WASHINGTON. Mr Market dished out yet another heaping helping of déjà vu all over again Wednesday. Like they did on Tuesday, and like they did most days this fall, stocks currently find themselves retreating once again back into full swan dive mode. Hopeful trading action that lifted stocks into the green zone after the opening bell soon reversed into the usual negative pattern. Evidently Mr Market changed his mind again. That enabled this fall’s newly-confident bears to send most stocks back into the red as of the noon hour today. Worse, though predictably, Auntie Maxine was no help today, either.
There’s no point in posting the current market averages in this piece. When these figures move 10, 20, 30 points a minute, up or down, the meaningfulness of posting current numbers is zilch. Take a look at our headline graphic above, a FinViz “heat map,” which shows “up” stocks in varying shades of green (brightest is best) and “down” stocks in red (brightest is worst. What a mess. And note, the big tech guys like Apple (symbol: AAPL) and Microsoft (MSFT) are taking the worst poundings. Again. Amazon (AMZN) and Facebook (FB) are not happy campers either.
So what’s going on with this latest Wall Street swan dive?
Why does Mr Market keep taking a daily swan dive?
Online financial pundits always feel the need to provide “reasons” for this or that market move up or down. In actuality, save for pure headline risk, most trading patterns follow the algorithmic hocus-pocus that highly-paid Wall Street nerds program into the high-speed computers of brokerage firms, hedge funds, big banks, big money traders and the like. But that doesn’t stop overpaid network opiners from opining.
On occasion, however, these financial pundits writing online may at least get the headline-risk part of algorithmic trading right, as in the following commentary via ZeroHedge, which relies at least in part on CNBC verbiage.
“US financials stocks have tumbled from opening higher after Rep. Maxine Waters – soon to take over the powerful House Financial Services Committee when the new Congress convenes in January – laid down the law on what will and won’t happen under Democrat rule.
“As CNBC reports, the California Democrat said efforts to loosen the reins on Wall Street financial institutions won’t be tolerated should she be committee chair, as expected.
“‘Make no mistake, come January, in this committee the days of this committee weakening regulations and putting our economy once again at risk of another financial crisis will come to an end,’ Waters said.”
Enter Auntie Maxine and her less-than-full informational deck
Auntie Maxine is, of course, wrong, wrong, wrong as she always is, given her usual custom of linking her pea-brain to her quick and volatile mouth. In the first place, the US banking system under the current administration, finds itself in much better shape than it was under the Obama Regime.
Second of all, Maxine, as usual, has no idea how government actually works and how little power she actually has to carry out her empty threat. The Executive Branch does much of the “regulating” in government On occasion Congress can legislate it. But guess what, Maxine? Anything you try must be reconciled in the still Republican-led Senate, a dubious proposition at best. And even if you pull off such a miracle, legislation next goes to a president who will never sign anything that has your fingerprints on it.
Give me a break. As usual, it’s just the daily dose of vapid rhetoric, virtue-signaling and showboating we’ve come to expect from nasty Auntie Maxine.
Worse, in the chart below, you can see how, after an initial surge on the morning after Election 2018, stocks plummetted severely. This unfolded after investors heard what the new House Democrat Majority, including Auntie Maxine, intended to inflict on the Trump Recovery.
More negative news from Florida’s election-stealing socialist hacks
That said, such merd-ish gasbaggery always gets the headlines. They probably scared the beejeebers out of at least a few headline-driven algorithms. In turn, this tipped averages back into the negative zone where they still feel most comfortable.
Also upsetting averages, however, is the continuing political nonsense roiling Floridians. The GOP stands to have even more elections stolen this year than they imagined. Time to send in a phalanx of lawyers, guys, just like Bush did in Y2K.
More fuel for today’s stock market swan dive
Once again, ZeroHedge gets the essence of this, giving a hat tip to the dubious and pro-Democrat Politico for the inside skinny.
“The Florida Department of State (DoS) last week has asked federal prosecutors to investigate official election documents with the dates changed, which the department says can be tied to the Florida Democratic Party, according to Politico.
“The concerns, which the department says can be tied to the Florida Democratic Party, center around date changes on forms used to fix vote-by-mail ballots sent with incorrect or missing information. Known as ‘cure affidavits,’ those documents used to fix mail ballots were due no later than 5 p.m. on Nov. 5 — the day before the election. But affidavits released on Tuesday by the DOS show that documents from four different counties said the ballots could be returned by 5 p.m. on Thursday, which is not accurate. –Politico
“Unsurprisingly, one of the counties under scrutiny is Broward – which is now conducting no less than six recounts, after the results of three statewide races and three local legislative races have been called into question amid mysteriously found ballots and lingering questions over the chain of custody governing the proper handling of voting materials.
“Republicans are pointing to Broward Elections chief Brenda Snipes’ dubious history of election gaffes, with many suggesting that she is rigging the election in favor of Democratic candidates.”
A hunger for market equilibrium
Both Wall Street and Mr Market want these elections to be over now. That way, traders and investors can regroup and figure out how to start making money again. Besides shorting the dickens out of hapless individual stocks, that is. And as long as the now-predictable Florida Election Stealing Machine runs unhindered, things are likely to drag out indefinitely. Remember Election 2000? That’s when Al Gore went hunting for freshly manufactured Democrat votes in Broward County. Fortunately, Justice Scalia and the Supremes shut down his and the Democrats’ illegal shenanigans.
When things like national elections drag out indefinitely, Wall Street doesn’t get reliable information. Mr Market tends to go on strike via wave after sickening wave of selling. Mr Market becomes even more unhappy. Rinse, repeat.
Add these outside forces to continuing waves of profit-taking after a heretofore successful 2018. Throw in as well the now understandable tumble of tax-loss selling. It soon becomes clear that getting back into the green this year might just not happen. Even a Santa Claus Rally might not do it, unless it happens to be a truly YUGE Santa Claus Rally.
Fiddling while our portfolios burn
For now, we continue to sit here not knowing what action to take. While we fiddle, the market continues to crush our portfolios. We could sell and take losses on holdings that still look outstanding for the long run. On the other hand, we want to conserve cash to buy bargains once this latest downdraft runs its course.
If we encounter anything that decisively affects Mr Market, we’ll let you know right here. But as of now, like Sgt. Schultz on “Hogan’s Heroes,” “We know nothing.”
—Headline image: Mr Market takes a swan dive in living color, courtesy of the most recent FinViz stock “heat map.”