Good Friday morning all. The employment report just released was a big miss from expectations. We’re told that 151,000 new jobs added, while the estimate was in the 190,000 range. As I said yesterday, this report will not change anything…even though the public will see the new shiny official unemployment rate of just 4.9%, and that might just be enough to keep them in their underwater stocks and maintain a fully invested position in their 401k’s. Psyops at work…
No one that I know/respect actually believes most of these government reports…not these days. If you remember, last months big addition of 292,000 jobs was supposed to be proof that “all is fine”…and then we found out that 280,000 of those new jobs were based on “modeling”, rather than actual job creation statistics from each state. Not kidding folks…that’s what happened. To prove its dissatisfaction with this (and more), the market has since plummeted more than 7%.
Here’s the big picture point about the economy…a point that is FAR more important at this phase than employment data; debt deflation is taking over. The coming contagion in debt, both globally and here in the states, will continue to act as gravity for most asset classes….precious metals being one of the few exceptions.
More Proof That FANG is Over
Did you see the earnings report from LinkedIn? This was another big time high flyer…until the bubble popped yesterday. Just this morning, LNKD is trading down a massive $67/share, for a shocking 35% loss. WOW…this one even surprised me. It’s now trading at $125…a full 50% lower than its price in December.
I dont have enough time to list all of these diary dust companies that are getting taken to the woodshed, but it’s just another sign of the times. AVOID ALL TECH “GROWTH STOCKS”…their declines are just getting started.
MARKET UPDATE – Today, the Bear Market Became Real…for the Investing Publics Lemmings
Take a look at my most recent Tweets from this morning….for those that are not already following me (why not?? Simply use my handle: @kherriage).
As you can see, it’s a tumultuous day in the markets, but it’s especially tough for the FANG related stocks that I keep harping on. When CNBC spends a significant amount of time on the bloodbath taking place, you know its bad.
Here’e the deal with today, and why we’ll soon see these 30-50% collapses as a “most significant development” in a bear market that will be brutal (for most).
When widely held, beloved stocks like LinkedIn, Netflix, Tesla, Google, SalesForce and Amazon get demolished…all at the same time, just as they are now, it’s a clear sign that the big money on Wall Street is throwing in the towel. 90% of the time (my estimate, but I believe its close), these kinds of “across the board shellacking”s are just the beginning of the real pain to come.
I believe this is the case now….that’s why TODAY is the day that this bear market becomes a reality…for most investors at least. Of course, we’ve been out of all the stocks getting slammed for roughly 2 months, not to mention the very nice profits we’ve made on the way down to date, through our market short positions.
Now, things begin to pick up speed…
Folks, today is the day that “many” thousands of investors globally say “to hell with this…just get me out”. That means Monday could be most interesting, as sell orders from over the weekend are placed for long term investors, including their IRA’s and 401k’s . If you’ve been here for any time at all, you know that I’ve been looking for a classic Monday selling climax. I’m talking about the kind of sell-off that takes the Dow down more than 1000 points, with fear and panic selling across the board….which will send VRA Core Portfolio market short positions, soaring higher still.
Stay Frosty….today will be remembered as MOST important.
PS; I just saw news come across the wire that Brazil’s health org. is announcing their findings that Zika CAN be transmitted via saliva, as well as semen and urine. We’re also getting global reports of numerous deaths from the virus…something that I continue to hear very little about in financial circles. Somehow, I think we’re on the right side of the history that’s about to be made with this virus.