“Even as a matter of economics 101, the forthcoming $1.8 trillion of combined bond supply from the sales of the US Treasury ($1.2 trillion) and the QT-disgorgement of the Fed ($600 billion) is self-evidently enough to monkey-hammer the existing supply/demand balances, and thereby send yields soaring.”
“That’s right. Heisenberg reminds us this morning that we are in undisputable record territory. It has been fully 395 trading days since the market had a 5% drop, and that’s never happened before in all of recorded history.”
“Such seasonality is truly remarkable and unlike anything we have seen before.”
“…we know of no melt-up that had legs of more than a few months after the point that irrational exuberance went full retard, as is happening at this very moment.”
“That refers to Wall Street, Washington, the Dems and the GOP, and all the far and near corners of the planet which are implicated in their collective follies.”
“How’s your 401(k) doing?”
“…it’s about to accelerate. Not only that, the tank is full of gasoline, and the car has been stripped of all the extra weight.”
“So when you ask what the big risk is, the answer is”…
“It could happen tomorrow given the extreme expense of US equities and the near universal consensus of a continued acceleration in the economic cycle despite the Fed also in the midst of a tightening cycle.”
“The dot com bubble had the internet. A constant theme of bubbles is the ability of speculators to shout that dreaded cry “this time it’s different.” Logical arguments against the bubble can then be disregarded as speculators declare that the doubters simply do not understand that the world has changed.”
“We are likely to be nearing a low point for major market bond and equity vol, and if the catalyst is policy it will likely come from positive volatility QE ‘flow effect’ being more powerful than the vol depressant ‘stock effect’.”
“The difference this time is that those macro pressures are being combined with a broad array of idiosyncratic negatives.”
“Perhaps, the prudent investor should be braced for at least a -20% plunge in the value of a well-diversified portfolio at some point during the next 18 months.”
“Can’t be distracted with what’s goin’ on with the war, or what’s wrong with the economy – stop worrying about that!”…
Let the bull market do its job.Â
“The question every client asks: ‘Is an equity correction imminent?’ The impetus for the inquiry comes from several sources”…
“What a bunch of superstitious hogwash.”
“…if the ninth year of expansion with unemployment approaching 4 percent is not the time for above-target inflation, when will that moment ever come?”
CPI rose 0.1% vs est. 0.2%, according to the BLS.
Ex. food, energy up 0.1% vs est. 0.2%
“I can accomplish amazing things with that untiring, never flagging, hundred-fold leverage. I can also kill myself.”
“Buybacks for the largest banks will soar by 45% this year.”
Well, here’s hoping this week lives up to last week…
Well Britain is about to vote – again. Thursday’s election is part of a trio
“The last time volatility in the US bond market was this low (and complacency this high), 10y yields spiked up some 150bp in only four months as part of Bernanke’s ‘Taper Tantrum’. “
“Technical factors and central bank liquidity have allowed markets to suspend disbelief.”
“The S&P 500 is at near record levels despite the fact that EPS hasn’t really changed in 3 years. So which economy is going to show up later this year and in 2018? We think the jury is still out.”
“That’s right! We can’t have anyone freak out out there, ok?”
In case you needed a reminder of just how long it’s been since this market
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