Good Afternoon:
Michael Hartnett gives further evidence a new bubble is being blown
President Biden’s fiscal spending intends to re-domesticate supply chains and spur domestic manufacturing. If those policies are working, why are only 7 stocks—all tech and not manufacturing—leading this rally, Hartnett asks.
We add that the wrong companies are being rewarded by investors. This all suggests a new mal-investment in stocks again. This in turn implies the current fiscal push (like QE before it), again is only helping boost assets owned by the 1% higher.
This can all end up being a supply-chain-to-nowhere, like those bridges-to-nowhere previous spenders used to build. And the market will implode like 1999 DOT COM did from cost of capital being too high sustain the bubblenomics
Maybe it will just take time to trickle down..
Contents:
Video Walkthrough
Chart Slideshow
Annotated Report
Topic Timestamps
*** indicate crucial or new concepts to his current thesis
0:00- Intro GoldFix description
1:45- Report Intro
3:05- Zeitgeist: Union Support***
Geopol/Fiscal/Unions means inflation
A.I. actually inflationary
6:45- Biggest Picture***
Bonds are a problem
8:10- Chart: Major New Observation***
Notional GDP explosion
Compared to 1940s, and mid 1970s expansions.
Similarities: High GDP, high inflation
Big Difference- which stocks rallied
11:41- The Key Comp vs previous “Booms”***
Stocks up in all 3
Spending up in all 3
Inflation up in all 3
Problem: Wrong stocks rally in 2023
16:55- Summarizing Hartnett’s Idea***
20:00- Low unemployment the last thing propping up Goldilocks
21:00— Why he still believes “sell the last hike”
22:00 Slide Recap
23:25- Comment: Stocks say it is a bubble right now***
