Sunday, November 4, 2018

The American Way: All Or Nothing

HINT: "All" is sold out...

The mythical American Dream is the guy who was living in his car but then goes on to bootstrap his way out of poverty, start a business, and build an empire. Ending up fabulously wealthy. Everyone outside the U.S. who hears that story wonders, why were you living in your car?

Anyone wanting to understand this week's 1929 rally amid asinine levels of risk, must first understand that it was predicated upon data starting in 1945:

Apple was the last global bubble to pop. On Friday. There is no place left to hide:

I will be honest, I never thought I would be blogging into the teeth of a global meltdown in real-time. And yet, this is exactly how it ends in an old age home. Massive denial right to the very end. No matter how nasty it gets, how illucid, irrational, incontinent. Just stupidity and denial. Nature is merciful. They never see it coming. Or going...

"The current standing is now at the highest level since February 6th of this year"

Meanwhile, recall that Barron's last week recommended the Hugh Hendry trade. As in, China is experiencing the slowest GDP growth in 25 years, and yet the Chinese authorities are in full control, hence that is where we will allocate your capital.

As we see, Barron's either timed a short-covering bounce perfectly, or they generated a short-covering bounce with their article. Makes no difference to anyone with a timeframe longer than 48 hours. 

This week, ever the optimists, they find new hope in a global arms race versus China (and Russia). Because you always want to be fully invested in your adversary, and the weapon systems to kill them, at the same time.


What they didn't notice is that EVERY sector has now rolled over. Unfortunately, those who are only focused on the S&P futures while listening to the soothing words of proven sociopaths, would have no way of knowing that this gong show is over.