Wall Street Keeps the Laughs Coming

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"The action on Wall Street is starting to remind us of Harlem Globetrotters shtick."

The action on Wall Street is starting to remind us of Harlem Globetrotters shtick. Yesterday, on the NYSE, stocks opened on a vaulting arc, only to be hauled back down to earth in mid-flight. Although the Dow had been up about 135 points in the early going, by day's end it was trading off 70 points.

The bullish segment of this raucous little burlesque appears to have been inspired by some tarted-up data that reflected supposed strength in the housing market. Yeah, sure. As for the selloff and eventual 220-point reversal, there was no obvious reason for it. Our take is that the elaborate hoax that has cajoled stocks higher since March 2009 has grown too tiresome to fool even some of the people some of the time. There is still Kudlow on the buy side, of course, and perhaps a handful of solvent bears covering shorts whenever "good" news threatens to trigger a squeeze. But that's about it, and whatever newsworthy excuse might arise on a given day to goose and goad the fearful and the clueless into acquiring shares, the effect is growing more and more muted each day, a diminuendo for the hubris of the late, great Financial Age.

We should note that bullion yesterday reflected none of the ambiguities that have caused stocks to trace out conniptions each day on their respective charts. Comex August Gold tacked $30 onto the previous day's lows, and the futures were holding the gains with easy aplomb as we went to press late Wednesday night, trading around $1,215. Bears had better dive for cover if the August contract closes above that price today, as that would portend instant additional upside to at least $1,261.80.

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