Absolutely boggles my mind that 21-year-old investment bank interns are subject to stricter insider trading rules than members of Congress.
These guys have access to more material non-public information than anyone on Wall Street—legislative changes, pharmaceutical trials, classified military intel, defense contracts—and they’re using it to operate their own amateur hedge funds from the House cloakroom.
Pelosi and her serial drunk-driving husband consistently outperforming the market. Ro Khanna making thousands of trades every year. Hundreds of other examples, across both parties. It’s completely absurd.
If you want the extraordinary privilege of being one of the most powerful people in America, you—and all members of your immediate family—should be required to place your liquid assets in a trust that can only invest in the S&P 500, a bond market ETF, and a money market fund. You can change your allocation among the three choices quarterly, but that’s it.
No more call options on biotech companies that just told the FDA about a medical breakthrough. No more short-selling defense contractors that just briefed the Armed Services Committee about production delays. No more fake “blind trusts” whose rules aren’t worth the paper they’re printed on.
Show up, do your job, and faithfully serve the American people. If you don’t want to do that, go study for the CFA exams and test your mettle against Ken Griffin and Steve Cohen in the trading world (for some reason, I don’t expect your streak of beating the market to continue once you and your staffers are no longer getting confidential briefings).
But no more of this Capitol Hill Wolf of Wall Street bullshit. It’s corrosive to good governance, it undermines democracy and trading markets alike, and we, the American people, are done with it.
🇺🇸 JUST IN: The Federal Reserve has released the minutes from its July FOMC meeting.
Several officials favored a rate hike, while many said further tightening may be needed if inflation does not decline.
In class tonight, I talked about how headlines can be used to manipulate retail traders.
Gold is now UP 8% since the news tried to convince you to sell at the lows.
This is why you need to learn to read the chart, not trade the headline.
After the Situational Awareness meltdown, the market has rallied into a strong Stage Two. It had its first major pullback into the 29,250 (Warner’s Quarter), and the NASDAQ spent all of Friday coiling. It now looks poised to run to the quadruple top above 30,000.
I’ll take an intra-week swing long targeting this level, and we’ll reassess if and when the other Warner’s Quarter at 30,250 is hit. I’m seeing no bearish news over the weekend that would derail this run to the quadruple top. But if for some reason there’s a breakdown, we will target the swing low and the Warner’s Quarter at the breakout of 28,750.
I’m having my wife manage my Asia positions while I’m at the gym. She says the numbers are moving too fast so I don’t think she’s ready for NY session yet 🤣
BREAKING: A US military base in northern Kuwait has been directly hit by Iranian drones, per Tasnim.
Initial reports indicate that this was the preemptive strike Iran has been planning.
⚠️ WARNING
Every global crash starts with South Korea.
It sounds ridiculous.
Until you look at the history.
1997:
- The Korean won collapsed
- KOSPI crashed
- Foreign exchange reserves nearly ran out
- Then the Asian Financial Crisis spread across the world
2000:
- South Korean semiconductor stocks topped first
- Months later, Nasdaq dumped 78%
- The Dot Com Bubble popped
2008:
- Korean stocks started breaking down
- Just over a month later, Lehman Brothers collapsed
- The global financial system went with it
2021:
- Bill Hwang used extreme leverage through Archegos
- The fund exploded
- Global banks lost more than $10 billion
- Credit Suisse alone lost $5.5 billion
2022:
- Do Kwon launched LUNA and UST
- More than $40 billion vanished almost overnight
- Then came Three Arrows Capital, Celsius, and FTX
Now the warning is coming from KOSPI again.
Samsung and SK Hynix dominate the index.
More than $30 billion flowed into leveraged products tied to the two companies.
These products rebalance every day.
When prices rise, they buy more.
When prices fall, they are forced to sell.
The deeper the market falls, the more selling the products create.
KOSPI has already fallen 25% in just a month.
The leverage that created the boom is now creating the crash.
Forced selling is feeding more forced selling.
South Korea has warned the world before.
It's warning us again.
Pay attention.