One Heckuva Party
Is there anything left in the drinks cabinet? We take a look at markets at the end of One Hot Week.
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Nvidia Won The Stock Market. Now What?
Every major rally in stock market history brings with it the acrid smell of seething anger, from bearish investors convinced that the move is a scam, a fakeout, a counter-trend rally, a B-wave spike, or something else of that ilk, which is to say they were wrong, but are trying to ex post facto rationalise why in fact they were right even when the other people (who were wrong) now have all the money and they (who were right) don’t have the money.
In 1998-1999, whilst savvy investors and traders were printing money from the boom in website operators, optical networking component vendors, and altnet carriers, right-thinking folk everywhere were bellowing “it will all end in tears” and “it’s a bubble”. Whilst not making the money that the apparently less educated and more morally reprehensible bulls were coining all - day - long.
In 2020-21, as trend-followers were pocketing Federal stimulus money by way of marking up and then realizing gains in their growth stock portfolios, fundamentalists were saying, “it will all end in tears” and “this money printing is out of control” (they meant the money being printed by the Fed, not the money being printed by the bulls, probably).
In 2023, as the anticipation of loosening monetary policy spins up the animal spirits, and as the Showman’s Showman Jensen Huang touts an $11bn revenue Q2, bulls have grabbed anything that can credibly be associate with AI and dragged the stock up kicking and screaming. And the formal-rational folks have whined about it all - month - long.
Man.
The truth is the price, and the price is the truth. That’s the end of it. There’s no moral high ground in a market or a stock dumping, it just meant the price went down. Folks getting all agitated on Twitter and elsewhere about the current market and wanting it go to to zero and fast? There’s something unhappy in their life that they don’t want to face directly, so they are using displacement anger to hector the rest of us. Meanwhile, those of us who believe price is the only datapoint, are making money, and those who prefer to moralize, are not.
That said, this week the party really got out of control. Every drinks cabinet has been raided, things that are not normally smoked have been cut up, ground down, wrapped burnt and inhaled, and there are only three Cheetos left on the countertop where once there were gourmet selections of canapes, sashimi and sliders.
There are three days to clean house before the grownups get back. Can markets recover and keep partying next week, or did this mark a local crescendo top?
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