"Why This Stock Market Will Never Go Down"

Tyler Durden's picture

Update: turns out it was satire. Supposedly:


While the last thing we would like to do is bring even more attention to today's grand slam in financial trollery, the following article by the ironically-named MarketWatch author Michael Sincere is just too funny to pass by.

Presenting: "Why this stock market will never go down" which contains such stunning pearls of financial insight as the following:

Everyone believes the U.S. stock market has reached a permanently high plateau. Everyone, that is, but the bears.

 

Last week’s Investors Intelligence survey showed bearish sentiment at its lowest since 1987 (13.3%). In fact, short-sellers have nearly disappeared along with the few remaining bears. In addition, the VIX is at historic lows (near 12), which reflects investor complacency.

 

Put another way, almost no one believes this market will go down.

Wait, "permanently high plateau"? When was the last time we heard that line. Oh wait, nevermind.

That said, the author does point out the clear inherent falacy in his premise, namely that there no longer is any retail participation in a market which everyone realizes is too rigged, too manipulated and too broken to hope to even break even:

Ironically, retail investors are not as gung-ho about the market as in the past. Viewership of financial television programs is at 20-year lows, especially in the coveted 25-to-54 age group. It’s a sign that even as the market climbs higher, interest in the stock market is falling along with volatility.

So who benefits: why Wall Street of course - the same source which eagerly passes one hot potato to itself after another, in the process CYNKing the S&P to higher records on ever declining volume.

On the other hand, the overwhelming view of Wall Street can be summarized by two Morgan Stanley analysts, who predicted that the S&P 500 SPX, -0.40%  will be at 3,000 in five years, a 50% increase. If they’re right, the Dow will hit 25,000 lickety-split. Dow 25,000 has a nice ring to it, and to Morgan Stanley and others on Wall Street, an additional 50% gain is actually a conservative estimate. This is a market that is unstoppable. If only they can convince Ma and Pa, the market would go even higher.

Then the author for some inexplicable reason decides to troll "bears" by "exposing" two "conspiracy theories." Actually, in retrospect the click-bait reason is quite explicable.

While the bulls are laughing, the bears are sulking. No one believes their Chicken Little doom-and-gloom warnings. A 10% correction? Wrong! A 20% crash? Wrong! Last month, after the Dow fell more than 600 points, the bears thought they had a chance, but they were mistaken. If you believed the bad news bears, you would have missed out on a 200% gain since 2009.

 

The market has shrugged off multiple geopolitical problems, low market volume, trillions of dollars of debt, sky-high sentiment, extreme P/E ratios for many high-flying stocks, and dozens of other red flags. Yawn. The only gorilla in the room that matters is the Fed.

 

And because bears are sore losers, they have come up with wild conspiracy theories to explain why they have been so wrong:

 

Conspiracy theory #1 — Plunge protection: Market observers have noticed a pattern that has been repeated for months. As soon as the market begins to sell off (usually in the morning), a massive computer algorithm enters with buy orders, preventing the market from falling. On the chart, it makes a “V” pattern. Conspiracy theorists believe the Fed is doing the buying, but they have no proof. We know that the Fed buys bonds, but buying stocks would go way beyond their mandate. Conspiracy theorists believe the Fed is terrified of letting the market fall because it could turn into a massive crash.

 

Conspiracy theory #2 — Ignore inflation: The bears believe this is a faux bull market that has turned into the biggest bubble in stock market history. They believe the Fed and other central banks around the world will keep interest rates low indefinitely by ignoring inflation. I have bad news for the bears: You’re right: The Fed will do everything in its power to keep interest rates low. As soon as the Fed seems serious about raising interest rates (that’ll be the day), the stock market might hiccup. But why would the Fed raise interest rates and crash the party?

Why indeed... Oh, maybe because as we showed yesterday excess liquidity in the market has never been higher and the central banks, the Fed included, know that once the Kool-Aid spice ends, nobody knows just how far the market will crash. So instead they do the only thing they can - push it to ever bubblier levels.

