There’s quite a bit to discuss about last week regarding the “markets” reaction to the endless headlines of: “The bull market is intact, prepare for more upside as the ‘Santa rally’ begins to unfold into the remaining year.”
Maybe it will, however, to regard last week’s “Great!” earnings reporting in conjunction with anything concerning “bull” can only be equated to something more along the lines to bullsh*t.
The so-called “Bulls” that have enabled these “markets” to punch-out ever higher highs (aka Facebook, Apple@, Amazon™, Google™, Netflix™, Microsoft™) have suddenly stumbled.
Facebook is in so much trouble and has become so toxic in regards to social media, that within the same week of earnings, it both announced a change of name, change of business direction and announced it would spend another $50Billion on stock buy backs that only have value based on what it’s changing from – not into.
It’s absolutely, positively, unequivocal beyond absurd.
And yes, it even tops the lunatic idea that you can have a CEO in-charge of two mega-$Billion dollar enterprises (aka Twitter™ and Square™) while he constantly opines that crypto is his main focus as if that’s a “Great!” business idea, and not be called out on it via the so-called “smart crowd” across the mainstream business/financial media. But I digress.
Facebook reported – and was summarily sold off. Same with Amazon and Apple. Google (aka Alphabet™) and Microsoft held up better as did Netflix™. But what they have not done (and won’t by my estimation) is make up for the losses and drag in said “markets” if the aforementioned do not recover and press ever-higher, quickly.
What I would also like to bring to your attention, is why this past week is more important to weigh in regards to going forward than most prior, which is this: Last week is one of the few times this year where the biggest “market” driving companies reported their earnings only days prior to an end of month, and a critical Fed meeting scheduled only days later, not prior as has been the routine.
This, coupled with the pent up release of many said companies stock buy backs, along with the usual month-end window dressing shenanigans, and what you get is a “market” posting new all-time record highs with more companies share prices declining than advancing. Same with buying vs selling. i.e., Meaning: more companies stock prices closed down on the month than advanced higher, coupled with, more people sold shares than bought.
That, is what is known in the world of stocks as an “Oh sh*t!” type precursor. But the “Oh…!” moment doesn’t begin and end there…
On Wednesday of this week (Nov. 3rd) the Federal Reserve ends its two day conclave and is thought to announce it is to begin reducing QE (quantitative easing) and set out a greater explanation as to when they will begin raising interest rates.
So, let’s parse this through a bit, shall we?
The biggest names in the “markets” are suddenly faltering. The newest edition of “Free money for the masses!” (aka the Biden agenda) to spend at all these same companies is now dead-in-the-water. Rent moratoriums have ended, emergency, enhanced benefits of unemployment are over. The deadline for the newest debt ceiling vote is now only weeks away, set for the beginning of December, where the possibility of the minority party helping pass anything with majority after the last debacle is also dead-in-the-water. Commodity prices, finished goods prices, oil, gas and more are becoming unhinged from affordability. And that’s only touching the tip of the so-called “iceberg.”
Do I need to even mention the ever evolving CDC mandates debacle?
As I said in my prior article…
Literally, there is only one thing to watch for over this coming week for those trying to “read the tea leaves” as some like to say, which is this…
This week will mark what many will interpret as the-road-ahead in regards to not only the “markets,” but rather, for everything regarding the global economy to the U.S. political. i.e., This week has the potential to set the tenor-and-tone for the remainder of the year and possibly beyond for everything else, emphasis on “everything.““The Week That Is” Oct. 25, 2021
Now, with last week in hand, all I’ll say is this: You’ve been warned, and not by yours truly, rather, by the “markets” themselves. Again, for those that are watching.
I’ll leave you with one item that really hadn’t received the attention that I felt it deserved. Maybe it’s for the reason that, just like the new highs that took place in the “markets” last week, no one wants to spoil the party with a bit of truth in the details. So with that said, I’ll just post the following and let you decide its value, as it should be. Ready?
With all the “Great!” being thrown about regarding more and more confidence that the “markets” will go ever higher as they eked out another one for the record books….
Bitcoin™ not only didn’t go higher, but rather, it flash crashed (i.e., not a fat finger mistake but real selling) to ~$56K and has since been having a difficult time staying above $60K
I thought it was going to “the moon?” Maybe it’s just me, but that seems to be acceleration in the wrong direction, is it not? You know, just like its ETF: BITO.
But then again, what do I know.
As always, we shall see.
© 2021 Mark St.Cyr
Note: This is not trading or investing advice of any sort. This commentary is for “big picture” discussion purposes only. Please read, or re-read the “About This Site” page for any questions or clarifications.