Human foibles are a spectator sport
And I'm a season ticket holder
For just over 3-years now, I’ve been taking people on a journey that has enabled them to stand apart from the seething mass of financial ignorance, helping those who are willing to learn to gain context for accurate interpretation, which includes myself. I’ve been a GPS for the financial cycle. It’s been fun creating a real-time track record that has stood at odds with the “experts”.
And here we are.
People are finally starting to catch on.
But it’s still early days.
All of a sudden, people are starting to take notice. And I strongly suspect that they’re only taking notice for the wrong reasons (as usual). They’re only taking notice because the data that came out happened to coincide with stocks falling and bonds rallying. In other words, they’re still looking at price action to make their interpretations.
They’re reverse-engineering their narrative to fit the price action.
Nevertheless, it’s because people never learn that makes it such a reliable and profitable exercise.
Friday’s unemployment data suddenly caught people’s attention. The U.S. unemployment rate jumped to 4.3% and triggered the Sahm Rule, which we have already looked at. Here’s an updated chart on the subject …
But as I said, I think the general excitement around recession risk was because the market already had reasons to be nervous due to the stock market having fallen over recent days.
Similarly, bond yields had been falling.
And Friday’s data just added to the fear, so stocks sold some more and bond yields fell some more.
This is all stuff I’ve been saying will happen.
But the end is not yet, by which I mean, I don’t expect things to continue running away in a straight line for a little while.
Let’s have a smell of what’s visible beneath the noise ….