Tuesday, June 30, 2015

The Deep Fried Zombies Are Done Like Dinner

Begging to be obliterated by their own denialistic bullshit. Burned out from faking it all the time.

Brewers are the last sector to peak in the economic cycle. For obvious reason. In 2008, they peaked AFTER Lehman. Everyone needed as much alcohol as possible...

Railroads: Late cyclical

Casino stocks: (Not to be confused with Etrade...)
Peaked coincident with the S&P in 2007:

Resources: Late cyclicals. Usually.


There is no way this could end more violently, amid zombies lounging in their own Imagined Realities. 

RISK OFF: China's "Imagined Reality" Is Over

ZH: June 30, 2015
Chinese leveraged stock funds down 77% in two weeks

The unlevered Chinese small cap index is down 35% in two weeks (with S&P in background):

ZH: Dec. 31, 2014
Hugh Hendry Embraces Central Planning (For Billunaires)

"There are times when an investor has no choice but to behave as though he believes in things that don't necessarily exist"

"In the long run we will come to rue the central bank actions of today"

"China is set to record its weakest growth in GDP in 25 years. Yet it seems to have entered a bull market and may be where we deploy much more of our risk capital next year. That's because the recent exuberant run up in onshore Chinese equities seems to me to amply demonstrate the power of imagined realities."

The next Imagined Reality on deck to Implode...
Shanghai Composite with S&P

"It Was a Bad Time To Be ALL IN Imagined Realities"

"By the end it was just a bunch of dumbfucks trading worthless pieces of paper back and forth believing in 'Imagined Realities' sponsored by Central Bank psychopaths"

Bears have been hunted to extinction
Rydex Bearish Fund Assets Under Management:

Bull: Bear asset ratio

Monday, June 29, 2015

Denialation: The Problem That Fixes Itself

"No one saw that coming..."

Except Goldman Skynet:
Etraders have already been sold. They just don't know it yet. As it was prior to Lehman and the Flash Crash... 
NYSE up volume / total volume

Dow % of stocks above 200 DMA: Lehman Level...

S&P 500 with 52 week range of average stock

MW: June 29, 2015
This just in: "We're not Greece, we pay our bills. With freshly printed money."

Ponzi World Is Collapsing. In Real-Time

"Greed, greed, and more fucking greed and cheap money"

Over the past thirty years the middle class has been systematically stripped of its livelihood by corporate psychopaths, all while having ever-cheaper debt thrown at them by Central Bank psychopaths.

The psychopaths are in for a real fucking treat, because their asinine myth of the ever-expanding debt is imploding in real-time. 

Greece was the first to repudiate its Ponzi debts, but Puerto Rico has already followed suit. Stay tuned for future events. We ain't seen nothing yet. Soon student Ponzi loans will be repudiated, then underwater mortgages from Greenspan's 2007 con job. 

The 2008 bailout was predicated upon the all time ludicrous plan of bailing out lenders by giving borrowers ever-more debt. Central Bank psychopaths have been encouraging and sponsoring debt accumulation with ever-lower interest rates. They are the ones paying out the rope on the noose...

Sunday, June 28, 2015

In the End The Idiocracy Consumed Itself. For a Profit Of Course.

The last stage prior to collapse

Aside from the denialism which near-term serves to hasten the collapse, the all-encompassing reason this society is not built to last, is its overriding infantile lack of responsibility towards future generations.

Instead of leaving things better for the next generations, this generation did the exact opposite, monetizing its own children via Ponzi debt and every other PhD contrived device conceivable, merely for consumption. Paul Kennedy warned that every late stage society consumes itself. And 28 years ago he knew it was already happening: Prechter's fifth wave had started with Reagan - A manic blow off top, attended by hubristic sociopaths. Subsequent to 2000, we've been locked in stair step decline approaching acceleration. To date, due to PhD quality financial engineering at 0%, about five generations have been consumed. All of which Ponzi debt needs to be wiped away.

In the Idiocracy, everything is for sale, including the children...
Corporate profits baselined to GDP

If a policy isn't good for three generations forward, then the policy isn't good. And we need not expect today's boy-men to understand that concept. Just take the garbage to the curb. They had a good run, they're not owed anything. A society without values has absolutely no value.

Rebuilding is only possible without them.

The Ayn Randists are a sad, self-obliterating footnote. History will not be kind to the Lost Boys.

