Bubblevision’s Scott Wapner nearly split a neck vessel today denouncing the US stock market sell-off. It was completely unwarranted, he thundered, because China don’t have nothin’ to do with anything.
Why, insisted CNBC’s best dressed pom-pom boy, China’s stock market has never been correlated with its economy, and, anyhow, its economy doesn’t matter all that much to the SP 500 because China accounts for only 14% of global GDP.
Besides that, China’s stock market is exactly like what Yogi Berra said about his favorite restaurant: It’s so crowded, nobody goes there anymore!
That is, according to the talking heads Chinese household’s don’t go to the bourses, either. Few of them own stock and equities account for only 20% of household wealth compared to upwards of 65% in the US.
So enough of the schwitzing about the red chip sideshow. Buy the dip!
Indeed, that’s exactly what the insentient robo-traders did at the close. After banging the 200DMA, they bid the SP right back-up to Monday’s VWAP (volume weighted average price) in the final seconds, thereby filling-up their sell buckets to unload on tomorrow’s dip buyers. As Zero Hedge noted,
On the day, US equities staged their standard JPY ignited momo bounce off the 200DMA – running perfectly to VWAP in the SP, before limping lower…and a mini algo meltup to VWAP at the close… all completely human!!
As for purportedly sentient humans, however, the better advice would be to flee the dip with all due haste. The truth is, China is not a sideshow; its the radioactive core of the entire global bubble.
Needless to day, the Wall Street shills and touts are so oblivious to this fundamental reality that they can not even see the obvious facts about China—-to say nothing of the macro-quick sand upon which the entire global economy is poised.
The meme of the day—–that China doesn’t have so many gamblers—-is hilarious. From stem to stern, China’s version of red capitalism has evolved into the greatest gambling den in history.
Originally appeared at: http://davidstockmanscontracorner.com/wall-street-still-didnt-get-the-memo-chinas-done-tops-in/