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Posted in Wolf Richter

This Chart Shows When the Smart Money Saw The Abenomics Fail

The year 2014 has been lumpy, to use Cisco CEO John Chambers’ propitious term, for stock markets around the world. Gone are the ferocious rallies followed by mild rallies interrupted by minor downticks, followed by more ferocious rallies. That’s so 2013.

It’s as if on December 31, someone turned off the spigot. The hype and investor exuberance is still out there, at least on the surface and with retail investors as the well-planned and meticulously executed rotation from the smart money to those who are plowing their life savings into stocks is in full swing. The smart money has been bailing out, not just in the US, but nearly in all major markets – as the chart by Doug Short at Advisor Perspectives makes amply clear.

And look what happened in Japan:

So for last week, hope for more stimulus drove Shanghai up 3.5%, with China’s economy teetering and its credit bubble cracking. On the other side of the spectrum, the Nikkei (red line) plunged 7.3%.

For the year through Friday, there are only three indices of the major eight that are up: the Indian BSE SENSEX (+ 6.9%), the French CAC 40 (+1.6%), and Shanghai (+0.7%). The rest got knocked down: Hong Kong’s Hang Seng -1.3%, the S&P 500 -1.8%, the UK’s FTSE -2.8%, and Germany’s DAX -3.1%. Though still minor, this amount of red had been absent during our crazy money-printing times when they’d gone up automatically, regardless of what happened in the real economy.

Read the rest of this post at Testosterone Pit. View original post.


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