technical short-term overextension. Once that retrace plays out, we'll have a great opportunity to start building some positions. .
Above was an excerpt from our monthly Macro Intelligence Report (aka MIR).
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
14,681 people have UUP in their portfolio

http://www.zerohedge.com/news/2017-0...ops+to+zero%29

While in previous monthly letters and public statements, Bill Gross has expressed a negative view of Donald Trump, warning his tenure would be damaging, and urging investors to move to cash, culminating most recently in a Bloomberg interview in which he compared the president-elect's policies to those of Italy's fascist dictator Benito Mussolini, in his latest monthly investment outlook he takes a more practical view of what Trump's policies would mean for markets, and specifically the one variable he believes is the key for market action going forward. Specifically, he is focusing on what he thinks is the critical resistance level of the 10Y yield, which will set the tone for virtually every other asset class, from stocks, to FX and, of course, to rates.

COMMENTARY FROM BENJAMINIS: Now we understand why WE must watch always the Us 10 Year Us Bonds. It sets the TONE for everything else.


But before he goes into that, he points out a tangent on the difference between secular stagnation and actual growth, which he notes is the difference between 2% growth and 3% growth and defines it as critical namely that 3% growth rates historically have propelled corporate profits to a somewhat higher clip because of financial and operating leverage dependent on higher growth. 2% or less typically has smothered corporate profits


How does this fit into markets? "The critical question of interest rates and the future level of the 10-year Treasury is challenging" noting that It is the key to interest rate levels and perhaps stock price levels in 2017 and then segues into what he dubs his "only forecast for the 10-year in 2017." To wit:
If 2.60% is broken on the upside if yields move higher than 2.60% a secular bear bond market has begun. Watch the 2.6% level. Much more important than Dow 20,000. Much more important than $60-a-barrel oil. Much more important that the Dollar/Euro parity at 1.00. It is the key to interest rate levels and perhaps stock price levels in 2017.


Which, incidentally reminds us of an article we wrote back in November asking "How Far Can Bond Yields Rise Before Hurting Equities", and the answer, not surprisingly was just around 2.60%


That said he remains skeptical: Trumps policies may grant a temporary acceleration over the next few years, but a 2% longer term standard is likely in place that will stunt corporate profit growth and slow down risk asset appreciation.

* * *
His latest investment outlook is below.

Echoes from Africa
If I sang a song about Africa
Of the spotted giraffe, the hyena's laugh
Of the fiery sun rising to meet the day
With a stillness belying the lion's evening meal;
Would Africa sing a song about me?
If I remembered a time once in Africa,
Bride at my shoulder, chasing a leopard's shadow
With human eyes and Nikon shutters wide apart
Invading the solitude of blackened ancestors;
Would Africa remember a time once with me?
If I knew a story of Africa
Capturing a disappearing continent for a moment in time
Fleeting far briefer than the earth's reign;
At least until its dusty death,
Would Africa know a story of me?

Bill Gross
- With appreciation for Isak Dinesen
* * *
I traveled once to Africa, as you might have guessed by now, and it's been a part of me ever since. Being perhaps the cradle of civilization, if not life itself, Africa casts an eerie glow over the entire history and, indeed, meaning of existence. There's a strange beauty to it this eat and be eaten land brutal, yet fair and loving underneath its violent surface. I think it's how I view my own life. I saw myself in Africa and, of course, through my own eyes I saw you there, too. The question however, that ends every stanza of my poem is whether Africa saw and will remember me. Are we just passing through without a trace following our dusty deaths? Will anyone, or anything, at the end of the line be the better for our time on earth? I,myself, know nothing of a grand scheme of existence, but I wish there to be one if only to give meaning to our precious moments of happiness and frequent hours of despair.

Happiness has dominated risk markets since early November and despair has characterized global bond markets. Hope for stronger growth via Republican fiscal progress/reduced regulation/and tax reform have encouraged risk. The potential for higher inflation and a more hawkish Federal Reserve lie behind the 100 basis point move in the 10-year Treasury from 1.40% to 2.40% over the same time period. Are risk markets overpriced and Treasuries overyielded? That is a critical question for 2017.

