The LAST Trump Casino

There are times when I feel that I am writing blog posts more for the archaeologists coming along later to figure out what actually buried this late stage Idiocracy, than I am writing for anyone reading this contemporaneously. This is one of those times. As always occurs during frothy rallies, my Twitter stats collapse and stock gamblers flock to whatever bullish media are willing to extrapolate record excess to infinity. Needless to say, it seems somewhat redundant to write about market risk in the tenth week of the worst energy crisis in world history at the apex of the largest asset bubble in world history.

Here we go...

Let me start by saying that only Trump could convince global investors to go ALL IN at the apex of record risk. And how he did that is already well known even now:

Trump has been lying non-stop since the start of the war, putting out messages saying the war would be over "soon". Several times he asserted that it was already over. And then the mainstream media have been propagating those lies non-stop since the start of the war. In particular, the media have been recurringly saying that Iran is engaged in talks with the U.S. when Iran was NOT engaged in talks at all. Then "someone" has been front-running those daily media press releases to short oil futures DOWN to manipulate oil lower. All of which has been fuel for continuous short-covering in the stock market. It's now impossible for hedge funds to hedge risk in the stock market.

This is by far the largest market rigging operation in world history. This is market rigging on an industrial scale, taking place in broad daylight:

Here's the thing about the oil market: It consists of two separate but linked markets - the spot market that deals in physical oil flows. And then there is the paper futures market which enables all manner of leveraged hedging and speculation and is linked to the spot market via arbitrage. In other words if those two markets get out of synch then large market makers can move physical oil around and sell/buy futures to bring the markets back in synch. Therefore, if oil futures are now being artificially manipulated lower then that means they are below the physical spot market in price, a rare condition called "backwardation". However, at settlement, every futures contract converges in price to the spot price, which means that over time the futures getting shorted by insiders are going to go up in price INEXORABLY over time.

The end of April expiry of the front month June Brent contract indicated spot Brent at $125 right at rollover, versus where it is now at $100 on the July contract. Meanwhile, that spot price assumes spot is not moving higher due to the record oil inventory drawdowns taking place globally and also assumes no war escalation. In other words, oil is under-priced by at LEAST $25 potentially as much as $50.

That's a huge gap between spot and futures that will be closed AGAIN at the end of May.

Another risk that came out this week is that the CIA poured cold water all over Trump's assertion that the war will be over "soon":

"A CIA assessment indicated that Iran would not ‌suffer severe economic pressure from a U.S. blockade of Iranian ports for about another four months, according to a U.S. official familiar with the matter, suggesting that U.S. leverage over Tehran remains limited as the two sides seek to end a conflict that has been unpopular with U.S. voters."

In other words, Trump's blockade strategy has FAILED.

Which leaves markets high and dry.

And yet investors are totally complacent:

"Despite war and tariffs driving worries about US affordability, attendees at this year’s Milken Institute conference were notably untroubled — gliding between Spago dinners, a speech by Tom Brady and parties at billionaires’ Bel Air homes."

The global stock bubble is led by Korea with the rest of the world playing catch up.

Go back to when the war started in March. This was the headline that I warned was coming:

March 4th, 2026:

Now look at the Kospi since March ("Weeks"). It's parabolic like a DotCom stock.

Now we learn the war will go on for several more months.

In summary, only Trump could pull off a record high stock market AND a record collapse in consumer sentiment at the same time and get away with record oil market manipulation.

And only history's largest cabal of equally corrupt FOOLS would think it's "bullish".