Picture no economy, no stimulus, no vaccine, and a petulant fraud barricaded in the White House while thousands are dying. Because that is what's coming. When they finally remove him, he will make Herbert Hoover seem popular by comparison...
Deja vu of subprime circa 2008, COVID is a massive wrecking ball that is being assiduously ignored by the GOP, the White House and Disney markets.
Denial is their entire way of life.
Way back in late February, the COVID pandemic had been spreading globally for an entire month since late January. COVID cases were beginning to appear in the U.S. and the experts were warning it was about to get far worse. However, the denialists in the GOP, the White House, and in Disney markets ignored the warning signs.
When the lockdowns arrived "unexpectedly", the market exploded.
Good times.
Right now, the COVID pandemic has been raging for ten months, and is entering "the winter from hell" according to President Biden's COVID expert. However, the pandemic experts in the GOP, the White House and Disney markets are in signature denial.
Good times.
For months, the alt-right and other make-believe pandemic "experts" have been saying that this is a "casedemic" meaning, much ado about nothing. And thanks to all of that denial which reached its apex last week at the election, COVID hospitalizations are now skyrocketing to new record highs.
I watched a young guy on TV recently, he had believed that COVID was a Democrat hoax, until he got his grandmother killed "by accident". Shit happens man. Some people run red lights, some presidents cheat on their wives and taxes, and some people get their relatives killed because they're lifelong idiots.
THE BIG SHORT 2020:
Back in late February, hedge fund billionaire Bill Ackman made a $27 million bet in the credit default swap market - the same private market used to bet against subprime in 2008. That bet turned into $2.6 billion within a few weeks, for a 1,000% return. Now being called the greatest trade of all time.
Now Ackman is putting on the exact same bet, albeit on a smaller scale, because he sees the same risks and complacency:
"What’s fascinating is the same bet we put on eight months ago is available on the same terms as if there had never been a fire and on the probability that the world is going to be fine.”
When Ackman took his profits on March 23, there were just over 10,000 new cases of COVID-19 nationwide. On Tuesday, new cases were just shy of 140,000, a dizzying number that has stoked fears of a second lockdown."
What Ackman calls "fascinating" is the same ridiculous greed and complacency that exploded markets in 2008. Clearly some dumbfuck investment bank is willing to take the other side of a failed trade a second time in a row and on the exact same terms. It would be like an insurance company selling fire insurance in a wildfire at discount rates.
What we notice vis-a-vis the cyclical sectors such as airlines, is that all year up until now, they rallied into a falloff in hospitalizations.
Except, this time they've rallied into a spike in hospitalizations:
Adding to the insanity is the manic reach for risk amid record risk. Also deja vu of February:
Step back for a moment and consider this past week of market madness. Last week, markets ramped higher into the election. Then on election eve when the blue wave failed to materialize, the deflation and reflation trades went in polar opposite directions. The deflation trade ripped higher into the end of the week, and reflation trades got monkey hammered. Then this week, the exact opposite took place Monday and Tuesday, the reflation trade ripped and Tech traders got monkey hammered.
In other words, algos were merely causing the most pain to the most people. Which is what I said would happen post-election. Run the stops in both directions. Now, Wall Street is loaded up on reflation trades, which is why today those trades started to roll over again, and Tech caught a bounce apparently thanks to Millennials buying the dip.
Bear in mind the bond market was closed today for Veterans Day, so we didn't get a good look at bond yields.
Here we see banks stalled at the same level as June, despite record call option speculation all year long:
“Until our political leaders force bars and restaurants to close, I don’t see how we can get this thing under control,” Cramer said. Investors have rotated out of stocks associated with the stay-at-home theme on Covid-19 vaccine optimism, but experts are warning that the winter months could be brutal as cases continue rising."
Uncertainty surrounding pending stimulus talks is also on the host’s mind...[Trump & Co.] denying the legitimacy of the election and trying to fight it any way they can, they’re certainly destabilizing the situation,” he said. “From the stock market’s perspective, that’s a problem.”