The assessment of future growth and associated risk spreads is still uncertain of course. President-elect Trump tweets and markets listen for now, but ultimately their value is dependent on a jump step move from the 2% real GDP growth rate of the past 10 years to a 3%-plus annual advance. 3% growth rates historically have propelled corporate profits to a somewhat higher clip because of financial and operating leverage dependent on higher growth. 2% or less typically has smothered corporate profits. The 1% difference between 2 and 3 is therefore critical. We shall see whether Republican/Trumpian orthodoxy can stimulate an economy that in some ways is at full capacity already. To do so would require a significant advance in investment spending which up until now has taken a backseat to corporate stock buybacks and merger/acquisition related uses of cash flow.

I, for one, am skeptical of the 3 and more confident of the 2. The longer term negatives of my "New Normal" and Larry Summer's "Secular Stagnation" may have disappeared from the business front pages of the FT and the NYT, but they have never really gone away Trump or no Trump. Demographic negatives associated with an aging population, high debt/GDP now more at risk due to rising interest rates, technology displacement of human labor, and finally the deceleration/retreat of globalization pose negative ongoing threats to productivity and therefore GDP growth. Trump's policies may grant a temporary acceleration over the next few years, but a 2% longer term standard is likely in place that will stunt corporate profit growth and slow down risk asset appreciation.



The critical question of interest rates and the future level of the 10-year Treasury is equally challenging. While the Fed has begun to tighten policy after abandoning Quantitative Easing several years ago, other major central banks continue to stoke the fire with as much as $150 billion of monthly buybacks. With the pinning of Japanese JGB 10-year yields at near 0% and the ongoing dovishness of Draghi's ECB, global arbitrage effectively caps the 10-year at 2.4% to 2.6% levels. Currency adjusted yield pickups of 70 basis points by selling 10-year JGB's or German Bunds and buying U.S. Treasuries, outline the artificial pricing of our 10-year, even as inflation moves higher and short term yields are raised by the Fed once, twice, or three times in the next 12 months.


So for 10-year Treasuries, a multiple of influences obscure a rational conclusion that yields must inevitably move higher during Trump's first year in office. When the fundamentals are confusing, however, technical indicators may come to the rescue and it's there where a super three decade downward sloping trend line for 10-year yields could be critical. Shown in the chart below, it's obvious to most observers that 10-year yields have been moving downward since their secular peak in the early 1980s, and at a rather linear rate. 30 basis point declines on average for the past 30 years have lowered the 10-year from 10% in 1987 to the current 2.40%.
http://www.zerohedge.com/sites/defau...ex_Graph_0.png


Source: Bloomberg.
Now, however this super strong, frequently tested downward trend line is at risk of being broken. 2.55% to 2.60% is the current "top" of this trend line, and over the past few weeks it has held and reversed lower by 15 basis points or so. BUT----------. And this is my only forecast for the 10-year in 2017. If 2.60% is broken on the upside if yields move higher than 2.60% a secular bear bond market has begun. Watch the 2.6% level. Much more important than Dow 20,000. Much more important than $60-a-barrel oil. Much more important that the Dollar/Euro parity at 1.00. It is the key to interest rate levels and perhaps stock price levels in 2017.

Commentary from Benjaminis: There you have it so please stay aware.

As we approach 11 AM , I myself have not seen any Forex trading opportunity so I am completely in cash. I have my focus on the confirmation concerning the Attorney General Jeff Sessions.

We need to watch the close of Europe at 11:30 AM EST and allow up to Noon to be sure everyone has probably gone home for the day.

Please check back on this particular post as I will use it throughout the Forex trading day until 5 PM EST. We need to see if Short Covering causes any changes and of course the Money Flow then will only be from North America.

