investmentwatchblog--2020-05-09--Ohio Governor Reveals Why He Walked Back on Social Distancing Orders

James Barett from The Daily Wire reports , In an interview with ABC ’ s “ This Week ” Sunday @ @ @ @ @ Mike DeWine admitted that his statewide mandate that Ohio residents wear face masks while in @ @ @ @ @ too far ” because people are simply “ not going to accept the government telling @ @ @ @ @ In a candid moment , the governor explained his political rationale for ultimately rescinding the @ @

James Barett from The Daily Wire reports, In an interview with ABC’s “This Week” Sunday, Republican Ohio Gov. Mike DeWine admitted that his statewide mandate that Ohio residents wear face masks while in stores was “a bridge too far” because people are simply “not going to accept the government telling them what to do.” In a candid moment, the governor explained his political rationale for ultimately rescinding the order.
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www.dailywire.com/news/watch-…


investmentwatchblog--2020-05-09--The government is ready to reopen. Its citizens aren’t, polls show. Malls across America resemble gh

The government is ready to reopen. Its citizens aren’t, polls show. Malls across America resemble ghost towns as they reopen

• Shopping malls in several states have begun to reopen amid the coronavirus crisis • However , photos taken inside malls in Florida , Georgia and Texas reveal that shoppers are still staying away • Empty parking lots , shuttered play areas and abandoned food courts were common themes inside each of the malls • Fear of contracting COVID-19 coupled with soaring unemployment figures are stopping many people from heading to the shops Many American states have begun to reopen amid the coronavirus pandemic , but shopping malls all across the country still resemble ghost towns .
Known for being @ @ @ @ @ @ @ of the American economy , dozens of malls remained abandoned this week , despite opening back up for businesses .
In Florida , Georgia and Texas , there were empty parking lots , deserted food courts and roped-off play areas as people continue to stay at home during the COVID-19 outbreak .
While both President Donald Trump and state governors have been talking about the importance of reopening the economy , it seems many are still fearful of heading out to shop .
As of Friday afternoon , more than 1.3 million Americans @ @ @ @ @ @ @ 78,318 have died .
Anxiety about the virus is coupled with soaring unemployment numbers , with many people now without the disposable income required to shop at the mall .
The unemployment rate currently stands at 14.7 percent , the worst since the Depression era .
More than 20 million people lost their jobs in the month of April alone .
Larry Kudlow , the White House ’ s national economic council director , on Friday even suggested employment figures could get worse as the pandemic wears on .
‘ I don ’ @ @ @ @ @ @ @ fully run its course , ’ he stated .
‘ This is a number full of heartbreak and hardship .
There ’ s no way to get around it.
’ The Government Is Ready to Reopen .
Its Citizens Aren ’ t , Polls Show .
Americans remain wary of the coronavirus ’ s threat , and are worried about going back to work too soon .
But that doesn ’ t mean they ’ re not hurting .
Miami-Dade malls are not reopening yet .
When they do , it will be @ @ @ @ @ @ @ , deserted food courts and shuttered play areas : Malls across America resemble ghost towns as they reopen to a virus weary public reeling from historic job losses .

Shopping malls in several states have begun to reopen amid the coronavirus crisis
However, photos taken inside malls in Florida, Georgia and Texas reveal that shoppers are still staying away
Empty parking lots, shuttered play areas and abandoned food courts were common themes inside each of the malls
Fear of contracting COVID-19 coupled with soaring unemployment figures are stopping many people from heading to the shops
Many American states have begun to reopen amid the coronavirus pandemic, but shopping malls all across the country still resemble ghost towns.
Known for being thriving social hubs and a key part of the American economy, dozens of malls remained abandoned this week, despite opening back up for businesses.
In Florida, Georgia and Texas, there were empty parking lots, deserted food courts and roped-off play areas as people continue to stay at home during the COVID-19 outbreak.
While both President Donald Trump and state governors have been talking about the importance of reopening the economy, it seems many are still fearful of heading out to shop.
As of Friday afternoon, more than 1.3 million Americans have tested positive to COVID-19, and 78,318 have died.
Anxiety about the virus is coupled with soaring unemployment numbers, with many people now without the disposable income required to shop at the mall.
The unemployment rate currently stands at 14.7 percent, the worst since the Depression era. More than 20 million people lost their jobs in the month of April alone.
Larry Kudlow, the White House’s national economic council director, on Friday even suggested employment figures could get worse as the pandemic wears on.
‘I don’t think this pandemic contraction has yet fully run its course,’ he stated. ‘This is a number full of heartbreak and hardship. There’s no way to get around it.’
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The Government Is Ready to Reopen. Its Citizens Aren’t, Polls Show.
Americans remain wary of the coronavirus’s threat, and are worried about going back to work too soon. But that doesn’t mean they’re not hurting.
Two months after the coronavirus shuttered much of the United States economy, the outbreak’s impact — on jobs, health care, food access and much more — is growing only more severe, according to a growing body of polling and social science data.
But here’s what else the polls are telling us: Americans are generally uninterested in returning to normal, and they tend to believe federal health experts, who continue to warn against a swift reopening of the economy.
President Trump said this week that he was eager “to get our country open again,” adding, “People want to go back, and you’re going to have a problem if you don’t do it.”
But more than two-thirds of respondents said in a Pew Research Center poll out Thursday that they were more concerned that state governments would reopen their economies too quickly than that they might take too long — roughly on par with past responses to the same question.
And in a survey released late last month by The Associated Press and NORC, 68 percent of Americans said they had a great deal of trust in the Centers for Disease Control and Prevention to provide them with reliable information about the pandemic. That’s three times as much as the dismal 23 percent who said they definitely trusted Mr. Trump’s statements on the virus.
Miami-Dade malls are not reopening yet. When they do, it will be a different world.
Empty parking lots, deserted food courts and shuttered play areas: Malls across America resemble ghost towns as they reopen to a virus weary public reeling from historic job losses.


investmentwatchblog--2020-05-09--Citi Panic/Euphoria. Well look at that, Euphoria got tagged this week for the first time since Febru

Citi Panic/Euphoria .
Well look at that , Euphoria got tagged this week for the first time since February .
@

Citi Panic/Euphoria.
Well look at that, Euphoria got tagged this week for the first time since February. pic.twitter.com/c4ASC8NJM1
— Helene Meisler (@hmeisler) May 9, 2020


investmentwatchblog--2020-05-09--Virus is old news IMO, next we deal with the recession & bankruptcies

Virus is old news IMO, next we deal with the recession & bankruptcies t.co/xu44UT1IUG — Matt Thompson, CFA (@dynamicvol) May 9, 2020
Markets bottom on the worst of bad “economic” news. So far only worst of health news has hit. Bankruptcies, mortgage defaults, declining GDP, lowered corporate earnings guidance, record unemployment rate hasn’t happened — GabrielD (@gdavidov) May 8, 2020
Btw, the amount of outstanding US #leveragedloan paper rated triple-C topped $100B in April, thanks in large part to a torrent of credit downgrades. CLOs, of course, have limits on how much CCC debt they want to hold #Covid_19 pic.twitter.com/59WvnGMHic — Leveraged Loans (@lcdnews) May 9, 2020
3/ NOW: with📉 revenues––and record #’s of these loans mixed together in CDOs the risk of cascade of debt defaults + bankruptcies seems VERY high 📈. Bulls say: priced in. Me: The disconnect discounting lasting economic destruction + current capital market recovery confounds- — Josh Wolfe (@wolfejosh) May 1, 2020
BlackRock CEO Larry Fink sketched out a grim economic vision on a private call this week: Mass bankruptcies, empty planes, cautious consumers and an increase in the corporate tax rate t.co/RzXnJIUpnp — Win Smart, CFA (@WinfieldSmart) May 7, 2020
NY Fed US Q2 GDP pic.twitter.com/XPn6qaA247 — Win Smart, CFA (@WinfieldSmart) May 9, 2020
You can force a recession, but you can't force a recovery. t.co/2eog0C47Sd pic.twitter.com/2HDi9F9cJf — Lakshman Achuthan (@businesscycle) May 9, 2020


investmentwatchblog--2020-05-09--The coming decline in continued claims, which will mark the end of the recession, will be the most s

The coming decline in continued claims, which will mark the end of the recession, will be the most severe ever, otherwise this recovery will take decades.