It is not until the end that one senses of hint of sarcasm:

If you study history, you know that no one thought the price of tulips, houses, or stocks would ever go down. Even most bulls believe that “one day” there will be a correction, but that day is far away. After all, the Fed has an unlimited supply of magical tools, and they are determined to keep the market from falling.

But said "sarcasm" promptly evaporates when one reads the final sentence, and realizes that the author was serious all along.

Unfortunately for soul-searching bears, the Fed trumps all. As long as new money flows into stocks, interest rates are low, and the market keeps going up, why worry?

As we said: pure trolling comedy. As to why worry... well "long-term" trader memories may be 6 years or less, but the last time everyone put their faith in the Fed, the market plunged some 60%.

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NidStyles's picture

Mania phase has started?

813kml's picture

Get your tulip bulbs while you can, they're not making any more.

CrazyCooter's picture

Because its denominator is going to zero?

Regards,

Cooter

Wolferl's picture

Repeat 100 times after me: This time it´s different, this time ...

Divided States of America's picture

Thats the most 'Sincere' stock market advice directed at the sheeps that I have ever seen. Fuckin retard columnist

The foo forgot to mention that we can still lose when our purchasing power tanks when the USD drops like a rock.

Leonardo Fibonacci2's picture

its rigged to never go down by the masters that run the Fed!

Supernova Born's picture

The IRS is waiting at the exit door of this market.

Darth Vader: I am altering the deal. Pray I don't alter it any further.

You didn't build those gains.

max2205's picture

Even sideways would be a big fail for the Fed.....enjoy it folks

Supernova Born's picture

Dance like a maniac high on cocaine at the jam-packed baseless fiat discotheque.

Just remember the Fed has bribed the fire marshal of "rational markets" and the blatant fire code violations are being ignored.

Bananamerican's picture

"permanently high plateau" is a psyche out for a crash that will not come on until the zombies of zimbabwe come out.

This time IS different.

Some say things dont "end" they just "change"...it's a nice thought

MalteseFalcon's picture

This market will go up until retail joins in.  If you won't take the bait @ 17K, then how about 18K?

Sooner or later retail is in, then, WHOMP, 2 BY 4 UPSIDE THE HEAD.

 

WHOMP!!!!!!!

Pool Shark's picture

 

 

"Even God himself couldn't sink her..."

[Hubris much?]

 

Bendromeda Strain's picture

"The Beatles are bigger than Jesus Christ"

[Hubris² with schadenfreude... "Instant Karma'a gonna get you, gonna knock you off your feet"]

wee-weed up's picture

MarketWatch? OMG! That's sinking lower than whale shit on the bottom of the ocean!

Aaaarghh's picture

I read somewhere, in more than one location, thatthere are CIA/NSA people openly talking about the possibility of an ISIS EMP attack, or an attack on the US ageing power infrastructure (read false flag). What effect would that have on  this guys 'stawks' ?

twh99's picture

Brad Thor's latest fiction book is on that possiblity.  Good reading.  Although it is the Chinese behind that fictional attack.

Tall Tom's picture

OT but related.

 

If you purchased Fine Platinum Physical, or Palladium, you may be elligible for a CASH CLAIM for the Manipulation as a party to a Class Action..

 

http://platinumpalladiumphysicallitigation.com/

 

Nahhhh...Markets are not manipulated. BTFATH. Right.

BIHM's picture

I think you touch on the real objective here.  See Rockefeller and Morgans circa end of the roaring twenties.  They pushed the manic market by flooding with liquidity and then called in all the demand loans at once.  This allowed them to collect assets at $.10 on the $1.00.  This time is no different.  The banks, and the families behind them understand money is not made by pushing markets up at all time highs.  It is made on the way down and by collecting assets for pennies on the dollar when the knife hits the floor.  So understand pushing the market higher is just the necessary set up to making real profits upon the collapse.

mrvco's picture

This time it IS different.  Obviously.  Well that is except for the result of course.

