Saturday, March 25, 2017

Welcome To The Hotel Californication



The last Emperor, I Clownius, lured untold amounts of capital into stocks on the basis of his tax cut, which would be paid for by canceling health insurance for 24 million working people. It took 14 months to create Obamacare, but Trump's team was going to repeal and replace it in 18 days. No greedy fucktard questioned him...

With only minutes left prior to Friday's close, the news broke that the Healthcare bill was being pulled. Algos went vertical chasing shorts up and out, as the new false "meme" circulated that the tax cut has now been moved up in date. And just like that, the door slammed shut. Howeever, after the close we learn that the goodies in the tax cut were predicated upon monetizing 24 million Obamacare participants. Without them, the math doesn't work.

Now, assuming there are no more morons left to be conned by Bozo the clown, I will go out on a limb and say that there is no way out of this for those who followed Trump into a dead end predicated upon monetizing their fellow man. We are very likely witnessing the perfect ending to the Roman Circus, and the clowns running it...

S&P with Rydex Bearish Positions:





Occupy The "Post Truth" Idiocracy

Who needs protests and demonstrations when the people vociferously supporting the status quo are busily hacking it down with all effort? We would be getting in their way...

Today's leaders are some of the dumbest fucking people in human history. Far too stupid to realize how stupid they are. They can't fix the problem, because they ARE the problem. Meanwhile zombies eagerly discarded the single God of Reality in favour of a thousand Gods of Ignorance, because reality was not good enough for them. We live in the "post-truth" world, which means a society of degenerate morons busily digging their own economic grave.

Trump just got rolled by his own party. Twenty-five rogue House Members funded by the Koch Brothers now control the U.S. government. 



Meanwhile, even as Trump's entire "growth" agenda just evaporated into thin air, here is what the Fed has been doing to junk bonds and Oil. Each circle is a Fed rate hike:

Note to Fed: Trump's Fiscal plan doesn't actually exist.



Janet, you can ease off there on the imaginary reflation...
Commercial & Industrial Loans, Year over year rate of change:




Financials, second largest S&P sector:





"Join the 1%"

Or get conned all over again, by the same psychopaths as last time...




No one saw this coming...




We Have Nothing To Fear But Ourselves

There was only one lesson to take away from 2008 - "Less". Because having less is what is coming and therefore being happy with having less is a prerequisite to survival. Not to say that anyone has the perfect lifestyle, however, it's the addiction to "more" with its attendant liabilities that will cause the greatest "attrition" in the days to come...


In the "Insanity" workout videos, the instructor, Shaun T, says at the beginning - "Are you afraid of what's to come? I am". Whenever I hear that, I always think you know I've heard better motivational speeches. I should be afraid of the future, but I'm not. I've come to terms with less in my own life - having taken my spend rate down 90% in the past year due to "unforeseen" circumstances. The nature of which I've written consistently about for the past decade. And yet, I've never been happier. With respect to the future, we have nothing to fear but ourselves. For some reason, due to an absence of worthy natural adversaries, the hairless monkey has decided to become its own worst enemy. We have been raised in a corporate toxic waste dump. From birth, brainwashed to be dissatisfied in life and to need "more". And then when we get more, we find out more is never enough. We are given happiness at birth and from that point forward, taught to do everything possible to undermine that happiness in pursuit of competitive materialism.

Now of course it's all ending. It has been ending for weeks, months, years, even decades depending on the person. Only the people at the very top of the Ponzi pyramid have been unaffected by the war of corporate attrition. And yet, people make the blithe choice to be used and exploited to pursue the mirage of happiness that glimmers ever more distant into their future. And so I'm not afraid, because I've been forced to accept "now" with respect to my happiness, and because the only enemy is oneself. We see it all around us - self-destruct mode is rampant. My own cousin died this week at age 48. He had been burning the candle at both ends with a blow torch. Arguably lucky to live to that age based on some of the stories. He could never be happy. We are all somewhere on the continuum of self-destruct mode. 

Finding the "now" for happiness is not that hard, but it means accepting less. It means accepting that more is not more, it's less. We are witnessing the final stage collapse of what began in 2008 - the consumption of the status quo for corporate dividends. Trading long-term economic revenue for short-term profit. The conflation of debt for GDP. On the other side of the "recognition event" there will be a glut of EVERYTHING, except money. So we will transition to a barter economy. Big deal. My parents already buy their clothes at the second hand store, and I kid them that they're taking away from homeless people. The fact is that trading IS the future. We are already witnessing the collapse of shopping malls in real-time. And it's not just because of Amazon, it's because everyone has too much shit already. I am optimistic that the Millenials will survive just fine, since they are the sharing generation. They share rides, AirBnBs, and even themselves - there's an app for that. The student loan debt however has to go, and I foresee maximum rioting until it does. We let corporations buy stock back from insiders to paper over dilution using borrowed money and then discharge that debt in bankruptcy, but Congress has decided student loan debt can never ben discharged. It's Congress that is going to be discharged. Meanwhile, those who have welded themselves to "more" and who are already self-medicating are going to find this adjustment "difficult". Why? Because it's already difficult. They've turned life into a competition, and the chemicals are just there to help them cope with the fact that they can never win.   

The important thing for the planet and the future is that the corporate toxic lifestyle is eradicated. It's a personal choice of who goes along with it. The hardest part will be watching the people around us who've already made that choice. I know.  




Friday, March 24, 2017

Trump Bubble Reversal Of Fortune

Social Mood is collapsing on Trump...




Trump began his foray into politics by alienating half of his country. Once elected, he promptly pissed off the entire world ex-U.S. He gave special "attention" to America's largest trading partners and allies. Next, the U.S. intelligence agencies went under the bus, the "liberal" media, half of Faux News, and the NeoCons who've been running the U.S. since Reagan. But it wasn't any of them who took him down, it was his own party. In doing so today, the ultra-right "Freedom Caucus" aka. the Koch Brothers, imploded the Trump bubble. 

