Daily Treasury Statement Charts Update: 29/4/11

An update of the daily treasury statement charts for 29/4/11:

 

Daily Treasury Statement - Operating Balance Vs S&P 500

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The total operating balance of the US Treasury fell by $5.5 billion on Wednesday and by $10.7 billion on Thursday (latest). Moreover, the US Treasury received $46 million from the proceeds of MBS sales/interest on Thursday. Proceeds from MBS sales have reached $10.23 billion this month so far.

 

The US equity indices have taken out their recent February and early-April highs and seem to be accelerating on the upside. Likewise, the precious metals have been rising sharply (with platinum recently taking out its February high). Perhaps coincidentally (or perhaps not), these moves have been inline with the lagged daily treasury statement indicators shown below. They continue to suggest that this up-trend could remain in force 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 - Operating Balance Vs Dow Inverted LAGGED

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

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Daily Treasury Statement - Operating Balance Vs Russell 2000 Inverted LAGGED

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Daily Treasury Statement - Operating Balance Vs VIX LAGGED

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Posted Apr 30, 2011