Stay Sane Says the Mental Patient

Stay Sane Says the Mental Patient

The definition of insanity is sometimes doing the same thing over and over again and expecting a different outcome.  The stock market has tried to time a Fed pivot and peak inflation three times this year with the same result, new lows.  Yes, we are doing a rotation into energy and fins right now as they are “cheap” (always cheap by the way for a reason!), so there is some market leadership not making lows at this time.  The entire stock market has about $46 trillion in market capitalization.  $GOOGL from its highs has lost about $1 trillion, $MSFT the same.  $META and $TSLA have both lost $500 billion from their peaks this year as well.  These are the most owned, popular, easy to understand companies.  The math would take me hours to figure out peak to trough on the SaaS group as $TEAM itself is down about $70 billion and $CRM about $150 billion.  I can assure you, it is no solace that there is a rotation into smaller sectors while the patient (the average investor) is being told to stay sane.

Friday was one of the craziest days in the market I have seen in a long, long time.  Overnight, the Hang Seng index rallied 5% as rumors of a change from the Covid 0 policy in China was on the come.  Oil flew 5% and copper 7% while many metals did the same.  The jobs number did come in hot, as we expected, but there became a narrative that we should ignore the headline and focus on the household survey which showed the opposite of the 263,000 jobs the BLS said were created.  Ok, so let me get this straight, phone calls to 60,000 households (who the heck answers a home phone anymore) is the preferred survey method for the Fed and the world to base their jobless projections?