Bill Blain: "My Prediction Is That Around October 12 Markets Will Get Horribly Interesting"

Tyler Durden's picture

By Bill Blain of Mint Partners

Mint - Blain’s Morning Porridge – May 22nd 2017

“The most dangerous four little words for a prime minister: “Doesn’t she look tired?””

Last week was dominated by Trump news flow. What initially felt like a major market wobble quickly reversed itself and we ended the week basically unchanged.. or "Unched" as the Facebook generation now like to say...

Fundamentals triumphed over the political shenanigans. What does that really tell us? The market was overly nervous, the bearish doomsayers are wrong... or is the bulls are too certain of themselves? Are stocks really so undervalued they justify further upside? Lots of people obviously think so and are ready to buy the dips. And that is basically the core of the current market.

What's on the menu this week? Sadly, activity is going to be thin this side of the pond - Ascension Day on Thursday means Europe is on a three day week,  and mid-term school holidays in the UK mean lots of empty desks over the next two weeks.  Next month we're into June, meaning the summer slowdown will be upon us. While summer is coming and the cotton is getting high, I don't expect the pace of market angst will slow. One of my market contacts at a large investment bank told me they think this is "phony war". They're reporting the same things we feel... many investment managers ignoring the physics of financial gravity and the laws of mean reversion.

Why worry? There will be a slew of data out this week - and it will likely to confirm strengthening growth in Europe and a heating up US. The ECB's talking heads will manage expectations so nobody gets too concerned about the coming Euro Taper.

Many fund managers will look at the numbers, conclude there is nothing to worry about, macro fundamentals are strong and sustainable.. and keep buying. Summer is traditionally the time for asset allocation decisions - and I'm hearing a number of funds, including some monster SWFs, are planning shifts from bonds into stocks. (Clue - a 5% shift from bonds into stocks on a $1 trillion fund = a very significant amount of new cash supporting stocks through the summer..)

But.... Catch a falling knife, why don't you... I shall spend the summer wondering just how long the Stock Market games continue. When, not if.

At the moment, my prediction is October 12th. Around that day its going to get horribly interesting..

Why that particular day?

Gut feel and knowing how the Bowl of Petunias felt in Hitchhikers. ("Not again.")

There are just too many contradictory currents out there. The unsustainability of burgeoning consumer debt, unfeasibly tight credit spreads, the sandcastle foundations of student loans, autos, housing and the CLO market, China, Trump, politics.. worries about what follows Brazil in the EM market, and whatever... The risks of a massive consumer sentiment dump..    

And bear in mind we haven't seen a significant correction to the stock market since 2011! And how sustainable are fundamentals - Goldman Sachs noted at 8-yrs, the current economic recovery is the third longest since 1854. I’ve said before it looks “tired”.

My high priest of stock picking; Steve Previs, was making some incantations to the Elliot deity along the lines of: "we're approaching the end of the 5th wave.. 5th waves are always followed by a correction.." No idea what it means, but Steve is usually right about these things.. after all he's been trading stocks since they used to mark up prices on the cave wall.. In those days a bear pit was exactly what it said it was... 

Interesting world we live in.

The Media and the Elites tell us what should be, but that ain't the way people actually think. Trump is the classic example - every single little thing he says or does is guaranteed to throw the political classes into turmoil and generate enormous waves of market angst – witness last week. Yet, the American heartland voters still love him. California might tumble into the sea, but the Rockies will crumble before much of America loses faith in the Donald. Sure someone will have to pay the price for his non-delivery - and I suspect that will be the Republican Party.

Back in Blighty, and The Theresa May Party might just have shot itself in the foot over the Dementia Tax. What I read in the press over the weekend about surging grassroots support for Jeremy Corbyn, perhaps my 5000/1 double on Corbyn IN / Trump OUT wasn't such an outrageous play after all...

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Nice Try Lao Che's picture

My prediction is that EXACTLY on October 12th at 9:44:031111116 GMT they'll get interesting (& it'll be because of global warming).

