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Below is a brief excerpt transcribed from Friday's edition of The Macro Show hosted by Hedgeye CEO Keith McCullough.

McCullough: Chinese Equities → Getting Smoked - 5 22 2020 1 11 59 PM

Let's talk about China and immediate term trade momentum.

We have a bearish trend in China and a bearish trend in Hong Kong, just look at the charts below. Hong Kong was down another 5.6% overnight. That’s a lot.

So if you’re long some “diversified equity basket”, you’re getting smoked currently. You’re getting killed if you have the wrong parts of the US equity basket (Financials and Industrials in particular) too.

But China broke what I call immediate term trade momentum. It’s already a bearish trend when you look at the Shanghai Comp as an Index.

That was a big move. China withdrew guidance, as in GDP. The number that they have been making up the whole time, they can’t even make it up!

Think about that!

I know everyone’s thinking this morning instead of breathing heavily looking at those FOMO futures, but take a step back and think about what is going on here.

The world’s second largest economy and could be the largest very soon, is not going to report numbers. There’s a lot of problems associated there Washington vs. Beijing and history has taught lessons. And they are not all Old Wall lessons.

McCullough: Chinese Equities → Getting Smoked - 5 22 2020 1 11 03 PM

McCullough: Chinese Equities → Getting Smoked - 5 22 2020 1 11 30 PM