THE WAR ON CASH IS INCREASING / DAVE´S DAILY

The War On Cash Is Increasing

Many don’t notice the stealth war on cash but it’s quite real.

As countries move to negative interest rates the thrust of the policies are to force people to spend. No mattress money allowed thank you. Nations like Japan, Sweden, Denmark and Switzerland have already implemented these policies.





Central Banks are basically charging member banks to hold cash. The superficial belief is to force loan making and spending which will stimulate inflation and growth.

The minus rates being applied by the ECB, Denmark, Switzerland, Sweden, and Japan havefailed to juice growth, or stocks, or inflation.

A clear ulterior motive is by eliminating cash, countries will increase tax revenues by negatively effecting the private economy and illegal activities at the same time. A recent move by the ECB is to eliminate the €500 note. This was followed this week by influential economist Larry Summers desires to eliminate the $100 bill. And, so it goes. But clearly the government wishes to squeeze cash transactions.



Stocks were basically flat on the day overcoming early selling. Oil prices fell once again hurting the energy sector.

Market sectors moving higher included: Biotech (IBB), Small Caps (IWM), Brazil (EWZ), Hong Kong (EWH), Thailand (THD) and little else.

Market sectors moving lower included: Most everything else.

Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red).

Dependent on the day (green) may mean leveraged inverse or leveraged short (red).



Volume was once again light and breadth per the WSJ was mixed once again.




 

Charts of the Day

Major U.S. Markets (7)
U.S. Market Sectors & ETFs (9)
Bonds (2)
Commodity & Currency ETFs (7)
International & Emerging Market ETFs (3)
$NYMO (1)
$NYSI (1)
$VIX (1)

• SPY 5 MINUTE

  
  
  
  
  

• SPX DAILY

  
  
  
  

• SPX WEEKLY

  
  
  
  

• INDU DAILY

  
  
  
  

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• EEM WEEKLY

  
  
  
  

• NYMO DAILY

  
  
  The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.
  
  

• NYSI DAILY

  
  
  The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.
  
  
  
  

• VIX WEEKLY

  
  
  The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation has changed due to a variety of new factors including HFTs, new VIX linked ETPs and a multitude of new products to leverage trading and change or obscure prior VIX relevance.
  
  
  
  

It was an impressive week for bulls, that’s for sure despite relatively weak volume.

Every dog has its day is all I can say in addition to—where’s the beef! Bulls will need to answer this since next week is heavy with economic data.

Let’s see what happens.