On the East Coast we are having an infestation of locusts. Last year plague, this year locusts, move along nothing to see here...
Back in paradise, bilking the public out of their life savings is now the new "economy". There are so many assholes competing to bilk the public right now that I started to make a list but I ran out of time. Needless to say, when this all explodes totally unexpectedly, the amount of rage will make the Capitol Riot seem like a picnic.
In a zero sum game, it's all about who can get over on the most number of people. This society sees nothing wrong with it. Which is why this year crypto went mainstream. Bitcoin saw major institutional adoption. Now it just crashed 50% in one week because Elon Musk finally realized Bitcoin can't scale without destroying the planet. What kind of "asset class" can fall 50% in one week and still be considered investable?
One thing crypto shows is that social mood is finally rolling over hard. Below we see that Bitcoin peaked in mid-April on the day of the Coinbase IPO which was also the day Bernie Madoff died. You can't make this shit up. Then it fell and rallied back to a lower high last week. Then Musk announced that Tesla was reversing its recent decision to accept Bitcoin. At the nadir yesterday, crypto currencies had lost almost $1 trillion in market cap. So then Musk changed his mind again, which is totally meaningless since Tesla still won't accept Bitcoin. Now we see that it's currently backtesting the 200 dma.
And we also learn that the institutions that just piled into Bitcoin, are already dumping it for gold:
May 19th, 2021
Yesterday, the Fed put a nail in the coffin of this free money experiment when the Fed Minutes showed they are ready to tighten policy sooner than expected:
May 19th, 2021
Which is perfect timing because the Economic Surprise Index is crashing:
May 20th, 2021
"Citi’s Economic Surprise Index — which measures the degree to which economic data is either beating or missing expectations — is at its lowest level in nearly a year. And if we have a few more disappointments, it could go negative."
Taking together the Fed Minutes and the crashing economic reality, it can come as no surprise that the reflation trade is getting monkey hammered this week, albeit still above the 50 dma and a bear market away from the 200 dma:
Which is fitting because we also learned this week that fund managers are record long the big "Boom":
"Exhibit 1: All Time High In Boom Expectations"
Indeed.
Can it come as any surprise that the Dow, crypto market cap, and "inflation" expectations are all peaking at the same time?
They are all part of the exact same fraud being perpetrated on the public:
This would be the first cycle in U.S. history in which inflation expectations peaked at the beginning of the cycle.
IF it were the beginning of the cycle.
Outside of the U.S., this chart in particular stood out this week:
And that is exactly what they are going to get.
What they deserve.
May 18th, 2021
