Kyle Bass Was Right: The Administration Did Speak To The Nation About The Market… And It Only Made Things Worse
by Tyler Durden
ZeroHedge.com
Mon, 12/24/2018
On Friday, in a since-deleted tweet, Heyman Capital’s Kyle Bass made a correct prediction, saying that “the administration will likely speak to the nation about stock market over the weekend.”
Unfortunately for bulls, said intervention by Treasury Secretary Mnuchin, in which he called the heads of the 6 biggest banks (JP Morgan, Bank of America, Goldman Sachs, Morgan Stanley, Wells Fargo and Citigroup) from his Cabo vacation, to discuss recent market turmoil and assure liquidity conditions, and noting that he would convene the President’s Working Group on financial markets – a panel created in the aftermath of the Crash of 1987 – also known as the Plunge Protection Team, yielded the opposite outcome of that desired, with the S&P sliding further on Monday and now less than 2% away from a bear market…
Commenting to Bloomberg, Michael O’Rourke, JonesTrading’s chief market strategist said “nothing says don’t panic like saying ‘I’m calling the plunge protection team tomorrow.’ I honestly think that’s the type of event that’s going to startle markets and create more panic and fear when it’s meant to create confidence.”
Others were just as harsh: “We saw a lot of sell-offs in 2011, 2015-2016, and I don’t remember the presidents trying to convene the bank heads,” said Michael Antonelli, equity sales trader at Robert W. Baird. “I’m worried the White House is going to make a mistake by exacerbating the market concern. Trump needs a political win, a PR that looks like he’s on top of the situation, and that’s what the weekend strikes me as.”
“Personally I take it as a huge negative,” said Titus Wealth Management managing director Scot Lance. “He’s calling bank CEOs asking about their liquidity. That doesn’t make me feel all warm and fuzzy. The bottom line is there’s a crisis going on right now and it was born I believe as a political crisis exclusively last February in a trade war. That’s turned into an economic crisis.”
The Rest…HERE
