Home / Investing / The real "tragicomedy" – Who is ready to buy the "dive" again now? – Investment surveillance

The real "tragicomedy" – Who is ready to buy the "dive" again now? – Investment surveillance

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Written by Sven Henrich through NorthmanTrader.com,

All frogs are boiling our perception of reality in the pot of price perversion that central banks have unleashed in the world.


A tragicomedy of epic proportions continues to develop in front of our own eyes. On Friday, world markets closed again at record levels and this week everyone is already crying again for more encouragement and central banks around the world are too eager to please.

Having stuck the markets to a record 158% market capitalization for GDP on Friday in non-stop interventions since the December 2018 lows, all in the name of preventing the next recession, central bankers, meanwhile, have very Little new ammunition in case a global recession develops.

It seemed that the can had been successfully kicked along the way just by looking at stock prices, but the bond market has been screaming caution all the time.

Then comes the coronavirus and everyone ignores it too. Let's move forward completely and look for actions at record levels, while the second largest economy with 330% debt to GDP is paralyzed. What could go wrong?

Central banks always support us, right?

And so, last night the obvious news arrived: $ AAPL issued an income warning and surely it won't be the only company that does it. The great irony, of course, would be if the further expansion of the market capitalization in the history of any action caused by an income warning in January 2019 ended with another income warning in February 2020 just at the moment when the action shows part of the more technically extended readings in its history.

Price movements have been distorted so much as a result of the constant intervention of the central bank that everyone understands the joke:

As I said yesterday:

Now I don't know if the $ AAPL warning will activate the largest correction suggested by the broader technical table in indices such as $ NDX or not, but it may well lead to that.

It is worth noting that this market continues to be held for 5 shares and one of these 5 shares has just been criticized:

The largest stock market is already in a much larger profit recession and 5 shares have been hiding everything.

5 actions are the safe haven in a market that has been forced to pursue performance and growth where it can be found. The stubborn approach to maintaining artificially suppressed rates has resulted in a perversion of price discovery.

And, therefore, world markets are at an all time high with Japan in recession, Germany with a 0% GDP growth and the second largest economy in the world with a 330% GDP debt in a virtual stalemate . Meanwhile, the ECB is financing the latest acquisition of mergers and acquisitions of the richest man in France:

The richest man in France receives a free lunch from the ECB

The true tacit and continuing tragedy of all this is that central banks with their policies continue to exacerbate wealth inequality by continuously maintaining disproportionate property assets of the top 1%. This leads to political divisions, tensions and a sense of economic injustice that some of the richest fully recognize. Low taxes for the top 1% and a permanent central bank placed on top of it. Bill Gates recognizes the perception of injustice:

Keep believing that nothing matters because of central banks if you choose. No, a tragicomedy develops before our eyes and the final end of the perversion could well be written like this:

I can't say if Coronavirus is the trigger that triggers the global recession that central banks in 2019 and 2020 tried to avoid. All I can say at the moment is that the impact of the virus is still underestimated by market participants and the revenue of $ AAPL last night serves as warning evidence.

What I can say is that central bankers threw their ammunition into the fire last year and the evidence of reflation remains highly doubtful, especially as yields continue to fall:

The real tragicomedy would be if the central bankers did everything possible to avoid a global recession in 2019 and, as a result, made everyone pursue the actions at the highest valuations of all measures and now a global recession would develop that would leave the caught hunters. to extreme valuations and central banks with little precious ammunition.

An overstimulated world may find that any renewed stimulus will be ineffective. And maybe it already does. After all, why year 10 is 1.5%?

Who is ready to buy the "dip"?

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For the last public analysis, visit NorthmanTrader. To subscribe to our market products, visit Services.




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