Top Tweets Today: 30/09/2015

I found this funny that on this day 34 years ago the US was grappling with high inflation and interest rates and subsequently all those years later till the present day we debating whether the Fed should finally lift interest rates off the floor of 0-0.25%  which seemingly is causing turmoil in financial markets.

The interest rate set a record for the highest government yield issued which doesn't seem likely that it could be matched anytime soon. I think the difference between today and 3 decades ago is there was much less debt back then whereas today markets are swimming in the stuff. We forget that the famous monetarist economist Milton Friedman warned against the effects of an expanding money supply. Printing money will not save the world, being productive will, something I think the world at present has lost its appetite for.

Today in 1981: USA issues new 20-year Treasury bonds at a 15.78% yield, an all-time record-high interest rate for any U.S. government issue.

— Barry Ritholtz (@ritholtz) September 30, 2015

I saw a particular piece of commentary last night where an analyst who was discussing the resources rout described what could be the start of the Commodities Crisis.  Garth Mackenzie of Traders Corner gave an insightful overview of what he thought are signs of distress within the commodities sector.

I've posted the video for those who might be interested to hear what he had to say of which I thought he made very valid points especially regarding the markets reaction to Glencore overladen debt situation.

This week's Traders Corner video is here. I discuss recent market weakness and open a new pair trade +FSR/-RMH. http://t.co/RdkNr3NAdj

— Garth Mackenzie (@TradersCorner) September 30, 2015

Following from that story I missioned around twitter to find some chart of significance that maybe help indentify where this market could take us. This particular tweet by veteran investor Karin Richards indicates exactly Garth's point that there is shakiness within the resources sector.

The chart found below is that of BHP Billiton listing on the Johannesburg Securities Exchange, so the stock is denominated in Rands. A monthly view shows that a head and shoulder pattern is prominent with a break to the downside already initiated.

BHP Billiton is the largest mining in the world and seeing these patterns unfold does send a chill down the spine. Its weighting on the JSE is one of the largest which means that if it were to fall, it could weigh heavily on a few JSE indices painting a bearish sentiment.

BIL: The potential downside for BIL, and what it may mean for other resi stocks, does not bear thinking about. pic.twitter.com/EdUKrn70BN

— Karin Richards (@Richards_Karin) September 30, 2015