18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
23,541 Blog Posts

Zero Price Memory Up Here

Now that it looks like Hello Kitty is gone and the $GME nonsense behind us, it appears markets are legging up and without any resistance or price memory in its way. What I mean by that is, you are no longer waiting for your down stocks to break even to sell them because they’re probably all at or near record highs. Stocks at record highs tend to make new record highs. That’s how it works.

Markets can always pause or become affected by external events. But for the most part, and this will piss off some of you out there, the FOMC did a superb job in managing rates back over 5%.

I understand costs are higher and inflation was/is an issue for some. No one likes to pay more for things, and I do not want to come across as elitist here since I too grew up lower middle class, but those of us with some money who played in the market the past few years made a great deal of money. More than that, most government workers benefitted greatly via their retirements plans, and 401ks. The inflation monster is in fact TRANSITORY, even though you pretend it isn’t. This doesn’t make up for the fact that our currency lacks buying power. I am not suggesting everything is great.

This is what I am suggesting.

The FOMC managed to provide Americans, pension funds, foreign investors with a 5.25% riskless return in Tbills and at the same time keep markets at RECORD highs. You might hate the Fed but you have to admit that was clutch. If the economy tails off, the Fed has plenty of fire power to fight against recession.

Into the afternoon hours, I am 157% leveraged long.

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One comment

  1. flea

    Basically the Fed printed so much money, that they could raise to 5% and nothing happens. In three months of 2020, they printed $3T. Yes, that’s a “T”. The balance sheet is still $1T above the level reached AFTER the $3T was added. Normal rates (~5%) aren’t affecting anything; it’s the money supply, the balance sheet. And note that the Fed is stealthily leveling that off so the 1% can continue the historic party.

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