The Realization Phase Continues

   “The Realization Phase Continues!” 

 

We are reading that even though Bernie won big over Hillary, because of super delegates, Hillary will get more total delegates than Bernie. How’s that socialism working for you now Bernie?

Bernie meets with Sharpton. A man who wants a ton more of your taxes and a man that doesn’t want to pay his taxes. Socialism makes strange bedfellows.

And:

We expect the coming recession (we are probably already in one) will be the front and center story of the election in the coming weeks and months. It is going to (no pun intended) trump everything else as Americans will be more worried about their wealth and their jobs before anything else.

As we wrote to you this past weekend, the “realization” phase of the bear market continues. This is the phase where all the permabears are paraded out as genius while the permabull strategists slyly make the turn to the dark side as price is giving them no choice. On top of that, the masses start to realize that something is really wrong.

Which leads us to this morning as yesterday was instructive. To be clear, when the Nasdaq is up a whopping 100 points during the day and finishes up only 14, that tells you that even though price has come down so far, the big money continues to sell into any nascent rally. That is simply not good and is simply anther characteristic of a bear market.

Throw in that abomination of Yellen testimony yesterday and one has to recognize that central banks that have had their way for so long every time they waved their magic wand…no longer have a magic wand as markets no longer care and no longer respond well to anything they do or anything they say.  Do recall that in the bull market, it did not matter what they said or what they did. Markets would go up in reaction
if they smiled, if they smirked, if they frowned. And frankly, we are not sure who we are worried about more, the questioners or the respondent. It amazes the hell out of us that MIss Yellen cannot figure out what is sitting right in front of her.We AGAIN remain very worried that this is not a garden variety bear market but another disaster in the making as another central bank-induced bubble has again morphed into a central-bank induced meltdown. As of this second, nothing we have seen in the action gives us confidence it is not. And now, financials are telegraphing something is very very wrong. Ignore at your own risk.