Just Another Manic Market Monday

Elon Musk did the smart thing and settled with the SEC . He got off cheap in my opinion. For $20 million he keeps his job as CEO.

The government had a great case (his tweets) and endless resources.

I assume all the short sellers leaning on the stock Friday into the close will get smacked again. Maybe Elon and crew get the last laugh short term by teasing the no settle Friday AM to see how the stock reacted.

Even if Tesla reduces all it’s losses on Friday, it is down over the last year.

Meanwhile…

It’s been a good few years for momentum stocks (the kind I talk about here).

Charlie has the numbers:

I won’t be the one that stand in the way of this momentum, but I won’t act surprised when it finally ends.

On Friday, I noticed that Goldman Sachs was near it’s yearly low. Charlie points out that:

Following the election in 2016, Financial stocks exploded higher and were said to be the biggest beneficiaries. Today, the ratio of Financials to the S&P 500 hit its lowest level since Nov 9, 2016, the day after the election.

General Electric is changing it’s name with a new CEO…my best guess is General RoboCloud.

Finally, let’s take a look at oil prices:

AS Charlie reminds:

The crash in crude oil on the left side of this chart led to a crash in inflation expectations and allowed for extreme monetary policies in Europe/Japan (neg rates) and the continuation of 0% rates in the US under the guise of “deflation.” That game is slowly changing…

No wonder….as Dr. Steenbab points out in this deep dive of traders research, that so few traders survive.

I’ll leave you this Monday with a great piece from Josh Brown on ‘the nine essential conditions to create massive fraud‘.

Have a great week.


Also published on Medium.