You know, as well as I do, this whole AI-orchestrated-euphoria by Nvidia, and/or counter-parties to Nvidia, is just a #SoldToYou event.
The irony is, I know nothing about the actual end client supply channel checks, or manufacturing queue, but it sure seems that those popping into my DM do! And neither side jives with nividia’s earnings beat and Coreweave’s flimsy story.
$NVDA CEO & President of NVIDIA Jensen Huang has cashed out over $42,000,000 in shares over the last week. Sold to you. Meanwhile the SOXS Igy bought two days ago up double digits.
Here's a poster reading the data from April and predicting ISM Services would roll over. Nope - that data series is accelerating actually.
August: "The ISM Services PMI recorded its eight straight month of expansion, coming in at 54.5, the fastest pace of growth since February 2023. The outcome was 1.8 percentage points higher than July's reading of 52.7, and well above economist expectations of 52.5."
@JeffWeniger We often hear that manufacturing is in recession but Services is the duct tape and glue that is keeping this ship afloat. But for how long will that be the case? This gap between 30-year and 3-month Treasuries is telling us that ISM Services PMI looks set to roll over.
To be fair, the poster didn't put a timeline on his forecast and eventually we will have a junk bond default spike and earnings recession.
Special Situations 🌐 Research Newsletter (Jay) @SpecialSitsNews Trust me, I wish life was all 🦋 and 🌈, and would love to be 80% long good companies at cheap/reasonable prices. But after the fastest rate hiking cycle in 40 years, stubborn wage inflation, deteriorating US economic fundamentals, slowing global economy, peak margins, banking stress, trillions in commercial real estate floating rate debt (1.4 trillion maturing in next 2 years), Medicaid expiring for 5-15mn, student loan payments restarting, and consumer savings dwindling, an $SPY earnings recession and $JNK default spike is inevitable... 2:47 PM · Apr 8, 2023 · 182.8K Views
Earnings Scorecard: For Q2 2023 (with over 99% of S&P 500 companies reporting actual results), 79% of S&P 500 companies have reported a positive EPS surprise and 64% of S&P 500 companies have reported a positive revenue surprise.
"Companies spent much time on AI during earnings calls/analyst days, and now it's time to start putting up results. Anecdotally, the experience of these products has underwhelmed users, and the novelty could wear off quickly" - JPM trading desk just pulled the rug
“Technology stocks are literally carrying the entire stock market: The Nasdaq 100 to Russell 2000 ratio just hit an all time record of 8.3x. Even in the 2001 Dot-com bubble crisis, this ratio peaked at 8.1x. At the start of 2020, the Nasdaq 100 to Russell 2000 ratio was just 5.1x. Markets really believe AI is the next big thing.”
A year ago Grantham published a piece called 'ENTERING THE SUPERBUBBLE’S FINAL ACT.' In which GMO explained with notes and tables that we were doomed to 1974 or 2009. If things went well. But probably it would be worse this time because we've been particularly naughty.
But here Leuthold made the correct-ish call - they noted that inflation had already peaked by 9/22, and historically that suggests stocks would go no lower. Technically they were incorrect, as the ultimate low was hit only a month later, in 10/22. But it was a fast recovery from there.
Leuthold Group’s Jim Paulsen: “… each of the past 7 inflation cycles after annual inflation peaked, the bottom of the stock market was already in, ergo…”
Not much change in the index returns for the past month or two.
Year to date, including dividends:
TSLA +101%
Bitcoin +55%
AI Stonks +41
ARKK +40
Comms Sector +40
Tech +37
Cons Discr +30
SP500 +17%
COWZ +11
Non-US developed +9
EM ex-China +8
Sm Caps +8 Industrials +8
Global 60/40 +8
Energy +7
Materials +6
Short term junk +6
Gold +5
Junk +5
Emerging +4
Value +3
Retail: +3
Financials +2
Corp Bonds +2
REITs +1
TIPS +1 Defense +1
Inter Treasuries 0
Healthcare -2
Staples -3
Green Energy -3
Weed: -7
Hussman -9
Utilities -9
China -13%
Peloton -31
As it has been...a wildly divergent market. Risk-on is the key though...value/conservative stocks are sucking wind while high growth is surging.