Now, the blood is in the water. Trump has knives sticking out of his back from every angle, his entire platform is in peril. The Freedom Caucus not only took away his Obamacare rollback with attendant tax benefits, but they will very likely also take away his Border Adjustment Tax (Tariff) plan, which was also a necessary part of his plan to cut corporate taxes. And of course they can make his life hell vis-a-vis the debt ceiling. 

All well and good, except, he sold Global markets on reflation, and they bought it hook line and sinker. This week that Imagined Reality wore off, as the Trump trades across the board got monkey hammered.

Meanwhile, U.S. micro caps peaked back in December. The S&P and Russell 2000 small cap peaked three weeks ago. And the Nasdaq peaked on Tuesday of this week, having an outside reversal day on heavy volume. 


The Nasdaq's Tuesday outside reversal can clearly be seen - gap higher followed by straight line collapse lower. As of today, that first leg down has now been "corrected".

If the first wave down looked like this, what will wave '3' be like?



This coming week (Wednesday), UK PM Theresa May will officially trigger the Article 50 EU exit clause, hence we should expect volatility: 


As we know, the dollar is hanging by a Trump Fiscal lie which just burst:

$USD:


Which means that we've seen this movie before...


Which just happens to look a lot like this movie...

S&P 12 month rate of change:




Should be an interesting week...

GBP (red) with USDJPY



"The peak of this volatility will likely happen between March 25th and April 8th – what we are calling the “heart of the window”.  This will likely be a very tumultuous and volatile period where massive rotations in price could occur"

You don't say...




Obamacare Saved By RepubliCon Incompetence

In summary, the Fed is full of bullshit, tightening into deflation
OPEC is full of bullshit and hasn't controlled the glut
And Trump is full of bullshit and can't deliver fiscal stimulus

We're surrounded by liars and con artists. How do we think this will all end?



With all of the "excitement" around the healthcare bill, zombies forgot to notice the Trump trade unwinding in size. Next week markets will absorb the concept that Trump failed his first time out, and now there are no Obamacare budget benefits to fund their tax cut:




In other words, the Monetary to Fiscal fantasy "hand-off" just suffered a major setback...




Banks



Asset allocation to banks




Hot money has to go home now...

USDJPY with VIX






Someone needs to buy a new calendar, there's an historically large Oil Glut right NOW:

Oil with Storage



Stock / bond rebalancing




Retail stocks



Transports




VIX with 2x ETF Volume (UVXY):




Goldman Sachs






Nasdaq % of stocks above 50 dma:



Money (Out)flow



I think we all see where I'm going with this...






Kamikaze Politics aka. Dropped Baton Death March

I like Trump, I think he's doing great...




Trump threw House Speaker Paul Ryan under the bus, because Trump REALLY doesn't want this bill to pass. He doesn't want to get stuck in a deadlock between the House and Senate which could go on indefinitely:



Therefore, to placate Wall Street, the White House signaled this morning that they've already moved on to inter-generational theft aka. "tax reform":


There's only one problem, which is that the tax cut for the ultra wealthy was supposed to be "paid for" by robbing 24 million working people and their children, of their healthcare. So without that pound of flesh, it's hard to see how the godless "Freedom Caucus" will agree to the "plan".

Nevertheless, there's an even bigger problem. Because markets rallied in November based on an IMMINENT tax cut, not a tax cut coming a year later. Hence, the Monetary-Fiscal baton pass will be dropped for an entire year, while Yellen is imploding the economy.

Which can be summarized thusly:

Gamblers are stuck between the Scylla and Charybdis of GREED and FULL RETARD:



Commercial and Industrial loans, % change from year ago:






Stock / bond rebalance:



Nowhere to hide:




Compliments of today's short-covering rally, we now have a Nasdaq count...






Thursday, March 23, 2017

"If You Like Your Fake Optimism, You Can Get Buried By It"

What we learned this week is that "repeal and replace" Obamacare, is a RepubliCon fantasy. Even Trump doesn't believe in it...

There is something profoundly fucked up about this Soylent Idiocracy of corporatized zombies. They are attracted to con men like a moth to a flame. They don't trust anyone who can be trusted. Meanwhile, they self-medicate on every substance known to man, preferably in multi-dose cocktails. Chemicals to treat chemicals. Self-destruct mode taken to level '11'...

Trump is pushing through the healthcare vote tomorrow, because he wants someone to blame when it doesn't pass i.e. Paul Ryan and intransigent Congressmen. He doesn't really care if it passes or not, just as long as he doesn't take the blame:

NYT: Trump Having A Rare Moment Of Self-Doubt
"He said ruefully this week that he should have done tax reform first when it became clear that the quick-hit health care victory he had hoped for was not going to materialize...So on Thursday night, Mr. Trump delivered an ultimatum...if the bill fails, he said, Mr. Trump will move on...Mr. Trump reiterated his veiled threat that Republicans who voted no would be punished by constituents...He made clear to members of the House Freedom Caucus during a testy hour long face-off in the Cabinet Room that they were going to have only one chance to fulfill their vows of repealing and replacing the health law, and this was it"

“In order to get this bill out of the House, they have pushed this bill too far to the right...the Senate will never accept it.”

I am sure that the intransigent House Members will appreciate his cynical cram job documented on the front page of the New York Times tomorrow. 

Back to the theme of this post, the definition of insanity is getting monkey hammered by the same crow bar over and over again, each time expecting a different result...

For example:

Oil ETF:


Dollar ETF:


Junk bond ETF


Fracking stocks:


Natural gas ETF:




Five year yield: