Just quick afternoon update for you fucks who are permanently long.
I’ve been doing this a very long time and I even built mean reversion algorithms to time markets. I remind you of this to separate the chaff from the wheat. We are not the same. Having said that, I mentioned a week ago that Stocklabs had flagged oversold — but if we started to “cluster signals” it could be the preceding elements of the apocalypse.
The character of this market has been to sell down all rallies and this doesn’t conform with a bullish tone or tenor. I will tell you this now — if markets do not bounce after today — it’s 100% over. I am hoping we do bounce a little, in order to assuage longs back into the building so we can burn it down later. But if we collapsed now — I would not offer protest.
At the heart of this tumult are treasury yields. We are +9bps to 4.33% and markets are screaming HELP to an obstinate Fed. We have not gone down yet. The fact that stocks have held it together up until now is admirable and shorting a market that defies logic is usually a reason to be long.
The divergence between small and large cap is a wide chasm today, +0.6% v DOWN 0.7%. My best guess is for stabilization and an attempted rally in the late afternoon or tomorrow. HOWEVER, I am open to suggestions and should we flop and flail and flounder, you will rue the day you chanced upon this eloquent prose and decided to ignore my most dire warnings.
You have been warned.
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I do not understand this blog.
It helps if you’re not too bright. Hit your head with a hammer a few times until you pass out. This will make the blog easier to understand. It worked for me.
Hypothesis: Rates are going up because the market is sniffing out the fact that inflation is coming back and the Fed will need to either hike more or keep rates elevated for longer. We saw a glimpse of this a couple weeks ago when the July CPI/PPI came out. We saw the first increase in PPI in many months and PPI is a leading indicator for CPI. Wouldn’t be surprised to see a hot CPI report come out in a few weeks and more hawkish tones from the Fed.
The Fed and most others here are STUPID. 3% or 4% inflation
Is good for America and the public. Just tax the living shit out
of the rich. A 110% tax on ALL income above $400,000 per year
solves any remaining problem.