Today's NAFTA 2.0 rally barely lasted until lunch time before rolling over to give up half of the day's gains. At the close, a 10 point gain on the S&P for reaching a trade agreement between the world's two largest bi-lateral trading partners. It appears that no one who can fog a mirror believed the NAFTA threat was real.
The Nasdaq was not along for today's ride:
This is the S&P highs-lows summary from last week:
But in the bigger picture, what this NAFTA charade speaks to is the fact that pushing Canada around was solely to send a message to China. Which is the basis of the Trump/Bannon trade "strategy". Bannon was on Bill Maher last week explaining the "brilliance" behind Trump's trade strategy. To paraphrase, Trump is reconfiguring the lives of 7.5 billion people to suit his base of demented hillbillies. All while keeping human history's largest asset bubble pinned to record highs. You have to be brain dead to believe this shit. That or balls deep in SPY ETF shares.
Sadly for Bannon, best case his deranged Manchurian Candidate is rearranging the deck chairs on the Titanic for the sake of reality TV theater. But far worse, he's full speed ahead through a blind ice field. Neither Bannon nor Trump having even the slightest fucking clue and even less interest, in how the world outside of Dumbfuck Disneyland actually works.
Which gets us back to today's rally. Because putting aside the Boeing moonshot - by coincidence the highest weighted stock in the Dow - today's rally was led by oil and Energy stocks. There is no sector that says "late cycle" as much as Energy.
Now put it all together, what do you get? Ignorant dunces blundering into a global depression while the world at large, including myriad "pundits", literally can't believe what they are seeing. Because it's unthinkable. For their SPY ETF positioning.
"Growth in China's manufacturing sector sputtered in September as both external and domestic demand weakened, two surveys showed on Sunday, raising the pressure on policymakers as U.S. tariffs appear to be inflicting a heavier toll on the Chinese economy."
A private survey showed growth in the factory sector stalled after 15 months of expansion, with export orders falling the fastest in over two years"
"Leadership" circa 2008:
"Leadership" circa 1929
