Daily Treasury Statement Charts Update: 4/3/11
An update of the daily treasury statement charts:
The total operating balance of the US Treasury continues its decline. The supplementary financing program is being unwound to $5 billion, and now stands at around $75 billion. They have been reducing it at a rate of $25 billion per week, so it should take 3 weeks to get down to the intended low of $5 billion.
Using the thesis that heavy expenditures are bullish for risk assets and accumulations of cash are bearish, I now present the total operating balance with some risk assets lagged ~40 trading days. According to this thesis, the market could remain weak for about 20 trading days before swiftly moving higher for a final ‘crack-up’ move.
I’ll be updating these everyday after the release at 4:00 PM ET. As in my previous posts (here and here), I’ll update the deposit insurance fund and TARP charts when something happens. The past couple of days have been quiet for these.
Again, I should warn that this may be regarded as an imprudent form of looking at things. For me, speculating is the art of finding the loser and opposing him; that is, of being a contrarian. But perhaps there is some contrarian merit in these charts?
Recommended: Charting the Federal Reserve's Assets - 1915 to 2012