Look at that healthcare...getting beaten up badly. All the conservative sectors...energy, Utilities, defense industries. Remarkable. Suggesting this econ growth will continue into 2024.
You'd think managers could provide alpha in 2023 given the wide dispersal of returns.. I'm sure some did, but the wild rumpus of tech stocks probably caught too many of them on the back foot and then catching up hasn't worked. it seemed smart to stay in value and be careful but that was a big mistake.
Bonds are doing...ok. They have a 5%ish coupon and they are up 2% over 8 months. A little capital loss but only a little. Will be amazing when we get actual 5-6% returns from bonds. Will buoy returns vastly.
Not much change in the index returns for the past month or two.
Year to date, including dividends:
TSLA +101%
Bitcoin +55%
AI Stonks +41
ARKK +40
Comms Sector +40
Tech +37
Cons Discr +30
SP500 +17%
COWZ +11
Non-US developed +9
EM ex-China +8
Sm Caps +8 Industrials +8
Global 60/40 +8
Energy +7
Materials +6
Short term junk +6
Gold +5
Junk +5
Emerging +4
Value +3
Retail: +3
Financials +2
Corp Bonds +2
REITs +1
TIPS +1 Defense +1
Inter Treasuries 0
Healthcare -2
Staples -3
Green Energy -3
Weed: -7
Hussman -9
Utilities -9
China -13%
Peloton -31
As it has been...a wildly divergent market. Risk-on is the key though...value/conservative stocks are sucking wind while high growth is surging.
Look at that healthcare...getting beaten up badly. All the conservative sectors...energy, Utilities, defense industries. Remarkable. Suggesting this econ growth will continue into 2024.
You'd think managers could provide alpha in 2023 given the wide dispersal of returns.. I'm sure some did, but the wild rumpus of tech stocks probably caught too many of them on the back foot and then catching up hasn't worked. it seemed smart to stay in value and be careful but that was a big mistake.
Bonds are doing...ok. They have a 5%ish coupon and they are up 2% over 8 months. A little capital loss but only a little. Will be amazing when we get actual 5-6% returns from bonds. Will buoy returns vastly.
Thanks, Agip. I find this overview tremendously valuable and appreciate the time you put into it.
One take away besides the one you've mentioned is that the S&P 500 is logging fairly sound returns (+17% ytd), and that is great news for savers and likely those in the retirement funds. Seriously, with so many people's retirement funds tied up in the markets these days, as opposed to the relatively rare pensions of bygone days, this is no small circumstance, as it likely reflects a lot of people's general plain-Jane retirement funds.
On another note, anyone see Tesla pop today? Up like over 10% at the moment.
Pretty sure Adam Jonas (not one of the brothers) saw the Dojo computer as saving TSLA as the company has cut prices on some Chinese sold models 30%. I would rather own TSLS for a pop. :-)
“Internal dispersion widening. SPX equal weight / cap weight ratio plunging. Russell 2000 / NDX ratio now below the 2000 extreme. Just 44% of stocks now above their respective 200-day averages. Leadership reversal with NYSE 52-week lows above highs 3 of past 4 weeks. Just FYI.”
JAIME DIMON: “.. I would not be a buyer of Treasuries at 4.2%, nor would I be a buyer of credit spreads at these spread levels.” [He wouldn’t be surprised to see 10yr Treasury yields at 5.5% or oil at $120-150.]
JAIME DIMON: “.. I would not be a buyer of Treasuries at 4.2%, nor would I be a buyer of credit spreads at these spread levels.” [He wouldn’t be surprised to see 10yr Treasury yields at 5.5% or oil at $120-150.]
—Carl Quintanilla
Dimon is one of the wrong bears I've cited...he isn't better than anyone else in predicting returns.
JAIME DIMON: “.. I would not be a buyer of Treasuries at 4.2%, nor would I be a buyer of credit spreads at these spread levels.” [He wouldn’t be surprised to see 10yr Treasury yields at 5.5% or oil at $120-150.]
—Carl Quintanilla
Dimon is one of the wrong bears I've cited...he isn't better than anyone else in predicting returns.
The Bulls missed the two largest destructions of wealth in the last two decades. The current one just started.
