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As We Reach New All-Time Highs, We Don't Even Know What We're Bullish About


  • Futures advance overnight to all-time highs.
  • As usual, futures are up on two fallacies: the tax bill being delayed and the assumption of a planned non-cut of interest rates.
  • The euphoric music will continue to play, until one day we wake up and it doesn't.

By Parke Shall

Very early on Wednesday morning it became clear that the market was once again going to be opening, more than likely, at new all-time highs. Stock futures advanced in the overnight session and as of the timing of this article, are indicating that the major indices will be opening at all time highs. By the time this article is published, it is likely that the market has already opened Wednesday and that headlines across financial media are all likely focused and centered around the markets being at new highs.

The exact numbers for today are mostly irrelevant. What we wanted to cover in this article today is why stock futures soared overnight and why we believe the market is showing signs of extraordinary euphoria that are far more likely to be a harbinger of irrationality and negative things to come than they are a sign of true economic prosperity and legitimate reasons to be bullish.

In order to make our case clear, let’s take a look at the two main headlines that drove futures overnight.

1. The first was that the Federal Reserve is not expected to hike rates later on today

2. The second was that details of this administration’s tax reform will be released a day later than expected, on Thursday.

Reuters reported on the latest with the Fed,

The Federal Reserve is expected to keep interest rates unchanged on Wednesday as speculation swirls on who will be its next leader, but the U.S. central bank will likely point to a firming economy as it edges closer to a possible rate rise next month.

The Fed has raised rates twice since January and currently forecasts one more hike by the end of the year as part of a tightening cycle that began in late 2015.

Investors have

This article was written by

Contributors: Scott Tzu, Parke Shall, Thom Lachenmann (contributors write under pen names for anonymity purposes) Please read Seeking Alpha's Policy on Anonymous Contributors to familiarize yourself with the site's terms and conditions relating to anonymous authors.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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