We received some criticism for saying initial jobless claims had peaked in late March .
Now that ’ s virtually assured as they fell for the 5th week in a row .
In the week of May 2nd , initial claims fell from 3.846 million to 3.169 million .
This is all about the situation getting worse at a lower rate .
The labor market is still worsening , but it ’ s not worsening at as quick of a rate as it was in late March .
Furthermore , as we will get to later , many of these @ @ @ @ @ @ @ these aren ’ t newly unemployed people .
As you can see from the chart below , initial claims are expected to fall to 2.48 million in the next report .
It also shows continued claims rose from 18.011 million to 22.647 million .
They are expected to rise to 28.979 million in 2 weeks .
When continued claims peak , it means the recession is near its end or ended .
We aren ’ t at that point yet .
To be clear , prior to this recession , the record high @ @ @ @ @ @ @ 695,000 .
Even with claims falling for 5 straight weeks , they are still more than 4 times the previous record .
Obviously , claims are still high because the economy is in dire straits .
Most states haven ’ t reopened yet and the ones that have reopened aren ’ t operating like normal .
There are 2 other reason claims are so high .
The first is there was a huge backlog in claims created when the economy fell into a recession in March .
The systems were overwhelmed .
It @ @ @ @ @ @ @ s websites couldn ’ t handle this many applications because there hadn ’ t been a recession in 11 years ( websites not updated ) and nothing like this could have been expected .
It took 3 years for the unemployment rate to reach its high in the Great Depression .
This peak , which will be higher than the Great Depression peak , will be reached in a few months .
The chart below shows unemployment claims as a percentage of the labor force by state .
We don ’ t know @ @ @ @ @ @ @ were from backlogs , but we can get an idea from this data .
For example , Florida had problems with its website .
The labor market in the past 2 weeks likely wasn ’ t worse than it was in March .
It just took time to process all the claims .
Georgia , which just opened its economy , processed the most claims as a percentage of its labor force , putting it in the lead for this recession .
Both Georgia and Michigan shockingly have over 25 % of their @ @ @ @ @ @ @ s good news that the backlogs are finally being worked through , but it ’ s bad news it took this long .
People without savings heading into this recession probably faced severe woes without any benefits for a month or two .
Washington has a backlog of 265,000 claims which it will get through by June .
That ’ s a tragedy because this state was one of the first to deal with the COVID-19 crisis .
57,000 of those backlogs are in adjudication where there is a discrepancy in the application @ @ @ @ @ @ @ that to get fixed , but it has taken several weeks in this case .
The governor of Illinois claimed the state doesn ’ t have a backlog , but reports show it has a 12,000 backlog .
There is a story of someone who called at 7:30 AM being forced to wait until 5 PM to get through .
The system is still overwhelmed .
The governor of New Jersey said the state would get though the backlog of gig workers by next week .
Keep in mind that as the number @ @ @ @ @ @ @ number of states reopening will increase .
That ’ s a double effect that will work to lower initial claims .
That might be why Pantheon Macro is predicting jobless claims per week falling below 1 million in June .
Almost all of the rise in the unemployment rate will have taken place by the May BLS report which is next month ’ s report .
Getting Paid Not To Work Initial claims are also still high because many people are getting paid more not to work than to work .
If the @ @ @ @ @ @ @ people making $ 60,000 or less would get paid more if they didn ’ t work , initial claims would spike .
People are incentivized not to work .
This wasn ’ t the case in the last recession ; benefits were instead extended to 99 weeks .
This situation is interesting because the government is probably willing to extend benefits .
However , you can ’ t judge the need for an extension by the number of people unemployed , if people are being incentivized not to look for a job .
@ @ @ @ @ @ @ on the COVID-19 situation .
To be fair , many people don ’ t want to stay unemployed because they know the benefits will run out eventually and if they chose to stay unemployed , someone might take their old job .
The chart below shows workers in more than half the states on average will receive more benefits than they get in their normal paycheck .
9 states have people making at least 20 % more via unemployment benefits than they would be working .
There ’ s a mistaken political narrative @ @ @ @ @ @ @ .
The backlog is a problem , but the policy certainly is good .
This will probably be the fastest decline in continued claims ever because it was an exogenous event .
The biggest quarterly average decline ever was 700,000 per week .
If that speed occurred in the coming expansion , it would take 7.5 years for a recovery .
That doesn ’ t sound bad , but recognize that the way declines occur , the fastest part is the beginning of the expansion .
That means if we saw a similar @ @ @ @ @ @ @ decades for the labor market to normalize .
The peak decline in continued claims will be the largest ever by orders of magnitude .
Initial jobless claims have fallen for 5 straight weeks , but they are still the highest ever outside of this recession .
They are high because the economy is weak , there is a huge backlog still being worked through , and because people are incentivized not to work .
The government is going to need to end this help when the labor market still looks weak because it @ @ @ @ @ @ @ getting paid more not to work than to work .
The coming decline in continued claims , which will mark the end of the recession , is about to be the most severe ever .
It needs to be or else this recovery will take decades .

by UPFINA
We received some criticism for saying initial jobless claims had peaked in late March. Now that’s virtually assured as they fell for the 5th week in a row. In the week of May 2nd, initial claims fell from 3.846 million to 3.169 million. This is all about the situation getting worse at a lower rate. The labor market is still worsening, but it’s not worsening at as quick of a rate as it was in late March. Furthermore, as we will get to later, many of these claims are from the backlog, meaning these aren’t newly unemployed people. As you can see from the chart below, initial claims are expected to fall to 2.48 million in the next report. It also shows continued claims rose from 18.011 million to 22.647 million. They are expected to rise to 28.979 million in 2 weeks. When continued claims peak, it means the recession is near its end or ended. We aren’t at that point yet.
Initial jobless claims should continued to trend lower, possibly dipping below 1 mn by the end of this month. Continued claims, however, will likely trend higher until surpassing 30 mn in three weeks or less. pic.twitter.com/KWXtVCxABk — Jeoff Hall (@JeoffHall) May 7, 2020
To be clear, prior to this recession, the record high in initial claims in a week was 695,000. Even with claims falling for 5 straight weeks, they are still more than 4 times the previous record. Obviously, claims are still high because the economy is in dire straits. Most states haven’t reopened yet and the ones that have reopened aren’t operating like normal. There are 2 other reason claims are so high. The first is there was a huge backlog in claims created when the economy fell into a recession in March. The systems were overwhelmed. It’s not surprising state government’s websites couldn’t handle this many applications because there hadn’t been a recession in 11 years (websites not updated) and nothing like this could have been expected. It took 3 years for the unemployment rate to reach its high in the Great Depression. This peak, which will be higher than the Great Depression peak, will be reached in a few months.
Backlog Being Worked Through
The chart below shows unemployment claims as a percentage of the labor force by state. We don’t know exactly which claims were new and which were from backlogs, but we can get an idea from this data.
Hard to digest that 25%+ of the workforce in GA, MI and PA filed jobless claims in a span of less than two months. pic.twitter.com/7sLKVbDV7H — Fully Synergized (@FullySynergized) May 7, 2020
For example, Florida had problems with its website. The labor market in the past 2 weeks likely wasn’t worse than it was in March. It just took time to process all the claims. Georgia, which just opened its economy, processed the most claims as a percentage of its labor force, putting it in the lead for this recession. Both Georgia and Michigan shockingly have over 25% of their labor force receiving benefits.
It’s good news that the backlogs are finally being worked through, but it’s bad news it took this long. People without savings heading into this recession probably faced severe woes without any benefits for a month or two. Washington has a backlog of 265,000 claims which it will get through by June. That’s a tragedy because this state was one of the first to deal with the COVID-19 crisis. 57,000 of those backlogs are in adjudication where there is a discrepancy in the application. It usually takes 21 days for that to get fixed, but it has taken several weeks in this case.
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The governor of Illinois claimed the state doesn’t have a backlog, but reports show it has a 12,000 backlog. There is a story of someone who called at 7:30 AM being forced to wait until 5 PM to get through. The system is still overwhelmed. The governor of New Jersey said the state would get though the backlog of gig workers by next week. Keep in mind that as the number of claims in backlogs falls, the number of states reopening will increase. That’s a double effect that will work to lower initial claims. That might be why Pantheon Macro is predicting jobless claims per week falling below 1 million in June. Almost all of the rise in the unemployment rate will have taken place by the May BLS report which is next month’s report.
Jobless claims should be back below 1M by the 2nd or 3rd week of June; the rate of decay is quite consistent. pic.twitter.com/OtOoeir28P — Ian Shepherdson (@IanShepherdson) May 7, 2020
Getting Paid Not To Work
Initial claims are also still high because many people are getting paid more not to work than to work. If the economy was fine and the government said people making $60,000 or less would get paid more if they didn’t work, initial claims would spike. People are incentivized not to work. This wasn’t the case in the last recession; benefits were instead extended to 99 weeks. This situation is interesting because the government is probably willing to extend benefits. However, you can’t judge the need for an extension by the number of people unemployed, if people are being incentivized not to look for a job. That government decision should probably be based on the COVID-19 situation. To be fair, many people don’t want to stay unemployed because they know the benefits will run out eventually and if they chose to stay unemployed, someone might take their old job.
The chart below shows workers in more than half the states on average will receive more benefits than they get in their normal paycheck. 9 states have people making at least 20% more via unemployment benefits than they would be working. There’s a mistaken political narrative that workers aren’t being helped. The backlog is a problem, but the policy certainly is good.
Recovery Speed
This will probably be the fastest decline in continued claims ever because it was an exogenous event. The biggest quarterly average decline ever was 700,000 per week. If that speed occurred in the coming expansion, it would take 7.5 years for a recovery. That doesn’t sound bad, but recognize that the way declines occur, the fastest part is the beginning of the expansion. That means if we saw a similar average cycle decline, it would take decades for the labor market to normalize. The peak decline in continued claims will be the largest ever by orders of magnitude.
Conclusion
Initial jobless claims have fallen for 5 straight weeks, but they are still the highest ever outside of this recession. They are high because the economy is weak, there is a huge backlog still being worked through, and because people are incentivized not to work. The government is going to need to end this help when the labor market still looks weak because it will never look strong when people are getting paid more not to work than to work. The coming decline in continued claims, which will mark the end of the recession, is about to be the most severe ever. It needs to be or else this recovery will take decades.


investmentwatchblog--2020-05-09--Oil Crash Busted Broker’s Computers and Inflicted Big Losses

( Bloomberg ) — Syed Shah usually buys and sells stocks and currencies through his Interactive Brokers account , but he couldn ’ t resist trying his hand at some oil trading on April 20 , the day prices plunged below zero for the first time ever .
The day trader , working from his house in a Toronto suburb , figured he couldn ’ t lose as he spent $ 2,400 snapping up crude at $ 3.30 a barrel , and then 50 cents .
Then came what looked like the deal of a lifetime : buying 212 futures @ @ @ @ @ @ @ astonishing penny each .
What he didn ’ t know was oil ’ s first trip into negative pricing had broken Interactive Brokers Group Inc. Its software couldn ’ t cope with that pesky minus sign , even though it was always technically possible — though this was an outlandish idea before the pandemic — for the crude market to go upside down .
Crude was actually around negative $ 3.70 a barrel when Shah ’ s screen had it at 1 cent .
Interactive Brokers never displayed a subzero price to him @ @ @ @ @ @ @ day at minus $ 37.63 a barrel .
At midnight , Shah got the devastating news : he owed Interactive Brokers $ 9 million .
He ’ d started the day with $ 77,000 in his account .

Oil Crash Busted Broker’s Computers and Inflicted Big Losses
(Bloomberg) — Syed Shah usually buys and sells stocks and currencies through his Interactive Brokers account, but he couldn’t resist trying his hand at some oil trading on April 20, the day prices plunged below zero for the first time ever. The day trader, working from his house in a Toronto suburb, figured he couldn’t lose as he spent $2,400 snapping up crude at $3.30 a barrel, and then 50 cents. Then came what looked like the deal of a lifetime: buying 212 futures contracts on West Texas Intermediate for an astonishing penny each.
What he didn’t know was oil’s first trip into negative pricing had broken Interactive Brokers Group Inc. Its software couldn’t cope with that pesky minus sign, even though it was always technically possible — though this was an outlandish idea before the pandemic — for the crude market to go upside down. Crude was actually around negative $3.70 a barrel when Shah’s screen had it at 1 cent. Interactive Brokers never displayed a subzero price to him as oil kept diving to end the day at minus $37.63 a barrel.
At midnight, Shah got the devastating news: he owed Interactive Brokers $9 million. He’d started the day with $77,000 in his account.


investmentwatchblog--2020-05-09--Disney sells out of tickets for weeks for the 30% capacity with health checks

Alternative headline Disney sells out of tickets for weeks for the 30 % capacity with health checks t.co/NWSRSZV5TE

Alternative headline
Disney sells out of tickets for weeks for the 30% capacity with health checks t.co/NWSRSZV5TE
— Sunchartist (@sunchartist) May 9, 2020


investmentwatchblog--2020-05-09--Given the massive size of QE and all the bailout facilities one cant be too certain about the path o

Given the massive size of QE and all the bailout facilities one cant be too certain about the path of equities…but this rally could easily be like the 1930 headfake,before stocks really got destroyed.

given the massive size of qe and all the bailout facilities one cant be too certain about the path of equities…but this rally could easily be like the 1930 headfake,before stocks really got destroyed. — bill fleckenstein (@fleckcap) May 8, 2020
Historically stocks have led the trough in a business cycle by about a quarter. Stocks are front-running the end of the shortest recession in history by early summer……if the market is wrong on that there will be a sharp leg down, if it’s right we keep going. That’s the setup. — GreekFire23 (@GreekFire23) May 8, 2020
In 2008 we saw the same “non sense” rally before the huge dump that “nobody saw it coming” pic.twitter.com/eSZV3a64En — Alessio Urban (@AlessioUrban) May 9, 2020
Not hard to figure out. I predict a large decrease in housing demand this summer. Housing demand depends on a feeling of income security. Do you know anyone who is worried about their job? — EPBerg (@epberg) May 8, 2020
35% of the lowest-earning American workers lost their jobs. Only 9% of the highest-earning Americans lost their jobs. Meanwhile, all 3 market indexes have rallied more than 30% from their March lows. t.co/antXwtRBNJ pic.twitter.com/8xyxh3M2A9 — Nomi Prins (@nomiprins) May 9, 2020
he knows his stuff t.co/nUXvhL3wfI — Alessio Urban (@AlessioUrban) May 8, 2020
Leisure and hospitality businesses, among the first to be affected by coronavirus-related shutdowns, saw particularly heavy losses in April, cutting 7.65 million jobs. t.co/dgilQKEWxc pic.twitter.com/mQ4kDV3FWz — Real Time Economics (@WSJecon) May 8, 2020
GLOBAL GDP AFFECTED pic.twitter.com/hv6yf2JECw — Win Smart, CFA (@WinfieldSmart) May 8, 2020
# of companies with lowest credit rating pic.twitter.com/Ovacbp8nwq — Win Smart, CFA (@WinfieldSmart) May 8, 2020


investmentwatchblog--2020-05-09--Eurozone crisis will be deeper (and longer) than most developed and emerging economies.

Eurozone crisis will be deeper ( and longer ) than most developed and emerging economies .

Eurozone crisis will be deeper (and longer) than most developed and emerging economies.
Watch:t.co/nQkw3AdgK7 pic.twitter.com/YmHyTjs0qj
— Daniel Lacalle (@dlacalle_IA) May 8, 2020


investmentwatchblog--2020-05-10--Bull Case / Bear Case

Bull Case / Bear Case

Just trying to collect all ideas for bull case/bear case .
I am biased on the bull side just a disclaimer .
But I will try to provide sources whenever I can .
Anything posted in the comments I will update the list .
• MM / Big Players loaded up in bottom will not let it crash • All of the world best mind are focused on this problem • There is no better place to put your money than in the market .
Bonds suck .
Oil ?
Forget about it .
Most commodities are low .
Where @ @ @ @ @ @ @ ?
There are threats to that going negative .
The market is the only game in town .
• Volatility never remains this high for very long .
We ’ re close to a 30-year record .
Declining volatility spikes are always associated with higher prices .
• Pesky Valuation / Fundamentals • We haven ’ t paid attention to fundamentals in a long time .
• Earning will be decreasing and will not return to the 2020 level for 2-3 years • Unemployment will remain high • Maybe a good argument for @ @ @ @ @ @ @ higher • Trade war with China • Maybe this brings all jobs back to the US so good for the economy .
This can be good or bad depending on how you see it .
• Depression / Recession • Not sure about this one , as Fed will just print more .
So stocks will rise even more • Waves of Virus • Maybe more stimulus , more Fed Intervention • Democrats in 2020 • They normally spend even more than Republicans • A lot of money sitting on the sideline • @ @ @ @ @ @ @ like this can be fuel for the rally for the stairway to heaven .
• Everyone is bearish / most hated rally • Maybe this will keep fueling this rally even more • US Yield Curve is trying to invert .
At least the futures are dipping into negative yields .
• Oil hits rock bottom again , which shows that the current market prices are not indicative of prices in 10 days .
Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the @ @ @ @ @ @ @ own due diligence .

by thetaTrader1729
Just trying to collect all ideas for bull case/bear case. I am biased on the bull side just a disclaimer. But I will try to provide sources whenever I can.
Anything posted in the comments I will update the list.

Bull Case
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The Fed Other countries central bank www.zerohedge.com/markets/markets-crashed-swiss-national-bank-went-faamg-buying-spree Sovereign Funds www.fool.com/investing/2020/04/08/saudi-arabia-has-taken-a-major-stake-in-carnival-w.aspx Pension Funds Election Year Reopening High unemployment with Stimulus Checks High unemployment and casinos are closed FOMO Short Squeeze A lot of Liquidity MM / Big Players loaded up in bottom will not let it crash Vaccine All of the world best mind are focused on this problem V-Shaped Recovery There is no better place to put your money than in the market. Bonds suck. Oil? Forget about it. Most commodities are low. Where shall you put your retirement? Savings? There are threats to that going negative. The market is the only game in town. Volatility never remains this high for very long. We’re close to a 30-year record. Declining volatility spikes are always associated with higher prices.

Bear Case
Pesky Valuation / Fundamentals We haven’t paid attention to fundamentals in a long time. Earning will be decreasing and will not return to the 2020 level for 2-3 years Unemployment will remain high Maybe a good argument for UBI? so stocks should go even higher Trade war with China Maybe this brings all jobs back to the US so good for the economy. This can be good or bad depending on how you see it. Food Shortages L or U shaped recovery Depression / Recession Not sure about this one, as Fed will just print more. So stocks will rise even more Waves of Virus Maybe more stimulus, more Fed Intervention Democrats in 2020 They normally spend even more than Republicans States / Cities Bankruptcy Trump/Pence catches Rona A lot of money sitting on the sideline Highest money market fund. I feel like this can be fuel for the rally for the stairway to heaven. Everyone is bearish / most hated rally Maybe this will keep fueling this rally even more Lots of Retail buying Buffett not buying US Yield Curve is trying to invert. At least the futures are dipping into negative yields. Oil hits rock bottom again, which shows that the current market prices are not indicative of prices in 10 days.

Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.


investmentwatchblog--2020-05-10--Wells Fargo slow recovery

Wells Fargo slow recovery

C up 40 % off lows Average 38 % recovery off lows , meanwhile WFC is the lone bank still @ @ @ @ @ information is only for educational purposes .
Do not make any investment decisions based on @ @ @ @ @ .
Do you own due diligence .

by WorkPiece
What am I missing?
JPM up 18% off lows
BAC up 30% off lows
C up 40% off lows
GS up 37% off lows
MS up 44% off lows
USB up 20% off lows
TFC up 40% off lows
PNC up 30% off lows
COF up 54% off lows
BK up 31% off lows
STT up 39% off lows
ALLY up 44% off lows
FITB up 52% off lows
CFG up 55% off it’s lows
Average 38% recovery off lows, meanwhile WFC is the lone bank still near lows
WFC up < 2% off it’s lows
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.


investmentwatchblog--2020-05-10--COVID-19 has come for prominent members of CDC, FDA, NIH – Dr. Redfield, Dr. Hahn, Dr. Fauci are all

COVID-19 has come for prominent members of CDC, FDA, NIH – Dr. Redfield, Dr. Hahn, Dr. Fauci are all quarantining

TLDR ; do they have COVID-19 but don ’ t want to announce it ?
If CDC can ’ t @ @ @ @ @ their own building how do they expect businesses to ?

by theinternetishere12
Dr. Fauci (NIH), Dr. Hahn (FDA), Dr. Redfield (CDC) all quarantining.
www.cnn.com/2020/05/09/politics/fauci-modified-quarantine-coronavirus/index.html
www.cnn.com/2020/05/09/politics/robert-redfield-cdc-director-self-quarantine/index.html
www.cnn.com/2020/05/09/politics/fda-chief-stephen-hahn-coronavirus-self-quarantine/index.html
TLDR; do they have COVID-19 but don’t want to announce it?
If CDC can’t keep the virus out of their own building how do they expect businesses to?


investmentwatchblog--2020-05-10--BIDEN SOLD OUT AMERICA TO CHINA WHILE WORKING FOR HOLLYWOOD:

“ Some of you were there .
Literally when by end of that lunch we had a handshake , ” Biden boasted to the MPAA .
“ The next year the number of blockbuster foreign films showing in China has increased by over half and our share of the box office revenue has doubled — or your share of the box office revenue has doubled.
” “ Keep me in mind for Chris [ Dodd ’ s ] * assistant later , ” he joked .
Biden understandably lost track of the difference between “ your share ” and “ @ @ @ @ @ @ @ a reliable fundraising machine for Biden .
What was good for Hollywood was also good for Biden .
Katzenberg got Oriental Dream Works , a $ 330-million joint venture with the PRC , and eventually hosted Biden ’ s first Southern California fundraiser which brought in $ 700K .
2012 was a big year for the adulterous nuptials of Hollywood and the Chinese Communist Party .
A few months after the meeting between Biden and Xi , China ’ s Wanda Group bought AMC Theaters for $ 2.6 billion .
The Wanda Group @ @ @ @ @ @ @ with close ties to regime officials , is working on a Communist theme park , and its investors allegedly include Xi ’ s sister .
Beyond just owning the theaters , Wanda owns the Legendary Group which has a hand in a long list of movies from Spike Lee ’ s BlacKKKlansman , to Pokemon , along with the King Kong and Jurassic Park sequels .
The only reason Hollywood movies can play in China is because the Communist leadership directly profits from them and controls what goes into them , either directly @ @ @ @ @ @ @ industry to submit scripts for the approval of its Communist censors .
HUAC would be superfluous today .
The big studios who make up the MPAA are all working for the Communists .
And they ’ re proud of it .

via frontpagemag
“Some of you were there. Literally when by end of that lunch we had a handshake,” Biden boasted to the MPAA. “The next year the number of blockbuster foreign films showing in China has increased by over half and our share of the box office revenue has doubled — or your share of the box office revenue has doubled.”
“Keep me in mind for Chris [Dodd’s]* assistant later,” he joked.
Biden understandably lost track of the difference between “your share” and “our share” because Hollywood has been a reliable fundraising machine for Biden. What was good for Hollywood was also good for Biden. Katzenberg got Oriental Dream Works, a $330-million joint venture with the PRC, and eventually hosted Biden’s first Southern California fundraiser which brought in $700K.
2012 was a big year for the adulterous nuptials of Hollywood and the Chinese Communist Party.
A few months after the meeting between Biden and Xi, China’s Wanda Group bought AMC Theaters for $2.6 billion. The Wanda Group, run by a billionaire Communist oligarch with close ties to regime officials, is working on a Communist theme park, and its investors allegedly include Xi’s sister. Beyond just owning the theaters, Wanda owns the Legendary Group which has a hand in a long list of movies from Spike Lee’s BlacKKKlansman, to Pokemon, along with the King Kong and Jurassic Park sequels.
The only reason Hollywood movies can play in China is because the Communist leadership directly profits from them and controls what goes into them, either directly through ownership, or by forcing the industry to submit scripts for the approval of its Communist censors. HUAC would be superfluous today. The big studios who make up the MPAA are all working for the Communists. And they’re proud of it.


investmentwatchblog--2020-05-10--Cat is euthanised after becoming first in Spain to catch coronavirus: Pet is feared to have caught b

Cat is euthanised after becoming first in Spain to catch coronavirus: Pet is feared to have caught bug from owner ‘who later died from the disease’

• The four-year-old feline was taken to the vet with breathing difficulties • He was suffering with heart disease so staff decided to put him to sleep • His body was sent to researchers who discovered traces of coronavirus • The cat is the sixth in the world known to have contracted the virus A cat has been euthanised after becoming the first in Spain to catch coronavirus .
It is believed he caught the disease from his Catalonian family who also had coronavirus – with his owner killed by the bug , according to local news outlet La Vanguardia @ @ @ @ @ @ @ to a veterinary hospital after his family noticed he was having difficulty breathing .
Staff discovered the cat had heart failure as well as a temperature of 38.2°C and low platelet levels , which meant his blood was not able to clot properly .
The cat , who already suffered from a genetic heart condition , was put to sleep after it was decided he was unlikely to recover .
The vet who euthanised the feline suspected he may have also been suffering from coronavirus so sent the body to a research centre @ @ @ @ @ @ @ and discovered traces of coronavirus in samples taken from his nose and digestive tract .

The four-year-old feline was taken to the vet with breathing difficulties
He was suffering with heart disease so staff decided to put him to sleep
His body was sent to researchers who discovered traces of coronavirus
The cat is the sixth in the world known to have contracted the virus
A cat has been euthanised after becoming the first in Spain to catch coronavirus.
It is believed he caught the disease from his Catalonian family who also had coronavirus – with his owner killed by the bug, according to local news outlet La Vanguardia.
The four-year-old feline had been rushed to a veterinary hospital after his family noticed he was having difficulty breathing.
Staff discovered the cat had heart failure as well as a temperature of 38.2°C and low platelet levels, which meant his blood was not able to clot properly.
We are primarily funded by readers. Please subscribe and donate to support us!
The cat, who already suffered from a genetic heart condition, was put to sleep after it was decided he was unlikely to recover.
The vet who euthanised the feline suspected he may have also been suffering from coronavirus so sent the body to a research centre for analysis.
Experts conducted a post-mortem and discovered traces of coronavirus in samples taken from his nose and digestive tract.
www.dailymail.co.uk/news/article-8300879/Cat-dies-catching-coronavirus-Spanish-owner-succumbed-disease.html


investmentwatchblog--2020-05-10--THE DEATH OF EQUITIES REDUX: The Booming Market for Gloom.

NBC News speculated that the shift millions of Americans have made to working , learning , and interacting with friends and family online will be difficult to roll back .
“ The major question will be whether ‘ normal life ’ ever returns , ” this report concluded .
And what about those of you who enjoyed socializing in the Before Time ?
Presumably , you won ’ t want to do that anymore .
Once you engage in this line of thinking , there ’ s no failsafe that stops the speculation from accelerating .
“ The way that @ @ @ @ @ @ @ that we hang out in parks , the way that we eventually will get to organized sports—which will probably be the last thing that we get to do—all of these things will change because of this virus , ” said Dayton Ohio Mayor Nan Whaley .
At CNN , the transformation of our lives will be total , “ says public health journalist.
” It is “ almost impossible ” to forecast what our lives will look like in this pandemic ’ s wake , but “ there will not be a single @ @ @ @ @ @ @ been unchanged.
” I don ’ t know about you , but I can all but guarantee that , whatever comes next , I will continue to wear clothes , consume calories at least daily , and reside in a free-standing structure .
So , are these prognosticators right ?
I don ’ t know , but neither do they .
One thing this unforeseen disaster should have taught us is a sense of humility , but that ’ s become yet another scarce commodity .
The relentlessness of these and many more @ @ @ @ @ @ @ knew it ended in March does strike a note of pornographic catastrophism , though .
And the omnipresence of reports like these suggests there ’ s a substantial audience for sullen fortune-telling .

via commentarymagazine
NBC News speculated that the shift millions of Americans have made to working, learning, and interacting with friends and family online will be difficult to roll back. “The major question will be whether ‘normal life’ ever returns,” this report concluded. And what about those of you who enjoyed socializing in the Before Time? Presumably, you won’t want to do that anymore.
Once you engage in this line of thinking, there’s no failsafe that stops the speculation from accelerating. “The way that we touch each other, the way that we hang out in parks, the way that we eventually will get to organized sports—which will probably be the last thing that we get to do—all of these things will change because of this virus,” said Dayton Ohio Mayor Nan Whaley.
At CNN, the transformation of our lives will be total, “says public health journalist.” It is “almost impossible” to forecast what our lives will look like in this pandemic’s wake, but “there will not be a single aspect of our lives that’s been unchanged.” I don’t know about you, but I can all but guarantee that, whatever comes next, I will continue to wear clothes, consume calories at least daily, and reside in a free-standing structure.
So, are these prognosticators right? I don’t know, but neither do they. One thing this unforeseen disaster should have taught us is a sense of humility, but that’s become yet another scarce commodity. The relentlessness of these and many more reports informing you that life as you knew it ended in March does strike a note of pornographic catastrophism, though. And the omnipresence of reports like these suggests there’s a substantial audience for sullen fortune-telling.


investmentwatchblog--2020-05-10--Company layoffs accelerate as recovery appears elusive…  9,000 Catholic churches received PPP loans

Company layoffs accelerate as recovery appears elusive…  9,000 Catholic churches received PPP loans meant for small businesses

This past week , General Electric Co. , Uber Technologies Inc. and Airbnb Inc. said they would lay off thousands of workers .
MGM Resorts International warned that some of the 63,000 employees it has furloughed may be let go permanently starting in August .
Aerospace supplier Raytheon Technologies Corp. , job-listings site Glassdoor and United Airlines Holdings Inc. also said in the past week that they had reduced jobs or planned to do so .
Corporate America unveiled another wave of job cuts and warned of additional reductions , as executives signal they are resigned to a lengthy coronavirus-induced @ @ @ @ @ @ @ announcements two months after officials moved to shut the economy to halt the spread of the coronavirus indicates many companies are bearing down for a sustained slowdown as the economy searches for traction .
Some are also using the moment to accelerate strategic shifts .
In April , payrolls fell by a record 20.5 million , erasing a decade of job gains .
“ Our airline—and our entire workforce—will have to be smaller than it is today , ” Kate Gebo , United ’ s executive vice president of human resources , wrote @ @ @ @ @ @ @ the company ’ s plans to potentially trim at least 30 % of managers and administrative staffers starting in October .
Other carriers are expected to reduce staff as demand for air travel remains historically low .
Almost HALF of all Catholic churches in the US were given small business loans as part of coronavirus emergency funding MORE than 12,000 Catholic churches applied for PPP loans meant to hold small businesses together in the US .
Three in four had them granted as small businesses are forced to make life-changing and devastating decisions @ @ @ @ @ @ @ money that was specifically meant for them .
Between 12,000 and 13,000 of the 17,000 US Catholic churches applied for PPP loans , denying the lifeline meant for millions in their communities .
The study found that the larger the church , the more likely it was to have applied for federal aid .
Churches of all faiths have been advised to assess their needs as most technically qualify for PPP , but the move is causing a crisis of morality considering Jesus ’ teachings and the unregulated wealth held by the Vatican @ @ @ @ @ @ @ Paycheck Protection Program has already seen national chains soak up millions of dollars meant for smaller fish .
This sparked an outcry among Americans on behalf of the millions of businesses it was meant for but who have been shut out .
Pat Markey , the executive director of the Diocesan Fiscal Management Conference , an association of finance officers from Catholic dioceses , estimates that around 6,000 Catholic parishes had their applications for federal funding approved in the first round of PPP and around 3,000 have received loans so far in the @ @ @ @ @ @ @

Company Layoffs Accelerate as Recovery Appears Elusive
This past week, General Electric Co., Uber Technologies Inc. and Airbnb Inc. said they would lay off thousands of workers. MGM Resorts International warned that some of the 63,000 employees it has furloughed may be let go permanently starting in August. Aerospace supplier Raytheon Technologies Corp., job-listings site Glassdoor and United Airlines Holdings Inc. also said in the past week that they had reduced jobs or planned to do so.
Corporate America unveiled another wave of job cuts and warned of additional reductions, as executives signal they are resigned to a lengthy coronavirus-induced economic downturn.
The burst of job-cut announcements two months after officials moved to shut the economy to halt the spread of the coronavirus indicates many companies are bearing down for a sustained slowdown as the economy searches for traction. Some are also using the moment to accelerate strategic shifts. In April, payrolls fell by a record 20.5 million , erasing a decade of job gains.
“Our airline—and our entire workforce—will have to be smaller than it is today,” Kate Gebo, United’s executive vice president of human resources, wrote in a recent memo to employees about the company’s plans to potentially trim at least 30% of managers and administrative staffers starting in October. Other carriers are expected to reduce staff as demand for air travel remains historically low.
Almost HALF of all Catholic churches in the US were given small business loans as part of coronavirus emergency funding
MORE than 12,000 Catholic churches applied for PPP loans meant to hold small businesses together in the US.
Three in four had them granted as small businesses are forced to make life-changing and devastating decisions over their futures after being denied the money that was specifically meant for them.
Between 12,000 and 13,000 of the 17,000 US Catholic churches applied for PPP loans, denying the lifeline meant for millions in their communities.
The study found that the larger the church, the more likely it was to have applied for federal aid.
Churches of all faiths have been advised to assess their needs as most technically qualify for PPP, but the move is causing a crisis of morality considering Jesus’ teachings and the unregulated wealth held by the Vatican.
The much-needed loans from the federal Paycheck Protection Program has already seen national chains soak up millions of dollars meant for smaller fish.
This sparked an outcry among Americans on behalf of the millions of businesses it was meant for but who have been shut out.
Pat Markey, the executive director of the Diocesan Fiscal Management Conference, an association of finance officers from Catholic dioceses, estimates that around 6,000 Catholic parishes had their applications for federal funding approved in the first round of PPP and around 3,000 have received loans so far in the second round, according to CBS.


investmentwatchblog--2020-05-10--Celente: Market Spike A Fraud. ‘Greatest Depression’ Has Begun

Gerald Celente is a pioneer trend strategist and founder of The Trends Research Institute .
He is the author of @ @ @ @ @ : How to Prepare for and Profit from the Changes of the 21st Century and @ @ @ @ @ Trends Journal newsletter .
Gerald Celente is a political atheist .
Unencumbered by political dogma @ @ @ @ @ wisdom , Celente , whose motto is “ think for yourself , ” observes and @ @ @ @ @ future trends for what they are – not for the way he wants them to @ @ @ @ @ earned his reputation as “ The most trusted name in trends ” by accurately forecasting @ @ @ @ @ , consumer , environmental , economic , political , entertainment , and technology trends .

Trends Research, Released on 5/8/20
We are primarily funded by readers. Please subscribe and donate to support us!
Gerald Celente is a pioneer trend strategist and founder of The Trends Research Institute. He is the author of the national bestseller Trends 2000: How to Prepare for and Profit from the Changes of the 21st Century and publisher of the internationally circulated Trends Journal newsletter. Gerald Celente is a political atheist. Unencumbered by political dogma, rigid ideology or conventional wisdom, Celente, whose motto is “think for yourself,” observes and analyzes the current events forming future trends for what they are – not for the way he wants them to be. Gerald Celente has earned his reputation as “The most trusted name in trends” by accurately forecasting hundreds of social, business, consumer, environmental, economic, political, entertainment, and technology trends.


investmentwatchblog--2020-05-10--Mannarino: EXPECT The Fed Balance Sheet To Quadruple! Stocks To SKYROCKET

Gregory Mannarino started his career working for the securities and trading arm of the now defunct Bear Stearns before the @ @ @ @ @ that working on Wall Street was not like the movies , he moved on to @ @ @ @ @ practiced medicine as a Physician Assistant .
He also served in the United States Naval @ @ @ @ @ having attained the rank of Lieutenant .
He is an active trader of the capital @ @ @ @ @ books pertaining to finance , global economics , and equity trading .
Gregory currently hosts @ @ @ @ @ ” on YouTube .
You can find out more about what he offers at his @ @ @

TradersChoice.net, Released on 5/8/20
We are primarily funded by readers. Please subscribe and donate to support us!
Gregory Mannarino started his career working for the securities and trading arm of the now defunct Bear Stearns before the dot-com bubble. After realizing that working on Wall Street was not like the movies, he moved on to get a medical degree and practiced medicine as a Physician Assistant. He also served in the United States Naval Reserve Medical Service Corps, having attained the rank of Lieutenant. He is an active trader of the capital markets and has published several books pertaining to finance, global economics, and equity trading. Gregory currently hosts a business day “MarketReport” on YouTube. You can find out more about what he offers at his website Traderschoice.net.


investmentwatchblog--2020-05-10--Is The Tesla Bubble About To Burst?

Is The Tesla Bubble About To Burst?

