A host on bubblevision this afternoon noted that the S&P 500 is now down $2 trillion for the year and wondered if his panel could explain ‘what’s happened since January 1st?’
The implication, of course, was that since no new recessions have started – – nor have any new wars been declared, polar glaciers melted or Wall Street banks gone down for the count – – that the market’s worst ever start of the year was surely overdone. Maybe it was even BTFD time again.
Then again, maybe the outlook is just as bad as it was before January 1st, but that the outlookers have acquired a new outlook. Stated more baldly, perhaps the sleepwalkers have finally awakened.
That would certainly seem to be the case with the market’s high flyers. Most of this year’s spectacular flameouts have reported nothing new nor issued any disturbing 8-Ks. Amazon apparently had a swell Christmas, for example, but its share price is now down 19% from the bubblevision man’s line of demarcation.
Indeed, Amazon and its fellow FANGs (Facebook, Amazon, Netflix and Google) succinctly explain the pivot. They have actually been the canary in the coal mine all along; it just now that their warnings signals are being noticed.
This post was published at David Stockmans Contra Corner on January 20, 2016.
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