Tuesday, April 17, 2018

The Last Trump Casino

The Idiocracy has finally found the cure for inequality.

Collapse due to rampant criminality...

"If you're looking around the poker table and you don't know who the patsy is, it's you" 
- Warren Buffett

Many people have speculated as to how Forrest Trump's ill-fated turn as reality TV president might end. Would he be impeached by his own party? Would salacious rumours, rendered true, chasten his alt-Christian base with an affair so sordid that even their squalid ranks would balk?

Or, for once, would they question RepubliCon orthodoxy that tax cuts for the ultra-wealthy create broad-based prosperity, which has only been diametrically wrong for forty years? 

Of course not. Despite the biggest volatility implosion in history a mere two months ago, "no one" at this late date yet believes that turmoiling markets, bereft of fools to con, will  render final verdict on what in the end amounts to Supply Side Dumbfuck-o-nomics taken to level '11' at the hands of a master con man. 

Although, some appear to be getting closer to the truth...

"Those who hate Trump already think he’s a crook; those who love him don’t care

I believe this assessment is wrong. 

I am unaware of anybody who has taken a serious look at Trump’s business who doesn’t believe that there is a high likelihood of rampant criminality.

The narrative that will become widely understood is that Donald Trump did not sit atop a global empire. He was not an intuitive genius and tough guy who created billions of dollars of wealth through fearlessness. He had a small, sad global operation, mostly run by his two oldest children and Michael Cohen, a lousy lawyer who barely keeps up the pretenses of lawyering and who now faces an avalanche of charges"

We learned this week that Wall Street's con men have already figured out that Trump-o-nomics is a game of three card monte.  For his part, Warren Buffett never once blinked, now sitting on record cash, while telling everyone else there's nothing left to buy, so keep buying. However, sadly, the serial-conned sheeple have once again been conned into buying and holding the bag through thick and thin. Hence they are the only ones left to learn. 

Which gets us back to the last Trump casino. 

Amid fundamentals at or below 2016 levels. Wall Street positioning at or below 2016; and technicals at or below that same level. The door out of the casino is closing.

Banks tell the story. Despite today's Netflix bid, the big banks were following the yield curve lower today, now following the 2016 analog:

Meaning that the casino doorway is as wide as banks are from their 200 day (red). 

As of today's close, large cap stocks are one year overbought, and yet, as we see in the lower pane, there is less and less participation:

Here is where it gets interesting, relative to the 2016 analog. 

The true "safe haven" trade - not counting Netflix - consisting of Utilities and Consumer Staples, is inherently weak:

The other problem of course is that the Fed got conned as well. 

Why? Because they are experts at turning a blind eye to rampant criminality.

Just as they blew up the housing market in 2007, this time they locked the sheeple inside the casino. With help from Wall Street and Trump, of course.