Friday, March 2, 2018

Global Reflation Was A Hoax

Foisted on denialistic morons, reality TV presidents, global EconoDunces, Larry Kudlow, CNBS mannekins, and Central Bank money printers. By themselves of course. Human history's biggest circle jerk. BTFD zombies are going to learn that unquestioningly buying every overnight dip isn't necessarily the best idea...

Short volatility bubble
Global reflation bubble
Short Treasury bubble
Yen carry trade bubble
Oil/Energy bubble
Netflix bubble
Dumb money bubble

My epiphany on Monday of this week was that only trendlines matter to Skynet. Subsequently, ALL of the retracement rally trendlines broke this week: the S&P, Nasdaq, Europe, Emerging Markets, Oil etc. etc. The mega cap Dow was hit hardest this week. Down -6% straight to its two year trendline (not shown), prior to bouncing Friday afternoon.

Nevertheless, it wasn't only the Dow that reached the two year trendline.

The final trendline is now in play, with a 35 point margin of error. Which is what the S&P lost three days in a row this week...

Looking at February as a whole, based on Netflix and the Nasdaq 100, one would think literally nothing happened during the past month. Quite the contrary, February was the month that global fake reflation died of higher interest rates. You know, just like the last time. But don't tell anyone, because it's still a secret...

Europe ended the week FUGLY, taking out key support:

Same with Japan:

Within the U.S., this was the week that Treasury bond yields chose economic reality over Fed bullshit. And the Yen carry trade got hit with the ugly stick...

Sorry to Gundlach and Gross, but we can check the short Treasury bubble off the list.

Which of course portends badly for stock market liquidity. Now that cash is yielding more than the S&P 500:

Large banks are tracking the stock/bond ratio:

This is the past month in oil

Check that bubble off the list as well...

Emerging Markets. Check.

S&P 500