Another sleigh ride today for stocks with plenty of tumult for Tesla as Zero Hedge noted:
Shit’s getting real in equity-land as this morning’s selling pressure has turned into a blood-soaked sea of red with TSLA leading the plunge, down 11% [and] The S&P has erased all of the week’s gains…
… and …
Traders are bracing for worlds end
The NASDAQ took it worse, plunging midday the most it has since September 13th and ended the day down 11% from its last rally peak. This all puts the NASDAQ on track for … (drum roll) … it’s worst December since the big dot-com bust:
(I think Bloomberg got its Christmas colors as upside down in that graph as the market thinks. Shouldn’t the December’s that were down be the ones that were in-the-red with the money-makers in-the-green? Ah well, what do you expect in this world of slop-happy financial reporting?)
Nevertheless, all stocks did manage to recover about 50% of today’s steep fall in the latter half of the day.
What is endlessly bemusing but also frustrating in this is the market’s idiocy as it is not hard to figure out where this is going:
Appaloosa’s David Tepper told CNBC … he is “leaning short” because central banks around the world are tightening and traders should “not ignore what the central bankers are saying.”
It’s so simple for anyone who hasn’t been clubbed on the head. If you didn’t believe in fighting the Fed all the way up, you have no reason to believe you can fight the Fed on the path down.
I’m leaning short on the equity markets right now because the upside/downside doesn’t make sense to me when I have so many Central banks telling me what they are going to do, what they want to do, what they expect to do.
Ya think?
Apparently investors do not.
We all know central banks with infinite money as well as unrestrained ability to remove money from their financial systems are the market riggers, so why would anyone be dumb enough to keep fighting them when they tell you endlessly in tougher and tougher language they are taking this baby down to the bottom of the valley? Still, every bear-market rally is proof that plenty of people are just that dumb.
His message is clear – rates will remain higher for longer as global central banks fight inflation that proves stubborn (wages and labor supply) and the market is not pricing that in at all…
“The market is not buying the Fed’s increasingly hawkish position that they are going to raise rates to a higher-than-expected level and keep them there,” said Lindsey Piegza, chief economist at Stifel Nicolaus & Co….”
Well, the head clubbing will continue until the market finds a deeper bottom that can hold, but this wan’t it:
“I believed the Fed before and I believe the Fed now.”
“We are going to have a lot more tightenings.”
“Don’t ignore what these guys (Central bankers) are saying….”
“It’s going to be just difficult for things to go up right now because of these banks and because what they are saying,”
Even ZH has pounded the pivot fantasy for months, as if they were the Vampire Squid, otherwise known as Goldman Sucks. However, even ZH stopped and took a breath today:
It appears the market had its ever-optimistic-pivot-blinkers really removed by Appaloosa’s David Tepper
Let’s hope ZH has its pivot blinkers removed, too.
It wasn’t just Tepper who tapped the market on the head with a sledge hammer. We also saw some of the old familiar good news (albeit fake) is bad news knee-jerk reflex. The fake Gross Domestic Pig report for the third quarter received a hefty boost to even loftier fantasies today. Mr. Market didn’t like that because, while it doesn’t ever want to believe the Fed will keep tightening, news that the economy was running even hotter was apparently too much to handle. So, we got an “Oh, maybe the Fed will keep tightening” response. (I won’t even go into how fake that GDP report was, having already covered it; so, you can read it at the link just provided. Let it suffice here to say they just managed to fake it up higher!)
