Charting The Maddening Market Messages

Let me categorically  state that in no way am I trying to be critical of the Trump Administration. I am simply, in an unbiased fashion, trying here to understand the competing views.

I would suggest that people's political bias is presently clouding their investment thinking!

WIDENING EXPECTATIONS GAP – TRUMP BETTER DELIVER SOONER THAN LATER!

INFRASTRUCTURE PE’S ARE CURRENTLY AHEAD OF THEMSELVES BASED ON LEGISLATIVE TIMING

THE SIGNALS JUST KEEP ON COMING: An Institutional “Re-Balancing” Signal

To assess who is likely right we might additionally segment who we are talking about with these views.

EQUITY MARKET

We must not forget that there are two sides to the Equity Market:

THE SELL SIDE

  • Wall Street Brokerage Houses selling securities and transaction volumes,
  • Fund Managers wanting to attract more Assets Under Management (AUM),

THE BUY SIDE

  • Institutions who do their own research and are not in the habit of disclosing their investment strategies,
  • Private Funds and High Net worth Individuals who study closely metrics such as "flows" , "volumes", "divergences", "macros", "Sentiment" etc. etc.

The public has visibility to the Sell Side primarily because it dominates the media in an attempt to sell its products. The Buy Side on the other hand seldom wants to disclose its investment thinking and is not typically found talking on CNBC.

My discussions with the Buy Side suggests that with respect to the equity markets, they are presently in the Bond Market camp! They point out the concerns with the global landscape that few are paying any attention to:

UBS: OUR GLOBAL CREDIT IMPULSE (COVERING 77% OF GLOBAL GDP) HAS SUDDENLY COLLAPSED!

DEUTSCHE BANK: GLOBAL ECONOMIC MOMENTUM SET TO ROLLOVER FROM CURRENT ELEVATED LEVELS

GLOBAL EXPORTS HAVE COLLAPSED IN JAPAN, EU & EMERGING MARKETS SINCE THEIR GREAT RECESSION RECOVERY HIGHS!

CONCLUSION

Do we really need to know more to assess who is likely right? Is it those who have unemotionally studied the situation, or those who have "faith", "believe" and are "afraid to miss out"?

(Click on image to enlarge)

A proven strategy has always been in situations like this: "Be fearful when most aren't - be bold when most are fearful"

We presently  have BOTH between the Equity and Bond markets. Who you favor may make all the difference to your financial health!

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Disclosure: Information herein was obtained from sources which Mr. Long believes reliable, but he does not guarantee its accuracy. None of the information, ...

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