This is precisely the type of tape I want to buy into. When traders who were formally permanently bullish give up hope and acquiesce to market forces, I buy their blood and drink it up. We have FX dislocations, market pricing shenanigans and most importantly the treasury market is in flux, with bonds PLUNGING in price. This will have a deleterious effect on our under-funded pensions, such as the States of NJ and CA.
But that’s for a later discussion.
When we are talking the end of Pax Americana, our timeframe is a decade — but it’s happening now and has been happening for over a decade. Our influence is waning and China is ascendent. But nothing goes up or down in a straight line and we are approaching levels of apathy that make for an appealing buy the dip moment.
I usually buy at 5% increments, but will now reduce that to 2.5% in order to achieve flexibility.
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We’ve just come so far, why would we not touch the June low here?
This isn’t blood. This is an orderly decline. Oversold perhaps, but anything that looks like a bounce will be sold into.
Bonds are now giving a yield where it’s easy to move one’s money out of equities.
The Fed will be able to get inflation down to maybe 4% but there will be a lot of blood getting inflation down to 2%. And after the Fed’s screwup on ‘transitory’, I don’t see them stopping hikes until inflation is vanquished.
Did I mention that the Fed is also draining liquidity? No? They are which is doubleplusungood for equities.
You forgot to mention that earnings are certain to decline, a reality that hasn’t even begun to get priced into the market… not even a little.