Wednesday, July 8, 2020

Robbing The Poor To Pay The Rich

...has been the signature GOP strategy for decades. Why stop now?

First, on the political front, one more meager stimulus package is planned ahead of the election later this month. Even if it passes - a big if - it will be far too little, too late. Whatever stimulus "plink" the GOP has planned will be trivial relative to the ending of supplemental unemployment benefits set to end this month. Picture a -50% drop in income for tens of millions of unemployed minimum wage slaves.

In the meantime, the global Tech-only melt-up continues mid-week. Here we see that U.S. internet stocks are outperforming the average U.S. stock by a net 50% year-to-date.

As we see above, the average stock is down -20% which coincides with Warren Buffett's performance for the year. Which is very interesting, because we just learned that he has almost HALF his portfolio in Apple stock. Yes, you read that right.

It took almost his entire lifetime - 90 years this year - for Warren Buffett to embrace Tech investing. Why? Because he has admitted many times he knows absolutely NOTHING about technology. And yet now he has made the largest bet of his storied career on dumbphone 11.

"Warren Buffett once said that “diversification is protection against ignorance. It makes little sense if you know what you are doing.” The take-away: Load up on what you know.

"My flip phone is permanently gone"

[We'll get you an ATM card next and then you will be a fucking Tech genius]

Earlier this year, Buffett explained to CNBC how critical the Cupertino, Calif.–based technology behemoth is to Berkshire’s overall performance. “I don’t think of Apple as a stock. I think of it as our third business”

Dave Portnoy - Ponzi schemer for the masses - is right about one thing, Buffett has totally lost his mind.

Below are some more charts to show the global Tech mania now going late stage parabolic:

Online retailers are in the stratosphere awaiting re-entry explosion:

Likewise, Chinese Tech and EM Ecommerce stocks (mostly Chinese) have temporarily left the atmosphere, deja vu of the last two global crashes:

The Nasdaq breadth ratio is diverging deja vu of February

The equity call/put ratio is likewise deja vu:

The breadth crash ratio is back to super crash levels

As we see below, gold is tracking internet stocks higher.

Which means that the divergence between bond yields and gold is now chasmic. 

There is no reflation whatsoever in the MAGA Kingdom. All of the money flows to the wealthiest individuals and the wage slaves are left with a "plink" to the forehead.

Those who don't realize that the GOP strategy has ALWAYS been to rob the poor to pay the rich, are about to learn the hardest lesson of a lifetime.