The market is serene: the world is fraught.
In chemistry there's Le Chatelier's Principle: If a chemical system in equilibrium is subject to a destabilising force there will be an equal and opposite force to counteract the initial disturbance to restore equilibrium.
As we all know, central banks and governments have successfully bent markets out of shape and destroyed the price discovery mechanism for over seven years.
The way they're now using of QE and interest rates more than ever across the world suggests that the protracted 'pattern break' from the 'norm' will be extended for quite a while yet.
We can even see circumstances under which the US Fed will go for QE4, and we note just what an Alice in Wonderland world it is with corporate bonds from GE and McDonalds teetering on the brink of negative yields.
It's a white knuckled ride for those fund managers who actually pick stocks and strive to beat the benchmark indices, which less and less of them now manage.
The secret to keeping your job in the fund management business is not to do worse than your peers by taking all-out risks on stocks or liquidating too soon.
By contrast the 'quants' who use high-speed pattern recognition systems to jump in and out of alternative investments such as interest rates, currencies, commodities via futures mainly and other derivatives and/or by front runs by getting in the middle of large order executions seem to be in a generally better position.
Besides, contrary to the common perception quants and hedge funds are not expected by their pension fund, insurance company, SWF, and family office customers to achieve high and consistent alpha returns, although some do, but to provide ballast to portfolios, which doesn't necessarily mean positive returns.
Meanwhile, in this out of kilter world, among markets badly bent out of shape, when will the snap back occur?
This raises the key question. How able are the central banks to delay almost ad infinitum the snap back?
We reckon for a good few years yet.
So we reckon to run stocks for a while yet.
After all their five year averages have been positive 86% of the time since 1929.
But then how long will the 'pattern break' last this time?
Plenty of pacing the bedroom floor at 2am during the melt-up.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.