BigFatUglyBubble's picture

Global warming intentionally caused personally by Putin, due to CO2 farts from eating lots of McDonald's.*


Wallstreet sends Kushner to KSA

Haus-Targaryen's picture

I wonder if Bo Palmy is out behind some 7/11 somewhere playing a flesh-flute as its his only means of now supporting himself. 

This guy'll be added to the list of "the financial system comes down on XXX date".  The day will come and go, and no one will be the wiser. 

Greenspazm's picture

"Blow Pony" and a long list of others like Jim Ricktards, Jim Give-me-the-Willie, Eric Snott, Andrew McQueer, Peter Sniff......

DeadFred's picture

I'm sure this guy got the exact date from a reliable source. Perhaps he consulted Pepe and found dubs followed by triples. You can't get more assured than that. LOL, (or is it KEK now?), everyone knows the end-of-the-world date is September 23rd and the market crashes BEFORE the world ends. Duh. How do people get so misguided when the truth is right out there on the internet?

Hammer823's picture

My prediction is that every dip in the market will be bought.  That any losses from any big down days will be reversed in the same day or in the days that follow.  Just look at last Wednesday's big drop.  That 350 point loss has almost been completely reversed.  It's pretty simple.  The stock market HAS to go higher for every government budget, pension, 401k, ira, 529 to work.  It will be rigged to go higher no matter what.  Always buy the dips.

Haus-Targaryen's picture


This keeps going until something large fails, whether it be an insurance company, bank or other credit institution or government I know not. 

However this will keep going and going and going and going until a tempest in a tea pot somewhere gets out of control and does this to the financial markets. 

Hammer823's picture

That already happend in 2008.  Now just a distant memory as we hit new all time highs almost everyday.

AlexCharting's picture

I think you are on point when it comes to 9:44, but do NOT underestmate the mayhem we might see aaround 9:36. 

Croesus's picture

10/12/17, marked on the calendar...of course, CRASH has been predicted every year since....

lester1's picture

Bill Blain should do some research on the unaudited Federal Reserve's PPT and US Treasury's ESF. They are unaudited for a reason, and able to buy stocks with electric money. They will keep markets propped up no matter what. 


Summer 2015 they reversed a -500 point drop in just 15 minutes. Does anyone remember that ?


Take notes Bill Blain.

venturen's picture

Nothing a hundred billion in printed won't cure.

Son of Captain Nemo's picture

Or Bill...

When all the fucking bankers take their last pills and start WWIII!!!

christiangustafson's picture

Panic low in early-mid October, support at the 2007 (year) highs @1576.

brushhog's picture

I'd have thought sooner. Q1 had a lousey .7% growth, Q2 seems as bad but we wont know until we get the fake numbers.

29.5 hours's picture

<<Around October 12>>

Jeez. Which decade?

<<knowing how the Bowl of Petunias felt in Hitchhikers>>

I guess I've had my fill of this guy's ramblings in the morning...

buzzsaw99's picture

there is zero chance the market will ever get interesting because there is no market

Stormtrooper's picture

No, no market but the computers are having a grand time trading amongst one another.

jamesmmu's picture

CRASH2: why the oil glut looks more and more like the catalyst for collapse

Arrest Hillary's picture

As opposed to Maxine Waters .... horribly boring ?

Swamp Yankee's picture

Dude... its OK to say that you don't know.

Bill of Rights's picture

Is this another buy more silver moment?

overmedicatedundersexed's picture

who will sell?? the mega banks, no..the Ins co's with pension funds..well no,

the trick the Fed knows..less than 5% of stock held is traded buying .1% will always keep a floor under it..

2008, was done by our own .gov with fed help to take wealth from the people..and make us all more dependant on them..many funds Ju owned knew in advance to sell & then buy back.. like "Trading places"..they set the price.

the .1% became the .01% and nobody asks why?  chris cox sec did nothing..bush played the panic'd frat boy..paulson smiled.

there is little to take today, so many of us are not in the no big crash.