11:10 AM - 5 Minute Chart on US 30

http://finviz.com/futures_charts.ashx?t=YM&p=m5

11:13 AM - 5 Minute Chart on US 10 Year Bond

http://finviz.com/futures_charts.ashx?t=ZN&p=m5

11:15 AM - 5 Minute Chart on USD/JPY

http://finviz.com/forex_charts.ashx?t=USDJPY&tf=m5

11:35 AM - 5 Minute Chart on US 30

http://finviz.com/futures_charts.ashx?t=YM&p=m5

11:40 AM - 5 Minute Chart on Gold

http://finviz.com/futures_charts.ashx?t=GC&p=m5

12:15 PM - Now that Europe is closed North America goes for lunch so the MAIN MOVEMENT that we look for to decide if we should do any trades is between 2 PM EST and 4:30 PM EST. If I see any Trade Opportunities I will share them.

12:45 PM - We now have RISK OFF so we wait and see when and where we can go SHORT US 30. We do not trade now since we want the near Top. Please post some charts showing where the resistance is. We should only post 5 minute and 15 minute charts. Please LIKE this Post so that I know that there are people coming in here. I am going to have my lunch now so will be back at 2 PM EST. Please let me hear from you. I only work good with Feedback. Thank You.

2:50 PM - Please give me your thoughts on this chart anyone. Thank You.

4:00 PM - The markets are now closed until Japan opens at 7 PM EST.

I will post here until 6 PM EST and tomorrow start a NEW THREAD FOR THE DAY. So Far only have I seen a LIKE from KeepCalmfx so we need to do better or there is no point for me to use this new method.

http://www.forexfactory.com/attachme...3&d=1484074759


Benjaminis

HEADS UP EVERYONE TRADING FOREX HERE TODAY - My Post 1053 will be our Forex Trading Thread for only today until 5 PM EST

PLEASE CHECK IT as I have started it today at 11 AM and it is something new that I am trying. You can PLEASE LIKE the Page so that I will have a good idea of how many people looked at it today whether one of our 12 Forex traders or anyone coming here for knowledge.

You can also post questions or comments whenever you wish and that includes anyone with the ability to post here so we have a ongoing dialogue during my Forex Trading hours.

What do you think of this new approach ?

Please give me feedback. Thank You. This is a learning process for myself on how best to share my knowledge and Forex trading experience.

Thank you for your cooperation.


Benjaminis

Do you use an Indicator or how do you see money flow . What do you look for or at on your chart. Do you mind posting your chart. Tnx!

http://www.zerohedge.com/news/2017-0...ops+to+zero%29

Dear goodness

With great RESPECT to your question , I will answer right to the point.

There is NO SUCH CHART !!!

As an accomplished Forex Trader while I was learning my trade and posting at many Forex Forums wherever they are located, I cannot tell you with certainty how many times I have been asked that question by Technical Forex Traders.

In many ways your question is the most important question of the day. Why ? I will soon edit this post and place one more time the most important thing that anyone MUST do if you are serious and want to make Forex Currency trading a real business where you earn a great living.

There is NO such Chart posted anywhere in the world that can help you with that request.

I sincerely request KeepCalmfx to also answer your question in his own words. I will come back to this post in a few minutes and add something so please check it again.

In closing Thank You for your question. You did good having asked it because now I get the chance to tell you and ANYONE else that freely comes here at no cost.

WE DO NOT MAKE IT SIMPLE AND GIVE YOU THE HOLY GRAIL.

Hard work and knowledge and Common Sense and a Method of trading Forex and CONTROLLING Risk is the only way to go. That is for me and everyone has the right to follow what I do or not.

goodness and everyone reading these words. I can only teach what I know works. I guarantee it works for me and as you can see it also works after ONLY two weeks of Forex Trading since December 27, 2017 for others here.

The ones that have the skills and common sense and the DISCIPLINE and Work Ethic to earn money trading Forex. I congratulate them all again as they have confirmed my STRONG VIEWS !!!

