Santa Rally Crawls Toward the New Year

In an economy that over decades has grown increasingly dependent on revved-up holiday sales, investors have responded by praying more fervently each year for a Santa rally. It’s an odd metaphor, however, considering that Wall Street even at its seasonal cheeriest has a heart as cold and dark as volcanic glass. The Santa of investors’ imaginations is assuredly not the fat, jolly one originally drawn by a Dutch artist Haddon Sundblom for the Coca-Cola company, but rather someone more like Fed Chairman Jerome Powell gone silly in a headdress of fluffy white dove feathers.

Unfortunately, Powell has not left much room for silliness in this holiday season. Gone are the days when Neiman Marcus could get a rise by featuring his-and-hers Bentleys in their Christmas catalog. The typical American household is thinking about more practical presents in these recessionary times: PG&E gift certificates…bread machines and pasta makers…survivalist seed packets…battery chargers.

More Turbulence

The result for investors has been a balky stock-market shaped more by Scrooge than Santa. Even with bullish seasonality at maximum force last week, the Dow Industrials could muster only a 300-point gain. They closed on Friday at 33,203, down a thousand points since Thanksgiving. More turbulence seems likely in the final days of 2022. Perhaps the best we can hope for when the markets lurch into gear on January 3 is that stocks continue to drift through a circa 1914 minefield without triggering a nuclear war or the debt deflation we all know is coming. [What do the charts say? Click here for my latest interview with Howe Street’s Jim Goddard. RA]

  • John December 31, 2022, 5:01 pm

    You know who is else is laughing at the people? The Musket clown.

    Sometimes you have to take a wider perspective to see the forest.
    Because at the moment too many unconscious people only see the clownish character of the Musket traitor double agent.
    He’s setting up a worldwide internet network with starlink
    He wants to produce cell phones
    He wants to implant chips in your head
    He wants to sell you programmed electric cars
    He wants to create vaxx printers with his curvac corp to modify people genetics

    It looks like technological domination to me.

    Musket a puppet of the WEF

  • RICHARD CHARLES December 27, 2022, 4:32 pm

    With markets as Frozen as the Arctic Bomb Cyclone,
    might be time to review some Big4 CFTC COT for the coming year.
    Thanks to you Rick and Larry, our Big4 talk at TSAA-SF was even posted on the website for some time so people could employ it. In simple terms, Big4 are the four largest trader positions in each listed contract who know Long Term demand/supply better than most. PnF Targets can improve timing.
    Incidentally, Jan 13 2023 Roundup of Analytical Market Talent luncheon at John’s Grill, famous for Mary Astor, Dashiell Hammett, Humphrey Bogart, John Huston Maltese Falcon classic. John another dear departed Calamari Club guest, people who ran San Francisco when it was the tiny city on hills to live artfully and productively.
    So here some interesting Big4 positions in order of magnitude:
    Peso 265 % Short (Border War?)
    Euro 261 % Short (Biden War on Energy/Europe?)
    OJ 241 % Short (Trading Places)
    Silver 225 % Short (EV contraction?)
    Pound 218 % Long (fiat iRates up ?)
    Dividends 213 % Short (Blue Chip Blues?)
    Sugar 213 % Short (No troops?)
    Plat 207 % Short (economic deflation)
    Rice 185 % Long (China march?)
    VIX 184 % Long (wild trading?)
    Crude 180 % Long (XOM ?)
    Oats 170 % Short (No breakfast ?)
    SOFR 1 mo 168 % Long (global bank brakes?)
    Bitcoin 166 % Long (Something from Nothing ?)
    Ultra Diesel 166 % Short (Less trucking?)
    Ultra Bonds 163 % Short (Bond vigilantes?)
    Milk 159 % Long (New Baby Boom?)
    Copper 156 % Short (econ deflation ?)
    Canola 155 % Long
    RE 155 % Short (Bad mortgages?)
    NatGas 154 % Short
    Gold 146 % Short (debt deflation?)
    Rand 142 % Short (China War on Africa?)
    Utes 140 % Short (Big Trouble?)
    Industrials 137 % Long (China Contraction ?)
    Healthcare 136 % Short (blowback)
    Cattle 135 % Short (Beefeater Special)
    As Red Skelton said, I just do ’em; can’t explain ’em.
    Prosperous New Year RA Picks.