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The molly-coddled, wet-nursed bulls who can’t take one iota of pain and demand a government bailout at the slightest loss are running around in a panic this morning, as they can’t understand their their stonks aren’t going up all the time like mommy promised.
In honor of Powell doing yet another 60 Minutes spot tonight, here is as chart of the SPY fund and the total assets held by the darlings at the Federal Reserve. The correlation has changed tremendously over time, but it’s pretty clear equities have “caught up” nicely with the trillions of dollars of Fed Bux.
Of all the “help” the federal government provided last year, perhaps the most distasteful was to have gobbled up ETFs from the good, honest people at Blackstone led by this decent, honest, and generous man. Here are some of the ETFs that the Fed bought with freshly-printed dollars. I offer these as more supporting evidence about how the interest rate world is turning, because they’re all turning south as these interest-sensitive instruments erode. It doesn’t matter that they’re declining. The Fed can always print up more trillions to cover any losses.
OK, the Fed day is over (we get eight of them a year), and Jerome managed to play the entire market like a master violinist. In our new USSR economy, the Fed is presumed to have clairvoyance beyond all others, and can confidently predict what’s going to this year, and next year, and even the year after that. That’s right: the Fed can tell you what the world is going to look like in 2023. Their Gartman-level track record gives them this right.
Thus, after a deep red morning, we saw this in the NQ………
