Sunday, December 11, 2016

MONDAY 12/12/16; Oil Rallies Over +5%; WTIC Oil Above 54; Natural Gas Mini-Crashes -6%; SSEC (Shanghai Index) -2.5%; Dollar/Yen Currency Pair Above 116; US 10-Year Yield Above 2.50%; 3 and 10-Year Treasury Auctions; SPX (S&P 500) New All-Time High; INDU (Dow Industrials) New All-time Closing and Intraday Highs; PAY

Last week was a huge upside rally in global stocks after the Italian referendum vote. Traders expected, and received, more QE stimulus from the ECB which pumps stock markets higher. The central bankers are the market. In addition, the 







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The five-week market rally is not broad-based. Energy, industrial and financial stocks are the big winners accounting for the bulk of the gains. 40% of the rally in the Dow Industrials after the Trump election is due to GS (bank), UNH (healthcare) and CAT (industrial). Goldman Sachs is the single biggest winner after the Trump victory. The banksters always win.

Quarterly Reminder

It is time for the Quarterly Reminder;

The KE Stone blogs, Keybot the Quant, The Keystone Speculator and Keystone the Scribe, only exist if supported by the tens of thousands of daily users around the world. During Keystone’s recent hiatus from the blogs, the emails came in at a fast and furious pace. Everyone did not want the information to stop. Fortunately, for the several hundred thousand international monthly followers of the sites, large and mid-sized donors stepped up and wanted the information to continue; many smaller donors as well which are greatly appreciated.

The quarterly reminders are never directed at the loyal supporters but instead directed at the broader readership. Any donation is welcome no matter how small but as the joke goes, big ones are even better. Keystone likes to see all users of the sites have skin in the game so even a couple bucks shows the willingness to support the information. If the blogs do not receive broad support and participation, they will end.

Many emails are constantly received requesting that the blog sites turn into a subscription-based service but Keystone has no interest in that; he takes it easy all day long. A subscription-based site is work, effort and responsibility, so, humorously, forget that. The blogs will continue as long as they are supported by a broad portion of the audience. If not, they end. So it is a very simple proposition.

Any site proceeds go to charities. Many families had a slightly better Thanksgiving since their tables were filled with more food. Keystone is helping an all-volunteer thrift shop in a nearby town, a very poor and destitute area that provides clothes and other products to help the disadvantaged. As the old saying’s go, “you can’t take money with you” when you croak and “money does not make you happy.” As you age, you realize that providing compassion to the disadvantaged and helping those in need is what provides eternal riches.

Thank you to all. Merry Christmas, Happy Holidays and Happy New Year!

SUNDAY 12/11/16

The OPEC oil cartel twists the arms of the 11 non-OPEC governments to cut oil production by a total of 558K barrels per day. The oil production cut agreement one week ago targeted a 600K barrel reduction from the 







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 5-year 1.89%, 10-year 2.47%, 30-year 3.16%. The yield curve continues to slightly steepen the 2-10 spread now up to 133 bips.

Saturday, December 10, 2016

SATURDAY 12/10/16

SPX 2260 (all-time high). INDU 19757 (all-time high). COMPQ 







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no claim of responsibility but the terrorist attack is either from the ISIS Islamic radicals or the Kurdish rebels that seek independence from Turkey. PM Erdogan, who develops more and more into a little Hitler each day, creates instability in Turkey due to his increasing authoritarian rule. Turkey is proposing constitutional amendments that would expand Erdogan’s power. Erdogan is following Hitler’s play book in Germany 80 years ago.

Thursday, December 8, 2016

FRIDAY 12/9/16; Cascading Global Rally Continues; ECB Aftermath; Did President Draghi ‘Taper’?; ECB Rejects Monte dei Paschi Request for a Funding Deadline Extension; MTN; Consumer Sentiment; Wholesale Trade; SPX, INDU, COMPQ, RUT and TRAN All-Time Record Highs

The stock markets are rejoicing to new 











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a rate that will send the fund into insolvency in 10 years. Dallas needs to get a handle on the problem before it bankrupts the city. Other cities face similar dilemmas and if a recession hits, and the tax base is reduced (money coming in from taxes paid by workers and businesses), the situations will quickly worsen. Cities will require bailouts in the future.

THURSDAY 12/8/16; Cascading Global Rally; DAX Above 11K; US Dollar Index Briefly Under 100; SHLD; ECB Rate Decision and President Draghi Press Conference Create Rally; SPX (S&P 500), INDU (Dow Industrials), COMPQ (Nasdaq Composite), RUT (Russell 2000) and TRAN (Dow Transports) New All-Time Highs; AVGO; COO; RH

A Dow Theory confirmation occurs yesterday with the Dow Transports finally printing 












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 medical device maker drops -0.5% after reporting earnings. AVGO +2.6%. FNSR +4%. RH crashes -19% after reporting earnings and offering weak guidance. DLTH crashes -17%.

Tuesday, December 6, 2016

WEDNESDAY 12/7/16; Pearl Harbor Remembrance Day; Cascading Global Rally; LULU; VRA; SPX (S&P 500), INDU (Dow Industrials), RUT (Russell 2000) and TRAN (Dow Transports) New All-Time Record Highs; Dow Theory Confirmation; CASY; COST; HRB

Today is Pearl Harbor Remembrance Day with many patriotic events planned in the 











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 to not mention ISIS in his final six weeks in office. The president’s timid and docile approach to foreign policy where he is leading from behind, has directly led to the rise of the Islamic State which potentially may lead to WW III. No president would ever want this doom and gloom as his legacy.