We are standing at the cusp of global meltdown and investors have convinced each other that the most crowded trade - Mega Cap Tech - which is going late stage parabolic, is the safe haven.
Full credit to artificial intelligence.
Today's bullish pundits have gone full Tom Lee of Fundstrat. They will say anything possible to keep the sheeple from bolting. The latest Zerohedge hypothesis is that hedge funds have capitulated to "buy in" the melt-up but retail is bailing so that means the bull market is just getting started. Sadly, it means quite the opposite:
Retail investors are not "capitulating", they are getting wiped off the map by their newfound 0 date gambling addiction. Meanwhile, hedge funds ARE capitulating and otherwise covering all shorts ahead of an imminent debt default.
Is this a smart idea? Probably not. But they tried the same thing ahead of the pandemic as well:
Speaking of default, the House of Representatives just adjourned for the holiday with no prospect of a debt deal:
"House lawmakers are leaving Washington for the long holiday weekend Thursday afternoon — just one week before the Treasury Department says the U.S. is at risk of a debt default — without a deal to raise the debt ceiling"
“It’s just the weirdest thing to be going home in the middle of an impending disaster”
It's not weird it's totally normal by today's Idiocratic standards.
In 2022, the first two weeks of June were the two worst weeks of the year. Here we see the Global Dow and in the lower pane, we see NYSE breadth on this latest zero hedged "breakout to new highs", is the worst since last year.
FYI, crack has not been legalized. So it's not a legal defense.
Yet.
Everything is playing out just as it did in 2011, except far worse. Market mass complacency has now backed up into the U.S. Congress where used car salesmen are now going on holiday believing that they can implode this house of cards economy with impunity.
Which gets us to my prediction for what comes next. I don't see a debt deal until markets fully explode. Then, comes what I call the "Super Clusterfuck" which will exceed all expectations. Followed by a too-late-now bailout from Congress and the Fed.
Followed by mass rioting.
In other words, exactly what this ass clown Circus deserves.