COMMENTARY FROM BENJAMINIS: See Ladies and Gentleman , now that you know how I get all the news and expert commentary you can do it now by yourself. My main point is that it is not that hard to learn and improve your Forex trading. We already see the great results from our Forex Traders themselves.

Benjaminis

I first want to talk about having an EDGE. Fundamentals by themselves is not an EDGE. However using Money Flow between Asset Classes from here on I will include in my basket of 100% of what a winning Forex Trader needs. I will not refer to it as a fundamental anymore since new people coming to this thread put my method as including Money Flow as a fundamental which it actually is however not in the same way as most people understand Fundamentals.

This week we will get to see Non Farm Payroll (N F P) and as any experienced Fundamental Forex Trader knows it usually is a fantasy number created by the BLS however next to a FED rate announcement it is the one number that can move markets hundreds of PIPS in seconds and minutes.

Whatever the number Trillions of Fiat Currencies and other Asset Classes will start to change values as we "SEE" the Money Flow. That is why I call it my EDGE and once you know it and understand it well then it becomes your EDGE as well.

Here are the 5 important things that any Forex Trader that belongs to the minority of constant profitable Forex Traders , which I have named , The 5% Club needs to have. Of course in my opinion, I would think that very few Professional Forex Traders use the EDGE. Of course when you know about it then anyone can use it.

Each of the following five important things which I have given a weighting of 20% to each makes up what a profitable Forex Trader needs to have in order of IMPORTANCE.

(1) The ability of the Forex Trader to control their FEAR and their GREED and their EGO. Perhaps the last one is the most important of the three since the MARKET is always right. Using Money Flow puts you with the Market instead of against it as your Forex Account keeps losing the value in it.

The reason that I teach Forex Traders whether experienced or new to Forex trading with a $50,000 US Dollars Demo Account is because that is how I learned my trade starting during 2003. By learning to trade with $50,000 US Dollars in Demo Funds, then I had no FEAR or GREED. However after 3 years of Forex Demo Trading I surely had EGO since month in and month out my Return On Investment (ROI) was constantly over 10% a month or 120% a year.

(2) Money Flow. I have now explained why.

(3) Risk Management. That is next to Money Flow the KEY element of my Forex Trading since when you blow your account whether you are trading with too little capital as the majority of Retail Traders are or because of a Black Swan event such as Brexit or Europe banking issue such as we have in Italy at the moment or the Swiss Central Bank as they did a few years ago say one thing and then next moment announce a major change in their policy and 500 PIP movements happen in seconds. The absolute MINIMUM Forex Account that I would and could trade with would be $10,000 US Dollars. I would be glad to answer questions as to why although most will understand. What if you do not have $10,000 US Dollars trade with ? Prove to yourself that you have the skills and the knowledge to trade with profits then you will have no problems finding funds to trade Forex with. After my 3 years of Forex Demo Trading, I went out and found 6 clients that first deposited initially $50,000 US Dollars and within 3 months along with the profits that I was generating in my first three months of Forex trading from March 2006 to June 2006, I was managing well over $100,000 US Dollars.

(4) Technical Indicators which includes all parts of it whether Support and Resistance or Supply and Demand or Pivot Points. I use when I do daily trades the 5 Minute Charts along with the 15 Minute Charts and 30 Minute Charts to go along with the 4 Hour Charts. When you toss a rock in the river the first ripple is the 5 Minute Chart and then on to the 30 Minute and the two others. I use other indicators aside from the standard ones which are SAR and Fractal and Awesome Oscillator. The most important one that I look at when I enter into a Forex Trade is Support and Resistance so if I am going long or short I enter either at the TOP or BOTTOM of the Chart that I am using. Of course my Risk Management protects me from Human Errors or EGO.

(5) Fundamentals. I am fairly sure most of those reading my words today or whenever they read it might be surprised how a Forex Trader such as myself who posts a tremendous amount of research can list fundamentals as number (5) in order of importance. It is the research that allows me to clearly understand the difference between PERCEPTION (Markets) and REALITY (Research) Then I know what will most likely happen in the future and I am better prepared to deal with it.

