I love this tweet from Northman Trader today:
The world is upside down distorted.
They’re chasing stocks no matter valuation but for need of yield.
They’re chasing bonds no matter the yield but for hope of appreciation
A BIG Amen to Northman. People are doing dangerous things with their hard earned and easily printed monies right now.
I love stocks (software and ecommerce) and startups (software and ecommerce) almost all the time and as interest rates continue to plummet and computing gets cheaper, the trade and trends have been really good to me.
I have no idea when and how this eventually ends, but of course as I always say…it will.
The last few months though I have been pulling back but it seems nobody else is.
The NYSE advance decline line enters September (a notoriously crummy month) at all time highs at the same time a massive flight to safety is underway – a rush to Gold, Bonds, Treasuries, Yen and Utility stocks (I wrote about this yesterday as well).
The people chasing both stocks and safety right now don’t feel they are confused. They have a point of view and are expressing it with their money.
This one chart below may explain the wierdness:
If the data in the chart is not broken, we are in crash mode for confusion (a bubble) as people have never been more confused about economic policy.
Keep this in mind when you turn on the TV tomorrow and see 100 talking heads talk with complete confidence on subjects like Bitcoin, Gold, Bonds, Stocks and China.
The truth is, nobody knows, but a resolution to this bubble in confusion is coming.