Business

Submitted by John Rubino via DollarCollapse.com,

Regular contributor Michael Pollaro offers three more charts which tell a story that’s both disturbing and apparently misunderstood by a lot of mainstream analysts.

The US trade deficit (exports minus imports) has been getting smaller. Since a trade deficit subtracts from GDP growth, a shrinking deficit will, other things being equal, produce a bigger, faster-growing economy (that’s the mainstream take).

As traders will, accurately, point out based on technicals stocks are significantly oversold on short-term time horizons, and are thus due for a rebound. Case in point JPM's Misla Matejka who said overnight that  "we note that some of the tactical indicators we follow, such as Bull-Bear at -16, are in oversold territory. This argues for a bounce in the short term...”

In a world of sheer confusion and pervasive central bank intervention, there is one immovable force of stability and direction: Dennis Gartman. Here is his latest:

Less than two months ago, on November 16, Goldman released its list of top trades for 2016, #1 of which was the infamous long USDJPY, short EURUSD equial-weighted basket which has led to massive losses for anyone who has since put it on. At the current rate of carry trade unwinds, we expect that this trade will be closed out shortly, and may have been overnight when the USDJPY plunged to the lowest since the ETFlash crash.

But while we wait, here is a reminder what the #6 top trade for 2016 was:

• David Bowie, musical legend behind Ziggy Stardust, dies at 69 from cancer (Reuters)
• With No Powerball Winners, Jackpot Grows to Estimated $1.3 Billion (ABC)
• Stock Gains Short-Lived as Chinese Volatility Hurts Oil, Metals (BBG)
• China's yuan spikes higher, but stocks tumble (Reuters)
• Yuan Loan Rates Soar in Hong Kong as PBOC Halts Currency's Slide (BBG)
• China stocks close down at lowest level since September (Reuters)
• Arch Coal Files for Bankruptcy (WSJ)
• Fed Eyes Margin Rules to Bolster Oversight (WSJ)