I hope that this post of my daily Morning Thoughts answers some of your questions both for the 12 Forex Traders using the $50,000 US Funds Demo account with FXCM UK or anyone else. There is no reason that an experienced trader reading this thread or anyone else to not open a $50,000 US Dollars FXCM UK account so they can use the knowledge that we share here to learn new things and try them without having any FEAR of LOSS !!!

As always , I look forward to feedback and thoughts and anything that you care to share with us on our Thread.




Benjaminis

http://www.marketwatch.com/story/ste...teid=rss&rss=1

The U.S. dollar was flat against its major rivals on Tuesday as investors held off on drastically changing their positions a day ahead of Donald Trump’s scheduled news conference, which could provide some clarity into the president-elect’s legislative priorities.


The buck has surged 5.2% over the past three months, with much of that coming since Trump’s election in early November. Investors are betting his policies will both accelerate economic growth and stoke inflation.


The ICE U.S. dollar index DXY, +0.24% which looks at the currency against a half-dozen rivals, was unchanged at 101.93. It remains about 1% from its highest level since 2002. Meanwhile, the WSJ Dollar Index BUXX, +0.10% a measure of the U.S. dollar against a basket of 16 major currencies, was flat at 92.65.

http://video.unrulymedia.com/native/opt-out-icon2.png
http://video.unrulymedia.com/native/...icon-41x48.gif

Against the yen, the greenback USDJPY, -0.08% traded at ¥115.82 from ¥116.01 late Monday. It dropped to ¥115.20 in Asian trading before rebounding.
“I think some were exiting from dollar-long positions as they remain cautious ahead of tomorrow’s Donald Trump news conference,” said Yuzo Sakai, manager of FX business promotion at Tokyo Forex & Ueda Harlow.


The euro EURUSD, -0.1513% traded at $1.0566 from $1.0592 late Monday.


Read: Here’s why Trump’s inauguration could mark a near-term top for stocks

The pound GBPUSD, -0.0740% traded at $1.2163, from $1.2167. The U.K. currency has been under heavy pressure of late—it is down 3.4% thus far in January and down 16.3% over the past 12 months. It has been in a downtrend since the U.K.’s June vote to leave the European Union; pressure this week followed U.K. Prime Minister Theresa May over the weekend calling for a definitive break from the EU. At its low of the session, the pound was at its weakest level since October, although it continues to trade near multidecade low.


Markets had been betting that Trump’s economic plans would stoke higher inflation in the U.S., causing the Fed to raise rates quicker than previously expected. Higher rates are likely to boost the greenback by making U.S. assets more attractive.

“It’s possible [Trump] will keep talking before his inauguration, but once Trump becomes president, he’ll have to start delivering,” said Koji Fukaya, chief executive at FPG Securities. “If his extreme remarks are toned down to a more realistic stance, that may be warmly received, though it could also cool expectations.”

Read: Why politics may not be done shaking up global markets


In other currency news, the Turkish lira USDTRY, +1.7695% traded at $3.7724 from $3.7111, a move of 1.6%. Earlier, the Central Bank of the Republic of Turkey announced moves to tackle “unhealthy price formations” in the market that it says are “inconsistent with economic fundamentals.” The lira has lost about a quarter of its value of the past 12 months.

A Personal Request For Traders That Are Not Able To Post Here On This Thread.

I would like to be able to answer your questions and it would be hard to believe that you have no questions. Please post any questions that you have and it will be my pleasure to answer them for you.

Forex trading the way we do it on this thread on Money Flow and Risk Management is UNIQUE to the best of my knowledge since all aspects of Forex trading is covered.

The Method of trading works since we are trading with what the markets are doing and in many cases we know when the Money will change flow, so WE have that EDGE.

