History Repeating?

Summary

Discussion, critique and analysis of the potential impacts on equity, bond, commodity, capital and asset markets regarding the following:

Last Time Out; History Repeating Itself

Lumber Futures; Oil Futures; 90 Day Sector Dogs 

Friday's Sell Off; Buried in The Details

Last Time Out

In any event, whether any of the above is by design or error, there may be another reason the PBOC might be firming the RMB. The PBOC is getting ready for a June FED raise and any potential market, currency, cost of loan funds and economic instability resulting thereof...

This would include any potential fall out should the schedule for the big punch bowl removal (Fed balance sheet reduction through bond purchase taper) be made public in the details of the June 14th FOMC announcement or July 5th release of the minutes. As they say, Beezlebub is always hiding in the minutia and Out. - Dollar Woes: Big Trouble In Little China?

The Spanish-American philosopher George Santayana observed that 

"Those who cannot remember the past are condemned to repeat it."

Finding the Devil in the details is just another case of....

History Repeating?

 

In 1997, when Shirley "Means" Bassey, at the age of 60, was approached by the Propellerheads to record "History Repeating", she initially turned them down and suggested that they give the song to Tina Turner. However they insisted that the song was written and arranged for her, and Bassey finally agreed to record it. 

The track is a fusion of several different styles of big beat, breakbeat and jazz combined with the powerful vocals of Shirley Bassey. The single was also a #1 hit on the UK Dance Chart, and was Bassey's first top ten appearance on any US chart since 1973's "Never Never Never", making #10 on the US Dance Chart. 

In 1998 the song became part of the soundtrack for the movie "There's Something About Mary", was used in a Jaguar commercial in 2000, was used in the movie "It's Complicated" in 2009, as well as a Pantene shampoo commercial.

This hip dancible Propellerheads/Bassey jazz hit has helped to re introduce Bassey's booming voice to a whole new generation who are too young to remember her signature "Goldfinger" and "Moonraker" of Bond film theme song fame.

By coincidence? The Propellerheads had previously worked with the James Bond composer David Arnold on the Bond tribute album Shaken and Stirred: The David Arnold James Bond Project, when they remixed the John Barry composition "On Her Majesty's Secret Service".

Hiding in The Minutia?

The ECB rates shall "remain at their present levels for an extended period of time", means no further cuts or raises. More important, ECB bond buying is still in full swing and could be stepped up if the economic outlook worsens.  However, much like the FOMC, many suspect that verbiage will be changed next month, which could cause History Repeating?

As of May 30th - Commercial positions are NET LONG on 3 month ED (Eurodollar) futures at CME.   In doing so, they have gone from net short to net long, in the EXTREME, as in $3T notional net long which is almost 35% of the OI (open interest).

Being long means you are buying the contract and betting that interest rates (90 day LIBOR) are going to decline. Not a harbinger of good economic times, but perhaps a hedge against a flight to safety, in the bond market.  And a flight from what? Economic decline and or a correction in equities valuations?

There is a 99.6% chance the Fed raises June 14th. Should the FOMC indicate in its minutia when the big punch bowl is getting taken away (tapered bond buying, reduction of balance sheet), or other circumstances increase the cost of LIBOR (short term loan funds), those bets or hedges with $3T notional will be on the wrong side of the fence, near term.  Unless of course a countervailing equities reevaluation appears. TBD.

Watch for Beezlebub in the minutia of the FOMC June 14th announcement and/or the release of those notes on July 5th, then witness what could be History Repeating?

This missive was published as an exclusive to Seeking Alpha.  To access the ENTIRE text for FREE on Seeking Alpha, please click here.  The Nattering One does not receive remuneration if you register, only satisfaction.

There is no cost involved and it has been our experience that if you exert control (by unchecking a box of two) over your communications settings in your Seeking Alpha profile, your email inbox will not be polluted with one bit of Spam (not even the cured pork shoulder variety. Tasty even.)

As we are now a "contributor" at Seeking Alpha, our published articles, instablog and comments can be found here.  Please continue to follow The Nattering Naybob here and at Seeking Alpha. We thank you for your support.