Well, here we is (sic) – March 22 – and this is ideally when in our strange view of reality, US Market MIGHT take to the high-board in a very 1929-like way.
I predicted this last month based on our work on the Peoplenomics side of the house, Dow futures were down more than 200 points earlier. We hold a very different (OK< odd, then) view of the markets. One that is based on globalism with the US only a single, non-dominant player. History matters, don’tcha know? When you line up the market break back in 1920-1921 with the Housing Bubble market break low (March 2009, remember at that fun?), this is what you get:
No, this is not financial advice – more like the confessional of a wild-eyed trader who sometimes wins big, but other times loses big.
That’s because there are just some aspects of the future that are difficult to nail down with enough precision to put money behind. Humans create lots of “activity noise.”
Which gets us to the troublesome part of the first chart: Are we at the left should pause (follow thearrows to the left, see immediate rally break-out) OR are we playing the right shoulder and about to dive as never before?
Let’s take the left should/bullish rally idea first. This is how the November 28, 1928 sequence lines up with the present market January high (and using the futures-implied data before the open):
Until the present decline started, I was leaning toward this being the preferred outcome. We get another massive rally, we get to buy a new car…yadas, yada…
Judging the correspondence between the two market periods forced me to come up with a new way of measuring…something I call the Boolean Logical Correspondence (BLC).
The way this works goes like this:
We note a simple yes/or/no to the question: “Did the market move the same direction today as it did in the corresponding period in 1928?”
If the answer is YES, score a point for the bullish case. Since the market peak (January), and through the February decline, and into this morning (based on how the futures look before the opening) the bullish correspondence has been a weak 56.41%.
So how about them Bears?
Visually, to my eyes (which ain’t to hot, admittedly) it looks to me like we are “over-hanging the Valley of Death!”
THIS IS NOT TRADING ADVICE and it’s a fools game to try. (*Which is why I do things like trade the after-hours session, lol.)
Seriously? The bearish (duck and cover) case, has a 64.1026% correspondence using BLC.
Not sure the market heard me, but a drop of 150-odd Dow points at the open should lead to the next three weeks being “veh-wee intawesting…silly wabbit.”
Such an opening would put our longer-term proprietary trading model into…naw, let’s save that stuff for subscribers, shall we?
Here’s the deal: We drop more than 300 today and only Peoplenomics readers get tomorrow’s column. Howzat?
Just understand that the WW (Whole World) index is now down 6.7 percent from its January 26 high, and that makes this the 7th week of what’s turning into what smacks of a Global Bear Market. We expect weakness to persist.
While bulls say it’s all because of the US tax reform and repatriated money, remember that when the dollar value goes up, it takes fewer of them to “buy the Dow” – so yes, we would be fine with a currency-driven market decline…money’s money, you know?
Maybe next month, someone besides me will see it, but remember, I’m a lone nut out here in the woods and this is a very unorthodox view.
Let’s see how it works out…
Does Old Consenting Sex Matter?
Didn’t seem to for Bill Clinton…the old petchewzelwhacker didn’t get impeached, so why is everyone doubling down on Trump? All smacks of a double-standard.
Still Need a Distraction – How About War?
We wonder “how soon?” when a story like how a ” Chinese paper says China should prepare for military action over Taiwan...” shows up.
Of course, since China bans Facebook (and isn’t selling gender-change in schools, so far as we know) they may have a little higher “national T-level” if you know what I mean… High T levels win fights, war, and…oh please, don’t mention this to anyone. Ain’t PC…factual, sure, but PC? No.
Meantime, file under blah, blah, blah: Zuckerberg apologizes for Facebook mistakes with user data, vows curbs.
Gosh, we hope not…it was a joy to see a rube like Trump slay the Deep State in social-ists. So maybe the “special lefties” ain’t so special, or bright, maybe? Tell me it ain’t so…
Or, as we sagely remind: On average, everyone’s average…
Tesla Pay Whiners
OK, it doesn’t really matter how much Elon Musk makes – but the media has gone into stupid mode on this.
Take for example: World’s top wealth fund says opposed Musk’s $2.6 billion pay deal/
Now a simple explanation of why we don’t care:
First,. Musk is a serious entrepreneur. This means he makes things happen whether you like ’em or not and we tall that growth.
Point two? Musk’s personal life is off-again-on-again with women, so I don’t know whether he’d file single (with shared support) or married (with share support), but as long as he’s paid a whopper of as W-2 than have at it. What bracket is a billion a year, anyone?
On the other hand, if it’s structured offshore for tax advantage? Well, yeah, then we start to look at the pay level as sleazy.
BUT, if we did that, half of Connecticut would be up in arms over offshore stock option domiciling and money coming in as “loan proceeds” (loan money is not taxable)…and all the other tricks of offshore, 1% screw-overing is a highly evolved art….but there you have it.
She’s to Die For
Tacky headlines? Us?
State of Confusiornia
That would be California. More California cities looking to reject state’s sanctuary law.
Call the WWF – this is a tag-team masterpiece! Get it on cable PPV!
Local government, vs. state government, vs. federal government, vs. Mexico….And on the undercard?
Where’s She Learn THAT?
Is this a GOP spin on Pocahontas Warren?
LEI (leading economic indicators) later this morning. It’s an anagram…and it ain’t hard to figure.
Neel Kashkari – one of the most rational of Fed members – speaks tomorrow be interesting to hear why he didn’t vote for the rate hike Wednesday.
Also would be interesting why the Fed overall didn’t buy in to his plan to resolve Too Big To Fail…oh, but we know the answer there: If you run out of money, it’s bankruptcy. But when banks (and other “special” people) do, it’s a bail-out. Free money from the tax-slaves… but I digress.
Four day trading week ahead – Good Friday is a stock market holiday…all Friday’s are good, don’t get me wrong…but that’s next week. Regular day tomorrow. (You like regular, right?)
Tomorrow Durable Goods. CFNAI Monday and Housing from Case-Shiller Tuesday.
And the beat goes on….
M oron the ‘morrow.