More than a decade after we first said that in the "New Paranormal" nothing matters besides the Fed, all those "experts" who mocked our Austrian view are falling like flies with one Wall Street strategist after another admitting that we were right.
The latest to demonstrate that the sell-side always reacts rather than leads, is Jefferies strategist David Zervos (who actually charges $500 for an annual subscription to his very deep thoughts - after all someone has to pay for all those trips) who has concluded that earnings and economic data are a "colossal waste of time" and it is all, drumroll, about Fed pumping the money (to Zervos' credit he has been a truly dedicated Fed fanboy for much of the past decade).
Here is the Zervos section in question from Sunday's aptly named Jefferies "Insights" ahead of the coming weeks:
Since there is a robust Fed liquidity backstop, and we do not know the depth or duration of the current economic downturn, spending any time looking at economic data releases or focusing on corporate earnings is a colossal waste of time.
For economic data, the signal-to-noise ratio is essentially zero, and for corporate earnings, N-T results are meaningless with regard to L-T earnings potential. The item to focus on is the Fed and its direct support for the financial and non-financial IG corporate sectors.
True to form, that's Zervos' entire note: after all why elaborate when all that matters is the Fed's "direct support" - that's self-explanatory and requires no "expert" commentary. It appears that similar to Marko Kolanovic, whose thesis is that central bankers have your back, Zervos is saying just bet it all on the Marriner Eccles printer, yet fails to grasp that there is no need for strategists in a centrally-planned market.
Why? Because as Blackrock's Rick Reider admitted one month ago, the world's largest asset manager with $7 trillion in AUM "will follow the Fed and other DM central banks by purchasing what they’re purchasing, and assets that rhyme with those." In other words, there is no more fundamental analysis left in a market where all that matters is reading the latest Fed press release and purchasing anything the Fed is purchasing, be it Treasurys, MBS, ABS, investment grade bonds, fallen angel bonds, or - sooner rather than later - equities. And no, David, one does not need to pay someone $500 to get "insight" from perfectly public Fed press releases disseminated to everyone at the same time.