Discovering The Limits Of Hyperbolic Bullshit

The attention deficit Idiocracy doesn't trust reality, but they trust sociopathic liars with everything...

Donny Trump has taken hyperbolic bullshit to level '11' as his words and deeds have gone in opposite direction. Nevertheless, fake-believe in the recovery and the casino remains pinned at record highs. Recall, back in 2011, it was the debt ceiling that caused the wheels to come off the bus, and now the debt ceiling is an issue again at the end of September. September is also when the Fed is expected to announce details around tapering the balance sheet. 

All of which means that the U.S. is the global weak link. But don't take my word for it:

The U.S. Dollar Is Weakest in 32 Years

https://www.investing.com/news/forex-news/weekly-comic-the-dollar-is-doing-something-it-hasnt-done-in-32-years-514161

So while Trump is blowing smoke up everyone's ass while approaching another debt ceiling crisis, the Fed is doing their part to engineer recession via Quantitative Tightening:

"The Fed has embarked on six such reduction efforts in the past — Of those episodes, five ended in recession"

Weak dollar and weak inflation. Two things that implode great together...

But wait, there's more...

Let's not forget OPEC's hyperbolic bullshit which has been going on for two years now.

In the same week that OPEC pledged to redouble their output cut efforts, we learn that output is at 2017 highs:

Which means a) that OPEC are price takers and b) that oil is trading entirely technically, based upon overbought and oversold support/resistance levels

And which also means that the latest stage Emerging Markets rally is in the latest stages:

Energy gamblers are losing patience...

Tech gamblers have tested support ~9 times

Bank gamblers are losing patience for the king on his golden throne...

Small cap/junk stock gamblers are out the door already...

Can the old age home watch the exact same movie in six years and not remember the ending?

Six weeks more like it...

"Aw Fuck, Not This Again!"

Reflation is a global hoax. Which proves you CAN fool all of the people every time with exceptional bullshit...

Fake reflation originated entirely as a U.S. concept when Forrest Trump got elected. Vast sums of capital flowed out of the rest of the world to the U.S. But when it turned out he couldn't find his ass with both hands, Wall Street magically exported the fake reflation meme to the rest of the world. First to Europe, and now it's chasing Emerging Markets:

All of which is deja vu of 2011 wherein the rest of the world bought into global reflation just before it massively imploded...

Of course, this time it's an end of cycle hoax which will have somewhat more shock and awe...

You know, like 2008:

Europe has already tapped out due to the rising Euro...

Canadian gamblers have abandoned ship over the rising C$

Japan has one foot out the door...

Until a few days ago, U.S. gamblers were happily trading revenueless Biotech back and forth with Skynet, but now they've bolted for the exits...

Right on time, cyclicals are imploding at the end of the cycle

Bueller?

Recession stocks are too weak to hold up the casino...

Which means that the only thing left holding up the casino is reflationary bullshit and the usual bagholders left holding it

Bonus chart: Bitcoin (Bitstamp, $USD)

"Geronimo!!!"

When the party is at its peak no one wants to rain on the parade. If everyone would buy more pot stocks risk could be zero...

The gap between fantasy and reality has never been wider. Stoned zombies are playing follow the dumbfucks. Straight over the cliff...

In a nutshell, the more capital is over-committed to revenueless Biotech and Chinese internet stocks, the less stress there is in the "system"...

St. Louis Fed Financial Stress Index:
"The STLFSI measures the degree of financial stress in the markets and is constructed from 18 weekly data series: seven interest rate series, six yield spreads and five other indicators. Each of these variables captures some aspect of financial stress. Accordingly, as the level of financial stress in the economy changes, the data series are likely to move together." 

What about Bitcoins and pot stocks? Where do they fit into this model?

Here we see that when stress is lowest, risk is highest. The taper tantrum occurred when Bernankenstein threatened to reduce dopium flow to his addicted junkies. When financial markets had a hissy fit, he delayed tapering by seven months until Janet Yellen could take over. One year later, markets shit an even bigger brick.

Something about this model isn't working, I can't put my finger on it...

Financial stress (red) with Rydex cash balances (black)

I see how this works now, the more leverage, the less risk...

Retail, car sales, commodities, industrial loans are getting obliterated, yet I am to believe that financial stress is at an all time low:

"as the level of financial stress in the economy changes, the data series are likely to move together"

Retail bankruptcies up 110% year over year, but financial stress is low. Sure.

Change in inventories (black). Financial Stress (red):

"Don't worry, Amazon is just blowing up the economy and Amazon"

And for those who say that the VIX isn't working anymore. I beg to differ. It's perfectly confirming that 18 financial asset classes have been bid up to historically asinine levels amid mass complacency.

VIX black:

What about Apple?

Tomorrow Apple will likely gap up due to the fact that it beat lowered expectations consisting of the lowest sequential revenue in four quarters. 

All in anticipation of the iPhoney 8c++ which will cost twice as much as the iPhoney 7, despite only being "one" better. Yes, you read that right: $1100 for a dumb phone.

Aside from the 80th iteration of iPhone, this rally is running on glue fumes and revenueless Biotech which is now leaving the party:

Speaking of fantasies, oil and commodities are rolling over again. In other words the same problems from two weeks ago were magically put on hold during the latest OPEC circle jerk rally.

Why? Because this sell-off is not about the price takers on the supply side, it's all about global demand:

"Keep buying Netflix, financial stress is at record lows"

Dow 22,000 And Bust: War Is America's Last Business

Uncle Sam's strategy of isolating, sanctioning, and marginalizing recalcitrant nations until they lash out in fury, thereby justifying Keynesian bombing of foreigners, has bolstered the economy for decades. It's a tried and true formula...

"We think know Iraq North Korea has nuclear weapons"

But first, it's the daily casino update from the croupier-in-chief...

The rest of the world completely funds U.S. hegemony:

Military equipment is the only 100% U.S. manufactured product now. So it has the highest Keynesian stimulus multiplier:

Here we see the Tennessee Valley Project and WWII to end the Depression:

Meanwhile, in the casino...
The last sector to peak is military/defense:

The Dow is the only major index still making new highs. Boeing accounted for over half of the Dow's gains in July:

Trump's last "Keynesian" option is war, which is why he is constantly provoking North Korea...

It reminds me of 2002 when the dollar was rolling over and Bush was starting to beat the drum against Iraq prior to the 2003 invasion:

Everything else is ready to crash...

World's largest stock by market cap reports tonight: