“When the fools dance, the greater fool is watching.”

I heard that popular Japanese witticism almost daily during the last three years of the Great Japanese Stock Market Bubble of the 1980’s when share earnings multiples rocketed from 20X to 100X.

Those traders who played the game made fortunes and retired young. Those who didn’t were sent looking for new jobs.

I feel like the same logic applies now to American stocks.

Old fools like me are peddling to the metal long stocks.

The greater fools are on the sidelines, wringing their hands over North Korea, Donald Trump, Robert Mueller, deflation, the collapse of retail, prices and valuations at century highs, and a giant asteroid that is about to destroy the earth.

And let me give you another parallel with the Japanese stock bubble, which I traded almost every day for a decade.

As insane as trading conditions are now, the bull market could continue for another three years!

The challenge here is not to get so greedy that your entire net worth goes “Poof” when the turn finally comes.

Add to that list the concerns over the euphoria over tax cuts, which were relit on Wednesday after a six-month abeyance with the administration’s spare six-page proposal, and had more holes than a pasta colander.

I am hearing words like “sail through,” “slam dunk,” and “piece of cake.”

I went through the last tax reform under Ronald Reagan during the 1980’s, and I can assure you with great certainty that it will be anything but easy.

Sausage making isn’t pretty, especially if you are a vegetarian.

To offer all this with unemployment at a decade low at 4.4% and with a chronic labor shortage is insanity.

It is guaranteed to bring high inflation, more expensive interest rates, and an eventual recession and stock market crash.

Whatever money companies save on taxes they’ll give back in higher costs.

But for now, that means higher for stocks.

Bring it on baby!

My call in July that the FANG’s would top out and that the action would rotate into lagging domestics and financial proved to be one of the bets in my career.

I expect these trends to continue for the rest of 2017.

This week, the data will be all about jobs, jobs, jobs, which we already know are red hot.

Good luck hiring anyone, especially if they have anything to do with online commerce, which the WORLD is fighting tooth and nail to get into.

We have a big data week ahead to look forward to.

Today we got the September PMI Manufacturing Index.

On Tuesday, October 3 we learn the September US Motor Vehicle Sales.Last month came in at 16.1 million units. 

This should be an interesting one. Will the hurricane disruptions cause a big dive in sales? Or has the replacement of the 350,000 cars destroyed already started?

On Wednesday, October 4, at 8:15 AM EST we get the beginning of the trifecta of jobs reports, the September ADP Employment Report for private sector hiring.

Thursday, October 5 at 7:30 AM we know the September Challenger Job Cuts Report.

Then at 8:30 AM EST we learn the Weekly Jobless Claims, which could be anywhere, thanks to the twin hurricanes.

On Friday, October 5 at 8:30 AM we receive the September Nonfarm Payroll Report. Keep in mind that the two-year average is now 200,000, so expect something to come close to that.

Wrapping up the week at 1:00 PM is the Baker-Hughes Rig Count, which delivered a rare fall last week.

As for me, I am going to be shopping for rental properties in West Oakland, CA. At the current rate of appreciation, investors are making an easy 100% return on equity with a 10% deposit.

Yours for Only $500,000!