The Global Everything Bubble Is Imploding

"In U.S. financial slang, a bagholder is a shareholder left holding shares of worthless stocks"

Those who don't see the everything bubble, ARE the everything bubble. At this latent juncture, stock gamblers are comforting themselves with the fact that the forward P/E multiple at 17, while high, is still within the normal range. Because this is the point in the cycle when forward profit estimates have the veracity of a Magic 8 Ball, whereby 17 turns back into a negative infinity pumpkin overnight. Leaving all of the true believers in their all too familiar position of holding the bag once again. 

Of all of the bubbles, the biggest and most manipulated by far is the U.S. stock market, prime beneficiary of global money printing, strong dollar asset flows, record stock buybacks, and debt-inflated "GDP". No market in human history has been more fabricated to the benefit of a minority of wealthy insiders.

Here is the set-up going into the G20 meeting at the end of this week. The Dow tanked in May when Trump raised the tariff level on China. Subsequently, the market has rallied back above the pre-escalation level. Despite the fact that the best case scenario envisioned by analysts is another truce. 

The likes of which tanked stocks in December:

Meanwhile, as I've discussed many times, the last stocks making new highs comprise momentum Tech and ("low volatility") bond proxies. 

Recession stocks. 

Which have become crowded trades indeed. Today Goldman was out telling gamblers that these stocks will outperform AFTER a rate cut, even though they've already outperformed before a rate cut. 

As we see below, these stocks on a volatility adjusted basis have been outperforming the market since 2018, posting higher highs even back in December when the rest of the market had already rolled over:

But beyond the recession stock bubble, there also cracks in the facade of the profitless IPO bubble:

Recall, the 5g trade war bubble was already beginning to implode, but then caught a bid in June for a retracement rally.

Now it's re-imploding into the G20 meeting:

But the real bubble this year is in what else but Bitcoin. Again.

I realize that crypto religious fanatics won't want to hear me say that the lies being told this time around are the same as the lies being told last time around.

The latest fantasy is that this parabolic asset - outperforming everything on the planet is a "safe haven" from trade wars.

Of all of the thousands of ETFs, the Bitcoin ETF is outperforming all of them, by a massive margin, including ALL triple-leveraged ETFs:

This week we learned that open Bitcoin futures contracts reached a new record high. We also learned that the futures market is having an outsized (leveraged) impact on Bitcoin:

Draw your own conclusions.

The most important thing we learned this week is that all of risk is now correlated.

Gamble at your own risk