Monday, June 18, 2018

Post-Truth And Consequences

The global coordinated con job ends this week with Friday's OPEC meeting...

This week is starting off where last week ended - EM implosion, and mega Tech rally. Today flashed the Zuckerberg Omen - the dreaded scenario wherein the global financial system hinges on one massively overowned and overvalued Tech stock. This gong show isn't so much going to crash as explode...






I'm eyeing the early Feb analog, post Central Bank sponsored short-covering.

The Dow is bearing the brunt of "fun and easy" trade wars. Now down five days in a row, as Skynet works overtime to keep it together...





It's a bad time for the Zuckerberg Omen...



Everything else is good to go...

The last cabal of liars meets on Friday this week, completing the month of global synchronized lying:



"Friday’s OPEC meeting of the cartel is likely to see Saudi Arabia and nonmember Russia prevail in boosting oil output despite the objections of Iran, Iraq and Venezuela"


Any questions?








For the segue to the 2016 analog...




More crash than segue











More 2008 than 2016





Sunday, June 17, 2018

MAGA: Make Alzheimer's Great Again

This farce only makes sense through the lens of an enfeebled, incontinent old man, debasing himself on a daily basis. Which is how it ends for all old men, by the way. Those in the mainstream media attempting to rationalize insanity, are forfeiting their own sanity to do so. In any social circle having an IQ above 5, this man is a pariah. To say that there will be rage directed at this man when he final implodes everything, is a vast understatement. In the meantime, keep up the good work...


"One minute I held the key
Next the walls were closed on me
And I discovered that my castles stand
Upon pillars of salt and pillars of sand"


Trump is now fighting wars on about 25 different fronts, and winning all of them. But only on Twitter. His TV ratings are through the roof. Trump's constant need for affirmation is his biggest weakness. He has to constantly find new ways to throw the rest of the world under the bus, to delight his base of demented hillbillies. He can count his friends in the millions and his enemies in the billions...







It took only a matter of hours for China to find Donny's wide open flank: 



"It's not hard to imagine a scenario whereby China encourages Saudi Arabia and Russia, the world's top oil exporters and partners in the agreement to restrict output, to pump more crude."

China would then buy the additional Saudi and Russian output, using it to replace cargoes from the United States"

The Chinese have probably calculated that they can take the pain from a trade conflict longer than Trump can"

The Ponzi oil reflation trade was already unwinding without any help from Donny's trade wars. This is Friday close:




Oil is now down -14% from the highs three weeks, ago, as oil speculators re-discover the joy of margin calls...




Strong dollar is also pounding oil. Which means that the dollar is accelerating deflation through offshore credit markets and now the oil market...




Make Alzheimer's great again...









We can thank Jeff Gundlach for sponsoring this three month short-covering rally, led by Fadebook of all stocks...





The rest of the world is sending a message via overnight gaps, but so far it's still BTFD: Buy The Facebook Dip













This Is For The Kill

"Thou shalt have no cult leaders before me"

Global trade wars, accelerating rate hikes, accelerating balance sheet rolloff, global slowdown, EM implosion, all paved over with rampant fake-believe. The good news is that the party of hate, war, greed, and lying, lie to themselves more than anyone else. They have no clue they're drinking cyanide-laced Kool-Aid mixed by their own cult leader.

The cult of Donny:




Fake optimism is rampant - among businesses, consumers, and casino gamblers. But especially among RepubliCons, the party that has taken lying to level '11', under the standard assumption that someone else will be paying the bills. The right wing media has duly propagated these lies to ensure that the sheeple stay in line and they don't see it coming...





Trump is the final proof that the human race will believe anything and anyone. Except the inconvenient truth...

Friday, June 15, 2018

Get Me Bernie Madoff. It's Time For Shanghai Surprise.

Yes, again...

