Now is a good time to speculate on the US markets and economy as a whole. A lot of macroeconomic information is trampling our attention from every corner of the world and the leader at the helm of the US is a character who seems to understand economics but has no grasp of how to achieve his own goals.
Something I’ve noticed is that, more than ever, the success of many enormous companies depends on the success of the market. This seems obvious, but it isn’t always necessarily this way. Besides, this suggests something very particular about the inertia we see from the several main indices.
If the industry has confidence about Intel in a broad sense, that Intel is not dependent on some global circumstances, then a dip in the S&P will not create a dip in Intel, unless it’s sudden and dramatic.
However, regardless of how sudden and dramatic, we have reached a boiling point where every bubble and pop no matter how fleeting causes a mirrored movement in companies like $AMD, $GS, $AAPL, $AMZN. Everything is very fragile right now and very codependent.
The whole market is one big clingy network right now. One event and it reacts.
It’s not an overreaction though. We’re at a boiling point because the heat has been turned up since the beginning of the 2016 elections. We’re just beginning to feel it now.
Many are speculating about the Fed rates, or tariffs, credit and car loan debt, housing bubbles, the volume of people with jobs but no savings which would create a huge impact on consumer spending if something bad were to happen, or maybe they’re speculating on the long bull run we had just been in and how it’s superstitiously time for correction…
Maybe some are speculating on a combination of all of that. What I see though is an intimate fear. If the market as a whole is not bullish, then neither is anything else. There is no fundamental confidence or individual responsibility. It’s all technical.