Since last Friday’s phony jobs report the casino has become so unhinged that analysis is beside the point. It is not surprising at all that the robo-machines are now gunning for the 2200 point on the S&P 500 charts. That’s what they do. What defies explanation, however, is that the several dozen humans left on Wall Street who apparently talk to Bob Pisani are actually attempting to rationalize this “breakout” of, well, madness.
As we noted yesterday, in his latest webcast to DoubleLine investors, Jeff Gundlach confirmed the key points from his weekend Barrons which summarized his outlook that "things will get worse in the future, not better." But while Gundlach's skeptical bent has been well-known, we also learned that Gundlach has been actively adding to shorts as the market breaks out to new record highs. Cited by Reuters, the new bond king said that there is "big money" to be made on the "short side."
What had previously only been hinted by the likes of former US attorney general Eric Holder who infamous said some banks are "too big to prosecute" shortly before resigning, became fact when a US Congressional report found that US officials refused to prosecute HSBC for money laundering in 2012 because of concerns within the DOJ that it would cause a "global financial disaster."
The fragile state of Italian banks in the fraught post-Brexit financial climate has been highlighted by the International Monetary Fund, in a stark warning that the eurozone’s third biggest economy will have suffered for almost two decades before it starts to recover the ground lost since the 2008 financial crash.
Silver out performs gold as both rise with Treasury bonds, which are in turn rising with stocks, as Junk bonds hit new recovery highs while USD remains firm as inflation expectations are out of the picture. This is highly atypical, maybe even unprecedented. As we watch the macro burp up all kinds of paradoxes and inconsistencies, we can’t help thinking back to the day that the ‘Hero’ announced Operation Twist...
The media has spent a lot of time parsing through the Clinton emails that already have been released - compiling lists, looking for specific names or discussion of particular issues. But they ought to pay more attention to the holes. Bob Woodward has declared that Hillary Clinton’s email scandal “reminds me of the Nixon tapes.” He’s right. In that case and here, it’s not what’s in the record that’s most troubling. It’s what’s not there.
The country’s local retirement savings managers, which manage about $300 billion, are handing over some of their cash to the National Council for Social Security Fund, which will oversee their investments in securities including equities. Why the shift? Simple: to help stabilize markets during the next rout. During last year’s tumble, policy makers armed state-run investing company China Securities Finance Corp. with more than $480 billion to try and limit declines. Now it's the pensions' turn.
Only one question matters for global investors - Where is the helicopter? Helicopter money will be raining from the skies in Japan, the Eurozone, the UK and even in the USA. This form of reflation will likely work and in due course work too much. Few things are binary in investment, but this huge decision to be taken in Berlin is the biggest binary event for investors this analyst has yet come across.
The boys and girls on Wall Street are now riding their bikes with no hands and eyes wide shut. That’s the only way to explain Friday’s lunatic buying spree in response to another jobs report that proves exactly nothing about an allegedly resurgent economy.
The FBI continues to benefit from decades of pop culture and government whitewashing which portrays the FBI and other federal agencies as professional and effective. Always a product of left-wing and Progressive desires for more government intervention and a weakened private sector, the FBI continues to benefit from the perception that it functions in the service of the “public.” With James Comey’s recent demonstration of the FBI’s political motivations and origins, we have gained yet another insight into how the FBI works, and public service has very little to do with it.
"In the wake of the weaker-than-our-expected 1Q results and recent macro headwinds, we are trimming our S&P 500 EPS forecasts by 3% in 2016 and 2% in 2017. Given the S&P 500’s 15% rally since mid- February, we are concerned that much of the improvement in earnings growth may already be priced in, especially with signs that earnings revision trends may be rolling over."