DirtySanchez's picture

Bill Blaine, whoever you are.
Make this bold prediction interesting.
Bet your life on it.

Opinions are like ass holes.....
Everyone has one.

Otherwise stfu.

August's picture

ZH still offers some valuable reading (mostly in the cmments). 

Reading this Blain piece, though, is truly a waste of perfectly good bandwidth, not to mention time.

Arrest Hillary's picture

I now have a wallet .... with .01 BTC in it .... it was a birthday present .... member in good standing of the war baby registry .... those born during the war ?

boostedhorse's picture

I was a nutjob like most ZH readers, always waiting for the big collapse to happen already, for years. "Any day now". Then I realised its not going to happen any time soon. Even if gold were to double within the next 5 years from now it wouldn't have been worth to tie up money in it and live subpar life instead of how I'd want to. Sold my gold stocks for a huge loss, bought a dual-sport dirtbike and am having the time of my life. Don't give a flying fukk what is going on with the price of gold/stocks anymore. If you're still into the whole doomsday scenario and dreaming of high gold prices, ask yourself if the reward is even worth it in the end.

Nunyadambizness's picture

Enjoy the bike, I enjoy my Ultra Classic Electra Glide HD.  I loved my dirt bikes when I had them, but love the open road on 2 wheels...

Let it Go's picture

Time has a way of revealing certain realities but does so at its own choosing. The economy is far from a well-oiled and designed machine and in the end, we may find that it is not really completely under the control of those who have been placed in the driver's seat.

In a world where central banks have become so deeply involved in manipulating and distorting markets we find true price discovery no longer exist. The question remains how best to prepare for a economic meltdown. Expect both luck and caution to play a big role on our individual fortunes as we move through the financially violent period before us. More on this subject below.

BlueHorseShoeLovesDT's picture

Are you sure it is not October 13th?

10fold's picture

The 13th of October is a Friday...

HomelessPatriot's picture

He doesn't even give us a time on October 12th, what kind of Guru is this guy?

IENTJ's picture

Funny ... he used the word "recovery" ... which recovery?

Publicus's picture

And my prediction is that you are an idiot.

shizzledizzle's picture

What the fed gonna draw back a big fat shot and mailine financials again?

silverer's picture

"...Markets Will Get Horribly Interesting"

Bill, we at ZH call that "entertainment". lol

idontcare's picture

The markets wil crash when the algos decide that it is time for a crash.  Market sentiment, earnings, the actual economy - what do these have to do with pre-programmed events which serve no one but the investment banks who are in control of "the machines"?  This isn't 1995, it isn't even 2005 - humans have nothing to do with market trends any longer.   Grow up.  Investing doesn't exist any longer - we are all speculating on irrelevant information.  All you can hope for is to cash in on a bet or 10 before the algos go against you.  It is a game of musical chairs and in the end, all but one will be left without a chair.  In the meantime, "party on!".

sunny's picture

Perhaps it's just me but these negative missives always point to major market problems at least 1 and sometimes 2 quarters away.  That is more than enough time for folks to forget the negative prophecy.  This has been going on for years and no one ever calls columnists for bad predictions.

It's getting old.

aliens is here's picture

Why can't these people predict they'll win the powerball?

Rakksan's picture

Right, it is always in the future. Enough time for you to forget.

aliens is here's picture

True I will predict the Sun will blow up in about 3 billion years.

Sanity Bear's picture

"My LSD shipment comes in October 11th."

elephant's picture

David Stockman told us March 15.  Bo Polny said the end of April.  How about Jonathan Cahn, was it last September?  Oh, and these guys just wait it out after their most recent prediction fails and then issue a newer prection.  OK, so I'll mark October 12 on my calendar.  It really has gotten to the point that I could mark off one prophetic YouTube warning for every week of the year.