Stocks at record highs? Last weeks Greek Crisis has turned into this weeks Greed Crisis. See what I did there? A quick glimpse of the stock market would make you think the economy is running on all cylinders. Robust growth. A white hot job market. Wage growth. And... what all expanding economies have... inflation. Yet its tough to argue that any of these are the case.
I have mused recently that it is "the buybacks stupid" and/or It's the "mergers and acquisitions stupid". The Central Banks? That would be the easy excuse as to why stocks closed today at lifetime highs.
Anyone remember the Ebola Crisis last year? Somehow we are still alive to tell that story to our grandchildren.
40 years from now the Great Ebola Crisis of 2014 will have swelled to millions dead. We survivors will tell a grand tale of how we fought off the disease. A lifetime of eating Pizza, Cookies, and drinking sugary beverages has proven to be too much for the deadly Ebola Virus.
And while fighting and ultimately slaying the great Ebola Virus, our financial accounts were decimated by an ongoing Greek Crisis. One that took the stock market to the precipice of collapse only to see it come back to life and rally to record highs. Years from now, in the anals...make that annals of the history books there will be one reason why stocks are at record highs.
Greebola epitomizes the current state of our stock market. The fear mongering, the scare tactics, the death, the destruction.... it never has come to fruition. It's Greebolic. Its Greebola... almost like Ricola except with a G an R a few E's and a B.... although phonetically they sound very similar.
Greebola: the continued rally of the stock market in the face of named potential headwinds. Examples include: The Gov't Shutdown, Syria, Cyprus, Ukraine.....
......I could go on... but does it really matter? This historic bull market has eaten named sell-offs for lunch and dinner... usually the 4 slice of pepperoni kind.
Tuning out The Noise, the Greebola, has offered a great opportunity to buy the pull back and ride it for significant gains, and ultimately record high stock prices.
As long and these pullbacks have names you can be sure there will be buyers waiting in the wings on any weakness to turn a Greek Crisis into a Greed Crisis. That yet to be unnamed pull back, the one that has everyone scratching their heads? That will be the one that takes this whole market down.
As I said last week, in the face of the Greek Crisis the market is telling you the outcome. Low volatility readings, higher stock prices. Greece is a non-issue. Just like Ebola. Late last year Ebola was going to spread around the Globe and turn us all into Zombies. Instead all we got was a bad case of Greebola. And it's sending this market into a frenzy.