Deep Market Thoughts...Could we Crash?

Last night, I was at a Jewish Federation Dinner with a few thousand charitable Phoenix friends. Many of my partners and clients were in the room and the pre-event is always the best part where we chat about things. Many of my clients are in their 60’s, having seen pretty much all the markets can bring and for most this is all they really can take. They are retired after selling their businesses and just want to chill and pester each other about gin rummy and their declining golf skills.

Yesterday, their tables should have been called the ‘I’ve lost this much tables’. As I went from table to table you could start a conversation about the markets and each would chime in with how much he lost and please don’t tell my wife, in an effort to outdo themselves. It has become somewhat of a release for them to one up themselves at this point. They are some of the most charitable people I know and my mentors. They are at the stage of living in reality with their financial losses and getting to cash.

It has pretty much been death by a thousand cuts. The market decline has worn out the longs at this point and many of the shorts.

It feels this morning as if a crash is really upon us.

Gold is still screaming, the US dollar is much higher than it should be, the administration looks indifferent to the stock market, the uptick rule is nowhere in sight and key financials can’t be saved.

There is no demand for anything – see oil prices.

Markets work on the basics of supply/demand and mood. There is just too much crappy supply of stock, not nearly enough demand and the mood is grim. If it was just mood, I would be more bullish, but our policies have created too much shitty supply of stock and the smart move seems to be short and on the sidelines.

You do not have to participate in this treachorous market.