Daily Treasury Statement Charts Update: 3/3/11

I have decided to post the daily treasury statement charts on a daily basis. For some opinions on them, see here and here. The releases by the US Treasury are at 4:00 PM ET daily. I’ll always try to get the charts up soon after.

 

This is the update for 3/3/11; meaning that the US Treasury has released data up to 2/3/11 at this point. The first chart below is the total operating balance (blue) of the US Treasury against the S&P 500 (red – inverted). The sub-components of the total operating balance are also shown. The general idea is that expenditures are bullish and accumulations (of cash) are bearish. The second chart below shows the withdrawals from the operating balance that went towards the TARP program. As you can see; large withdrawals for TARP expenditures have typically preceded an up-move in the stock market.

 

Total Operating Balance: update 3/3/11

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TARP withdrawals from the total operating balance.

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The peculiar thing about these charts is that there is a remarkable correlation between the stock market and the total operating balance if you lag the latter by ~40 days. As I said before, this could be deemed to be a form of alchemy, but I’m going to update these daily anyway. That way, anyone willing to use this indicator can get frequent updates. In the charts below, I have plotted the Dow, S&P 500, Russell 2000 (all inverted) and VIX against the total operating balance line.

 

Dow Vs Total Operating Balance

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S&P 500 Vs Total Operating Balance

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Russell 2000 Vs Total Operating Balance

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VIX Vs Total Operating Balance

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Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression

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Posted Mar 4, 2011