As if several markets tumbles and heartstopping short squeezes in just the first two months of 2016 have not been enough to turn professional traders' hair prematurely gray and drive all retail daytraders permanently out of the "market", here is a warning from Wedbush's otherwise quite somber repo market analyst, Scott Skyrm, according to whom the volatility is only just starting.
Despite the unequivocally good economic news of low oil prices, Restoration Hardware's CEO just pre-warned of a massive miss in top- and bottom-line for Q4 thanks to "energy, oil, and currency fluctuations." This has sent the stock down over 20% after hours to its lowest since early 2013.
Here is why the headline scanning algos are puking:
The firm's CEO explains the reasons for the collapse:
As has become increasingly obvious to many, unconventional central bank policies have resulted in an unprecedented level of crowding – a "herd mentality" to trade positioning on the basis of a similar theme – throughout global equity markets. UBS quant team guages the "barometric pressure of developing investment bubbles" across various factors and looks for the inflection points with the dollar, oil, and politics as the main catalysts.
Well, we've seen some ridiculous moves in markets before but today's cross asset-class malarkey takes the proverbial biscuit...
Or put another way...
Hoo boy. Newell Normand, the Republican sheriff of Jefferson Parish (suburban New Orleans), seeing the complete disaster that former Gov. Bobby Jindal and the GOP-run legislature made of the state’s fiscal situation, is volubly repenting. Excerpts:
“The state budget, what a mess,” Normand said. “Bobby Jindal was a better cult leader than Jim Jones. We drank the elixir for eight years. We remained in a conscious state. We walked to the edge of the cliff and we jumped off and he watched us.