Deep Fried Zombies. The Idiocracy Is Ready To Be Served.

This is going to be cataclysmic. As apparently intended.

Everywhere I look I see zombies. Semi-lucid denialist morons stumbling around taking the status quo for granted like it was their God given right. Disposable corporate batteries placidly being drained of all humanity. In total denial about every single risk bearing down on them like a freight train.  

These zombies are going to get monkey hammered from every fucking direction at the same time. They are totally asleep at the wheel. Stoned on their own self-serving bullshit and Fauxtard news. In 2008 they were rolled in flour and for six years since, they've been deep frying in their own toxic vat of junk food and junk culture. The History channel has no history, and the Learning Channel has no learning. 

"And then the economy collapsed while people were watching 'Buying Naked'. No one saw it coming"

Meanwhile, the wolves of Wall Street lured them back in to the casino, so they could get bludgeoned by their own greed and gullibility for the last time. A fittingly Darwinian ending to an Idiocracy blind to risk...

Ponzi Schemes Collapse From the Bottom To the Top

Emerging Markets are the weakest dominoes. Totally ignored. 

The weakest dominoes are the submerging markets which have been completely left behind since 2008, when the "miracle" of Globalized trickle down growth stopped working. An advent totally ignored by Globalization's cheerleaders. The BRICs turned to Bricks overnight.  

Meanwhile, faith in the almighty power of Central Banks to contain and absorb ALL global risks is pervasive. It's the central tenet of Ponzi investing. 
Now, pundits wide and far tell us that today's risks are "random", "uncorrelated", and "contained". When commodities collapsed this past year, it was deemed a "tax cut" for jobless "consumers". Leave aside that it monkey hammered Emerging Markets which are substantially dependent upon resources for GDP and tax revenues. 

And then when the dollar rose based upon interest rate expectations, Emerging Markets were shellacked due to the hot money carry trades that experienced massive outflows. These risks are fully ignored right now, with all "containment" focused on supporting European Ponzi bonds and the S&P futures. 

Ironically, it will be the developed world's total neglect and blindside for how the 'others' live that causes the ultimate unwinding.

Another leg down here and shit gets real:

EM stocks with oil stocks:
In no way supported by any "plunge protection team"

Ponzi schemes collapse from the bottom to the top. Those at the top are always the last to know.

The developed world must do penance for monetizing poverty instead of trying to fix it before it spread globally.

Monetary Policy: Handmaiden to Collapse

"It was a bad time to be ALL IN playing charades, without a safety net, six years into a totally fake recovery" 

The Fed has zero ammunition in case of an adverse 'event'

Zero Monetary safety net visualized. The safety net has been squandered to fund asset speculation:
Fed funds (blue) with Fed balance sheet

While we wait for this final All at Once 'revelation'. I figured I would write the eulogy for modern activist Monetary Policy. It's a sordid tale...

Saturday, June 27, 2015

This Isn't A Fucking Mystery Novel

Blind men are always trying to 'predict' what will happen next, like it's some sort of secret. It's not necessary to guess what WILL happen, it's only necessary to open one's eyes to what already has happened...

Global economic growth (black line) with commodities:

The U.S. stock market is now held up solely by momentum biotech. Economic cyclicals have left the party...

From Manic to Panic

"It was a bad time for Greece and China to both be melting down at the exact same time. But no one saw it coming, despite 5 years of non-stop coverage..."

Got cash and food?
Below is what happens when stoned zombies ignore risk and wait until the last minute. The ones who are least prepared make the best rioters. 

Greek bank run. Right now:
Eurozone Refuses Greek Bailout Extension. Default Looms

Under globalization, market correlation now approaches 100%. Therefore a bank run in one corner of the world could easily spread globally via counter-party risk and the 'subprime' effect. "But let's remember that the Global Financial Crisis was a 'one-time' event and we've borrowed our way out of it." 

More importantly, global markets have never been weaker. If this labelling is correct, the Global Dow is poised for a Third Wave down at multiple degrees of trend...

Global Dow with Global GDP growth (red line), now at a twelve year low (ex. 2009)...

The ingredients of a global panic are all in place...

There, But For The Grace of God Go I

Forget that. Lose everything. Overnight.

Too busy shopping at Walmart to wonder where cheap junk and 0% come from?

Child sweatshops and your job dumbfucks.