I started trading stocks in the late 90s , it was an exciting time ; the internet was coming of age , and investors , or rather day traders , were extremely excited about the riches of this new digital era .
I was in my early 20s , and I had very limited investing knowledge at the time , nonetheless , I opened an online trading account and used half my college tuition money to speculate on internet stocks .
A year later , my capital had multiplied by twenty folds !
And notions of being a financial genius @ @ @ @ @ @ @ success attracted the attention of many friends , even family friends , and at the ripe old age of 21 , I was dispensing financial advice ( mostly stock tips ) to people double and triple my age .
To those older than me , I became a sort of Sherpa to a new world where finance and technology intertwined into a new and exciting reality .
Trading tech stocks during the technology boom was an intoxicating experience ; popular names such as Netscape , AOL , Yahoo , JDS Uniphase , Cisco @ @ @ @ @ @ @ Qualcomm and Amazon among others skyrocketed day after day to unbelievable highs .
It seemed as if all one had to do to become rich was to open a brokerage account , and buy whatever tech stock was in vogue .
Investment legends such as Warren Buffett were written off as out of touch for they did not comprehend the peculiarities of this new paradigm , where valuations , profitability , or even revenues were of little interest .
Traditional valuation metrics were replaced by new measures such as eye balls and available @ @ @ @ @ @ @ Khosla at Kleiner Perkins Caufield & Byers , explained it so : A lot of people look at the traditional measures for the economy and start scratching their heads about this long period of growth we ’ re enjoying .
That ’ s because the traditional measures are industrial measures ; they miss what ’ s really going on .
The old econometric models take into account the cost of oil , but they totally ignore the cost of bandwidth .
The old yardsticks don ’ t make sense any-more because what ’ @ @ @ @ @ @ @ change in the structure of our economy .
The old world , with its physical constrains seemed to have been replaced by a new virtual world , a terra nova of infinite growth possibilities .
I felt fortunate to live at a time of such amazing optimism and change , a world where a kid my age could make more money in a day than his dad could earn in a year .
I don ’ t wish to spoil the end of this fairy-tale , but to my disappointment , the good @ @ @ @ @ @ @ the trees , in which I parked my capital , didn ’ t grow to the sky .
After peaking at over 5000 points on March 10th 2000 , the NASDAQ crashed into a brutal two-year bear market that took it all the way down to 1100 by October 2002 , an 80 % decline .
Of course , the bursting of the technology bubble did not eliminate the internet , on the contrary , the internet continued to grow , and a host of new successful technology companies came to the scene @ @ @ @ @ @ @ who believed in this new world were vindicated , but few of us made real money out of it .
After losing my shirt in the technology crash , I developed a unique interest in investment bubbles , and read countless books on the subject .
One of the books that marked me was Irrational Exuberance by Professor Robert Shiller ; in the book , Shiller beautifully captures the essence of what fuels a speculative bubble : “ Irrational exuberance is the psychological basis of a speculative bubble .
I define a speculative @ @ @ @ @ @ @ of price increases spurs investor enthusiasm , which spreads by psychological contagion from person to person , in the process amplifying stories that might justify the price increases and bringing in a larger and larger class of investors , who , despite doubts about the real value of an investment , are drawn to it partly through envy of others ’ successes and partly through a gambler ’ s excitement.
” He then goes on to say , “ Errors of human judgment can infect even the smartest people , thanks to overconfidence @ @ @ @ @ @ @ and excessive trust in the judgments of others , stemming from a failure to understand that others are not making independent judgments but are themselves following still others—the blind leading the blind.
” The process of price increases bringing on more price increases is a phenomena I have noticed in all the investment bubbles I have studied over the last twenty years .
However , a price increase by itself is usually not sufficient to sustain a bubble , something more needs to be present , something that captures the imagination , and @ @ @ @ @ @ @ excellent book , ‘ A Short History of Financial Euphoria ’ by the economist John Galbraith .
Galbraith cites ‘ newness ’ as one the key drivers to a financial euphoria : All speculative episodes are driven by the thought of something new , exciting that catches the public imagination .
It ’ s rich in imaginative prospects , but light on realistic prospects .
Speculators take pride in a discovery or new innovation ( financial or other ) , thinking they ’ re ahead of their time ( much like early adopters @ @ @ @ @ @ @ others recognize it and pile in .
Financial innovations are less innovation and more a twist on a past financial concept or product , unknown to a new generation of speculators .
“ The world of finance hails the invention of the wheel over and over again , often in a slightly more unstable version.
” Ironically , John Galbraith ’ s book was published in July 1994 , merely a year before the famed Netscape ’ s IPO ( August 1995 ) which marked the start of the 1990s technology boom .
@ @ @ @ @ @ @ have formed if Galbraith ’ s book had been a best seller ; the answer is probably not , and the reason can be found in the book itself as Galbraith argues this exact point : Warnings of speculative euphoria are treated in the short run as an attack , as envy and lack of faith in the asset ’ s potential and the wisdom of the market .
Participants defend their vested interest .
Doubters are castrated as unimaginative or “ too old ” or “ too out of touch ” to @ @ @ @ @ @ @ Whether it is the technology bubble in the 1990s , the Tulip bubble in the 1600s , the Mississippi bubble and South Sea Bubble in the 1700s , the stock market bubble of the 1920s , the real estate and stock market bubble in Japan the 1980s , or crypto-currencies bubble in the 2010s , such bubbles seems to share a number of common characteristics in the way they are inflated and around the time they are deflated .
It is this bubble deflation , or bubble bursting phase that fascinates me the @ @ @ @ @ @ @ this article .
A recurring feature of a bursting investment bubble is the culmination of absurd statements and assertions by an otherwise seemingly reasonable individuals right around the parabolic top of such phenomena .
The most famous example of these is the famed statement by the Yale economist Irving Fisher , who asserted in September 1929 , a month before the catastrophic Dow Jones collapse , that “ stock prices have reached what looks like a permanently high plateau.
” Many such absurd assertions and speculations can be found around the top of @ @ @ @ @ @ @ such ‘ delusions ’ if we can call them so , stand a decent chance of generating an above average return by positioning themselves for the approaching burst of the bubble in question .
To further drive my point , I will briefly examine a series of historical bubbles as I make my way to the bubble referenced in the title of this article .
In the late 1990s , Cisco Systems was a tech investors darling , with its routers and networking gear at the core of the internet and communication revolution @ @ @ @ @ @ @ .
By early 2000 , Cisco Systems had become the most valuable company on earth with a valuation exceeding half a trillion dollar as its P/E ratio raced above 120 .
In other words , investors were paying $ 120 dollars for a claim on one dollar of Cisco ’ s earnings .
In March 2000 , Cisco ’ s excessive valuation didn ’ t stop Paul Weinstein , an analyst with Credit Suisse First Boston , from forecasting the company reaching a trillion dollars in market value within 24 to 36 months @ @ @ @ @ @ @ the next two to three years , Cisco could be the first trillion-dollar market cap company–and don ’ t think they wouldn ’ t love it , ” Mr. Weinstein wrote in his “ strong buy ” recommendation .
Weinstein was by no means alone , George Kelly at Morgan Stanley was equally buoyant ( Wall Street , banks often piles up on the top of a bubble , in the hope of gaining favour with the ‘ hot ’ company , thus increasing the bank chance of securing a piece of any @ @ @ @ @ @ @ ) : “ One of the reasons investors value Cisco so highly right now is that , unlike Microsoft , Cisco doesn ’ t have the uncertainty of a Justice Department settlement–it ’ s a much cleaner situation , ” Mr. Kelly said .
“ Second , Cisco has had a tremendous track record of continuous upside surprises .
And Cisco is viewed as opening several new markets , the biggest of which is optical , which is expected to be an explosive market.
” Michael Neiberg , lead communications equipment analyst at @ @ @ @ @ @ @ as well : “ If you had picked a price point to sell [ high ] at anytime in the past 10 years , you would have been wrong , ” he said .
“ They have such an impressive track record of growing … that the financial community isn ’ t thinking in terms of a multiple of what they ’ re earning this year , but what they will be earning three or four years down the line.
” Weeks after these rosy predictions were made , Cisco Systems went on @ @ @ @ @ @ @ from its zenith in early 2000 to its nadir in late 2002 : It is important to note that no company had ever traded at a one trillion valuation at the time , hence , when analysts started making such hyperbolic predictions , right at the top of a parabolic stock price move , investors should have taken this as an ominous sign .
In early 1999 , Qualcomm , the company beyond the CDMA wireless technology , traded at merely $ 25 a share , by the end of the year , @ @ @ @ @ @ @ the nice round number of $ 1000 a share .
The combination of wireless communication and the internet ignited a euphoric interest in Qualcomm , unlike other technology companies , Qualcomm was riding two secular growth trends : wireless and the internet .
After the stock spent 1999 hitting a new high after another , the move accelerated towards the end of the year and culminated with a $ 1000 a share price target by Walter Piecyk at PaineWebber on December 29th 1999 , from the Wall Street Journal : Within minutes , @ @ @ @ @ @ @ some traders complained they couldn ’ t keep up with the demand .
They ended the day at $ 659 , up $ 156 , or 31 % .
The shares blew through their 52-week high of $ 528.50 , and ended up 26-fold from their 52-week low of $ 25.3125 a share .
The buzz surrounding the trading topped news bulletins on business television , market newswires and Internet investment chat rooms .
When an “ it ” stock really goes ballistic , conventional analysis becomes pointless .
It ’ s all @ @ @ @ @ @ @ later .
bother with research now ?
This thing ’ s a rocket !
As the momentum maniacs piled in after Piecyk ’ s call , Internet message boards were swamped with sophomoric posts , often fixated on hourly price fluctuations .
On the day of Piecyk ’ s call , 3,034 posts poured into Yahoo !
’ s Qualcomm message board .
Old-timers bemoaned the “ RIP factor ” –the low ratio of intelligent posts .
Intoxicated with profits , one gleeful investor crowed , “ I AM A GENIUS.
” A @ @ @ @ @ @ @ insight : “ 1000 yea baby yea.
” As was the case with Cisco Systems , the parabolic stock run , the frenzied trading , and Wall Street analysts hyper bullish price calls marked the top of the move .
The stock spent the next two years losing 90 % of its value , it took investors twenty years to see the stock reach and exceed its 1999 high : The parabolic hype pattern we witnessed with Cisco Systems and Qualcomm has played out with countless other 1990s technology names , including the @ @ @ @ @ @ @ went to on to exceed their old highs by a wide margin , names such as Apple and Amazon .
But even in the case of these successful companies , it took between ten and twenty years for these stocks to reach their 1990s highs .
It is possible for an investor to be right about the future of a company , and yet make no money on it for decades , if they have paid far too much for the stock during a speculative frenzy .
In January 2008 , as the @ @ @ @ @ @ @ approached its demise , oil prices hit $ 100 a barrel for the first time in history .
By May of the same year , as WTI exceed $ 120 a barrel , Goldman Sachs warned that oil was heading towards $ 200 a barrel : Mr Murti said the energy crisis could be coming to a head as a lack of adequate supply growth was becoming apparent .
He said : “ The possibility of $ 150- $ 200 per barrel seems increasingly likely over the next six to 24 months.
” @ @ @ @ @ @ @ the Organisation of the Petroleum Exporting Countries to cushion against unexpected supply shocks was very low .
The fact that the global economy was facing acute economic challenges in the summer of 2008 , didn ’ t dent the oil price rally , nor did it lesson analysts enthusiasm for oil prices : Oil recently hit US $ 135 a barrel , more than double where it was a year ago .
And the once unimaginable prospect of oil at US $ 200 a barrel is gaining currency among the world ’ s @ @ @ @ @ @ @ , chief economist with CIBC World Markets , predicts oil will rocket to that level by 2012 .
Goldman Sachs figures we ’ ll get there even sooner .
Other analysts , meanwhile , have begun to float more startling figures , of oil at US $ 250 , even US $ 300 a barrel .
As you can imagine , the parabolic move in oil , and the increasingly bullish analysts rhetoric , marked the top for oil prices .
The WTI contract topped at $ 147 a barrel in July 2008 @ @ @ @ @ @ @ $ 30s by December .
Twelve years later , oil prices remain nowhere close to the egregious summer 2008 analysts price calls .
Peak oil , the idea that the world was running of oil was one of the factors that drove oil prices ever higher at the time .
Many of those forecasting higher prices in the summer of 2008 failed to account for the impact of technology in unlocking new oil reserves , nor did they adjust for a potential weakness in demand as prices soared and the global economy weakened @ @ @ @ @ @ @ critical thinking at the moment it is needed most .
During the 2010s , a digital currency of an unknown origin named Bitcoin , grew from an obscure financial innovation into a worldwide phenomena .
As the crypto currency increased in value , it attracted hoards of investors , speculators and gamblers from the four corners of the globe .
In a sense , Bitcoin was the first global bubble , a bubble that knew no creed , color , or ethnicity .
As Bitcoin raced towards its all time high of $ @ @ @ @ @ @ @ on the exchange ) and reached roughly $ 300 billion in total value in December 2017 , predictions around the digital currency future value became practically surreal : Former hedge fund manager James Altucher thinks bitcoin will reach $ 1 million in three years … “ There ’ s only going to be 21 million bitcoins minted ever in history .
That ’ s also going to drive demand , ” Altucher said .
Others , went even further : Bitcoin has a value potential of at least $ 90 trillion … The @ @ @ @ @ @ @ 21 million , which is approximately $ 4.3 million per bitcoin .
Bitcoin promoters threw the kitchen sink to justify their increasingly inflated price projections : they claimed Bitcoin would re-make the global financial system , replace banks , credit cards , cash , it would create new business models and dominate payment systems , dethrone central banks , and transfer wealth into the hands of the masses .
The fact that only a limited number of Bitcoins could be mined or ever be created further added to the investment proposal scarcity value @ @ @ @ @ @ @ currencies could be created was conveniently sidestepped by those espousing ever higher Bitcoin price targets . )
Once more the same pattern repeats itself : parabolic price move , wild price projections emerge , and a collapse ensues .
After hitting its all-time high in December 2017 , the digital currency lost 80 % of its value within 12 months .
Although , Bitcoin has rebounded since , it is still trading 50 % below its previous peak .
Tesla , with its popular electric cars and its controversial CEO , Elon Musk @ @ @ @ @ @ @ investors .
Despite 17 years of loses , many broken promises , and a litany of high-profile skeptics , a bidding frenzy rocketed the stock from $ 250 a share in late 2019 to over $ 900 a share by February 2020 , at which point , the company market value exceeded the market value of General Motors , Ford and Fiat Chrysler combined .
As we have seen with previous bubbles , the parabolic move in the stock price only encouraged the bubble proponents into making wilder , crazier , future price @ @ @ @ @ @ @ manger at Ark Invest a renowned Tesla bull , issued a whopping $ 7000 a price target on Tesla days before its $ 917 a share peak : “ Our confidence level that this stock is heading for $ 7,000 over the next five years is very high , ” Wood , the founder and CEO of Ark Investment Management , said on “ Fast Money.
” Around the same time , Toni Sacconaghi at Bernstein , while acknowledging that Tesla valuation had become disconnected from reality , attempted to justify the unjustifiable @ @ @ @ @ @ @ cash flows , he said it would be difficult to justify the current share price , which would suggest Tesla will eventually become bigger and more profitable than Volkswagen .
However , he acknowledged that investor perceptions have changed , with Tesla becoming the “ ultimate ‘ possibility ’ stock.
” Nigam Arora , at Marketwatch.com , captured the investors ’ mood around Tesla in an article entitled : A perfect combination for Tesla ’ s stock gains — future fantasies , short selling and FOMO : Since it is imagination that investors @ @ @ @ @ @ @ restrictions and no constraints .
Isn ’ t it , say , a matter of time before Tesla makes millions of cars a year ?
Many investors have conviction that it will .
Aren ’ t there too many variables to jump from half a million to many millions ?
No problem , just add perfect foresight to the conviction Let us not forget about advances in autonomous cars by Tesla , robotaxis , solar roofs and batteries .
Could flying taxis from Tesla become our favorite mode of transportation ?
The sky @ @ @ @ @ @ @ so far ahead that nobody else can possibly catch up .
It is a matter of time before everything around us is Tesla , or so the story goes .
A month after closing above $ 900 a share , Tesla shares collapsed to $ 351 , before rebounding to $ 819 a share .
Today , the stock market capitalization is worth more than the combined market value of : GM , Ford , Fiat Chrysler , Uber , Lyft and Ferrari .
Tesla embodies many of the same characteristics of the @ @ @ @ @ @ @ a parabolic stock price move , a diet of hyperbolic price forecasts , and a valuation that defy all logic and reality .
If Tesla ’ s stock price follows the same pattern of its bubbly predecessors , the stock price has much further to go on the downside .
At the parabolic top of every financial bubble , thrilled investors lose their tether to reality , and as the price of the speculative instrument rallies ever higher , investors ’ expectations for additional price appreciation inflate ever more .
Whether its Cisco @ @ @ @ @ @ @ Qualcomm at $ 1000 a share , Oil at $ 200 a barrel , Bitcoin at a million dollar a piece , or Tesla at $ 7000 a share , these far fetched price fantasies are the fuel with which bubbles , and their beneficiaries , attempt to sustain themselves .
To the chagrin of the bubble chasers , history is categorical in this regard , the combination of a parabolic price move , a hype narrative , and the proliferation of wild price projections , is highly indicative of a topping bubble @ @ @ @ @ @ @ course , Tesla shareholders will dismiss this article as irrelevant since history count little in the eyes of those who believe their company to be at the forefront of a new transportation and business paradigm .
John Galbraith puts it best : “ There can be few fields of human endeavor in which history counts for so little as in the world of finance .
Past experience , to the extent that it is part of memory at all , is dismissed as the primitive refuge of those who do not have the @ @ @ @ @ @ @ the present ”

