Well for those who had their doom bunkers all prepped and ready, there’s “good” news on Tuesday – the apocalypse is back on.
The takeaway: if you’re long and unhedged, one of two things must be true. Either you know something everyone else doesn’t or the other way around.
Generally speaking, this week’s theme (reflation back on in the U.S. as stocks, the dollar, and yields all rise in tandem) held, as there was no news “bigly” enough to change the narrative.
These concerns have found expression in cautious notes from Goldman and lengthy missives penned by the likes of Howard Marks, who in July implicitly compared the current environment to the “perpetual motion machine” that was at work just prior to the dot-com bust.
Time to give some more money to your local Target manager.
“InformationTechnology has been the primary driver of above-average fund returns versus their benchmarks in 2017 (Exhibit 5). The average large-cap mutual fund is overweight Info Tech by 144 bp, the largest overweight across all sectors.”
And just like that, all of the good news trial balloons we got from McConnell on Monday (debt ceiling guarantee) and from Politico on Tuesday (tax reform moving ahead) were rendered null and void…
“Make inexorable rallies great again.”
“…but I do know who’s not afraid: Nasdaq-buying E*Traders, dammit.”
Kind of makes you think…
And now back to your regularly scheduled rally.
So you know, he’s got that going for him…
“And you will know my name is the Lord when I lay my vengeance upon thee!”