Daily Treasury Statement Charts Update: 29/3/11 – Has the Crack-up move begun?

An update of the daily treasury statement charts:

 

Total Operating Balance Vs S&P 500

Click to enlarge.

 

The total operating balance of the US Treasury was flat yesterday (latest). After today’s action in the markets, one has to be asking – has the crack-up move already begun? According to the lagged charts below, this crack-up move is ‘supposed’ to start in 3-4 days. Of course, this indicator is only a rough guide and alchemistic if considered otherwise. Thus – insofar as we can say anything – we might see a crack-up move for a few weeks.

 

I wrote extensively about the importance of the daily treasury statement here. The charts of the total operating balance vs lagged risk assets follow. They use the thesis that net US Treasury withdrawals are bullish for risk assets and net accumulations are bearish for risk assets (on a lagged basis).

 

Total Operating Balance Vs Dow Inverted (LAGGED)

Click to enlarge.

Total Operating Balance Vs S&P 500 Inverted (LAGGED)

Click to enlarge.

Total Operating Balance Vs Russell 2000 Inverted (LAGGED)

Click to enlarge.

Total Operating Balance Vs VIX (LAGGED)

Click to enlarge.

 

Note: The industrial and agricultural auction house, Ritchie Bros. was up 5% today. This takes out the bearish divergence that was developing with the auction houses.

See here for our collection of rare historical economic data.

Posted Mar 29, 2011