Gurus Gone Mad, Market Gone Gzonkers
By its close yesterday, the market provided exactly the example of the head slamming I said bulls were going to get in the article I was writing all day yesterday because the “Stock Market Bulls are Delusional in Face of Great Depression.”
Monday’s stampede proved how utterly disconnected from reality the market’s bulls remain, and that means they’re going to get their heads pounded from ceiling to floor until they are rendered unconscious for their retardation.
Now that Tuesday is done, here is what ceiling-to-floor head-slamming looks like:
Look at the straight-up rocket ride that originated deep in an underground silo, shot for space, then veered sideways when it hit the stratosphere and spiraled to all the way down earth. These wild swings on the tiniest tidbits of news prove the meaninglessness of the bullish mind, exhibit clear disorientation, disorderliness of thought and delusional behavior. One writer summarized yesterday’s excursion like this:
The U.S. stock market is battling rollercoaster levels of volatility. Yesterday, the Dow Jones Industrial Average (DJIA) made a round-trip of almost 2,000 points – something it hasn’t done since the 2008 financial crisis…. When this last happened in October 2008, the stock market was still five months from its lowest trough. Instead, the recent bounce is likely just a ‘bear market rally’CCN
Such huge swings are happening because the bulls’ wish to infinity and beyond is getting constantly hammered back down by reality:
The recent ‘relief rally’ is fading as the focus shifts to dire economic data and corporate earnings this month.
Which is exactly the reason I gave when I said the ceiling-to-floor hammering would happen in yesterday’s article:
Reality is going to win because it always does, and the longer you put off reconciling with it, the worse things become for you. Monday’s claims by the marketeers that we’re on a coronavirus upswing are not likely to prove out.
Fact is, the results were in for Tuesday before I finished the article, so I’ll just have to ask you to take my word on my statement that I was not looking at what the market was doing at all as I finished the article late in the day. I had only seen how it shot up by noon. If you don’t want to take my word on that, that’s OK because there is going to be plenty more opportunities to see my words proved true about how badly the bulls are going to keep getting their heads slammed.
The bulls can thank their favorite not-so-gifted gurus for that, who are playing them for the half-witted, reckless creatures that they are.
Just track Big Boy Bill Ackman for the past week to see an example of either complete derangement or unadulterated market manipulation:
I am beginning to get optimistic. Cases appear to be peaking in NY. Almost the entire country is in shutdown. Hydroxychloriquine and antibiotics appear to help. There is increasing evidence that the asymptomatic infection rate could be as much as 50X higher than expected.— Bill Ackman (@BillAckman) April 5, 2020
Huh? The number of new coronavirus cases appears to be peaking but infection rates may go 50x higher than expected? He must be drinking the same fermented silage juice the other bulls have been sipping. Or maybe he is mainlining the stimulus drugs that he says below might help. (He might be as cracked-up as Kudlow.)
While it is hard to be positive when we know that tens of thousands more will die and many more will get severely sick, I have no choice but to be more optimistic about the intermediate future based on the data and facts I have seen recently. I hope I am right.— Bill Ackman (@BillAckman) April 5, 2020
Banks that were swinging like a piñata in the wind through a half-year repo crisis were “reasonably well capitalized?”
No commercial real estate overhang after numerous articles have been out for months about malls closing and especially in the last month about commercial real-estate loans defaulting in bank-smashing numbers?
OK, Bill. No choice but to me more optimistic because? Well, there’s so much good news in the air.
Bear in mind this is Bill Ackman the Prophet of Doom and Gloom who woke up on the wrong side of the bed three weeks ago and wrote the following divination of woe on March 18:
Mr. President, the only answer is to shut down the country for the next 30 days and close the borders. Tell all Americans that you are putting us on an extended Spring Break at home with family. Keep only essential services open. The government pays wages until we reopen.— Bill Ackman (@BillAckman) March 18, 2020
After reading the first comments I posted, you could be forgiven if you are about to tell me he was just be facetious or sarcastic in that last comment. So, let me help you by showing how he doubled down on that in the following end-of-the-world-as-we-know-it broadcast that was based on a vision he had in a nightmare: (I couldn’t even make this stuff up and get away with it.)
Swinging from day to day as manically as the market, bouncing his own head from ceiling to pillow as he hops around on his bed due to nightmares and knocks himself out in a panic, Bill must be going through some intense withdrawal now that the market bulls have built up a tolerance to Fed meds. You just don’t see such 180-degree, ceiling-to-floor head-bangers in sane individuals.
Or is it that you don’t see that behavior in honest individuals? Because of his market manic-depression, many questioned whether Buffalo Bill was just playing the market for a fool. That was after they learned Ackman essentially shorted the stock market just before his nightmarish tweet and hellcast. Then he did all he could to alarm the market into a panic, and the bulls ran off the cliff as I nicely showed you they would be prone to do in a video yesterday because the mass-market has no brain. Then Ackman sold his shorts (he’s naked behind his desk at home when he’s doing TV gurus work by phone so you won’t see his is without his shorts) and reaped multi-billions, for which he got excoriated.
He certainly traded the recent crash flawlessly, because as we reported a few weeks ago, heading into the coronacrisis the Pershing Square founder had put on a substantial amount of short hedges at the start of the month. Today we learned the full details of Ackman’s trade, and it was a doozy: in a nutshell, Ackman bought $27 million in marketwide puts “in the form of purchases of credit protection on various global investment grade and high yield credit indices” and sold them on Monday, March 23 for the nice sum of $2.6 billion.Zero Hedge
But television turns to prophets of false profits like Hackman because he makes BILLIONS, even though he’s doing it by playing the other market mavens who interview him for fools … through whom he plays the market, itself.
After this scary interview, the world apparently got all better overnight. Bill must have had a nice dream of daisies and sunshine in which he saw the light because he went shamelessly long and started sounding like a bull all over again, even though he had just said it was time to shut down the entire country and crawl in a hole and hibernate only a week or so before.
I might have thought that his way of shorting the market before the first interview simply exemplified a man who believed what he said and put his money where his mouth is. I mean I make investments based on the way I tell others I think the economy and/or the market is going to go. However, when Bill instantly reversed himself after getting ridiculed for that play and went all long and moved on to make completely opposite prognostications of health and prosperity, that moved him to whole different kind of arrogant you-can’t-catch-me-or-won’t-ever-try moxie that should be against the law … somewhere.
As Ackman described his own reversal,
“That’s the most bullish thing we’ve done. We are all long, no shorts, you know, ‘betting on the country.'”Zero Hedge
Yeah, dress it all up in patriotism, Buffalo Bill.
Stocks immediately surged, and Ackman rang up another bundle in gains. As soon as you learn he went all long, you know why his talk was “beginning to get optimistic.” Have to pump the market to match your bet somehow. You can be sure he’s full-on optimistic now that his bet paid off with a spectacular rise out of the market right after he spoke … again.
The advantage of being a guru is the bulls listen, so you have a ring in their collective nose to lead them by.
Bill’s a bull behaving badly:
But that doesn’t always turn out for the bad boys like they think it will:
Given what Buffalo Bill wanted to do with the market here, let’s hope it ends that way for him one of these days … just when he’s all in.
And let’s hope it ends that way for all those getting bailout bonanzas … again, too: