15 Nov 2021

A $27 billion valuation in less than 2 weeks. Sounds about right. Something is seriously wrong with capital markets when an exiled Chinese billionaire Wengui Guo and Steve Bannon get behind a cryptocurrency that is taking on the Chinese government.

Himalaya is a stable coin claiming it has the most advanced encryption technology and a feature that caught my eye was that 20% of its value was held in gold reserves. This brings me to the following bullish Gold chart by Martin Pring.

What is also worth keeping an eye on is Inflation Adjusted Gold is close to its 40yr downward sloping trend line. The most recent challenge failed, we should keep a watchful eye on this one as a break above might just be a sign that the inflation genie is out the bottle.

I wrote last week about the IPO of Tesla rival Rivian. I am sorry this is ridiculous. It now boasts a market cap of more than $100 billion which makes it bigger than Ford and General Motors. This I think will become a poster child of the excesses inherent in our current distorted market. By the way in case you were wondering Rivian has never recorded revenue and it expects less than $1 million in sales for the 3rd quarter.

I have to say I love the fact that Elon Musk is throwing shade on his competitor. You got love the theatre.

“There have been hundreds of automotive startups, both electric and combustion, but Tesla is [the] only American carmaker to reach high volume production & positive cash flow in past 100 years,” Musk said in a tweet

The equity market is once again at record highs and the Hedgies are getting stuck in, take a look at Net Leverage for all strategies.

I have traded market extreme behaviour for decades. I live for it and 2 out of 12 times I am right the rest of the time I am early. However I don’t think there is too much argument that markets are crazy bullish and when markets are too optimistic we tend to come back down with a thud. I am bearish right now.

Take a look at these extreme readings by Sentiment Trader. Remember Bull Markets don’t start when sentiment is extremely bullish.

Finally I have to say after 2 weeks of boring Climate discussion it all came down to the last hour. I believe history will only remember that India (with China and USA’s backroom politics) got the language changed from “Phase Out” to “Phase Down” coal use.

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