By Nawar Alsaadi
I started trading stocks in the late 90s, it was an exciting time; the internet was coming of age, and investors, or rather day traders, were extremely excited about the riches of this new digital era. I was in my early 20s, and I had very limited investing knowledge at the time, nonetheless, I opened an online trading account and used half my college tuition money to speculate on internet stocks. A year later, my capital had multiplied by twenty folds! And notions of being a financial genius floated within my head. My remarkable success attracted the attention of many friends, even family friends, and at the ripe old age of 21, I was dispensing financial advice (mostly stock tips) to people double and triple my age. To those older than me, I became a sort of Sherpa to a new world where finance and technology intertwined into a new and exciting reality. Trading tech stocks during the technology boom was an intoxicating experience; popular names such as Netscape, AOL, Yahoo, JDS Uniphase, Cisco Systems, Juniper Networks, Ebay, Qualcomm and Amazon among others skyrocketed day after day to unbelievable highs. It seemed as if all one had to do to become rich was to open a brokerage account, and buy whatever tech stock was in vogue. Investment legends such as Warren Buffett were written off as out of touch for they did not comprehend the peculiarities of this new paradigm, where valuations, profitability, or even revenues were of little interest. Traditional valuation metrics were replaced by new measures such as eye balls and available bandwidth. In July 2000, Vinod Khosla at Kleiner Perkins Caufield & Byers, explained it so:
A lot of people look at the traditional measures for the economy and start scratching their heads about this long period of growth we’re enjoying. That’s because the traditional measures are industrial measures; they miss what’s really going on. The old econometric models take into account the cost of oil, but they totally ignore the cost of bandwidth. The old yardsticks don’t make sense any-more because what’s going on today is a fundamental change in the structure of our economy.
The old world, with its physical constrains seemed to have been replaced by a new virtual world, a terra nova of infinite growth possibilities. I felt fortunate to live at a time of such amazing optimism and change, a world where a kid my age could make more money in a day than his dad could earn in a year.
I don’t wish to spoil the end of this fairy-tale, but to my disappointment, the good times didn’t last, and the trees, in which I parked my capital, didn’t grow to the sky. After peaking at over 5000 points on March 10th 2000, the NASDAQ crashed into a brutal two-year bear market that took it all the way down to 1100 by October 2002, an 80% decline. Of course, the bursting of the technology bubble did not eliminate the internet, on the contrary, the internet continued to grow, and a host of new successful technology companies came to the scene in the ensuing two decades. Those who believed in this new world were vindicated, but few of us made real money out of it.
After losing my shirt in the technology crash, I developed a unique interest in investment bubbles, and read countless books on the subject. One of the books that marked me was Irrational Exuberance by Professor Robert Shiller; in the book, Shiller beautifully captures the essence of what fuels a speculative bubble:
“Irrational exuberance is the psychological basis of a speculative bubble. I define a speculative bubble as a situation in which news of price increases spurs investor enthusiasm, which spreads by psychological contagion from person to person, in the process amplifying stories that might justify the price increases and bringing in a larger and larger class of investors, who, despite doubts about the real value of an investment, are drawn to it partly through envy of others’ successes and partly through a gambler’s excitement.”
He then goes on to say,
“Errors of human judgment can infect even the smartest people, thanks to overconfidence, lack of attention to details, and excessive trust in the judgments of others, stemming from a failure to understand that others are not making independent judgments but are themselves following still others—the blind leading the blind.”
The process of price increases bringing on more price increases is a phenomena I have noticed in all the investment bubbles I have studied over the last twenty years. However, a price increase by itself is usually not sufficient to sustain a bubble, something more needs to be present, something that captures the imagination, and for that we can refer to another excellent book, ‘A Short History of Financial Euphoria’ by the economist John Galbraith. Galbraith cites ‘newness’ as one the key drivers to a financial euphoria:
All speculative episodes are driven by the thought of something new, exciting that catches the public imagination. It’s rich in imaginative prospects, but light on realistic prospects. Speculators take pride in a discovery or new innovation (financial or other), thinking they’re ahead of their time (much like early adopters of new tech). Eventually, others recognize it and pile in. Financial innovations are less innovation and more a twist on a past financial concept or product, unknown to a new generation of speculators. “The world of finance hails the invention of the wheel over and over again, often in a slightly more unstable version.”
Ironically, John Galbraith’s book was published in July 1994, merely a year before the famed Netscape’s IPO (August 1995) which marked the start of the 1990s technology boom. One wonders if the tech bubble would have formed if Galbraith’s book had been a best seller; the answer is probably not, and the reason can be found in the book itself as Galbraith argues this exact point:
Warnings of speculative euphoria are treated in the short run as an attack, as envy and lack of faith in the asset’s potential and the wisdom of the market. Participants defend their vested interest. Doubters are castrated as unimaginative or “too old” or “too out of touch” to understand the new paradigm driving values.
Whether it is the technology bubble in the 1990s, the Tulip bubble in the 1600s, the Mississippi bubble and South Sea Bubble in the 1700s, the stock market bubble of the 1920s, the real estate and stock market bubble in Japan the 1980s, or crypto-currencies bubble in the 2010s, such bubbles seems to share a number of common characteristics in the way they are inflated and around the time they are deflated. It is this bubble deflation, or bubble bursting phase that fascinates me the most, and is the subject of this article.
A recurring feature of a bursting investment bubble is the culmination of absurd statements and assertions by an otherwise seemingly reasonable individuals right around the parabolic top of such phenomena. The most famous example of these is the famed statement by the Yale economist Irving Fisher, who asserted in September 1929, a month before the catastrophic Dow Jones collapse, that “stock prices have reached what looks like a permanently high plateau.”
Many such absurd assertions and speculations can be found around the top of subsequent bubbles; those who can spot such ‘delusions’ if we can call them so, stand a decent chance of generating an above average return by positioning themselves for the approaching burst of the bubble in question. To further drive my point, I will briefly examine a series of historical bubbles as I make my way to the bubble referenced in the title of this article.
Cisco Systems – 1st Trillion Dollar company
In the late 1990s, Cisco Systems was a tech investors darling, with its routers and networking gear at the core of the internet and communication revolution, the company growth potential seemed infinite. By early 2000, Cisco Systems had become the most valuable company on earth with a valuation exceeding half a trillion dollar as its P/E ratio raced above 120. In other words, investors were paying $120 dollars for a claim on one dollar of Cisco’s earnings. In March 2000, Cisco’s excessive valuation didn’t stop Paul Weinstein, an analyst with Credit Suisse First Boston, from forecasting the company reaching a trillion dollars in market value within 24 to 36 months:
“We humbly submit that over the next two to three years, Cisco could be the first trillion-dollar market cap company–and don’t think they wouldn’t love it,” Mr. Weinstein wrote in his “strong buy” recommendation.
Weinstein was by no means alone, George Kelly at Morgan Stanley was equally buoyant (Wall Street, banks often piles up on the top of a bubble, in the hope of gaining favour with the ‘hot’ company, thus increasing the bank chance of securing a piece of any upcoming lucrative underwriting or investment banking business):
“One of the reasons investors value Cisco so highly right now is that, unlike Microsoft, Cisco doesn’t have the uncertainty of a Justice Department settlement–it’s a much cleaner situation,” Mr. Kelly said. “Second, Cisco has had a tremendous track record of continuous upside surprises. And Cisco is viewed as opening several new markets, the biggest of which is optical, which is expected to be an explosive market.”
Michael Neiberg, lead communications equipment analyst at Chase Hambrecht & Quist, chipped in as well:
“If you had picked a price point to sell [high] at anytime in the past 10 years, you would have been wrong,” he said. “They have such an impressive track record of growing … that the financial community isn’t thinking in terms of a multiple of what they’re earning this year, but what they will be earning three or four years down the line.”
Weeks after these rosy predictions were made, Cisco Systems went on to lose 87% of its value from its zenith in early 2000 to its nadir in late 2002:
It is important to note that no company had ever traded at a one trillion valuation at the time, hence, when analysts started making such hyperbolic predictions, right at the top of a parabolic stock price move, investors should have taken this as an ominous sign.
Qualcomm – $1000 a share
In early 1999, Qualcomm, the company beyond the CDMA wireless technology, traded at merely $25 a share, by the end of the year, analysts were projecting the stock to hit the nice round number of $1000 a share. The combination of wireless communication and the internet ignited a euphoric interest in Qualcomm, unlike other technology companies, Qualcomm was riding two secular growth trends: wireless and the internet. After the stock spent 1999 hitting a new high after another, the move accelerated towards the end of the year and culminated with a $1000 a share price target by Walter Piecyk at PaineWebber on December 29th 1999, from the Wall Street Journal:
Within minutes, Qualcomm shares were climbing so quickly that some traders complained they couldn’t keep up with the demand. They ended the day at $659, up $156, or 31%. The shares blew through their 52-week high of $528.50, and ended up 26-fold from their 52-week low of $25.3125 a share. The buzz surrounding the trading topped news bulletins on business television, market newswires and Internet investment chat rooms.
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CNN Money, provided more color:
