- Risk Trade Is Back On
- This Week's Biggest Story: The Dollar
- Corporate Issuance Continues at Torrid Pace
- The Bernanke Dollar Bounce & Gross Says Forget About Rate Hike
- Colgate Really Sparkles After Hours
- Light Volume Has Traders Complaining
- Gold Shatters Another Record
- Have Retailers Reached Their Limits?
- The Retail Mind Game
- The Gold Rush Is On
TRADER TALK RSS FEED
MOST SHARED
- Wednesday's Economic News Crunch Could Tilt Markets
- The 'Real' Jobless Rate: 17.5% Of Workers Are Unemployed
- Obama Reiterates Commitment to Boost US-India Ties
- The Social Media Gaming Threat
- NBA D-League On The Rise
- Japan Export Rebound Eases Fear of New Recession
- Stifling Anger at Work Can Kill, Survey Finds
- Australia Wheat Exporters Face Challenges: GrainCorp
- Citi Mortgage Reveals What Treasury Won't
- S&P to Hit 1,200 by Year-End: Chief Investor
- Amended Berkshire Hathaway Filing Indicates No Secret Stock Stakes at End of Q3
- Facebook's Biggest-Ever Holiday Shopping Season
- Facebook's New Dual Class Structure - Slow Steps to an IPO
- 5 Big Bank Stocks Investors Should Consider: Strategists
- Gambling Drunk, Texting to Live And America's On Sale - Your Emails
- Nov. 24: Unusual Volume Leaders
- NBA D-League On The Rise
- AIG Board OKs CEO Pay; Benmosche Agrees to Stay
- Obama Reiterates Commitment to Boost US-India Ties
- FDIC's Bair Cautions on Risks in Bank Break-Up Plan
- Wednesday's Economic News Crunch Could Tilt Markets
- Call Me Crazy: Confessions of a Black Friday Shopper
- Starbucks Eyes China as Next Major Market
- 'Very Blah' Christmas Is Coming for UK Retailers
- US Firms Hit by Payroll Taxes at Exactly the Wrong Time
- Citi Mortgage Reveals Something the US Treasury Won't
More Videos
Trader Talk
Text Size 
The Dow Jones Industrial Average finally closed below its November 21 closing low, and is now at the lowest level since 2002. The S&P and the NASDAQ have not broken the November lows.
Is there really a reflation trade? I have told you that small groups of traders have been attempting to buy commodity and commodity stocks in the past couple weeks, under the theory that governments around the world—particularly the Chinese—are attempting to "reflate" their economies.
So far, this trade has been unsuccessful for anything more than a day trade, but they are trying it again today:
1) Governments worldwide—particularly in China and the U.S.—are attempting to stimulate their economies;
2) Today, PPI was stronger than expected;
3) Some are starting to bet that the recent dollar strength will moderate;
4) Oil analyst Paul Cheng at Barclays made a call this morning to sell defensive oil names (Exxon) and get into higher-beta, mostly oil service names (Transocean, Chesapeake Energy, Noble, Rowan, and Ensco), under the theory that those names were likely bottoming. Classic stock-picking calls like this have been rare recently, since stocks have been trading as a single asset class recently.
Bears, of course, outnumber these few bulls.
Bears say:
1) These are all rallies in bear or sideways markets;
2) We will not "reflate" until we see positive macro data;
3) There are far fewer "speculators" to make these kinds of trades, and the leverage people used has been cut dramatically.
_____________________________
_____________________________
Questions? Comments?
POPULAR TRADER TALK POSTS
- Risk Trade Is Back On
- This Week's Biggest Story: The Dollar
- Corporate Issuance Continues at Torrid Pace
- The Bernanke Dollar Bounce & Gross Says Forget About Rate Hike
- Colgate Really Sparkles After Hours
- Light Volume Has Traders Complaining
- Gold Shatters Another Record
- Have Retailers Reached Their Limits?
- The Retail Mind Game
- The Gold Rush Is On
Data is a real-time snapshot *Data is delayed at least 15 minutes