Sunday, August 28, 2016

David Stockman*: The Market Is
Being Set Up For A Hard Fall
"The market’s melt-up since the Feb. 11 interim low has been positively surreal. It has gone up 19% since that February low of 1,829 on the S&P 500. But there’s nothing sustainable about it. This latest rebound was the work of eyes-wide-shut day traders and robo-machines surfing on a thinner and thinner cushion of momentum. What comes next, in fact, is exactly what happens when you stop pedaling your bicycle. Momentum gets exhausted, gravity takes over and the illusion of stability is painfully shattered .. The Fed is just systematically juicing the gamblers, and thereby fueling ever greater mispricing of financial assets and ever more dangerous and explosive financial bubbles. What we’re seeing now is the illusion of stability."
link here to the essay

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