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While it is somewhat amusing to watch all of the perpetually bullish talking heads find the microphone again today, please don’t confuse our amusement with the math.

Today’s move wasn’t about the US stock market’s “great valuation.” Assuming that something you could have purchased 4 months ago 40% cheaper was actually cheap, you get the point. Valuation is a Wall Street narrative that ebbs and flows with price momentum.

Ultimately, today’s US market hitting fresh YTD highs is all about what’s been happening since March. The US Government is perfectly willing to Burn The Buck. I have outlined the levels of TRADE, TREND, and TAIL that support this view (see chart). No matter what your investment time horizon, the US Dollar remains as broken as the US Financial system’s credibility.

In the immediate term, this is REFLATIONARY.

In the intermediate term, this will morph into INFLATION.

In the long term, the American commoner and her government’s creditors, will be dead.


Keith R. McCullough
Chief Executive Officer

Chart of the Day: Burning The Buck - km45