Yo pit crazies,
Day 10 and the first day of spring. I was hoping the Iran Conflict would wind down once the ice melted, but that didn't happen.
Tomorrow marks 21 days, and this conflict won't have a quick fix.
As you can see below, except for the icy morning, the giant ice bridge that spans the cove is out to sea and melting as spring gears up.
We've gotten used to the Fed saving the day.
A Trump TACO move or some Congressional fix to solve the stocks-going-down problem.
Right now, the price mechanism is working after being mostly blown up by ex-Fed Chair Ben Bernanke in 2010.
That was the dreaded start of QE (quantitative easing, the Fed's money-printing program) and Fed-enabled government spending that has gone unchecked for 15 years.
Now only one thing can fix our current situation.
SPY Finally Sold Off
What's funny about this SPDR S&P 500 ETF (SPY) chart is the high tick came the Monday after the invasion. Normally that would make sense.
Once the planes fly, stocks recover. It didn't happen this time. The Fog of War has made the Iran Conflict opaque, to say the least.
The media already has the darkest outcomes predetermined. SPY finished at six-month lows today. Traders finally said screw it and sold.
SPY 20 Day Chart
Oil prices going to the moon don't help.
The three-month timeline for the United States Oil Fund (USO) provides the context. WTI (the U.S. oil benchmark) is assuming a shortage of production coming out of the Persian Gulf.
3 month USO chart
How This Will Play Out
Like I said, time is the only savior here. The U.S. Military has to stay on mission. The only people who thought this would be over in a couple of days were the mainstream media.
My guess is we have to secure the Iran oil assets, and that will be the beginning of the end. How long that takes is anyone's guess, but I think it starts sooner rather than later. That's when stocks stabilize.
Right now the only stocks going up are oil and gas related names. Today institutions sold.
If you want to see what institutions are doing next with their money, tune in to my replay here.
All right, everybody have a good day.
AG