Arius's picture

CORRECTION:

 

The stock market never goes down!

it is logical really everything goes only up ...until you reach intercourse and climax pennsylvania

Dr. Richard Head's picture

So if bearish sentiment is lowest since 1987 that means everyone is on the same side of the boat.  Here's to wishing for the fucking thing to tip over already. 

Arius's picture

it will tip over only when they say so, not even one minute sooner ... it is a fixed casino

Zeptemberalevin's picture

the "black swan" event to tip over this corrupt market is another false flag here in the US 

maybe this Thursday on 9/11? 

TeamDepends's picture

Amen Doc, bring it on! We have spent the last several weeks bugging out of the big city, and couldn't be happier about the decision. We have a good stash of supplies and will continue to prep until the wheels fall off. Most importantly, we have all we need to grow a huge garden next summer when we will all be farming for keeps.

tarsubil's picture

Yeap. This is the point where the addict is making bank and doesn't see an issue with having a morning cocktail of coke and vodka and losing 20 lbs in the last month. Looks good and feels good so why worry?

Driving through a fog at 80 miles per hour just waiting for a brick wall.

rubiconsolutions's picture

The stock market never goes down, everything else goes up.

 

 

/s

zorba THE GREEK's picture

Without any shorts in the market, there is no short covering to slow the decline when it corrects

and no bid to allow you to get out or cover margin calls. Recipe for disaster. I guess theoretically

The Fed could buy the whole stock market and could set stock prices wherever they want.

reset71's picture

@NidStyles

Mania phase is right.  I sold out of stocks too early because I though this-time-would-be-different in that I thought there would be no mania phase.  I thought the FED couldn't necromance the economy back to life.  Anyways, the FED suceeded at pumping up another huge bubble.  I will buy back into the stock market after the crash- hopefully at a point lower than where I sold.

strangeglove's picture

I hope you have enough TP for the wait.

KnuckleDragger-X's picture

Topping the news today the S&p topped 3000 on heavy trading of 1000 shares. Also in the news the government is promising to take Indiana and Kentucky from the rebels any day now and swears that there is no way they'll lose West Virginia. Finally don't forget to catch the new season of Survivor:Chicago where the contestants present their recipes for roasted rat.

order66's picture

The stock market can go down?

pods's picture

Going to go get my shoes shined today and see if the guy has any cool stock tips.

This is like groundhog day!

pods

in4mayshun's picture

Pods, you witty bastard.

Arius's picture

take a notepad with you... the guy's english might not be that good though

intric8's picture

Perhaps only one thing will tank this market - a damn nuclear war.

Israel can arrange that!

realdealer's picture

Sure, not Russia, not Ukraine, not European countries as they put pressue on Russia, not North Korea, not China as it plays games with Japan, certainely not the US with all its bases and subs. Only Israel. Cute. 

yogibear's picture

Maybe Barry will if he visit's the White House.

The Merovingian's picture

To the moon Bitchez ....

IronShield's picture

Ah ha ha ha, ah ha ha ha...

Oh, wait, you're serious???

Ah ha ha ha, ah ha ha ha...

AccreditedEYE's picture

I can't believe ZH disagrees with this kid. With all knowledge of Central Bank activities laid bare each day, how is he wrong? Which "Tyler" wrote this "expose"?

Bell's 2 hearted's picture

I'm not very impressed with ZH's take on the $29 trillion

Chuck Knoblauch's picture

There is no short/put demand because they know the market is rigged.

Rigged to go up until it's rigged to go down.

IronShield's picture

The commercials would tend to disagree with you.

Teaser's picture

Until the retail investor gets super excited, we haven't topped.  Moar printing!  

Wolferl's picture

Retail investors? A species that died out about 6 years ago?