Black Swan Diving Into Pavement

Seven years of self-imploding charades ending with a big fucking bang...

Direct military confrontations with both China and Russia at the exact same time. Mega-bullish.

"Get out there and buy some stock bitchez..."

The last Google moonshot was the pre-Flash Crash high:

We've been through this level 28 times in 10 months:

Daneric's Wilshire count: 75% retracement back to 11 month resistance
i.e. he found Prechter's missing 5th wave...

Nasdaq Gap 'n Trap:

Linear Extrapolation Of Insolvency: Ignorance x Arrogance

For seven years straight, corporate Mad Men have been liquidating the status quo for special dividends. The exact same tools who assume it will always exist...

In order to sell more books, magazines, subscriptions, and advertisements, the de facto Idiocracy must take certain factors for granted aka. the indefinite status quo.

Which provides the foundation for linear extrapolation of whatever dumbfuck idea is being proposed - from foreign invasions to tax cuts for the "ultra-wealthy". What none of these dunces seem to take into account is that the status quo is already insolvent, based upon third grade math.

The U.S. Federal debt has grown 9% compounded annually for 35 years now. People have wed their entire future to the assumption that it will continue to grow forever. Obama just deployed troops to Syria because raising the debt ceiling over and over again is his ATM machine. No responsibility to future generations required. 

Linear extrapolation visualized:

What we face now is what is known as a "non-linear" event. Meaning that current asinine ideas and behaviours and the people wed to them, will go in one end and not come out the other. 

Back in the 1960s and '70s, we extrapolated the U.S. space program into the future. Which led to many shows such as Star Trek, Star Wars etc. One show attempted to be a bit more modest and "realistic" in its future projections than the others. A colony living on the moon by 1999, which at the time seemed wholly plausible.

Suffice to say, no one at the time foresaw the U.S. manned space program ending in 2011. Though when we saw these special effects we should have known something was wrong...

The Big Splat: Zuckerberg Shrugged

2008 was "The Big Short", this is "The Big Splat"

Skynet's tech-stock Apollo moonshot is gaining attention: Microsoft's serial layoffs have catapulted the stock into the stratosphere. Who knew that going out of business could be so lucrative...

CNBC: Oct. 30, 2015
This Has Only Happened Six Times In Ten Years
"This is a very unusual setup," added Krinsky. According to the technician, the dispersion is so rare, it has only happened six times since March 2005. In those instances, the returns were largely negative, with the index falling an average of 5 percent in the 10 days to follow"


Nasdaq 100 Equal Weight / Cap Weighted ratio at 52 week low, while index is at 52 week all time high

One could make the case that this asinine scenario has only happened one time ever...

Nasdaq 100 with "the economy", still missing in China

% of stocks above 200 day moving average

Apollo 2015:
Back in 1967, men built a 6 million pound thrust rocket to carry a 130 ton payload at 24,500 miles per hour (8x faster than a bullet) to the moon and back (240,000 miles).

Now, we have Facebook...

The Big Splat visualized:

Corporate profits are going back to 1975...

Globalization Is Too Big To Bail

The Idiocracy consumed their own future, at 0%, between episodes of the Kardashians

The death blow is hanging over the almighty status quo, which has been softened up for seven years straight. Liquidated for special dividends by the same tools who benefited most from it. Because more was never enough.

The deck will get shuffled and it's anyone's guess who gets the strong hand, however gutting the insolvent status quo is the first order of business. Which shouldn't be hard since it's disintegrating into daily mass shootings already. The average American is $1,000 away from rioting...

There are going to be some dumbfuck ideas, we know that much. Almost as dumb as the ideas we live under now. The apologists for the status quo aka. "the corporatists" believe in all things fake: fake people, fake casinoConomy, fake non-educational system, fake government, fake pharma drugs, fake food, fake wars, fake news etc. etc. 

The delusion that an economy could be divvied up across the globe with demand in one region, supply in another region and colossal arbitrage profits in the Caymans, was a man boy fantasy of the first order. That money in the Caymans is called "debt" and it's secured by what is known as "nothing".

It will vanish overnight via the S&P futures. 

And yet they're still trying to propagate their lies, even as their temple is collapsing in on them.

Denialism is a DNA level problem.

And it requires a DNA level solution. The Idiocracy is marked for self-extinction.

