{"id":18640,"date":"2016-03-08T16:29:18","date_gmt":"2016-03-08T21:29:18","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18640"},"modified":"2016-03-08T16:29:34","modified_gmt":"2016-03-08T21:29:34","slug":"the-price-isnt-right-how-central-banks-are-fixing-to-ambush-the-casino","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18640","title":{"rendered":"The Price Isn\u2019t Right\u2014\u2014-How Central Banks Are Fixing To Ambush The Casino"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/davidstockmanscontracorner.com\/the-price-isnt-right-how-central-banks-are-fixing-to-ambush-the-casino\/\" target=\"_blank\">The Price Isn\u2019t Right\u2014\u2014-How Central Banks Are Fixing To Ambush The Casino<\/a><\/h3>\n<\/header>\n<div class=\"entry-content\">\n<div class=\"ssba ssba-wrap\">The casino is incorrigible. After a monumental short squeeze that\u00a0has lifted the averages right into the jaws of danger, Goldman Sachs has the\u00a0temerity to print the following:<\/div>\n<div class=\"pf-content\">\n<blockquote><p>\u201c<strong>Our model suggests SPX calls are more attractive than at any time over the\u00a0past 20 years\u201d.\u00a0<\/strong><\/p><\/blockquote>\n<p>There must have been a mullets\u2019 breeding frenzy awhile back because it\u2019s hard to fathom how Goldman has any real customers left. Then again, its current preposterous call is just indicative of the horrible threat\u00a0heading menacingly toward\u00a0what remains of main street\u2019s 401k investments.<\/p>\n<p>To wit, the Fed and other central banks have thoroughly falsified financial market\u00a0prices and destroyed all of the\u00a0ordinary\u00a0mechanisms of\u00a0financial discipline. Foremost among these are\u00a0short sellers and a meaningfully positive cost of carry trades.<\/p>\n<p>Markets are therefore\u00a0unhinged from any connection to fundamental economic and financial reality, meaning that\u00a0they are\u00a0capable of an extended period of\u00a0spasmodic deadcat bounces that will have only one end result.<\/p>\n<p>Namely, the na\u00efve and desperate among main street\u00a0investors who still, unaccountably,\u00a0frequent the casino will presently be taken out back and shot\u00a0yet another time. The market technicians are pleased to call this \u201cdistribution\u201d. Would that someone on Wall Street man-up and\u00a0amend\u00a0the phrase to read\u00a0\u201d distribution\u2026\u2026.of losses to the mullets\u201d and be done with the charade.<\/p>\n<p>The S&amp;P 500\u00a0is heading\u00a0<em><strong>through 1300\u00a0from above<\/strong>\u00a0<\/em>long before it ever again penetrates\u00a0<em><strong>from below\u00a0its old May\u00a02015 high<\/strong>\u00a0<strong>of<\/strong>\u00a0<strong>2130<\/strong><\/em>.\u00a0And\u00a0now that\u00a097% of Q4 results are in, there is a single number that proves the case.<\/p>\n<p>Reported LTM profits as of year-end 2015 stood at just\u00a0<em><strong>$86.46<\/strong>\u00a0<\/em>per S&amp;P 500 share.\u00a0That particular\u00a0number is a flat-out\u00a0bull killer.\u00a0<strong>At a plausible PE multiple of 15X, it does indeed imply 1300 on the S&amp;P 500 index.<\/strong><\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The Price Isn\u2019t Right\u2014\u2014-How Central Banks Are Fixing To Ambush The Casino The casino is incorrigible. After a monumental short squeeze that\u00a0has lifted the averages right into the jaws of danger, Goldman Sachs has the\u00a0temerity to print the following: \u201cOur model suggests SPX calls are more attractive than at any time over the\u00a0past 20 years\u201d.\u00a0 [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[6122,124,5979,2120,303,305,376,696,860],"class_list":["post-18640","post","type-post","status-publish","format-standard","hentry","category-economics","tag-casino","tag-central-banks","tag-contracorner","tag-david-stockman","tag-fed","tag-federal-reserve","tag-goldman-sachs","tag-sp","tag-wall-street"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18640","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18640"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18640\/revisions"}],"predecessor-version":[{"id":18642,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18640\/revisions\/18642"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18640"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18640"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18640"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}