Shanghai popped 4.3% today.
That would be like the Dow gaining 800 points in a day. Ho-hum – it's just the kind of thing we've come to expect in what Daniel Stetler refers to as "Ponzi World," saying:
We all are in a Ponzi world right now. Hoping to be bailed out by the next person. The problem is that demographics alone have to tell us, that there are fewer people entering the scheme then leaving. More people get out than in. Which means, by definition, that the scheme is at an end. The Minsky moment is the crash. Like all crashs it is easier to explain it afterwards than to time it before. But I think it is obvious that the endgame is near.
Of course, if this is the "end game," I'm sure China bulls will saying "Thank you sir, may I have another" after this morning's action. We're looking forward to an opportunity to short FXI (now $42) but we're not going to jump in front of the runaway train that is China at the moment. We are, on the other hand, still shorting Japan (see yesterday's post) as we're betting on "peak Abe" into the upcoming elections.
Of course, "peak Draghi" is the big concern of the morning as the ECB did NOT change their policy this morning – and that's coming after Mario promised us that "the ECB must take action without delay" only two weeks ago.
Not taking action on the last meeting of the year seems like a delay to me – but let's hear Draghi's song and dance at 8:30 this morning (we're already shorting the Futures – see my Early Morning Alert to Members on Twitter).
8:30 Update: Let the BS storm commence! As we expected, the markets are tanking on disappointment from the ECB indecision and Draghi's comments are not helping matters. We've got a 5-point ($500 per contract) drop on /TF (Russell Futures) already and 8 points ($400 per contract) on our other selection – the /ES (S&P…
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