Friday, December 23, 2016

The Santa Trump Rally Hangs In The Rebalance

Forrest Trump's planned tax cut drove a chasmic gap between stocks and bonds, which needs to be "rebalanced" before 12/31...

Having destroyed the labour market for decades straight, what follows will be the largest destruction of capital in history, without any comparison...which will get everyone on the same page...

"Rotation out of domestic U.S. equities would be one of the largest on record"

You don't say...

Dow / TLT ratio:

Active managers are near record long:

The Rydex bullish / bearish asset ratio shows the late cycle dash for trash...

Copper confirms that the Trump rally was a cyclical headfake to nowhere that drew in record amounts of capital to be obliterated.

In other words, this is going to make 2008 seem like a fucking picnic:

A close-up view reveals that short-term rates (red) are already rolling over, which means bank stocks are on borrowed time, and money. 

With the average S&P stock:

Margin of error: Zero

Bonds versus high dividend stocks