Yellen Warns Of Small Cap Bubble

Tyler Durden's picture

In mid February Fed's Tarullo first opined on the "stretched valuations" in small and high-tech companies in the US - while careful not to label the entire market a bubble. It seems, given Janet Yellen's comments today, that this is the new meme...

  • *YELLEN SEES POCKETS OF POSSIBLE OVER-VALUATION IN SMALL CAPS
  • *YELLEN SAYS EQUITY MARKET VALUATIONS ARE IN HISTORICAL RANGES+

 

Remember - Don't fight the Fed!! Sell Small Caps!


Yellen repeats that stock values are in “historically normal ranges”

 

“There are pockets where we can potentially see mis-valuations,” Yellen said in response to questions after speech to Joint Economic Committee

 

Still, there’s no sign “we are obviously in bubble territory”

And then there's this:

  • Yellen: Can't Detect Asset Bubbles With Any Certainty

Perhaps the following 2 charts will help...

 

Nope, no bubble here...

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Max Damage's picture

By historical ranges she means 1999 and 2007. 

knukles's picture

I could tell them before I couuldn't

Pinto Currency's picture

 

AMZN, NFLX, TSLA, CMG, SBUX are not in a bubble becuase of unique circumstances.

max2205's picture

Vol is crazy on these. ...Tvix off 20%....what the what?!

Pinto Currency's picture

 

The most leveraged stocks are letting go.
Next comes the core.

davinci7_gis's picture

"POSSIBLE OVER-VALUATION IN SMALL CAPS" 

I see a crowd forming at the exits..

LetThemEatRand's picture

Interesting how the Russell started selling off well before these "revelations" from Yellen.  Yeah, not a rigged market.  No insider information here, move along.

Xibalba's picture

"We need household growth to strengthen the economy.  Household growth will return when the economy strengthens." - A skilled/coached wordsmith, but makes it a practice to violate the law of non-contraction.  Any semi-intelligent person watching this is not fooled by the many words.  We're fucked.

Doña K's picture

Whoever, insults her with a comment like that, will pay the price. They are the world's mafia. period

Act accordingly. starve the beast. Let the banks and the hedge funds cannibalize each other. Grab your drink of choice and watch.

Just in case, stay away from the screen and keyboard so that you do not spill anything.

Xibalba's picture

*law of non-contradiction

 

stoopid spellcheckr on my fone 

NOTW777's picture

cool - stock pics from Janet

wonder if she collects a promotion fee

drendebe10's picture

"There ain't nuthin uglier than an old white woman."  
Fred Sanford, Sanford and Son

saveUSsavers's picture

WSJ has trailg p/e of 100 ! That's not a bubble? BULLCRAP

Cacete de Ouro's picture

Fama: But there are no bubbles?

Stoploss's picture

Mission Accomplished yet??

maskone909's picture

brownie, yer doin one heck of a job.

cant wait to get its take on pinksheets, errrr large caps!

Itchy and Scratchy's picture

I wonder if it was the 85x P/E that tipped her off? When she re-cranks 'QE' 100x P/E won't be far behind!

Looks like she's got the Nobel Prize for Economics in the bag!

Another bold accomplishment for gender diversity!

Gamma735's picture

She just can not admit that the fed is in the business of creating bubbles and distorting markets to the advantage of a very elite few.

Pairadimes's picture

Yellen: "Rumors persist of an anus located somewhere on my posterior, but as of yet, I have been unable to locate it."

Dr. Engali's picture

It seems for right now the central planners are capable of smashing any asset class they wish without collapsing the system. Gold...Check...silver....... check.... Small caps..... check. Lets' see how they do with oil.

maskone909's picture

i think they can manipulate commodity prices to extremes because there is really no true economic output.  nobody is consuming, therefore they could probably even get away with oil too.

CrashisOptimistic's picture

Oil is not like other commodities.  You burn every drop of it and it is gone.  Nothing else is like that.  You eat corn but you grow more.

And if they are manipulating it, they have manipulated it north of $100 most of this year.

Oil at $100 is a pervasive, global drain on everything.  EVERYTHING. 

Whatever happened to the abundance narrative?

 

maskone909's picture

good point.  i just think they yield more return from front running the mannipulation (short/long) rather than gaining from returns on delivery ect.. they get a free pass becasue there really isnt much of a consumer market and nobody to cry foul.  200 dollar oil? no prob!  just increase the snap card limits lol  does that make sense?

