There is a 52.63% chance that we are replaying the left side of the 1929 run-up from December of 1928.
HOWEVER, there is also a 73.68% chance that we are replaying the right side of the 1929 blow-off, and in that case, the world will be ending shortly – at least in a financial sense.
All of which means what? Overall a 58.33% chance that March will end badly…very, very badly.
I won’t even begin to explain how to “run the numbers” which are – admittedly – VERY SPECULATIVE. That will be in Peoplenomics tomorrow.
But, like the old saying goes: In a Land of the Blind, the One-eyed Man is King.
We shall see.
The market is set to pop a bit at the open this morning, but I am (at least for a few minutes at the opening) on the short side of things after scalping some lunch money on the long side yesterday.
Feels like someone’s screwing with things – or something’s way off – as computer trading warfare goes.
Thursday’s NASDAQ and the S&P were about flat. One was down, one was up. But with these broad indicators stuck in about neutral, the Dow was cranking up 2/3rd’s of a percent.
Earlier this week, Walmart got creamed Tuesday (go look at their five day chart here and you’ll see what I mean). But that wasn’t the reason for the rise in the Dow.
This feels a lot like something called painting the tape. This is what happens when the market is trying to suck in the last little bits of “weak money” as the STRONG MONEY is getting ready to blow town. This is why we actually do look at things like short-term on-balance volume.
If you’ve never read Joe Granville, it’s some mighty useful trading floor economics to keep in mind. If you Wiki it:
“Total volume for each day is assigned a positive or negative value depending on prices being higher or lower that day. A higher close results in the volume for that day to get a positive value, while a lower close results in negative value. So, when prices are going up, OBV should be going up too, and when prices make a new rally high, then OBV should too. If OBV fails to go past its previous rally high, then this is a negative divergence, suggesting a weak move.
The technique, originally called “continuous volume” by Woods and Vignola, was later named “on-balance volume” by Joseph Granville who popularized the technique in his 1963 book Granville’s New Key to Stock Market Profits. The index can be applied to stocks individually based upon their daily up or down close, or to the market as a whole, using breadth of market data, i.e. the advance/decline ratio.
OBV is generally used to confirm price moves. The idea is that volume is higher on days where the price move is in the dominant direction, for example in a strong uptrend there is more volume on up days than down days.“
We continue to be stuck in something of a mess right now globally.
Whether you realize it, or not, we have a terrible problem in this country right now with consumer super-saturation.
What this means (simply) is we’re all running out of useful shit to buy. It’s like I was writing in the Coping section this morning: I can pick up a useful set of Pings on Craigslist for a fraction of their retail “new” price. And who has time for golf except old people and we’re all going to the docs, quacks, and senior centers so we don’t need most of two generations of accumulated STUFF.
This is why those storage auctions are on television; See? People LOVE the idea of getting a bargain on things, but how much is ENOUGH?
I was considering my collection of ham radio classics. One set-up (the Knight R-100A receiver and T-150 transmitter) were featured in the new ham radio journal (QST) just out this week. Do I need them? Uh…no, I guess not. Who uses AM anymore?
But do I need any of the half-dozen other collectible radios (transmitter and receiver combos) that I have? Uh…no. Try not to mention it.
Inspecting my own stupid materialism, it occurs to me that we are likely in a world-wife glut of THINGS and that at the uber-macro level, capitalism has produced itself nearly to death.
If the doors are slammed on immigration, how many houses do we need to build? (Answer: Not as many!)
And with immigration dialed down, how about hiring new ESL teachers? (Answer: rethink teaching?)
And, if China relations don’t blow up, where are the new semi-skilled jobs coming from? Voice-controlled computing is taking over a lot around here – including turning lights on an off…
Point I’m making? We are stuck in exactly what Nicholas Kondratiev was writing about in the 1920’s when he was working for Joe Stalin. Capitalism is a grand and holy things when times are bad but when things are not so bad it will out produce every other system eventually making so much of EVERYTHING that it ALL collapses in a heap because no one has any pricing power.
And besides, how many razor clubs do we need?
Point is, it’s a perilous time. Markets are in bubbles and even Bitcoin which looked for a few days like an upside breakout was imminent has pulled back this morning to the $10,000 region.
I don’t mean to go on about CONSUMER SUPER-SATURATION so often, but we have too much of STUFF.
In the meantime, the news industry is dying before our eyes and you can see it when Drudge is running the same CNN scripted the kid story as yesterday.
Why, event the (not so special) prosecutor can’t find any more work than to add more charges against Paul Manafort…involving the TIME BEFORE TRUMP. Tax returns from 2010 to 2014? Fer cryin out loud.
WHERE’S HILLARY? WHERE’S STEELE?
Maybe there are a bunch of European Socialists (Soros anyone?) who know that capitalism will blow up left to its means.
And you saw where the near of the NRA is issuing the warning again about those kinds of power-hungry political madpersons?
Meantime, with falling newspaper sales, we read in the New York Daily News how all of a sudden it’s now “Trump’s plan for teachers to pack guns is crazy, will only cause more violence, educators say.”
EXCEPT for the damn details (liberals hate those): It’s not a PLAN…it’s an IDEA.
But, the MSM is desperate as people shoveling shit into storage units to keep their own economy going.
It’s amazing, but I tell you brothers and sisters, it’s the New American Way.
Obama lied by omission not being straight that America news to import growth -even if problematic like unvetted immigrants – because without it, where will growth come from?
Showing now in headlines like “Nation of immigrants’ no longer: USCIS updates mission statement.”
We have, as I’ve told you before, a major product and marketing crisis spread before us as a country.
Thing is, if America really was a product, we’d arrive at best possible answers more promptly – and when a product change (like to Trump) is selected by the Big Focus Group, the renegade socialists (like Hillary et al) wouldn’t piss and moan about it for 18 months. We’d instead be getting on with getting on.
Thing is, in a weirdly perverse way, by stopping Trump from being totally effective, the American Left is actually postponing the day of financial reckoning that brought four term president FDR up in the Great Depression.
The Socialists are all good with elected “benevolent dictators” so long as they’re on the in’s with ’em and able to control via revisionist history.
So, in conclusion while the whole thing should blow over starting next month because we’re drowning in our own excess production success, there’s the other side doing what they do best.
Really obstructing economic progress by regulation, charges and claims, movements, and all the rest.
Those who don’t read Kondratiev are prone to walk in Stalin’s footsteps. But, you suspected that already, right?