Like any all old age home, the expectations bar just keeps getting lower and lower. Until the totally "unexpected" occurs. It's obvious why this cycle can never end, because for a certain demographic there isn't going to be another cycle. Therefore they have to enjoy this one to the Trumptopian fullest...
Speaking of lowering expectations, Wall Street's favourite game is to lower profit estimates ahead of each quarter so that it appears that stocks magically "beat" Wall Street expectations. It's a game of alchemy and deception that apparently never ceases to fool serial dunces. Unfortunately, this time around it has inadvertently concealed the end-of-the-cycle. Overnight, more earning warnings from Whirlpool, 3M, and Lockheed Martin. All ignored by gamblers.
Speaking of delusion:
"Remember when Deutsche Bank found late last year that 2018 was the worst year for markets since the great depression, with 90% of all assets posting a drop for the year?"
Now, one month after the December devastation, everything has made a drmatic U-turn, and global equities have bounced back violently"
This is a week of critical events: key earnings reports, the Fed tomorrow, and fake trade talks later this week. Recall that last year January was strong, but the beginning of February marked VolPlosion. Specifically, Friday Feb. 2nd was weak and Monday, February 5th was the meltdown. Which means that this year is following an eerily similar trajectory:
Exhibit A of lowered expectations, Apple is "soaring" after hours, having beat their sharply lower expectations set earlier this month.
Any questions?
Going into tomorrow's FOMC rate decision, there is rampant speculation over what the Fed will say about the balance sheet. Pun intended.
No surprise, it appears the codgers inconveniently forgot why they did it in the first place:
"Some investors blame the stock market’s volatility on the Federal Reserve shrinking its bond portfolio. But the critique puzzles Fed officials and some economists because there is little evidence of turmoil in the two markets where the central bank actively intervened: Treasurys and mortgage debt."
Needless to say, these are not intelligent people in any way shape or form. We are now to believe - via amnesiacs - that Bernankenstein printed $4 trillion in new money just for shits and giggles. And of course there is no sign of turmoil in the Treasury market - the entire point of QE was to bolster RISK markets by forcing investors out of Treasuries into riskier assets. Now of course, that process is going in reverse.
What gamblers will want to know from tomorrow's meeting is can the Fed get this Ponzi scheme back on track? Because at present the Fed is reducing liquidity at approximately 4x the rate they were reducing it this time last year:
Here we see momentum growth stocks year over year:
Oil
German Stocks
"This is the best month ever for stocks"
"I know, bro"
No question, without the Casino-Bankrupter-in-Chief, this shit show would have ended a long time ago.
