Nasdaq has been driven by FOMO in 7 stocks. Based on social media MEME type silly pumping in AI, FED rate pause and better then "expected" (but not better) earnings.
While I have no problem with a bull run, I do have a problem with the way bulls ran it. Meaning, moves that are designed to provoke emotions are rarely if ever trustworthy.
From an economic stand point stocks are extremely expensive at the moment. So much so that we would require to find millions of people to enter the workforce, with good wages, willing to take on more debt in order to drive consumption higher and boost EPS growth to justify current stock prices. At 3.7% unemployment (from 3.4%) that is not going to happen.
Alternativerly we need massive deficits, ZIRP, and more QE. That ain't going to happen either with core ifnlation falling only -0.3% since Jan 2023. If it does come it will be for recessionary reasons not because of a "soft landing".
At some point going from high inflation to recession the illusion of a soft landing will always appear. There is no way around it. I take the FED pause as a bearish signal rather than a bullish signal since everytime the FED lowers rates we are already in a recession.
From great Euphoria comes great Misery.
While I have no problem with a bull run, I do have a problem with the way bulls ran it. Meaning, moves that are designed to provoke emotions are rarely if ever trustworthy.
From an economic stand point stocks are extremely expensive at the moment. So much so that we would require to find millions of people to enter the workforce, with good wages, willing to take on more debt in order to drive consumption higher and boost EPS growth to justify current stock prices. At 3.7% unemployment (from 3.4%) that is not going to happen.
Alternativerly we need massive deficits, ZIRP, and more QE. That ain't going to happen either with core ifnlation falling only -0.3% since Jan 2023. If it does come it will be for recessionary reasons not because of a "soft landing".
At some point going from high inflation to recession the illusion of a soft landing will always appear. There is no way around it. I take the FED pause as a bearish signal rather than a bullish signal since everytime the FED lowers rates we are already in a recession.
From great Euphoria comes great Misery.
Comment:
Looking good!
Comment:
BAM!!! MAGIC!
As expected
As expected
Comment:
BAM! Another new low.
Another great call!
Another great call!
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