The just ended "most important week of the year for the world economy", was a week of epic hubris: make-believe nuclear deals, raising interest rates, inciting global trade wars, jamming IPOs out the door. All while Emerging Markets imploded in real-time. Fortunately Netflix and Go Daddy were ready safe havens, since the real safe havens no longer exist. Next week could be more interesting....

This week can be summarized thusly via the chart below:
Emerging market credit (local currency) is perched at the post-election stick save level. Meaning that Trump has crashed Emerging Markets twice - the first time just by being Trump. The second via tax cuts and tariffs. The intervening period was the global synchronized con job. The Nasdaq meanwhile is off in imagined realities land, deja vu of late 2015. The smart money (lower pane), is not betting on another con job. Because really, isn't one enough? 

To complete the circuit, the Fed just raised rates deja vu of late 2015: 





In $USD of course, the stick save failed this week. A function of EM currencies getting doubled teamed by Trump and the Fed. In dollar terms, it's already 2016 deja vu.

aka. 1997...




But what happened to implode EM currencies?

CNBC: What's Wrong With Emerging Markets
"I think everything started in mid-April, with the IMF meeting. Everyone went there with one theme in mind — synchronized global growth which would work with rising rates in the U.S."

But then, global synchronized growth turned out to be a global synchronized con job. Which means that threats of further Fed rate hikes were not going to "work". 

In summary, it was the day that International sweatshop workers shrugged, while global capitalism bet the farm on Forrest Trump and Go Daddy...





"Attack, attack, attack, never defend"
- Roger Stone, Trump Campaign Advisor

"Trade wars are good, and easy to win"
- Donny Chump




"For some reason I can't explain
I know St. Peter won't call my name
Never an honest word
But that was when I ruled the world"







I think we all see where I'm going with this...The Manchurian-Candidate-in-chief has picked up some bad ideas along the way. He's learned from the worst...

Thursday, June 14, 2018

U.S. And Them

Trump is oblivious to the fact that the Globalized sweatshop is funding his tax cut via the trade deficit. Why? Because he's a total fucking moron, according to his former Secretary of State...

Straw, meet camel's back:



"China is already slowing after a stronger-than-expected start to 2018, even before any new US tariffs on its exports."

So far, this week has featured escalating trade wars between the U.S. and its largest trading partners, Canada, Mexico, Europe, and tomorrow China. Meanwhile, the dictator-in-chief was praising the virtues of a Third World despot whose country has the GDP of Netflix. I kid you not. Unfortunately, the rest of the world can't afford to fund the AmeriClown...




Yesterday, the Fed threw Emerging Markets under the bus, raising rates this month and signaling an additional two rate hikes in 2018. During his press conference Chairman Powell also indicated that balance sheet rolloff is "going smoothly", contradicting what the head of India's Central Bank said on June 5th...

"Global spillovers did not manifest themselves until October of last year. But they have been playing out vividly since the Fed started shrinking its balance sheet. This is because the Fed has not adjusted to, or even explicitly recognised, the previously unexpected rise in US government debt issuance. It must now do so" 



Speaking of debt issuance, this week we learned that second quarter GDP is approaching Trump's 4% goal. The bad news is that we also learned this week that the 2018 deficit will be 4% of GDP. Meaning that Trump's smoke and mirrors economy is 100% smoke and mirrors:



"The budget gap rose 66 percent last month from a year earlier"





But where will all of that *free* money come from if the Fed is tightening? Oh right, the rest of the world, now getting monkey hammered by tariffs, higher interest rates, balance sheet rolloff, and asinine profligacy.




Meanwhile, for those who actually believe that consumption zombies throwing their last borrowed nickels away portends 4% GDP forever, the bond market would beg to differ. Treasury shorts are on the verge of getting final pole axed...




The global economy is in even bigger trouble, as the sugar high from the latest round of Central Bank stimulus wears off:




"China's economy appears to have hit a significant speed hump, with a number of key indicators across the industrial, construction and retail sectors slowing to either multi-year, multi-decade or record lows."

