We are staring down the barrel of the BIGGEST capital misallocation in HISTORY! Think dot-com bubble MEETS 2008 housing crisis — that's the scale we're talking about here!
You've got a commodity deflating at RECORD speed while the debt to produce it is EXPLODING at record speed. What could go wrong?! EVERYTHING!
Usually the market self-corrects — prices fall, management panics, budgets get slashed. But that mechanism is COMPLETELY BROKEN right now! Prices never dropped enough to scare anyone, and Washington's running a deficit near 7% of GDP that's papering over all the cracks!
Prices stopped carrying information — now they carry a STORY. I call it NARRATIVE DOMINANCE. Reality doesn't matter anymore. What matters is what you can get people to BELIEVE while there's enough money sloshing around to keep everyone comfortable!
But ONE market still tells the truth: BONDS!
Last month Treasury DOUBLED its buybacks and Wall Street read it as support. I said SHORT BONDS instead. Today? The 10-year blew through 5% for the first time since 2007! BOOYAH!
You try to defend a price the fundamentals don't justify? The market COMES FOR YOU every single time!
Eventually somebody's gonna cut a capex budget — and THAT'S the day this whole story DIES!
I don't see how this ends any other way! Do you?!
You've got a commodity deflating at RECORD speed while the debt to produce it is EXPLODING at record speed. What could go wrong?! EVERYTHING!
Usually the market self-corrects — prices fall, management panics, budgets get slashed. But that mechanism is COMPLETELY BROKEN right now! Prices never dropped enough to scare anyone, and Washington's running a deficit near 7% of GDP that's papering over all the cracks!
Prices stopped carrying information — now they carry a STORY. I call it NARRATIVE DOMINANCE. Reality doesn't matter anymore. What matters is what you can get people to BELIEVE while there's enough money sloshing around to keep everyone comfortable!
But ONE market still tells the truth: BONDS!
Last month Treasury DOUBLED its buybacks and Wall Street read it as support. I said SHORT BONDS instead. Today? The 10-year blew through 5% for the first time since 2007! BOOYAH!
You try to defend a price the fundamentals don't justify? The market COMES FOR YOU every single time!
Eventually somebody's gonna cut a capex budget — and THAT'S the day this whole story DIES!
I don't see how this ends any other way! Do you?!