When an “it” stock really goes ballistic, conventional analysis becomes pointless. It’s all about momentum. Buy first, think later. bother with research now? This thing’s a rocket! As the momentum maniacs piled in after Piecyk’s call, Internet message boards were swamped with sophomoric posts, often fixated on hourly price fluctuations. On the day of Piecyk’s call, 3,034 posts poured into Yahoo!’s Qualcomm message board. Old-timers bemoaned the “RIP factor”–the low ratio of intelligent posts. Intoxicated with profits, one gleeful investor crowed, “I AM A GENIUS.” A fellow philosopher contributed this pithy and profound insight: “1000 yea baby yea.”
As was the case with Cisco Systems, the parabolic stock run, the frenzied trading, and Wall Street analysts hyper bullish price calls marked the top of the move. The stock spent the next two years losing 90% of its value, it took investors twenty years to see the stock reach and exceed its 1999 high:
The parabolic hype pattern we witnessed with Cisco Systems and Qualcomm has played out with countless other 1990s technology names, including the ones that survived the technology crash and went to on to exceed their old highs by a wide margin, names such as Apple and Amazon. But even in the case of these successful companies, it took between ten and twenty years for these stocks to reach their 1990s highs. It is possible for an investor to be right about the future of a company, and yet make no money on it for decades, if they have paid far too much for the stock during a speculative frenzy.
Oil – $200 a barrel
In January 2008, as the subprime crisis was brewing and Bear Sterns approached its demise, oil prices hit $100 a barrel for the first time in history. By May of the same year, as WTI exceed $120 a barrel, Goldman Sachs warned that oil was heading towards $200 a barrel:
Mr Murti said the energy crisis could be coming to a head as a lack of adequate supply growth was becoming apparent. He said: “The possibility of $150-$200 per barrel seems increasingly likely over the next six to 24 months.” He added that the spare capacity of the Organisation of the Petroleum Exporting Countries to cushion against unexpected supply shocks was very low.
The fact that the global economy was facing acute economic challenges in the summer of 2008, didn’t dent the oil price rally, nor did it lesson analysts enthusiasm for oil prices:
Oil recently hit US$135 a barrel, more than double where it was a year ago. And the once unimaginable prospect of oil at US$200 a barrel is gaining currency among the world’s most respected oil watchers. Jeff Rubin, chief economist with CIBC World Markets, predicts oil will rocket to that level by 2012. Goldman Sachs figures we’ll get there even sooner. Other analysts, meanwhile, have begun to float more startling figures, of oil at US$250, even US$300 a barrel.
As you can imagine, the parabolic move in oil, and the increasingly bullish analysts rhetoric, marked the top for oil prices. The WTI contract topped at $147 a barrel in July 2008 before collapsing all the way to the $30s by December. Twelve years later, oil prices remain nowhere close to the egregious summer 2008 analysts price calls. Peak oil, the idea that the world was running of oil was one of the factors that drove oil prices ever higher at the time. Many of those forecasting higher prices in the summer of 2008 failed to account for the impact of technology in unlocking new oil reserves, nor did they adjust for a potential weakness in demand as prices soared and the global economy weakened. Parabolic price moves tend to numb critical thinking at the moment it is needed most.
Bitcoin – $1 million a coin
During the 2010s, a digital currency of an unknown origin named Bitcoin, grew from an obscure financial innovation into a worldwide phenomena. As the crypto currency increased in value, it attracted hoards of investors, speculators and gamblers from the four corners of the globe. In a sense, Bitcoin was the first global bubble, a bubble that knew no creed, color, or ethnicity. As Bitcoin raced towards its all time high of $17000-$19000 a coin (depending on the exchange) and reached roughly $300 billion in total value in December 2017, predictions around the digital currency future value became practically surreal:
Former hedge fund manager James Altucher thinks bitcoin will reach $1 million in three years … “There’s only going to be 21 million bitcoins minted ever in history. That’s also going to drive demand,” Altucher said.
Others, went even further:
Bitcoin has a value potential of at least $90 trillion … The calculation is $90 trillion divided by 21 million, which is approximately $4.3 million per bitcoin.
Bitcoin promoters threw the kitchen sink to justify their increasingly inflated price projections: they claimed Bitcoin would re-make the global financial system, replace banks, credit cards, cash, it would create new business models and dominate payment systems, dethrone central banks, and transfer wealth into the hands of the masses. The fact that only a limited number of Bitcoins could be mined or ever be created further added to the investment proposal scarcity value. (The fact that other digital currencies could be created was conveniently sidestepped by those espousing ever higher Bitcoin price targets.)
Once more the same pattern repeats itself: parabolic price move, wild price projections emerge, and a collapse ensues. After hitting its all-time high in December 2017, the digital currency lost 80% of its value within 12 months. Although, Bitcoin has rebounded since, it is still trading 50% below its previous peak.
Tesla – $7000 a share
Tesla, with its popular electric cars and its controversial CEO, Elon Musk, has captured the imagination of many investors. Despite 17 years of loses, many broken promises, and a litany of high-profile skeptics, a bidding frenzy rocketed the stock from $250 a share in late 2019 to over $900 a share by February 2020, at which point, the company market value exceeded the market value of General Motors, Ford and Fiat Chrysler combined. As we have seen with previous bubbles, the parabolic move in the stock price only encouraged the bubble proponents into making wilder, crazier, future price projections: Catherine Wood, a money manger at Ark Invest a renowned Tesla bull, issued a whopping $7000 a price target on Tesla days before its $917 a share peak:
“Our confidence level that this stock is heading for $7,000 over the next five years is very high,” Wood, the founder and CEO of Ark Investment Management, said on “Fast Money.”
Around the same time, Toni Sacconaghi at Bernstein, while acknowledging that Tesla valuation had become disconnected from reality, attempted to justify the unjustifiable:
Using traditional auto valuations and discounted cash flows, he said it would be difficult to justify the current share price, which would suggest Tesla will eventually become bigger and more profitable than Volkswagen. However, he acknowledged that investor perceptions have changed, with Tesla becoming the “ultimate ‘possibility’ stock.”
Nigam Arora, at Marketwatch.com, captured the investors’ mood around Tesla in an article entitled: A perfect combination for Tesla’s stock gains — future fantasies, short selling and FOMO:
Since it is imagination that investors are trading on, there are no restrictions and no constraints. Isn’t it, say, a matter of time before Tesla makes millions of cars a year? Many investors have conviction that it will. Aren’t there too many variables to jump from half a million to many millions? No problem, just add perfect foresight to the conviction Let us not forget about advances in autonomous cars by Tesla, robotaxis, solar roofs and batteries. Could flying taxis from Tesla become our favorite mode of transportation? The sky’s the limit. Tesla is so far ahead that nobody else can possibly catch up. It is a matter of time before everything around us is Tesla, or so the story goes.
A month after closing above $900 a share, Tesla shares collapsed to $351, before rebounding to $819 a share. Today, the stock market capitalization is worth more than the combined market value of: GM, Ford, Fiat Chrysler, Uber, Lyft and Ferrari. Tesla embodies many of the same characteristics of the aforementioned bubbles: a new technology, a parabolic stock price move, a diet of hyperbolic price forecasts, and a valuation that defy all logic and reality. If Tesla’s stock price follows the same pattern of its bubbly predecessors, the stock price has much further to go on the downside.
Conclusion
At the parabolic top of every financial bubble, thrilled investors lose their tether to reality, and as the price of the speculative instrument rallies ever higher, investors’ expectations for additional price appreciation inflate ever more. Whether its Cisco Systems at a trillion-dollar market value, Qualcomm at $1000 a share, Oil at $200 a barrel, Bitcoin at a million dollar a piece, or Tesla at $7000 a share, these far fetched price fantasies are the fuel with which bubbles, and their beneficiaries, attempt to sustain themselves.
To the chagrin of the bubble chasers, history is categorical in this regard, the combination of a parabolic price move, a hype narrative, and the proliferation of wild price projections, is highly indicative of a topping bubble and an impending price collapse. Of course, Tesla shareholders will dismiss this article as irrelevant since history count little in the eyes of those who believe their company to be at the forefront of a new transportation and business paradigm. John Galbraith puts it best:
“There can be few fields of human endeavor in which history counts for so little as in the world of finance. Past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have the insight to appreciate the incredible wonders of the present”
By Nawar Alsaadi for Oilprice.com


investmentwatchblog--2020-05-10--Chicago fire department responds to nursing home for 151 positive covid paitents!

Cfd just responded to a respiratory call at a nursing home supposedly with 102 residents and 49 staff Positive with @ @ @ @ @ which home it is as of now .
Ok so this is total .
Cases @ @ @ @ @ still a lot for one location If you do Twitter follow Eric tendian for scanner @ @ @ @ @ ’ s real time info Unsure which one as this shows all of cook county @ @ @ @ @ one of these .

Cfd just responded to a respiratory call at a nursing home supposedly with 102 residents and 49 staff Positive with the Wuhan virus.
Unsure which home it is as of now.
Ok so this is total. Cases have been reported there but still a lot for one location
If you do Twitter follow Eric tendian for scanner updates in Chicago. He’s real time info
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www.dph.illinois.gov/covid19/long-term-care-facility-outbreaks-covid-19
Unsure which one as this shows all of cook county. But it’s one of these.
h/t Lazlo


investmentwatchblog--2020-05-10--President Trump Tweets Video of Sean Hannity Interview with Mark Levin

A counter-intelligence operation can not be initiated without Presidential knowledge .

A counter-intelligence operation cannot be initiated without Presidential knowledge.
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AC