My Favorite Plays to Ride the Chinese Government Sponsored Stock Market Bubble

COVID-19 is surging again in the South and West, with cities like Houston, Phoenix, and Tucson out of ICU beds or close to it.

Meanwhile, the economy is slowly recovering in fits and starts, with unemployment shrinking – but much slower than some analysts were expecting.

You wouldn’t know it from looking at the stock market, though. Fresh off a five-day winning streak, stocks consolidated on Tuesday.

And a crash like the one we saw in February and March is nowhere in sight. In fact, we’re in the fastest bull-market in U.S. history. Stories abound of stocks surging unbelievably fast. Some of them, like Hertz Global Holdings Inc. (HTZ), spiked only after they declared bankruptcy.

Part of the reason is the flood of millennials and generation Z-ers using the lockdowns to start trading stocks and options – who are joined by the sports betters who have no games to bet on – joining forces and using Robinhood and similar apps.

But this “disconnect” between the market and what’s happening out in the world isn’t just limited to the U.S.

In China, that reality gap is much, much wider.

In the short term, that’s very bullish, setting us up for a virtuous cycle of stocks pushing up one another.

But in the longer term, this is reason to start getting worried


The Good, the Bad, and the Ugly of This Week’s Earnings Reports

I hope you had a great Fourth of July weekend!

It certainly had a different feel this year, what with beaches in some states closed, restaurants restricted, and many iconic celebrations cancelled, including my hometown’s fireworks display. Fortunately, some of my neighbors did their best to make up for the lack of community ordinance, creating an impressive display of sight and sound.

But some things stay the same – like the continuing disconnect between what Big Media is saying on the one hand, and what the market is doing on the other.

This morning, for example, The New York Times leads off its Monday Morning briefing with the question “How badly is America doing?” and the first few articles are all about record-high COVID-19 cases in Texas and Florida.

But the market reality is different. Despite new record infection numbers last week and over the Independence Day weekend, the S&P 500, Dow, and Nasdaq all opened up 1.4% or so


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