My assertion is that the ninety year secular rally from the early 1930 lows ended in 2020 with the COVID pandemic. Unfortunately, most people never got the memo. It makes perfect sense that this fifth wave blow-off top was by far the fakest and most fraudulent rally of our lifetimes. One could make the case that the secular bull lasted for one more year, however, this will be a lethal rally. A bull trap of multi-decade proportions, awaiting those who didn't know when the party was over. No one in the future will believe that a pandemic that blighted the economy could fuel a manic risk on stock rally.
Sheer lunacy is lethally contagious. Far more dangerous than COVID.
Unfortunately, the sheeple have been conditioned to expect the future to be the exact same as the past. Now we are seeing the full divergence of fantasy over reality.
In 2020, the U.S. became 100% Japanified. Meaning that the economy and markets are now fully dependent on dramatic and ongoing stimulus. This means that the U.S. is now locked in a perpetual boom and bust cycle similar to Japan and China. This rally from the March 2020 lows is merely the first sugar rally, but by no means the last. This year, the U.S. national debt will grow four times faster than borrowed "GDP". Yes, you read that right. Currently, most of Wall Street is betting that the secular bull market in bonds is over. Nothing could be further from the truth. Per the rules of Japanification, U.S. long-term bond yields will soon be heading to zero, although not necessarily in a straight line. First, the two most crowded trades of this era - long stocks, short bonds - must be reversed. The volatility will be epic.
Of course, most people don't see this coming. Why? Because this era represents the pinnacle of Wall Street fraud and the pinnacle of Main Street gullibility. It's sheer arrogance to believe that the U.S. will escape the same fate that met Japan and China while taking the exact same path of stimulus dependency. Arrogance, stupidity, gullibility. Call it what you want. Most people today don't see anything wrong with this current level of widely accepted deception, because this is by far the most corrupt and decadent society in U.S. history.
Back in late 2014, erstwhile hedge fund manager Hugh Hendry called this stimulus-driven delusion "imagined realities". Meaning it's all just sugar-addled gamblers front-running false narratives. In this era, mass deception has been fully normalized. When Congress held hearings on the Gamestop debacle, their only concern was that everyone had equal access to the pump and dump scheme. In this era, we have democratized access to fraud.
Japan's stock market peaked way back in 1990 (not shown). They have been in a sideways boom and bust cycle ever since, and yet they still lack the fortitude to reform their economy. At this point in time given the global COVID depression, it's possible that it's too late. A possibility that the U.S. will soon contend with - a global poverty trap. Competitive currency debasement.
China's stock market peaked back in 2008. Since then they've been in a boom and bust cycle similar to Japan. Each boom and bust weaker than the previous one.
Of all of the rallies in U.S. history, this one is by far the fakest and most fraudulent. You pretty much have to be brain dead to believe in it. Hence it goes largely unquestioned. When this fraud ends, this society will realize that the "experts" are the con men, and the cassandras were right all along.
At which point their incipient mental breakdown will be fully realized. For those considering a new profession in therapy, bear in mind there is no market for telling people to grow the fuck up. I've tried.
