24May11:09 amEST

When Pride Still Mattered

Back when pride still mattered even the most cutthroat of politicians would be willing to strike a bipartisan deal on something like the debt ceiling headed into a somber, flag waving holiday like Memorial Day weekend. 

But times are different now. And I have seen very few people even remark about trying to get a deal done lest we spoil the purpose of Memorial Day, beyond the usual barbecues, ball games, and beaches. 

Instead, we have a market which has been as complacent as any market I have traded or studied in the face of more posturing inside the Beltway--And only now are seeing a modicum of weakness which is still extremely orderly. 

So despite the news headlines about "jittery markets, let's be absolutely clear that you ain't seen nothing yet when it comes to markets in turmoil. 

However, it is worth noting that both the junk bond (JNK ETF, below on daily chart) and the high yield corporates HYG ETF) both completely threw cold water on the recent rotation attempts into ARKK and small caps in general insofar as diverging bearishly. 

And now today we have HYG JNK breaking down to fresh multi-month lows. 

In addition to the divergences in rates, the Dollar, and narrow, expensive leaderships in "AI," this high yield/junk action is yet another red flag which continues to have me viewing the VIX as remarkably underpriced, still, headed into the post Memorial Day early-summer trading period. 

The United States of Credit ... Where There's Smoke, There's...


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