Price action: confirming recession in 2008?

M

makloda

I am trying to remain agnostic to economic forecasts, but some of the market price action feels like it's pricing in a definite recession within 6-12 months, just looking at the charts without any emotions. Opinions/comments/additions welcome:

2 year yield vs. Fed Fund Target Rate spread now approx. 1 full point:
25058928kz4.png


10 year yield - broke support. Looks more like DEFLATION rather than INFLATION to me:
39650370rq5.png


Sector price action:

Consumer staples about to make new 52w highs. Who on earth is pushing the staples unless money that believes we're headed for a recession:
33399254iu9.png


Energy sector stocks... A series of higher volume down days. Topping out soon?
24499594yp2.png


Semis.. just looks like puke after a gigantic Shoulder-Header-Shoulder
32809966ff6.png
 
I have some more recession scenario pieces :

1) up to 500 billion in write downs associated with subprime mess

2) deteriorating ABX index

15b7b6f61379b71060163a57e4a.png


3) Expected deteriorating investmentbank / commercial bank earnings for the next couple of quarters

4) Higher delinquency rates on credit cards

5) Mr. Bush still ruling the U.S.

6) Slowing retail sales

7) FED cutting rates

8) Widening TUT Spread

9) Meredith Whitney is short Citibank
 
Quote from Adobian:
If this were true, how long this recession will last ?
More...
I don't think there is a way of telling ever how long/deep a recession (any recession) will be before it actually happens.
 
Quote from Adobian:

If this were true, how long this recession will last ?
More...

This does not answer your question but it's a good leading indicator. When the fed starts to raise rates the worst is usually over.
 
Quote from makloda:

I am trying to remain agnostic to economic forecasts, but some of the market price action feels like it's pricing in a definite recession within 6-12 months, just looking at the charts without any emotions. Opinions/comments/additions welcome:

2 year yield vs. Fed Fund Target Rate spread now approx. 1 full point:
25058928kz4.png


10 year yield - broke support. Looks more like DEFLATION rather than INFLATION to me:
39650370rq5.png


Sector price action:

Consumer staples about to make new 52w highs. Who on earth is pushing the staples unless money that believes we're headed for a recession:
33399254iu9.png


Energy sector stocks... A series of higher volume down days. Topping out soon?
24499594yp2.png


Semis.. just looks like puke after a gigantic Shoulder-Header-Shoulder
32809966ff6.png
More...


I knew you were to smart to stay a permabull when the evidence was screaming otherwise.
 
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