There cannot be any possibility that the Dow 30 will not come back at least 1,000 points to 9000 and perhaps more. When this happens we know exactly what that means. We know THEN the direction of the USD/JPY. We know when all the Trillions of dollars that have gone into what they think is safe assets and investments will change their mind and go elsewhere.

If we somehow make an error in our Forex Trading or some Black Swan event happens, we do not care because our Risk Management cuts our losses and then puts us in an advantageous position when the reverse happens.

Trading Forex can be fun and almost stress free when it is done properly.


Benjaminis

http://www.zerohedge.com/news/2017-0...ops+to+zero%29

Submitted by Paul-Martin Foss via The Mises Institute,
With a new year come new opportunities as well as new issues to take into consideration. Here are the five most important issues to keep an eye on in 2017.


1. Trump Presidency
The most important issue facing monetary policy, at least in the United States, will be the incoming Trump Administration. The Federal Reserve Board of Governors is currently operating with two vacancies and has been for quite a while. With majorities in both the House and Senate, it is highly likely that President Trump will be able to successfully nominate two candidates to the Board. Depending on who he picks, that could put additional pressure on Chairman Janet Yellen to continue to raise the federal funds target rate throughout 2017.

COMMENTARY FROM BENJAMINIS: This CANNOT HAPPEN AS IT WILL COLLAPSE THE DEBT BUBBLE AROUND THE WORLD.


2. Ongoing Weakness in Europe
The PIIGS are returning. The Greek debt crisis is still unresolved, the Italian banking sector is weakening with Monte dei Paschi likely facing a bailout this year, and Portugal is showing signs of a weakening banking sector. Add to that the difficulties continuing to face Deutsche Bank and 2017 could be a perfect storm facing the Eurozone banking sector. The big question then would be to what extent bank failures and bailouts in Europe would cause spillover effects in the United States and worldwide.

COMMENTARY FROM BENJAMINIS: Europe will collapse first before the USA and the currency pair most affected will be EUR/USD so we must watch carefully each day how this is unfolding since the collapse of EUR/USD will cause US Dollar Index to rise and that will cause corporations to show losses because of the high US Dollar.


3. China Is Still a Wild Card
While the yuan continues its march towards becoming a global reserve currency, the Chinese economy faces continued difficulty and slowing growth. Private sector debt loads are high, the insurance and banking sectors are built on matchsticks, and the government is beginning to sell off some of its foreign exchange reserves to defend the yuan. 2017 could be a very interesting year for China, and for the rest of us if a Chinese collapse spills over to the West.


4. The Relentless War on Cash
As India’s demonetization demonstrated, the war on cash is ramping up around the world. While there likely won’t be major moves towards eliminating high-denomination bills in the United States or Europe, there will be continued actions that chip away at the use of cash and the financial privacy that cash affords. Expect more legislative and regulatory action against cash transactions under the guise of fighting against money laundering, terrorist financing, and tax havens as governments continue to try to squeeze as much money as possible from taxpayers.


5. A Coming Financial Crisis
The most important thing to watch for in 2017 is the possibility of another financial crisis. With the trillions of dollars of new money pushed into the financial system over the past several years by central banks around the world, financial bubbles growing, popping, and leading to financial crises are inevitable. Contrary to the thinking of Ben Bernanke and others of his mindset, it doesn’t take a central bank actively removing liquidity from the financial system to pop bubbles or create financial crises. All that is required is for the central bank to stop or slow its monetary easing and the effects of the newly created money will soon be evident.


As the reality sets in that massive amounts of resources have been malinvested in unproductive sectors of the economy, the bubbles that were blown will inevitably burst. While monetary policies around the world remain historically loose, the Federal Reserve’s raising of its federal funds rate target has been accompanied by talk in other countries about raising interest rates. Given the anemic recovery in the aftermath of the 2008 financial crisis and continued low interest rates, central banks don’t have much room to maneuver when the next crisis hits. It’s always tricky trying to predict when a crisis will occur, but given economic data in various sectors that show similarities to the last crisis, it’s not out of the realm of possibility for 2017 to be the year of the next crisis.