‘We All See It Happening’: Dour Predictions Proliferate As Insanity Reigns

‘We All See It Happening’: Dour Predictions Proliferate As Insanity Reigns

Risk sentiment was noticeably sour Wednesday morning in the US, as market participants pondered earnings, vaccine rollout, the future of Joe Biden's stimulus plan, and what looked like it might be the beginning of a waterfall effect from the ongoing efforts of the Reddit crowd to engineer short squeezes and otherwise triumph in what some have framed as a kind of "populist" uprising against the "suits." The dollar trekked higher as equity futures sank, and 10-year yields fell again -- a move bac
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4 thoughts on “‘We All See It Happening’: Dour Predictions Proliferate As Insanity Reigns

  1. Re: “Whether it makes sense to blame one man — Powell”

    I suggest looking back to when trump played tweet games, undercutting Powell at every turn, and, at every turn, Powell blinked and was frozen like a deer in laser beam headlights. That frozen deer stupidity is what set the stage for low interest rates as we headed into the pandemic. Digging out of that hole is almost impossible now.

    If we look at CBO forecasting, they say: “The rate on 3-month Treasury bills is forecast to remain near 0.2 percent through 2026 and then increase to 2.0 percent in 2030 ”

    And, meanwhile, the FFR is currently below zero, where it will stay frozen: “The Wu-Xia shadow federal funds rate stood at -0.29 percent on December 31. The rate is constructed with underlying input data for Gurkaynak, Sack, and Wright yield curve estimates.”

    This new riot attack phase to kill off shorts is obviously a whole new dynamic that feels like a real-time Black Swan with shark teeth — which kind of fits like a glove with sub zero Treasury future value. That paints a picture of a Red Sea parting and a biblical dis-connect between realities and fantasies, perhaps even a story about a social movement that turns stock picking into HFT radical extremism — and an extension of a social agenda. It strikes me as odd that weeks after the attack on the Capitol we now have an Arab Spring social network disrupting financial markets. Probably nothing, maybe cabin fever?

  2. The block quote containing an excerpt from Mr. O’Rourke’s commentary is funny. Reads like something that could have been published 20 years ago. Reads like the 1,001 commentaries just like it, from various different authors, across the last 20 years, that we’ve all read.

    Of course, he’s right. The big one could happen tomorrow. Who knows? Cyberattack? Reddit goes down?

    Then when the big one hits, assuming Vanguard is up, we can go in and take advantage of the low PEs in the range of 10-12. hahaha. Until then, let’s just sit on cash.

    No one’s best interest is served if it all comes down tomorrow. We. kind of have to keep it going until we can finally colonize space.

  3. I tend to try to simplify when possible looking for common denominators… It has all been done for me , ironically by the market crash crowd , the MMT proponents, and the Reddit Mania… There is a lot more to this picture than meets the eye… We all best beware of Wolves in Sheep’s clothing and/or .unintended consequences.

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