Monday, January 22, 2018

Zero Intelligence. Required.

Taleb was right. Who am I to question him?

There were actually two Hindenburg Omens in a row late last week, but who's counting?

No one.

Speaking of imbalances, I will leave it to the Mad Man himself to explain "rational" Ponzi schemes and why large caps are massively outperforming small caps:

"I'm talking about these multi-day-up extravaganzas, where investors can't buy enough shares in one session after a positive event so they keep coming back, day after day after day, to get their full positions on, no matter how much the stock runs in the interim...Honestly, I have never seen anything like it, so I've got to point this out and explain it to you."

"It's a crazy case of FOMO — fear of missing out — on the next big move, even as these buyers are creating that move with their own massive footprint"

Stock prices keep climbing, so hedge fund buyers are racing to complete their orders, which must be big enough to "move the needle"

Got that? Hedge funds are bidding up their own assets, which causes other hedge funds to do the same thing. And they must do so in the largest stocks in order to "move the needle"

CNBC: Ameritrade Gained 2% After The Bell On Earnings Beat

"Enhanced consumer interest in blockchain and cannabis-related securities drove a further surge in engagement in the final weeks of the quarter, particularly among first-time investors"

"Happy New Year!"

"The retail capacity overhang was just solved by bidding up retail stocks"

"Wiping out $800 billion will prove once and for all that Crypto is a success. No one will question it after that"

"It's called Ponzi reflation. Zero intelligence is required"

"Do you have what it takes?"