Thursday, May 3, 2018

The Big Long: Outside The Doomsday Machine

The gambling defensive team has left the field, now there's only offense. As long as Go Daddy holds up, this will all be fine...

Coincidentally, Zerohedge picked up on a theme I'd been mulling over all week, which is that Goldman Sachs is as clueless as everyone else this time around. Apparently they've been drinking their own Kool-Aid. The amount of self-serving mass confusion emanating from Wall Street and the Fortune 500, is epic...

Yesterday, post-FOMC meeting, the wheels came off the bus as expected, and the sellof continued this morning. However, this afternoon Skynet stepped in at the 200 day Maginot Line to force short covering ahead of tomorrow's jobs report.

Any questions?

Aside from Wall Street's self-inflicted misdirection, what is different between now and 2008 is that compliments of mass bullshit, gamblers are crowded into the shittiest stocks at the end of the cycle. While the quality names are getting crushed... 

In other words, we've never seen anything this fucking dumb before. This is the ratio of large cap tech to consumer staples. 

Think Netflix versus Procter & Gamble:

Within consumer staples the annihilation has been picking up steam all week:

Looking across other sectors

Comcast did a stock split near the top in 2007 which was such a dumb idea they did it again ten years later:

Beer stocks are getting crushed

One area of junk stocks not doing well are those reliant on stock buybacks which are largely suspended during earnings season:

Fortunately Go Daddy made a new high today, so as long as that stock doesn't roll over, this will all be fine...

In summary, when the zombies are rudely awakened from their stoned coma, the underwear shall be mighty stained.