After a 3-day squeeze off the lows, nothing has changed the causal factor of growth and profits slowing. Below are key observations from Hedgeye CEO Keith McCullough's macro notebook sent to subscribers earlier this morning:
"REFLATION – this is what, the 4th or 5th or 6th time (July, Oct, Feb = were the biggest “bottom is in” commodity led rallies) I’ve had to quintuple down on #Deflation being non-transitory – Australia and Russia (Equities) +2.3% this morning vs. Copper down -1% - who has the intermediate-term call from here right? Copper"
We've been warning our subscribers about the next dramatic leg down in stocks.
"RUSSELL – after “covering” (Real-Time Alerts signaling product) SPY last week, the signal said to re-short the Russell (IWM) into the close yesterday – fully loaded with the 3-day squeeze, don’t forget that the Russell 2000 is still in crash mode (-21.9% since July) and being long illiquidity (junk and small caps) is killing returns – short lower-highs; cover lower."
We're already seeing the air start to come out of this week's bounce. The key question for investors now: "Are you bearish enough?"
Watch the video below where McCullough explains why he's the most bearish guy on Wall Street.