Markets Give Up Yesterday’s Gains; The Ark Floats

This is a hugely negative development for longs. The reversion back to the grind house is indicative of a market sentiment that beckons back to the past two years, a period which was cruel to market participants.

Relatedly, the flight to treasuries is pervasive and consistently rewarding.

The Nasdaq is within 10 points of giving up all of yesterday’s degenerate gains.

A storm is coming. You’ve been warned.

Understand something, the problem here isn’t the fact that Kenyan banks open and close like the doors on a Disney ride. The problem is Kenyans expressing free speech on Twitter, using the devilish hash tag #KOT to communicate with fellow Kenyans–concerned over their deposits.

“We had some individuals that shouted fire in a crowded theater room; to me there is nothing as reckless as that,” he told reporters in the capital, Nairobi. “If one made such horrendous statements, you can cause a run, some crisis. Indeed the bank was under serious pressure.”

Chase Bank on Wednesday sought to assure customers that it was operating normally as a flurry of comments on social-media sites speculated on the financial health of the company. Rumors on the safety of deposits and investments mounted following the resignation of Chairman Zafrullah Khan and Managing Director Duncan Kabui, and concern over a qualified opinion expressed by auditors on earnings that had been restated to show a surge in loans to employees and directors.

Don’t worry folks. The government of Kenya, the all benevolent non corrupt officials who are pilfering the country, will protect you from those Twitter people causing banks to fail. Once Twitter releases the location of these criminals and the government imprisons them, all will be well again.

“Rumors have been rife on social media which is turning out to be a pre-eminent early warning system,” Aly-Khan Satchu, chief executive officer of Rich Management, an adviser to companies and wealthy individuals, said in response to e-mailed questions

This outlier of a move is beginning to become a serious matter. The yen is markedly higher for the 5th straight day and really applying some gusto to the move, higher by more than 1.2% now.

S&P futs are sharply lower.

Gold is the real deal in 2016. Aside from treasuries, nothing has been more consistent.

Crude is mildly lower.

It’s a classic risk off tape, with treasuries firming, gold soaring, Yen spiraling higher and stocks lower. The market has been very resilient and we did add 75 NASDAQS yesterday. Therefore, unless we give back all of yesterday’s gains, today’s pullback will be viewed as healthy, rightly so.

But the Yen move higher isn’t good for Japan, currently at a 17 mo high.

Perfect for whom, exactly?

In a report out tonight, the G men feel $35 crude is the perfect price to bankrupt all of the marginal players to hell, causing rapid and large scale layoffs in America, which in turn will permit the Saudis to continue pumping at their heart’s delight–effectively paving the way for a sustainable 2017 recovery–once America is out of the way.

“We view our second-quarter 2016 oil outlook as an idealistic Goldilocks scenario,” the analysts wrote in the report. “We would use volatility to add to positions of shale productivity winners and the next rung down.”

Goldman said it favors U.S. producers EOG Resources Inc., Diamondback Energy Inc. and PDC Energy Inc. as well as stocks in “the next rung down” — Hess Corp., Cenovus Energy Inc., Anadarko Petroleum Corp., Encana Corp., Continental Resources Inc. and Whiting Petroleum Corp. While the bank predicts WTI crude prices will average $35 a barrel in the second quarter, it forecasts $38 for 2016 and $57.50 for next year.

Funny thing is, I doubt the blockheaded analyst who uttered these words put 2 and 2 together, as they’re always thinking macro, global, views. I understand it’s their job and they’re simply making projections. That’s all fine and dandy. But is anyone discussing the ramifications of these fucking bubbles coming and going out of the American economy, which is causing massive disruptions in the American work force?

We see a lot of idiot jobs being created in this country, replacing the one shining star in American industry–oil and gas. By 2017, effectively, those jobs will be exported overseas too, as American production halts and we start importing foreign oil again.

Wonderful.

Fed’s Kaplan is out tonight with hawkish comments on the US economy, suggesting that 1.9% growth is enough to start tightening.

“We’re approaching that time where I think it would be prudent to remove some accommodation,” he said.

He did, however, provide insight into why the Fed hasn’t been hiking like rabid dogs all these idle months.

“I thought we’d be wise to, in light of what just happened in the first part of the year [in global markets], we’d be wise to turn over few more cards and be patient,” the central banker said.

Fed’s Kaplan summarizes his philosophy on life.

“Being cautious or patient doesn’t mean standing still.”

Draw your own conclusions.

You’re literally the guys playing the violin as the fucking Titanic cracked in half and descended into the cold, murky, waters of the Atlantic.

According to the book-worms at S&P Global Market Intelligence, earnings for Q1, 2016 are on pace to donkey-punch its shareholders and catapult their dead, diseased corpses into foreign cities for immediate incineration.

Earnings will, inexorably, fall hard, by as much as 7.9%–led lower by energy. Incidentally, energy will post its first loss ever. That’s ever with a capital E.

Oh, don’t worry, I’m sure the financial heavy S&P will bail out the earnings parade, no?

Actually, the opposite will occur. Investment banks are nose-diving, headlong, into cement pools–vacated of any semblance of water. Everyone is heading towards their very worst earnings since the Great Recession, a singular great reason to barrel into idiot stocks careening towards annual highs.

Tech?

Heading for a -5.9% earnings decline for Q1.

Try again.

Markets crushed to the upside, lifted by Fed minutes that said nothing. Moreover, oil spiked after the EIA stats showed a drawdown from inventories that are so immense, so massive, that it’s causing oil men to lease tankers to store it– and generally burn that shit into the atmosphere to reduce supply.

All in all, the bears were flogged at the gibbet again, utterly humiliated and overcome by discomfited losses.

As for me, I am long TLT with 25% of my assets, long SPY with another 25% and short XLE with another 25%.

The remainder has been in cash since Monday.

My prognosis is especially dire. The higher we go, the sharper the drop will be. God willing, the markets will climb very high indeed, making the forecasted fall all the while more interesting.

We are heading into a world that has Rafael Cruz trying to shove bibles down our necks– and earnings of a bad varietal looming. I promise you, your giddy demeanor will soon morph into utter agony and disbelief.

The Devildog is coming.

Checkered pants wearing Chase Coleman III, from the private country club golf course, who also run Tiger Global, got poleaxed to the tune of 22% last quarter, amidst a sundry of boondoggled investments that left his investors in ruins.

Among some of his low brow holdings are NFLX, JD, FLT and homosexual furniture retailer RH.

His losses are a stark reminder to all those out there wearing checkered pants: karma is coming for you bitches.

It’s also worth noting, his ‘family office sized fund’ of just $6 billion was flat for March, sitting out the rally of epic proportions that ingratiated the unwashed and uneducated masses towards steak dinners and champagn cock’d-tails.

Some of Chase’s other bowsers include DATA, VIPS, and Frederick Wilson’s junkyard, ETSY.

‘Inflation’ was mentioned 117 times and ‘fuckery’ zero. The Fed minutes revealed a divergence in opinions regarding rate hikes. Seemingly, the only thing holding Yellen back from jacking them higher is the word ‘global.’

Stocks are holding their gains, post minutes, with the Nasdaq higher by 51.