December 5, 2017

Doug Kass on Tax Reform bill

When history judges this moment, it will not be kind. Central banks, oblivious to the real reasons for low wage inflation, have created a monster bubble and the markets, rather than being frightened by this, have celebrated it.

The passing of a stimulative tax bill that will clearly worsen income inequality and, according to virtually all economists, lead to minimal growth while expanding deficits, despite a nine year economic recovery and 4% unemployment is irresponsible.

When the inevitable bust occurs, the public will justifiably reject corrective recommendations from those who have behaved so imprudently, thereby limiting the ability to re-stimulate.

No inflation? $450 million paintings, wild punting on bitcoins up tenfold by grandmothers at casinos, $100 million NYC apartments?

They have enriched the already rich and for moderate income people they have given them less than 1% in their savings accounts. 

Remember Joseph in the Bible? When things were good, he put grain of the silos to have sustenance for an eventual bad day.

via twitter

December 4, 2017

Shorting the S&P500 futures

"In my personal account shorting S&P futures now in size 2,659.50. Pray for me. And mark your calendars: 9PM 12/3/2017. The last time I personally shorted S&P futures was in August 2007."

"I continue to pound home that each day that goes by we get closer to a much wider monetary tightening next year -- $420 billion to be sucked out by the Fed and about $500 billion less in the way of buying from the European Central Bank. I would note for timing purposes that one trillion of reduced liquidity in 2018 is beginning in just four weeks."

"Investors, both passive and active, remain conditioned to buying every dip no matter how slight in a sprint to this year's finish line as the global volatility short bubble continues to grow."

via twitter, realclearmarkets

November 27, 2017

China stocks decline

The markets warning signposts are multiplying.

Shanghai drops by most in 17 months as bond rout spreads. China is overleveraged. Even BOJ expressing concern with an over bountiful monetary policy.

via twitter

November 22, 2017

Doug Kass slams the media's lack of transparency

"Business media is too often a bully pulpit consisting of consensus "Group Stink," snarky and uninformed comments, rehearsed sound bytes, ex post facto investment wisdom and (most importantly) lack of accountability and transparency of recommendations' records/results.

A big problem with biz media is that unlike most of us, they do not show transparency and follow up of investment recommendations success or failures. Too many viewers accept ideas as gospel. 

A very good example is the "unusual options" activity - directional call bets when done excessively and on a steady diet is a mug's game. Nowhere is it systematically recorded if ideas are working or failing. Viewers are basically told, believe us."

via twitter