Make no mistake, the real loser of the 2016 U.S. presidential election was not Hillary Clinton. No, it was nearly the entire Western mainstream media which up to the final moment last night clung to a political fairytale it tried so very hard to convince its readers over the past two years. No matter whether you are a Hillary or a Trump supporter and no matter how you feel about the 45th president of the United States as a person, this is something that should deeply upset and worry you long after your current euphoria or depression has subsided and given way to your daily routine.
The question you should ask yourself today is not how on earth Hillary Clinton could possibly have failed or whether president-elect Donald Trump will truly deliver on all of his campaign promises. Instead ask yourself what the hell has happened to the fourth estate of our republic and how it is possible that so many ‘independent’ polls and third party projections could have been so very wrong – once again. The last pertinent shock treatment to what apparently seems to be a clear political agenda happened not so long ago last June when, contrary to widespread and repeated media projections, Nigel Farage, leader of the BREXIT movement in the U.K., embarrassingly was forced to declare victory.
And, mind you, this is not just a new phenomenon exclusive to the United States. I happen to speak fluent German and can assure you that the word ‘Lügenpresse’ (meaning ‘lying press’) has long become an official political term and even has its own Wikipedia entry. Even among the most diehard liberal democrats you will have difficulty finding many trusting souls who still believe that our media is truly fair and balanced. There is a big issue here that needs to be addressed and it is one of trust and credibility. And given the fact that we all now live in a world of social media and instant digital communication it should even more so be one of relevance.
Perhaps now you understand why I have long been a fervent proponent of maintaining a disciplined information diet. What you let into your head on a daily basis will affect your decision making, your belief system, your personal opinions, and yes – your investment and trading decisions.And why would you ever pay attention to anyone who apparently has no clue what they are talking about? If I want to listen to noise it’s much easier to just open my windows, which incidentally has the added benefit of letting in fresh air. And perhaps at this point, after one of the dirtiest and controversial presidential races in recent history, a breath of fresh air is what we may all need the most.
Alright, let me get you guys up to speed:
The E-Mini dropped like a rock last night but has since snapped back after European traders realized that, against all expectations, the sun did rise as usual early this morning. The good news is that no matter which option strategy you decided on yesterday odds have it that you will bank some coin simply due to a significant increase in volatility. Once the VIX opens we’ll know more on that end.
Bonds however are still trading far below yesterday’s range and it seems the going expectation is that Trump will not rock the boat when it comes to the Federal Reserve’s current mission to kick the can even further out.
Gold also going nowhere fast. Although it’s back at hourly support I wouldn’t jump into long positions here just yet. Let it settle down a bit more and wait for easier pickings.
Crude stopped me out but I already re-entered earlier this morning. This wasn’t terribly hard to predict which is why I only took out 0.2% position yesterday. My new stop has been set below 44 and although it’s not impossible we see more gyrations in the coming hour I do believe this is a solid entry. Nevertheless I’m playing 0.3% only as the lair remains in Defcon 3 mode until the dust has truly settled.
The Euro – boy, I was already afraid I would need to raise the subscription fees this year but it seems the all clear has been given as it is once again trading near yesterday’s lows. This was actually something I was a bit worried about – in my mind a Trump victory was sure to severely weaken the Dollar and luckily I’m proven wrong on this one. I know, the fat lady has not sung just yet, but this is positive for the Dollar and this lowly expat.
Here’s the Yen, which also seems to have made a beeline though the traditional DABDA stages and quickly arrived at acceptance. Actually given such a huge political upset things seem to be suspiciously composed and settled across the entire spectrum. Which in turn makes you wonder how much of what we’ve seen and heard in the financial news over the past weeks once again was nothing short of theatrics. As the saying goes – in the end, just follow the money.
Which is what brings me to my final chart, and it is the one I posted here two days ago after the quick ramp up higher: Maybe I’m subjective here but apparently whoever was pricing risk across on the option side knew a thing or two more about political elections than the media in charge of reporting it? Just saying…