The Dumbest Fucking Society In History

Laid itself off to "increase" profits.

Consumer price Index (red). Interest rates (blue)

In today's Idiocracy the most widely embraced and LETHAL assumptions are the most easily refuted. In the asinine debate between deflation and inflation, deflation won thirty five years ago. Which is only a secret to blind men and those selling gold bars.

We live under the all time asinine assumption that 0% interest rates will now succeed where 1% interest rates failed catastrophically...

Friday, June 26, 2015

Ponzi World: An Orderly Self-Obliteration. For Now.

Bernie Madoff would be proud of how all this is ending

Distribution visualized: 
The process by which Wall Street dumps worthless stock onto Etrader bagholders...
NYSE distribution (up volume / total volume) 30 week moving average

Another Hindenburg Omen today
H.O. Count: 5

Denialism is the Root Cause of Collapse

It's hard to solve problems in a society devoted to pretending they don't exist. The biggest problem we have today is that "we" pretend that there are no problems.

Denialism can't be 'fixed'. It fixes itself.

Getting past denialism, here is a concise list of root causes of collapse, as brief as possible, and borrowing heavily from Paul Kennedy's:

"The Rise and Fall of the Great Powers"

In other words, these are all of the MASSIVE issues that are being denied right now...

Hubris: 'exceptionalism', denial, laziness, complacency

Moral decay: greed, materialism, gluttony, nihilism, hedonism, cynicism, narcissism

Lack of competitiveness: Recurring trade deficits, outsourcing, industrial arbitrage

Rent-seeking: excessive speculation, excessive laws, lawyers, regulations, lobbying

Complexity/sclerosis/stagnation: intractable bureaucracy, incompetence

Depletion of the treasury: borrowing for consumption versus investment

Currency debasement: Monetizing debt, printing money

Financial engineering: Derivatives and Ponzi Finance as substitute for real economy

Strategic overreach: Troops in 145 countries, war mongering, serial blunders

Resource/energy depletion: Buying oil from terror sponsors, fracking, environmental degradation

Consumption over investment: Consuming the future via stock buybacks and special dividends

Propaganda/spectacle: Faux News, reality TV

For those who still believe in Macroeconomic policy here is how today's asinine policies deviate from the prescribed implementations. 

This shows the magnitude of incompetence inherent to today's thought dealers:

We need not expect "responsible" application of policy, because the concept of responsibility no longer exists. 

Only collapse and reset can break rampant denialism.

Wednesday, June 24, 2015

Third World Aspirations "Revealed"

The economy was sold for stock buybacks and special dividends, while Etraders swapped worthless pieces of paper back and forth. Given enough time, history's most morally void generation of mindless corporate zombies, laid themselves off, pending Ponzi revelation.

Got Walmart? The elevator ride to reality is waiting...
Long-term Treasury bond yields aka. forward deflation expectations

Got profits?
Corporate profits baselined to GDP

Got eConomy?
U.S. Stocks by sector

Got Risk?
Russell / Dow Ratio: Binary repricing of risk visualized
As it was right up until Lehman, Etraders were leaning ALL IN Risk ON...

Got Jim Jones?

Jim Jones is pleased to announce the new "Imagined Realities Fund", and the Madoff Special Monkey Fund, guaranteed to outperform the PhD competition...

The One Party System: By And For Billunaires

Everyone gets a vote, it just doesn't mean anything... Who is more more cynical - those who still believe in a system where nothing ever changes. Or those who realize it's a useless charade?

"At the end, the stoned corporate Idiocracy munched placidly as their economy was dismantled in broad daylight..."

Fast Track has been fast tracked, by the one party system:

The Republican Manchurian Candidate Foodstamp-dispenser-in-chief, has now fulfilled Bush's fourth term, and can now retire to the lecture circuit for $200k per speech, on his way to amassing a Clinton-like fortune of $55 million. All while extolling let-them-eat-cake limousine liberal bullshit lapped up by Bill Maher & Company. After the carnage of 2008, The Koch Brothers realized that only a Democrat could get away with finishing the job aka. the "left wing of the Republican Party" - so they substituted their closing pitcher.    

"And the Fauxtards were shocked and outraged that their 'Commie' President monetized them in broad fucking daylight while they were busy watching Nascar..."

