Well, it's definitely been an exciting start to the year. Equity holders have been sweating, option players have been cheering, and the bond market still sucks.
There's been a...hunch that the US market isn't as rosy as everyone believes. Employment, wages, and a host of other data have been telling us that everything is ok. But still that itch remains. With China blowing up in spectaclar fashon, it seems the bears finally have their day (7 years later...but I digress).
China spent the better part of a week trying to stablize their economy, and I have a sinking suspicion that it's partly due to devaluing their currency, partly from putting a gun to Corporate-China's head saying "Have faith in the grand party" (figuratively? literally? Probably both.)
So China's market stablized, and the US market has reacted to it. Mainly by being squirrely and not moving until some big players make a big purchase. But with a couple +100 point days on the Dow, everyone seems to have calmed down.
Execpt...it's all not true. None of it. The fundamental fact remains that manufacturing in China is down. That means nobody is producing items. Which means the sale of items is down. Which means people aren't buying. Governments can prop up and put lipstick on the pig, but it's still a pig.
My not so humble opinion is that we're gonna see a lot of depressed sales in the earning reports coming out in the next couple weeks. Most of retail is gonna take a hit, and tech is gonna be hurting. the casino sector is ripe for The Fall. LVS and MGM are heavily into Macau. Boyds is safe, but they'll feel the ripple. And Caesar's just needs to declare bankruptcy and be done with all the Apollo games.
My plays for the next few weeks is gonna be to play the downside with options, and look for potential bargains on the stock side. Don't let a couple upside spikes fool you; there's trouble on the horizon.
Disclosure: I am/we are short LVS, MGM.
Additional disclosure: I'm a random guy on the internet. If you haven't learned it already, most of the internet is full of crap. So do your own homework before you invest or take a position in anything.