After yesterday’s CPI Roman candle, we prepare for today’s PPI firecracker. I gotta tell you, the notion that we’re at 4.9% inflation is simply comic. Just a few days ago I was looking at a faucet to buy only for $170. I decided to buy it the next day, and it was $313. I see that kind of price shift constantly, whether it’s my utility bill or a restaurant tab. Inflation is 4.9% in the deluded minds of those making up the numbers. I’m thinking more like 30%, if my life experience is any guide. In any event, the /ES is down slightly as I’m typing this, pre-PPI.
This is driven in part by the fact that banks are resuming their fall (in spite of the 190 year old Yellen’s declaration a few years ago that we’d never see any financial crisis in our lifetimes, since in her diseased, never-actually-had-a-real-job brain the government can dictatorially control outcomes in daily lives – – psychotic old biddy). Here we see PacWest take a tumble as depositors continue to flee their institution in terror.
One of my general themes continues to be energy bearishness, with the general notion that crude oil’s long collapse will go hand-in-hand with global economic disaster. We flash-crashed to $63 last week. If we can cut below this number in the weeks ahead, it’ll just set up another leg of the downturn.
There is still no resolution to the “face-off” that we’ve been tracking. This pattern is so monstrous, it will take weeks to resolve. However, once it resolved, its effects will be felt for months, if not a full year.
As I enter this day, I am more aggressively positioned than yesterday, with 10% cash (instead of 30%) and an assortment of 21 bearish positions. Good luck to everyone, and thanks for being here.
