Wednesday, November 4, 2020

MAGA Is Running On Glue Fumes

Four years and counting...

Trump is working overtime to sow the deceit that late ballots are now being "dumped" by Democrats to rig the election. Which is why Twitter put an alert on Trump's account:

Warning: Most of what this dunce says is pure fiction. He couldn't get elected with out it. 

Twitter is biased against lying jackasses. It's a conspiracy. What once was freedom of speech is now equal opportunity deception in the hands of an Idiocracy. Who needs Pravda when half the country considers the truth to be liberal? Regardless of who wins the election, we just learned the terrifying truth that after four years of incessant lying, nearly half the country still prefers Trump over reality. Inbound from outerspace, an approaching alien would be making a U-turn right about now, concluding there is no intelligent life on this planet. History will say that we tried having the smart people lead the country and when that failed we opted for the dumbfucks instead. One must exhaust all options. What I want to know is why hasn't the Deep State gotten Joe Biden elected already? You would think they learned their lesson in 2016 when they let King Donny slip through the cracks. These elites are falling asleep on the job AGAIN.

There is a book that was written back in the early 1970s called Future Shock which predicted all of this dumbfuckery would happen. The basic premise is that Globalization brings about so much unprecedented social change that the populace at large goes into a state of shock. They become fearful of the future. Society basically disintegrates:

"Alvin Toffler argued that society is undergoing an enormous structural change, a revolution from an industrial society to a "super-industrial society". This change overwhelms people. He argues that the accelerated rate of technological and social change leaves people disconnected and suffering from "shattering stress and disorientation"—future shocked"

Society experiences an increasing number of changes with an increasing rapidity, while people are losing the familiarity that old institutions (religion, family, national identity, profession) once provided"

All very prescient, and yet we face a choice to accept this change and manage the consequences, or curl up into the fetal position and find solace in the fabrications of a known con man. Recycle the same failed policies over and over again each time expecting "reflation". Each time ending up closer to a banana republic. 

Which gets us to where we are today post-election. No surprise, $350 trillion in global capital just decided today that gridlock is the best thing for asset prices. Which is surprising because just yesterday they were bidding up the reflation trade.

Nothing lies more than misallocated capital at 0% interest rates. At the END OF THE YEAR. It's Santa time, so untold amounts of sideline capital is now flowing back into Trump Casino to partake in the gridlocked deflation rally. I fully expect that by the end of this week we will find out that not only have shorts covered, but active managers are back to 110% fully loaded. The call/put ratio will be back in the stratosphere. Every investment advisor on the planet is right now telling their clients the coast is clear. 

Meanwhile, the real economic disintegration will accelerate into year end. Starting now:

The fantasy of a quick stimulus dies hard, even as it slips away:

“Now having (a stimulus package) done in early January or February becomes a big feat” 

No surprise, banks stocks are getting monkey hammered today. Deja vu of June's fake reflation rally.

That was the mid-point of the rally and this is the endpoint of the COVID rally:

This is the final rotation for the Virtual Economy, because guess what, there's no such thing.

My wave count for Tech is nested 1s and 2s, just waiting for the glue fumes to wear off:

Among the other early casualties of gridlock and deflation are gold and gold stocks. 

And gridlock won't be friendly to the top performing trade of the year, alternative energy, as solar stocks and Tesla are selling off today:

Chinese stocks have already decided Biden will win. But in reality now, no matter who wins, they are primed to implode. The last Vixplosion took place on the Monday after the jobs report and FOMC meeting. Just stating a coincidence. 

Because it might not take that long.

In summary, this fake rally is led by MAGA Tech, under the assumption that they are now protected from anti-trust legislation by the newly re-elected Sith Lord Mitch McConnell.

Sniff glue at your own risk.

And bear in mind, this is now the Y2K scenario. A contested election coming at the end of the biggest Tech bubble in decades. 

Except this time instead of 30 year high GDP and a Federal surplus, there is negative GDP and a -17% deficit. An accelerating pandemic, mass unemployment, record low interest rates, inadequate fiscal stimulus, and impending riots.

Otherwise pretty much the same. 

100% fantasy and misallocated capital.