Well, we’re just hours into 2018 and everyone is already bemoaning the absence of new narratives to latch onto.
I’m not entirely sure what everyone expected. If 2018 were a person, it would probably be thinking something along the lines of this: “well shit, give me at least 48 hours to get my feet wet before you start accusing me of being a cheap knock-off of my predecessor.”
On the geopolitical front, Iran has taken center stage and “lordy I hope there are tapes” or at least some diplomatic cables that get leaked over the next couple of months, because it seems entirely likely that the social unrest you’re seeing is at least to a certain extent engineered. I mean don’t get me wrong, the moderate vs. hardline narrative has been playing out for years, but it seems like some damn coincidence that this is happening just as MbS aggressively moves to counter Iranian influence in the region and just as Trump ratchets up the pressure on the Revolutionary Guard on the way to undoing the nuclear deal. So if you’re looking for an oil narrative for 2018, you’ve got one.
But outside of that, nothing has changed materially from Friday. Which, again, isn’t surprising because Friday was just four days ago.
“2017 has started with Asian equities rallying, bond yields low and steady, oil and metals prices well supported and the dollar soggy,” SocGen’s Kit Juckes writes on Tuesday, adding that “economic data is strong, risk is ‘on’, investors are looking for yield, and the year won’t start until after Friday’s December US employment report.”
Luke, referencing Kit’s note, is afraid we’re still going to be grasping at narrative straws later this month:
My greatest fear is that we're still reading this headline in three weeks. pic.twitter.com/n4KvgDErFa
— Luke Kawa (@LJKawa) January 2, 2018
Sid’s in the same boat:
Coming up with 2018 market narratives that are different from H2 2017 pic.twitter.com/59ikh9UiM1
— Sid Verma (@_SidVerma) January 2, 2018
Tracy (fresh off an epic romp through the Great Savannas) thinks we need to just stop it:
You and @LJKawa, stop it.
— Tracy Alloway (@tracyalloway) January 2, 2018
“There are, perhaps, some lessons to be gleaned from the earliest price action but, heaven forfend, make no conclusions,” former trader turned-Bloomberg columnist Richard Breslow writes on Tuesday morning, before reminding everyone that “if there is one takeaway from the investing experience of last year, it’s that the most beleaguered class of traders were those unfortunate enough to use fundamental analysis as an important piece of their asset allocation process when you were meant to just kick back and be passive.”
Right. So maybe it’s just best to put your feet up and passively “participate” (fun paradox there) in the perpetuation of this dynamic:
Or better yet, just buy yourself some Ripple for the “guaranteed” 32,000% gain…
i thought the theme would/will be ‘tax policy impacts otw’, and/or ‘infrastructure spending to spur growth’
after all, once the markets have give all they can (fundamentally at least) the next move is to pretend things are bad (jobs the economy) and do some major deficit spending. b/c if the markets seem mathmatically unlikley to give much more, just change the law and force the govt to put more money in your pocket (given you are a member of tptb).