Thursday, August 2, 2018

Global Reflation Is A Hoax

Trump has imploded the Auto and Housing sectors, now it's on to China. And then the world. In the meantime, 'BTFD' is the order of the day, because global reflation is a hoax. A conspiracy of dunces, to be exact...

Remember August 2015 when the mere threat of Fed rate hikes imploded China's currency? Well this is double Fed tightening and trade war for good measure. If this doesn't work, nothing will. We are locked in the dreaded dumbfuck death spiral...

Trump has the IQ of a billy goat:

"Look - these bastards are devaluing their currency. More tariffs, now!"

"Fuck trade wars, we have iPhone 11. It's one better than 10"

"They make it, but we invented it"

The Chinese Yuan is in a trade-war driven death spiral. Compliments of "truthful hyperbole" aka. non-stop bullshit, global markets are pricing in the worst. Ironically, the resulting dollar flight to safety bid is making the U.S. less competitive. 

Unfortunately, now neither side can back down:

China is already "winning" the Pyrrhic trade war to the extent that the currency is front-running trade actions. The Trump Administration is now in a situation of chasing the currency lower by applying ever-more stringent trade actions, driving the currency ever-lower:

Overnight, Chinese markets got monkey hammered deja vu of 2015. It appears that investors don't like devaluation of currencies...

Cross-listed China Tech is taking it worst:

A little known fact is that Trump's trade war started last year against Canada in lumber. Trump was trying to help greedy lumber producers in the U.S., by imploding the U.S. housing market.

It worked. 

In other words:

"I hope the automakers appreciate what I'm doing for them on steel prices"

Bounce off the 50 day. Check. 

Skynet is a computer program, after all...

Short-term wave counts are an invitation to look like an idiot

I accept, as usual

Speaking of moonshots. The world's largest stock is now up a cool 100% since the election. Despite the fact that annualized iPhone unit sales have been flat for three years straight. Yes, you read that right. Flat since the last peak in 2015. It was all much ado about Donny.

Meanwhile, due to share buybacks, now $207 is the $1 trillion mark

Another Fed meeting out of the way portends badly for global markets. The hope going into these meetings is always that the Fed will say, "don't worry, we're done raising rates". This last rally encompassed the entire month of July.

Fake hope and short-covering quickly turn back into a pumpkin when the Fed confirms that rate hikes will continue until everything implodes:

After all, it's a tradition, so why stop now?

Everything "risk" caught a massive bid in July. 

This is just bad marketing is what this is...

In summary:


Because who can remember what happened exactly six months ago?