Obamanomics: Foodstamps for jobs

"Look away, look away, look away Dixieland"
Corporate profits baselined to GDP

"Something that doesn't know what's in its own self-interest, has the shelf-life of a rotten banana" 
- Charles Darwin

The Disposable Idiocracy is End of Life

The Hunger Games Economy

How to plan history's largest 'surprise' riot...

"...Then the stunned middle class was efficiently monetized by the exact same psychopaths they had just bailed out, while they were still in the fetal position post-Lehman. It was 9-11 Shock Doctrine, on steroids. Meanwhile, those highly fortunate wealthy gamblers who remained intact post-bailout were so grateful, that they turned around and threw it all down the exact same shit hole as last time. The same psychopath casino that robbed them twice previously. But only because their Jim Jones financial advisors told them to do so...Nevertheless, in the end, the bailout would be for absolutely nothing, other than to bury everyone. Including the multinational corporations which, having no else to monetize, monetized themselves, using stock buybacks and *special* dividends at 0%. So it all worked out in the end. After the riots subsided."

Walmart versus Netflix (new all time high):

As long as no one needs another bail-out, this will all turn out fine.

There is no one left to warn them, so the wealthy are oblivious to risk. 2008 will be repeated sans bailout and sans economy. Bailing out greedy fucks, just so that they can continue on their sordid ways, can never end well. One of many Third Grade concepts that the Idiocracy can't understand - up there with printing money to artificially inflate stocks, borrowing your way out of debt, shipping the economy to China and wondering why there are no jobs, etc. etc...

Fortunately, nature has checks and balances on unbridled stupidity - In Ponzi World, those who sell others, eventually get sold.

And then the game of charades ends. Abruptly. 


Tuesday, June 23, 2015

The Canaries Are All Dead

MW June 23, 2015
Here's One Bear Market Sign You've Never Seen Before
"The degree to which stocks move together in unison is a function of the market cycle. In bear markets the vast majority of stocks do so, whereas in bull markets stocks tend to march to the beat of their own drummer. It’s at market tops, therefore, when stocks’ moves in step with the overall market tend to be at the lowest point. Such as it is now. Last week, even as the broad market averages rose to within shouting distance of their all-time highs and some secondary averages actually did so, just 7.2% of stocks on the New York Stock Exchange hit new 52-week highs. A slightly greater percentage of stocks — 7.3% — hit new 52-week lows."

Goldman Skynet has created divergences in this cycle that only a Russian PhD in math could conjure up. Because we know that infinite market manipulation just comes down to the right equation. As we see further below, it always comes together in the end...

New 52 week highs NYSE:

Coming together in the end, visualized...
"In bear markets stocks and sectors move as one"

The Lehman singularity circa October 2008:

"Don't believe your advisor when they tell you this is a 'stock picker's' market"

You mean the same gambling advisor from 2008?

The Four Horsemen of the Apocalypse: War, Pestilence, Famine, Denialism

The Sixth Mass Extinction is underway, with extinction occurring at 100x the natural rate. Unfortunately it includes humans, and is caused by humans. So, as expected, there is mass denial about mass extinction. 

Denialism: is a weakness of the mind, rendering the sufferer incapable of facing the truth; it usually afflicts old people, but can afflict young people, due to consumption addiction which weakens the brain. It's contagious and fatal. The only known cure is Zen to strengthen the mind, which unfortunately is a totally foreign concept to dopamine-addicted zombies. 

Denialism is nature's way of putting people out of their own misery while solving the problem at the same time. It's Euthanasia for the mentally infirm - merciful and brutally efficient. Today, denialism is epidemic, it's the zombie virus. Like Ebola, it has to burn itself out by killing the host, so it can't propagate.

From an evolutionary standpoint, denialists serve an extremely important purpose: they blind the herd to risk. Making thinning (strengthening) possible. If the herd saw it coming, it wouldn't work. There has been no thinning for far too long, which has allowed the dumbest fucking people and their ideas, to flourish. Things can only improve when the denialists and their ditto heads are gone. Denialism has put this species at extreme risk, so it needs to be allowed to "run its natural course"...

Post-2008 Denialism stampede visualized:
"This way to hope and change"
The natural zombie herding process increases the average IQ and frees up resources, making sustainable change possible:

The stampede is already in full motion, so it's important not to inadvertently volunteer for early "retirement" in a FEMA camp, by believing all of the bullshit. 