Economists at global investment bank Rabobank said investment growth, "was all shockingly weak by Chinese standards."





Yet, we should bear in mind that all of this fake euphoria has been sponsored by history's largest short squeeze to fund Wall Street's largest IPO pump and dump in four years:







Meaning that this is a one way trip to the sun...










The Bank of Japan meets tonight to complete the trifecta of money printing meetings, and associated short-covering:




"It is just not credible that the U.S. remain an oasis of prosperity"
- Greenspan, 1998 Emerging Markets crisis



Especially when the oasis is paid for by robbing the rest of the world...










Rat Race Or Human Race. Choose Carefully.

Kentucky Fried consumption zombies are this cycle's burnt offering to quarterly profit. The price of drinking the Kool-Aid. There is nothing as lethal as the American way of life...

The externally-directed corporate Borg lives in the vacuum of its own ad-sponsored lies, incapable of differentiating fact from fiction. Long ago eschewing the lucid natural world, for the comfort and "safety" of corporate-provided brain fog:




As I predicted when I started this blog over ten years ago, the great corporate job killing machine inevitably claimed me as a victim. Two years ago this month I lost my high paying job to a company merger. Being in IT I was used to changing jobs frequently earlier in my career, but this time the axe came fairly late in my career and my technology skills were obsolete. I didn't have enough to retire on yet, so I faced the worst case scenario: late career pay cut, retraining, and location move. So instead, I said fuck it and took my spend rate down 90% by going "full college student" - basically adopting a subsistence lifestyle. I can now get by on a nominal wage and I can take months off at a time whenever I want. I've never been happier. I don't fear the future, because I'm already living in the future. I've already learned what everyone else is about to learn. That the path of external ingratification is a massive liability...

Wednesday, June 13, 2018

Countdown To Implosion











The first two FOMC meetings this year led to massive selloffs. The third meeting (May 1) led to a brief selloff followed by a non-stop rally that has lasted until...

Today

Getting the casino exactly back to where it was the last time it imploded:







Tuesday, June 12, 2018

The Last Emperor. Has No Clothes.

I just watched a sordid documentary about Trump's kingmaker, Roger Stone, proving that all it takes for democracy to fail is widespread nihilism, cynicism, and ignorance. The demagogue figures out what the mob wants to hear and works backwards to the podium...

Movie reviewer on Get Me Roger Stone:
"How the Republican Party made itself over from an organization of gentlemen to a slash and burn cult "
- Owen Gleiberman





I will start by saying that relative to post-WWII subject matter, this is likely the most sordid documentary I've ever watched. Something this cynical would not have been possible in a prior period. While intending to profile Trump's controversial kingmaker Roger Stone, the film inadvertently documents the process by which the Republican party descended into depravity by becoming the party of hate, war, and unbounded greed. Cloaked in the artifice of Christian family values. 

Interestingly, I used to be extremely conservative, especially on economic issues. I had been brainwashed by business school. Over time however, as I compared economic reality to the textbook fantasy I had been taught, I eventually came to realize that modern conservatism is merely Ayn Randian fiction: The inversion of morality from altruism to self-interest leading to an imbalanced cycle of greed and collapse which will terminate in anarchy. Those who never grow out of this zero sum Lord of the Flies mentality are the ones who never really grow up. Enter Trump, who exhibits the behavior and literacy of a petulant child. The hand-picked sock puppet of Roger Stone.

The film itself is an indictment of the Republican party as cynically told by Republicans themselves. There is unabashed enthusiasm for corruption and malfeasance throughout the entire film. It's a cautionary tale and testament to the unseen moral slide that attends the collapse of all once great nations. It's abundantly clear that the people in the film are wholly self-unaware that what they are de facto describing is the latter stages of a nation in moral death spiral. An economically-stunted political class evincing 100% faith in their Voodoo Economics to recursively restore their bubble, while treating the middle class like their personal ATM machine. Zero understanding or concern for the finite limits of an ever-less mentally stable society that they themselves openly exploit for political advantage.

