ASX: Banks clubbed as gold shines

The Australian dollar is firm this morning:

Bonds yields are breaking down:

XJO is struggling big time:

Big Iron is soft. I’m worried after Brazil’s better July number:

Big Gas better:

Big Gold up and away. NCM not even at new highs.

Big Banks are sinking into the bath of blood:

Hoocoodanode that fiscal tightening, quantitative failure, crashing property and virus outbreaks do not mix well for banks!

David Llewellyn-Smith
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Comments

  1. don’t tell me stimuli not enough, we need moar!!! until cyclicals take off, then it will be for real 🙂

  2. Goldstandard1MEMBER

    This is how I see the latest developments.
    Everything is negative at the moment, it’s because this Victorian lockdown is hitting everyone harder because you don’t have the ‘wiggle room’ like the last time. eg. walks without masks, kids still getting some level of care etc…..In other states they are still nervous it’s coming but the economy is still stuffed and many jobs are going to be wound up in next 3 months.
    Ppl are really negative at the moment and far as I can see, the sharemarket is the only place there is any joy. WHEN that goes, you are going to see proper depression behaviour. Much more crime, sadness and suicides.
    Tough to see the light at the end of the tunnel as a community at the moment.

    • ” WHEN that goes (stock market), you are going to see proper depression behaviour.”

      You’re referring to the “Loss Aversion” principle whereby people are much more devastated by a loss than happy at a gain.
      https://en.wikipedia.org/wiki/Loss_aversion
      90% of Aussie battlers don’t have shares so think your analysis is a bit skewed to your cohort maybe?

      For those shareholders that are going to be devastated there’ll be little pity as they’ve had months to get out and recoup March losses.

      Ffs, we live in a privileged nation and apart from the genuine battlers who’ve lost their jobs or small businesses and those facing genuine hardship, abuse, or loss of a loved one – and the young in their entirety – most of us should just suck it up and be unendingly grateful to the supermarket workers, health care professionals, and aged care workers earning a pittance while putting themselves in danger daily.

      Nation of wooses and pansies imo. Time to toughen up.

      • Goldstandard1MEMBER

        You are grossly out of touch.
        Average people are pouring money from stimulus to the sharemarket to have a hobby and to try and cover lost wages.
        I was simply giving some insight into what I am seeing and a likely outcome because of it.
        There is no need to cover your own insecurities by being prick.

        • “average people….to have a *hobby*?

          Really? Who’s out of touch here?

          And i wonder who’s the prick?

  3. I didn’t see this coming ..

    On which note, gold is often thought of as an inflation hedge – not so and the anti-dollar – not really.

    More than anything gold is a hedge against faith in the financial system, ergo, gold rallying hard and banks getting clubbed like a baby seal.

    • ‘hedge against the financial system’ – correct.

      That’s why it doesn’t correlate all that well with other metrics, except DXY (which is just its denominator)…inflation, deflation, interest rates, etc….

      Gold is actually a reflection of faith in the system, and other metrics may or may not have implications for faith in the system.

  4. Not sure I would trust NCM to deliver on the promise. They were a source of disappointment years ago. I suppose I may be out of touch as I turned my back on them years ago. What do you think?