We hope you enjoyed your Memorial Day weekend. It turned out to be wonderful weather here in Northern Illinois.
Yesterday, a coronavirus vaccine from Novavax hit the newswires and stock futures opened up almost 1%. As of this morning, futures are up nearly 2%. We think we saw this movie last week with Moderna, but that's how Hollywood works - change a character's name and it's a new movie. We think stocks need to go lower, vaccine or not, so the news gives us reason to put back on our shorts - and shows why we covered our shorts last week before the weekend.
1) Citi puts out a few really neat sentiment indicators. This one is the panic/euphoria model. As you can see, we hit the lows of panic in March and are now back above the euphoria highs.
2) A constant reminder that valuation isn't a catalyst. Valuation provides a backstop to investing ideas, but can overshoot on both sides and stay cheap/expensive for a long time. The current market is super expensive by historical standards; especially when compared to the last recession.
3) Bill Gates has gotten a lot of wild theories thrown around about him during this pandemic. Some say he started it - maybe with Dr. Fauci. Now some are saying he's trying to use the vaccine to track people. This poll shows whether folks believe he wants to track them with a vaccine split up by some telling indicators. Unbelievably, 50% of Fox News viewers think it's true!
We have never been big Bill Gates fans, but respected him for leaving Microsoft and giving away almost all of his money. But to think one of the richest people on earth, and a generally good guy, wants to start a pandemic, profit from it, and/or use the cure as a way to track people is beyond nuts. Seriously, people.
So, with futures up on vaccine hopes, we'll likely put on new shorts sometime today and maybe reduce longs. If GDX is up from our purchase price, we'll sell it - especially given that gold is down this morning.
The China vs. Hong Kong news is looking worse as China is said to be moving in with national security law after "Hong Kong failed to deliver" their end of the bargain. Or something. Further, Trump and his trade war with China isn't slowing down. There is a lot of risk still sitting out there. Never mind the valuations.
So as another week gets ready to roll, we wish you good luck and hope to see some reality take hold.
Yesterday, a coronavirus vaccine from Novavax hit the newswires and stock futures opened up almost 1%. As of this morning, futures are up nearly 2%. We think we saw this movie last week with Moderna, but that's how Hollywood works - change a character's name and it's a new movie. We think stocks need to go lower, vaccine or not, so the news gives us reason to put back on our shorts - and shows why we covered our shorts last week before the weekend.
1) Citi puts out a few really neat sentiment indicators. This one is the panic/euphoria model. As you can see, we hit the lows of panic in March and are now back above the euphoria highs.
2) A constant reminder that valuation isn't a catalyst. Valuation provides a backstop to investing ideas, but can overshoot on both sides and stay cheap/expensive for a long time. The current market is super expensive by historical standards; especially when compared to the last recession.
3) Bill Gates has gotten a lot of wild theories thrown around about him during this pandemic. Some say he started it - maybe with Dr. Fauci. Now some are saying he's trying to use the vaccine to track people. This poll shows whether folks believe he wants to track them with a vaccine split up by some telling indicators. Unbelievably, 50% of Fox News viewers think it's true!
We have never been big Bill Gates fans, but respected him for leaving Microsoft and giving away almost all of his money. But to think one of the richest people on earth, and a generally good guy, wants to start a pandemic, profit from it, and/or use the cure as a way to track people is beyond nuts. Seriously, people.
So, with futures up on vaccine hopes, we'll likely put on new shorts sometime today and maybe reduce longs. If GDX is up from our purchase price, we'll sell it - especially given that gold is down this morning.
The China vs. Hong Kong news is looking worse as China is said to be moving in with national security law after "Hong Kong failed to deliver" their end of the bargain. Or something. Further, Trump and his trade war with China isn't slowing down. There is a lot of risk still sitting out there. Never mind the valuations.
So as another week gets ready to roll, we wish you good luck and hope to see some reality take hold.
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