When I look at Thursday’s rally, I am beginning to realize that we have become so binary and so up close that we have lost our ability to think about what matters. The big fish data got caught among the minnow minutiae and we ended up with ridiculous rallies that are, therefore, based on nothing. That, of course, tells you that those newfound percentages can be taken away based on nothing. That’s how trapped and intellectually devoid we have become. I have now studied every aspect of the runup of that beautiful — for the bulls — session on Thursday, and I can truly say that it was game-set-match in favor of the bulls by 8:30 a.m. ET — one hour before regular stock trading begins. That’s when the weekly jobless claims number was released. The components of that print — somehow — made sidelined investors feel more comfortable that the Federal Reserve will cut interest rates without the economy rolling over, so it’s all clear to buy. They tackled the opening at 9:30 a.m. ET hard, with the industrials and techs getting the benefit of the doubt. Was it an S & P futures-based program that resurrected stocks, both in the morning and at the close? It got hard to tell. It was that positive a session. How could a number that comes out every Thursday really play the catalyst? The absurdity of it is palpable. I mean you could hire 10,000 actors and then lay them off and you might have had a selloff of gigantic proportions because the hard-landing types would be unfettered. Then again, is that any more outrageous behavior than watching unknown large institutions sell their large-cap U.S. stocks on Monday because Japan’s central bank raised rates there, causing an over 12% decline in Japanese stocks in one session? The lunacy of that move and its aftershocks brought Wall Street’s fear gauge, the VIX , to a 52-week high of 65.73 intraday, another insane collaterally thoughtless metric that alternately scared some and made others feel the whole thing is overdone. At the same time, the S & P 500 held at certain levels that helped start the fire. For comparison, the VIX was at a 52-week low of 10.62 on July 19. The whole thing was chimerical. Let’s step back for a moment and remember where we are: We’ve been in a precarious earnings season and the havoc dealt to whole sectors screams to be noticed. Whole swaths of positive points were rolled back because of the Japanese-related craziness. For example, this season started with the banks roaring higher on great numbers, legitimately great numbers led by a phenomenal Bank of America quarter. Then less than a month later, we get the unleashed tsunami of selling that seemed particularly harsh on the financials. On top of that came the report of huge selling of Bank of America stock by Warren Buffett as if, somehow, that meant he no longer liked the banks as a group. Nobody questioned whether Buffett was just selling everything not nailed down, including Club holding Apple . Or maybe there’s been some…
Read More: On paper the market should be great, not on edge. That’s the opportunity