‘Nothing can stop the market now.’ Famous last words of every failed investor dating back to the volcano futures traders of Pompeii.
Predictably, markets traded flat after a horrific attack in France, which is, conveniently, being painted by the media as a ‘lone wolf’ secular attack. It was merely the act of a deranged man and had nothing to do with the religion of peace. The fact that he blurted out ‘Allah Akbar’ just before catching a bullet to the dome was merely a coincidence. I’ve heard media suggest the ‘opulence’ of Nice, his adopted city of residence, was the driving force behind his jealous-raged filled outburst.
Moving on.
For the week, airlines led the way higher, up by 8%, followed by semis, banks and copper. I can see why the airlines are in vogue, with all of the wonderful sites and sounds in the God forsaken continent of Europe.
On the downside was treasuries and gold. We saw a hard reversal in the risk off asset allocation cabal, with bonds getting shunned and suffering a stark repudiation in Germany– and down a bit here as well too. The pound and yen cooperated in kind and WTI is sitting pretty at $46.
The assumption is, naturally, Pokemon Go will spur traffic for the retailers, leading to a mammoth sized rally, one for the ages, in a sector that has been reduced to ash. The overall bullish sentiment has markets sitting in a citadel at new highs, of course and naturally, buttressed by reports that Dr. Benjamin Bernanke is counseling the Empire of Japan to throw money at their anime obsessed virgin population, in order to stoke life into their economy.
Next week the ECB meets and they might just pull a surprise on the market and ease some more. I hope it’s indelibly clear by now that every single upside catalyst for the market is driven in large part by central bank intervention. I’ve been fooled many times into believing this was a sustainable rationale from which investments could be formulated around. Nothing could be further from the truth.
What these policies have wrought is volatility and uncertainty, introducing periods of great panic and elation. The boom-bust cycles have been pervasive and continuous for the better part of the past 20 months. In my opinion, there is just one place that has rebuffed the deleterious actions of these nefarious central banks. And that my friends is The Ark.
Have a great weekend.
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The ark is a central banks fueled bubble that is very disconnected from the US macro numbers. Ecb boj will not let deflation win. Soon we will see fiscal stimulus which will turn the bonds around. Watch the jgb especially that are highly correlated to Treasuries. In Japan deflation could turn into hyperinflation in a matter of weeks. If you can’t see it I feel sorry for you. Great trade so far thought tlt. But since you haven’t sold it is a little early to declare victory
Pokemon foot traffic is serious.