The Broker-Dealer Index (XBD) is where the wonders of financial engineering
take place. When the sector is soaring, bonuses have been outstanding. When
it is in a distinctive decline bonuses get whacked. Recent chart action is
similar to the key rebound and reversal in October 2007 and in February 2001.
Both were followed by serious financial contractions. In December 2007, the
establishment boasted that because of the "Dream Team" of economists at the
Fed - nothing could go wrong. Eventually, the same establishment described
the contraction following the 2007 Bubble as the "worst calamity since
the 1930s".
Needless to say, but Wall Street bonuses going into that Christmas were severely
reduced. In 2001 the Bonus Pool plunged by 48 percent and in 2007 it was 49
percent. Porsches and Ferraris were sold, not bought. Through open-ended student
loans, students and teachers remained aloof from reality. Staff at the New
York Fed grew from 271 in 2005 to 514 in 2013, the latest report.
XBD
The rally out of the August hit has clocked an outstanding swing in the Daily
RSI. Similar to the one in August-October 2007. This covers momentum and this
week's action has registered a Sequential (13) Sell. This is pattern and the
index should soon roll over.
Bonus Pool
