Today turned into a 'risk on' day.
There were various interpretations of why that happened, in the manner of price action making the news action.
There were thoughts that the rally in risk was triggered by comments by the Fed's Stanley Fischer which seemed 'dovish' in that he sees only two more rate hikes this year.
A second piece of news that was latched onto to help explain this counter-rally was the news from the Conference Board that retail confidence in higher stock prices is so overly confident. How high is it? The confidence of the 'little guy' is at the levels we last saw at the peak of the dot com bubble.
And thirdly, the ratio of SP 500 valuations relative to emerging markets at historic highs.
Speaking of historic highs, APPL closed today at its all time high going back to 1982 at least. And Darden Restaurants is right there on its heels as well.
And these are consumer stocks. We expect the US consumer to be rebounding strongly? These are risk on bullish? LOL I think the piglets doth protest their book too much.
Theresa May is expected to act on Article 50 which formal begins the Brexit process. That process will be playing out over some time, most likely a couple of years.
Let's see how it goes. The silver action was 'constructive today' in that it held its levels, largely ignoring the currency cross calculated smackdown that was dealt to gold.
The conscious mispricing of the risks and rewards in any proposition, the basic facts of it, are the very foundation of fraud. It is not due to animal spirits or any other such nonsense, although those do help in selling the suckers on your con. There is always a small core of actors promoting this mispricing for their own short term gains.
And where that sort of behaviour is permitted and not punished, there is lingering decline and misery.
Have a pleasant evening.
