Daily Treasury Statement Charts Update: 27/4/11

An update of the daily treasury statement charts for 27/4/11:

 

Daily Treasury Statement - Total Operating Balance Vs S&P 500

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The total operating balance of the US Treasury rose by around $16 billion on Monday and by around $23 billion on Tuesday (latest). Moreover, $1654 million was received into the US Treasury’s coffers on Monday from MBS sales/interest (as part of the unwinding of the Government’s MBS portfolio). Proceeds from the US Treasury’s MBS sales have reached around $10 billion this month so far.

 

As mentioned in previous updates, it would seem that the so-called ‘risk assets’ have staged a recovery (inline with the lagged daily treasury statement indicators below). The major equity indices have clearly taken out their February and April highs. The lagged daily treasury statement charts (below) still suggest that the current short-term up-trend could continue for around 6 weeks.

 

For those just stumbling onto greshams-law.com: As always, I warn that this interpretation could be deemed to be alchemistic in nature. The broad thesis is that net government spending is bullish for asset prices (on a lagged basis) and net accumulations of cash are bearish for asset prices (on a lagged basis). For a more detailed interpretation of these charts see here.

 

Daily Treasury Statement - Total Operating Balance Vs Dow Inverted LAGGED

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Daily Treasury Statement - Total Operating Balance Vs S&P 500 Inverted LAGGED

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Daily Treasury Statement - Total Operating Balance Vs Russell 2000 Inverted LAGGED

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Daily Treasury Statement - Total Operating Balance Vs VIX LAGGED

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[NOTE: For anyone perturbed by Bernanke’s comments on Emerging Markets today, I suggest reading this and this.]

 

Should you invest in China or Japan?

 

See here for our collection of rare historical economic data.

Posted Apr 27, 2011