The story begins with the rise of Roger Stone from the ashes of the Nixon debacle. The failure of the Nixon presidency forced the Republican Party to adopt brutally vicious campaign methods to regain power. A makeover led by a man having a cult-like obsession with Nixon. Going so far as to have a tattoo of him on his back. A man who openly embraces Machiavellian evil in every form.

Along the way, Stone and his allies invented the unlimited funding vehicle "Political Action Committees" (PACs) to circumvent campaign funding laws. They took attack ads and character assassination to a level of viciousness never seen before. They turned insider-based political lobbying into a large scale industry. They used racism and sexism as a political weapon to incite polarizing divisiveness and gain votes. Some would say I'm naive to believe that Democrats haven't themselves co-opted many of these same tactics. Of course they have. However, the willingness to continually debase the moral status quo and "do whatever it takes" to gain power is the signature of the party that believes maximizing profit is a post-moral imperative. As taught in every business school. 

For forty years, the signature Republican access path to power has been to fan and exploit the anger of the intentionally uninformed working class, inciting them to vote against their own interest. Each successive cycle of reflation and collapse leading to more anger to be exploited for the next round of political and economic gain.

We all know the downstream outcomes. First off, *Free Trade* gutted the U.S. economy to the benefit of multinational profit. In addition, they turned war into an economic stimulus program. They systematically eliminated healthcare for the working poor. They raided Social Security and Medicare to fund tax cuts. Only in the U.S. would a deduction from one's pay check be called an "entitlement" and then re-directed into someone else's pocket. In any other developed nation that would be called theft. Which means that historically speaking the plundering of Social Security and Medicare are the largest thefts in human history, carried out by de facto criminals. 

All of this malfeasance of course culminated in yet another recursive round of fake "MAGA" by recycling Trump into his greatest reality TV role yet. Led by the man who took D.C. swamp politics to a level never seen before. In other words, once again, the inherently illiterate Trump base installed the fox into the hen house. The invisible "deep state" was subsequently blamed for all of the ensuing corruption, in order to defray any semblance of conscience.

It's all a cautionary tale. All that is needed to subvert democracy is widely embraced nihilism, cynicism, and ignorance. America's fake Christians made a pact with the Devil. The down payment was made, the balance is due.




Monday, June 11, 2018

Global Markets Are Saying "Fuck Trump"

It's not just De Niro, global markets have lost all confidence in Bozo the Clown...

Aside from Go Daddy gamblers and hedge funds getting squeezed, global stocks, oil, crypto, real estate, industrials, banks, yield stocks, Emerging Markets, and even the sectors Trump says he's making great again, are all saying the same thing...







Worldwide v. Trump smack down is already in progress...




Begin with Walmart which is telling us that the tax cut for the ultra-wealthy, is only benefiting the ultra-wealthy...




Blue chip stock Johnson & Johnson, arguably the highest quality U.S. stock in terms of long-term earnings record...

The Path Of Humiliation Has Been Chosen

It's a well-established rule of history that every empire always continues one clown too long...

But first, Trump's errand-boy Peter Navarro told Faux News over the weekend that there's a special place in hell for Trudeau. Trudeau politely declined the job offer....

Meanwhile, should this man control 6,000 nuclear weapons? The short answer and long answer are both no. This guy isn't an embarassment to the U.S. he's an embarassment to humanity. But I'm sure his post-literate base can't find anything wrong with this message. Someone take the crack pipe away from this guy...





This week is the decade's culmination in epic hubris:




Today the casino is shrugging off the aftermath of the G7 circus, which sets up the rest of the most important week of the year. This week culminates the biggest short squeeze since October 2008. Except far bigger...




1) Separated-at-birth despot reunion, Singapore, Tuesday


2) FOMC (Wed.), ECB (Thurs.), BOJ (Fri.)








3) UK Brexit vote (Wed.)