CrashisOptimistic's picture

No. 

Oil is the one thing immune.  Consumption of it is not discretionary.  You HAVE to move food to grocery store shelves and it's only done one way, burning diesel. 

Here is a site where you can select China and look at their consumption ramp. 

http://mazamascience.com/OilExport/

Look at India, too.  They don't give a shit what the Fed does.  They burn it at faster and faster rates.

stewie's picture

Wow, awesome link,. thanks.

You can really see the correlation between energy consumption & GDP.  Look at Japan.  Consumption flat since the mid 90s.  Europe, NAmerica, all down. 

Quinvarius's picture

The mantle of the earth is 90% oil.

Meat Hammer's picture

maskone909, spot on. Everything is paper: Oil, Wheat, Gold, Silver.  A financial system based on complete fantasy, totally malleable by an elite group of scumbags.

Winston Churchill's picture

Notice they cannot do it all at once.
Whenever they try, the DXY gets hammered.
Yesterday being the exception that proves the rule.

q99x2's picture

Jump banker jump.

lasvegaspersona's picture

Please....modern bankers do not jump. They have someone push them. Or do something more interesting. Nail guns are passe. 

Hippocratic Oaf's picture

I would argue that the mkts (pfft) have not traded on fundamentals for at least 5 years

NoWayJose's picture

She needs to be less specific on this kind of thing - and go back to Greenie's book of tricks by calling it 'irrational exuberance".

SheepDog-One's picture

'We're not in a bubble....but I wouldn't know a bubble if I saw one'......What a damn 3 ring clownshow!

Obama_4_Dictator's picture

Listen this is all bullshit Janet, may I call you Janet?.....I thought everything was fixed in 2009 / 2010.....we were promised it was over.  Still 3-4 years later you are fucking with the markets....if everything was fixed stop intervening...just stop it right now and we will forgive you...if you don't raise interest rates right this second, at least admit it's not fixed, and that it never will be, and you have to keep interest rates low forever....and then we will also forgive you...if you do neither, then we will NEVER forgive you and you will regret this day when we stone you all for your transgressions against the people.......

Yen Cross's picture

  Yellen must have stumbled on an article from Z/H whilst looking for a new looking for a new hair-stylist on the interwebs...

Kaiser Sousa's picture

well what do ya know...

this lyin ass MoneyChanger cunt steps before her employees and mumbles meaningless bullshit and presto, chango, the phony paper prices of Gold and Silver fall off a fucking cliff....

yeah, pure coincidence driven by earth shaterring economic news/data....

complete fucking farce...

DEATH TO THE MONEYCHANGERS.

SheepDog-One's picture

And now these 'everyone on the edge of your seat' jawboning sessions are a daily event now.....we used to laugh at Castro and his weekly 1 hour mandatory national addresses.....he had nothing on these guys!

locklimit's picture

So does this mean new Dow highs on transfer of small cap money?  Seems that way

Pairadimes's picture

*YELLEN SAYS EQUITY MARKET VALUATIONS ARE IN HYSTERICAL RANGES+

There, I fixed it.

kurzdump's picture

Putins fault - send the nukes already.

philosophers bone's picture

Translation:  If you're in, get the fuck out.

valley chick's picture

Do any of these clowns asking questions of old yeller even understand what the hell is even going on?

SheepDog-One's picture

It sure wouldn't appear so....after Paulsons blatant lying to them, and Bernank's serial perjury before them time after time, I guess they just keep going along with this Kangaroo Court bullshit for the sake of keeping their phoney-baloney jobs.

valley chick's picture

What  committee is asking the questions of old yeller. I would like to look it up to see who sits on it.

philosophers bone's picture

Yellen offers further clarification:  Small Cap = <$100 Billion

SheepDog-One's picture

Small cap...yer on yer own. Large cap is TBTF.

Meat Hammer's picture

But if we didn't have a centrally-planned economy and traded with each other with barbarous relics, things could get too risky.

 

/SARC!!!!

Kaiser Sousa's picture

bitch said with a straight face..

"housing is affordable..."

i swear to Al Swearington, i getting close to pulling a "Travis" on one of these sociopaths....

FUCK!!!!!!!!!!!!!!!!!!!!!