Tuesday, September 21, 2021

#USStocks Review #ES_F $SPY

US Stocks Review
Those that view the message of the market on a daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bag holders of trend transitions.

The global economy and stocks began behaving strangely in late summer of 2019. Repo rates spiked unexpectedly. Few acknowledged it. Anyone looking for a return to "normal" market by fundamentals will likely be disappointed in the coming years.

Stocks crashed in early 2020. Relative performance within the stock market suggests a reallocation of resources away from old to new economic plays. The old norm of "Made in USA" is not coming back. Manufacturing, design, and information collection will be borderless. Citizens will struggle to maintain their liberties and rights without oversight and intervention under this economic backdrop.

Rising stocks as the global and certain market groups decline is a real possibility that has been discussed for years. The stock market's distortion of reality is being attributed to the Federal Reserve. The Fed, contrary to popular opinion, is not that powerful. It cannot control the world's capital flows. The invisible hand, the true driver of market and trends, is redefining the world as the core economy passes from North American to Asia.

Subscriber Comments

Expect a steady diet of nothing to see here in the coming weeks.

The latest poll count, a random sample but not very large, suggests the majority believes Evergrande is China's Lehman Brother's moment. If I could have voted, I would have selected Irrelevant (Excuse Only). It doesn't matter what we believe. The only thing that matters is what the invisible hand is doing.

While many of Internet's mouthpieces will try to convince us nothing has changed after yesterday's unexpected decline, a quick look at the weekly reversals for the major stock indices paints a different picture.

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