March Madness

I had to take some time off of posting on Twitter because my mind had melted down at the amount of bullshit streaming out of the Trump Administration regarding this ONGOING Iran clusterfuck. Trump's latest demands that the world now clean up the gargantuan mess that he made would make a petulant three year old blush. But I don't want to go down the rabbit hole of wartime propaganda again.

So below I will focus on markets:

Despite the obvious risks, Wall Street pundits remain consistently bullish. Just this morning both Goldman and Morgan Stanley were telling investors to buy the dip in U.S. stocks. Which is interesting because right up until the war started Wall Street was telling everyone to buy non-U.S. stocks. Recall that U.S. stocks had been imploding left and right before the war due to "AI panic" - the fear that AI was going to implode a multitude of industries. So now we are to believe that those AI risks are gone because a war started?

Just two weeks before the start of the war, BofA was on a sell based upon hedge fund over-positioning in non-U.S. stocks:

February 17th, 2026:

"Investors are net 49% overweight emerging market equities and 35% overweight Eurozone equities, while they are net 22% underweight U.S. equities."

“FMS combined allocation to equities & commodities is net 76%...highest since Jan’22,”

"The BofA Bull & Bear Indicator rose to 9.5, triggering a contrarian “sell signal.”

Meanwhile, Japan is once again warning of imminent currency intervention to bolster the Yen:

Gamblers have forgotten that back in July 2024, BOJ intervention imploded the AI bubble. And as we see, the AI bubble is ALREADY imploding from this war. So a BOJ intervention would further monkey hammer global speculators:

Bitcoin has now completed its second backtest of the 50 day moving average. Meaning its third lower high. This shows that speculator optimism is getting desperate:

On the economic side, using the March 2022 Ukraine war analog, even if oil prices hit their peak last Monday at $120 (intra-day), that would imply gasoline prices at $4 by this summer. And consumer sentiment would tank to a new 50 year low.

In other words, the economic damage is already done.

However, this crisis is considered far worse:

"The International Energy Agency (IEA) has warned that the current energy crisis triggered by the war in the Middle East marks the “largest disruption” in the history of the oil market."

This chart shows U.S. gas prices in red and crude oil in black. Back in March 2022, crude oil peaked at $125, but gasoline peaked in June at $4. Consumer sentiment (lower pane) hit the lowest level in 50 years at the exact peak in gasoline prices:

In summary, the worst oil crisis in history makes U.S. stocks safe once again, but massively crowded non-U.S. stocks will go bidless without impacting the U.S.

And if you believe that then the man in the White House is YOUR president and you are about to be liberated.

From the burden of wealth.