Most in the developed world will be self-obliterated by their own Denialism. Denialists are the first to go, which is merciful because they have no will or ability to live in a real world anyway. Life without shopping sprees is unthinkable. The corporate disposable batteries have served their purpose and are tagged for disposal.

Having consumed their own future, the Idiocracy's only recourse is an invented reality. The status quo is a dead-end. They have very limited time, and are desperate to refute any shred of reality that could impair shopping sprees today. It's a garbage society ready to be flushed down the toilet of history, by their own hand. 

Therefore, we live in the Age of Denialism overrun with professional liars spinning lies for an old age home painted into a corner. This is an infantile society wholly void of any sense of responsibility, preoccupied with monetizing its own children and grandchildren by any means possible, now featuring ponzi-debts and negative interest rates. A comfort-seeking Idiocracy incapable of facing reality in any direction - economy, environment, resources and especially the all-important Walmart-oriented lifestyle. Stoned zombies having consumed their own future, and in doing so unwittingly self-selected themselves for extinction.  

Fortunately, nothing bulk thins the herd as efficiently as denialism. And it's the fairest form of obliteration. Self-nominated extinction. Darwin has a special solution for members of a species that can't face risk of any kind. 

A global warming denialist circa 2015, extolling the benefits of drinking fracking waste water, due to drought:

The Sixth Mass Extinction Visualized:

We can't reach the quota without the denialists. Fortunately, they are the first to go, and they wouldn't have it any other way. The real world is no place for self-absorbed zombies lacking any survival imperative. 

But don't take my word for it. A hard rain is a-gonna fall. And the more "volunteers" up front, the better.

#Desecration #Tribulation

The Wall Street Bail-out: History's Largest Self-Burial

"...and just six years after bailing out Wall Street, everyone was bankrupt..."

"Only 22% of Americans have at least six months of emergency savings (that’s what advisers recommend) — the lowest level since Bankrate began doing the survey."

Foodstamps versus employment:

Got economy? Or just dead canaries in a coal mine...


The Scylla and Charybdis of slowing growth and rising interest rates

Ponzi schemes require relentless growth and liquidity, both of which are now reversing. Central planning for billunaires is ending. Badly.

Global growth is at a decade low 2.8% (ex. 2009) and global short-term interest rates are at a 500 year low. So the accelerator is on the floor, but the car is stalling.

Meanwhile, globally, long-term borrowing costs are rising across the board - U.S., Europe, China, Japan, Emerging Markets.

Meaning that liquidity is now tightening into a slowing economy...

Global Dow with global growth (red):

De Facto tightening
U.S. Treasury 30 year Bond (prices) with Real Estate (REITS):

Reducing liquidity into a weakening economy. End of Ponzi. 

The risk isn't that "something" breaks, the risk is that all things break, at the same time.

The Madoff Report

Watching Globalization Melt-down in broad daylight, while stoned zombies trade Netflix

In summary: 
-The world's second largest economy (China) is falling apart in real time amid Municipal borrowing at ~12x last year's rate
-The unwinding EM carry trade is the largest in two centuries on a relative basis
-The Japanese Yen is the last leg of the stool poised to go RISK OFF

Overnight, the Shanghai Composite fell another 5%, and then rallied back for a 2% gain.

Meanwhile, also in China, "explosive" Municipal bond issuance last month alone equaled the same amount for ALL of 2014 i.e. 600 billion Yuan:

"Driving the huge new issuance of municipal bonds is an estimated 22.6 trillion yuan of high interest local government debt, which provinces are struggling to refinance more cheaply."

"...local government spending collapsed in the second quarter to just 1.2 percent growth from a year earlier and investment growth is at a 10-year low

Chinese stocks with Chinese GDP (red)
(U.S. close yesterday):

EM Carry trade is just the largest in two centuries:
Real risks of course are centered in the totally ignored Emerging Markets which don't have the ability to monetize their debts. Combined EM dollar debt is 20x Greece...

UK Telegraph, December 2014:
EM dollar debt tripled in a decade to $6 trillion: 
"It is comparable in scale and ratio-terms to any of the biggest cross-border lending sprees of the past two centuries."

EM debt (local currency terms) and EM Currencies w/U.S. stocks (Small caps):

As long as the Japanese Yen doesn't go RISK OFF, like the dollar already has...
Yen (black) with European stocks (red): I knew I'd seen that chart before...