Instant Collapse. Just Add Panic

All support has been eliminated from the cheap tent...

Shit companies have been hiding behind stock buybacks while earnings growth was falling, now that charade is ending, amid tanking revenue and profits:

"stocks with the highest buyback ratios have been falling behind the broader market. Underperformance of this index coincided with a market top before two market crashes"

Skynet is hiding in the last few mega-caps as it did in July...
S&P equal cap weighted / market cap weighted

And remember this asinine situation...

Walmart versus Amazon?
One has profits without revenue growth. The other has revenue growth without profits i.e. the one going vertical...

Then I showed Kohl's, Macy's, Sears, JCPenny also tanking...

Via: "Use discretion when picking consumer stocks"

This is what is happening across the entire retail sector ex-Amazon, Home Depot and other mega-caps:

Equal weight retail / market cap weighted retail:

Versus Amazon

Because: More Was Never Enough

At the end, there was only exceptional lying


"Just cut taxes for the ultra-wealthy. That will fix the economy"

Tool boy is in for a big surprise

"George Orwell once offered an excellent explanation for this phenomenon: as the imperial end-game approaches, it becomes a matter of imperial self-preservation to breed a special-purpose ruling class—one that is incapable of understanding that the end-game is approaching. Because, you see, if they had an inkling of what's going on, they wouldn't take their jobs seriously enough to keep the game going for as long as possible." 
- Club Orlov, License To Kill

"There Will Be Maximum Pain"

Fed policy by Police Squad will now inflict maximum pain on those still believing in this clusterfuck. aka. "Wall Street"...

Houston, we already have a problem...
Aussie (Yen) rolled over hard today:

Longer-term view:

New highs today for anyone doing bong hits with the FOMC:
Nasdaq 100 with % of stocks above 200 dma

S&P Average stock

Emerging Markets already rolling over

The Fed Is Set To Monkey Hammer Markets All Over Again...

FOMC meeting today:

Stocks tanked immediately post FOMC release because the Fed just re-located the fake-believe economy. But then Skynet squeezed volatility to monetize the weak handed shorts ahead of the collapse...

"That was fun. Let's try this all over again..."
10 months to nowhere:

-20 S&P points in 1 millisecond all from this:
"In determining how longwhether it will be appropriate to maintain thisraise the target range at its next meeting, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation." 

This line from September that led to the six week Commodity/EM rally, has now been removed:
"Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term"

Parsing meaningless gibberish, and the countdown is re-started. In other words, shorts covered and Emerging Markets/Commodities rallied for six weeks straight for absolutely no reason...

What could go wrong?

Fed policy explained (Via ZeroHedge):

Walking Into A Buzz Saw: Extreme Risk. Extreme Complacency

Pavlovian gamblers have already been monkey hammered at 0%, but they want more pain please...

The investing cycle is ending amid negative returns, however, low volatility and low interest rates have forced gamblers to take extreme risks for ever-less reward. They have 0% incentive to go to cash...

Returns are already turning negative across all asset classes, but interest rates still at 0% means that it hasn't occurred to any of them that the cycle might actually be over:

Volatility (red) is just starting to rise:
Corporate profits (black)

But hedging is non-existent, even as returns go negative...
Index Put/Call ratio

"Double down. You got this, bitchez"

Margin Call: Ponzi Schemes Don't Go In Reverse

A Ponzi scheme fakes solvency with liquidity. Now capital is flowing out of the scheme at an alarming rate

The Chinese government is a one legged man in an ass kicking contest...

0% interest rates has had two major effects:

1) It discouraged long-term investment in the real economy because there was no real rate of return

2) It incentivized extreme speculation and gambling i.e. zero sum capital gains versus income, as one asset class after another got pumped and dumped...

Nowhere to hide:
All risk asset classes have peaked:

Consider this in the context of China now trying to "help" the economy by lowering interest rates:

“Although China has cut interest rates many times recently, steel mills said their funding costs have actually gone up.”

Why? Because lowering interest rates has caused capital to flow out of the country at an unprecedented rate. Meanwhile capital flight from China means capital flight from the U.S. as the Chinese government repatriates capital to defend the Yuan currency peg to the dollar. 

Well, at least the stock markets are "decoupled". From reality: