Equity Market Obsession

Equity Market Obsession = Very Bad Sign


Market Actors Care Too Much.

Resistance To Liquidity Normalization Mounts.

Q3 hedge fund letters, conference, scoops etc

Equity Market Obsession

After A Herculean + Unprecedented Price Thrust [see above chart] From The March ’09 Lows….Without Any Meaningful Capital “Draw-Down”…The Recent Market “Sell-Off” In The S&P 500 Has Drawn A Slew Of Attention + Scrutiny.

Specifically, U.S. President Trump Even Suggested That The Federal Reserve’s Interest Rate Policy Was “Crazy.”

Of Course…I Agree…But For A Diametrically Opposed Reason.

Further Trump Even Mentioned That He Would NOT Be “Firing” Fed Chairman Powell…Which Clearly Suggests That He Is Considering It. Quite Clever…A Veiled Threat Delivered In A Wrapper Of Denial.

A Mere 7.5% U.S. Equity Market Selloff After A 341% Advance Primarily Fueled By Global Central Bank Liquidity Torches.

It Ought Not To Cause Too Much Discomfort…To The Uninformed.

But Then…The Power Elite Actually Realize The Fragility and Inter-Connectivity Of The World Capital Markets.

After A Decade Of Ultra-Easy Monetary Policy They Have Inadvertently Created An Addiction To Global Interest Rate Suppression + Quantitative Easing…Generating An Ethos Among Market Actors That Free-Flowing Liquidity Will Continue Indefinitely…Fanning Excessive Speculation…And Ultimately Effecting Severe Market Volatility.

It Seems Though…That The Power Elite Finally Realize Their Error Of Too Much Duration & Are Marginally Committed To Tightening The Monetary Reigns.

So The Removal Of The Liquidity Narcotic Has Begun…Led By The Federal Reserve…Albeit Very Slowly…Yet Has Already Created Quite A Bit Of Global Economic Discomfort…Especially Outside The U.S.

The Addicted  Market Actors In The U.S. ,It Seems, Have Recently Capitulated To Their Discomfort …Likely Initiated By The Accumulating Withdrawal Of This Pernicious Economic Drug.

Naturally…They Complain And Whine For A Larger Dosage Of The Reduced Narcotic [see Trump comment above]…In Order To Ease The Pain Of Downward Price Action.

And Somehow…They Now Are Attracted Toward Their Fear…The Market Fear They’ve Never Truly Confronted.

That Is…The Evolving Reality That The Narcotic Might Not Drip Into The Market’s Veins Again…At The Same Rapid Pace…If At All…For Quite A Long While.

But They’d Be Wise To Take Notice Of Their Fears.

Because Printing Money + Creating Insurmountable Piles Of Monetized Sovereign Debt To Solve Economic Ills = NOT A Sustainable Economic Reality.

Moreover…There Is Quite A Body Of Evidence Suggesting That Market Excesses Have Not Only Formed …But Have Also Matured…And May Be Primed To Burst.

So As Market Actors Ponder The Business Heroes In Ayn Rand’s Thick Classics “Atlas Shrugged” + “The Fountainhead” …They May Also Benefit By Contemplating One Of Her Singular Famous Quotes… Warning…

“You Can Ignore Reality But You Cannot Ignore The Consequences Of Ignoring Reality.”

Article by Global Slant

Saved Articles

The Life and Career of Charlie Munger

Charlie is more than just Warren Buffett’s friend and Berkshire Hathaway’s Vice Chairman – Buffett has actually credited him with redefining how he looks at investing. Now you can learn from Charlie firsthand via this incredible ebook and over a dozen other famous investor studies by signing up below:

  • Learn from the best and forever change your investing perspective
  • One incredible tidbit of knowledge after another in the page-turning masterpiece of a book
  • Discover the secrets to Charlie’s success and how to apply it to your investing
Never Miss A Story!
Subscribe to ValueWalk Newsletter. We respect your privacy.

Congrats! Are you a smart person?

We have an exclusive targeted for being a sophisticated and loyal reader.

Sign up for ValueWalkPremium today and get our exclusive content for 35% off.

Use coupon code vip19 or click on the button below

Limited time offer only ENDS 12/31/2019 or after next 25 subscribers take advantage whichever comes first – please do not share this discount with others