Investment guru Cathie Wood’s ARK ETF topped at 158.82 in February. Since then, the ETF has fallen 55%.
Big Betting Against ARK
‘Short interest as a percentage of shares outstanding on the $12 billion ARK Innovation ETF (ARKK) has jumped to a record 8.6%.’ https://t.co/HsPjFiXLWd pic.twitter.com/1Prv5h6usi
— Jesse Felder (@jessefelder) January 25, 2022
Those shorts will cover sometime, but when and at what price?
ARK Innovation ETF Weekly
There is technical support for ARK in the low 30s. And that’s where I think it’s headed, but with no time frame in mind.
If you want a different view, Wood says “Disruptive innovation is often not priced correctly by traditional investment strategies because people may not understand how big the ultimate opportunities are going to be. They aren’t sizing the opportunity and they aren’t analyzing the disruption.”
She sounds remarkably like the roaring 2000s “Gorilla Game” wisdom that implied “You can never pay too much for a gorilla.”
Investment gurus come and go in every stock market cycle. Most look like geniuses until suddenly they don’t.
Tweets of the Day
The wealth is lost on the way up, in an endless bull. People fork over their capital to buy assets. The sellers receive this as a profit, as income. They spend it.
The crash occurs (much) later, and is just the accounting catching up to the consumed and destroyed capital.
— Keith Weiner (@RealKeithWeiner) January 25, 2022
“The wealth is lost on the way up” by investing in bubbles.
What the Fed Achieved
A little harsh but is any part really inaccurate? https://t.co/izHqMKVGyC
— Jim Bianco (@biancoresearch) January 12, 2022
Cramer’s Magnificent Seven
What a hoot – Jim Cramer’s “Magnificent Seven”
Anyone have a scorecard since he posted that chart? https://t.co/Cm9xGklQQG
— Mike “Mish” Shedlock (@MishGEA) January 21, 2022
Second Consecutive Wild Ride in the Stock Markets, This Time Closing Lower
In case you missed it, please consider my post on January 25, Second Consecutive Wild Ride in the Stock Markets, This Time Closing Lower
Many people think the Fed will keep hiking until it breaks something.
I have news. The markets and the economy are already broken by the Fed’s policy errors.
For discussion of how bad inflation really is, please see Home Prices Jump Another Percent, Fed Extremely Behind the Inflation Curve
Home prices rise another percent according to Case-Shiller. The Fed does not even count that as inflation.
The seeds of decline were sown in bubbles already blown. And it’s not just the stock market. It’s also junk bonds, housing, and cryptocurrencies.
It’s far too late for the Fed to prevent another deflationary asset bubble collapse.
This post originally appeared at MishTalk.Com.
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Mish
Three invest
bankers were stranded on a deserted island for a year. They managed to salvage
three trunks, one filled with hats, one filled with coats and the last filled
with gloves. Since they were investment bankers they started trading hats, coats and gloves among themselves and
by the time they were rescued they had all become billionaires.
link to equitymates.com
Trying to get investment education by watching Cramer is like trying to get sex education watching X-rated movies.
If he’s firm on language that seeks to curb inflation I think precious metals will have a very bad day. However, long term I believe if that happens it will all be talk, attempting to calm the markets but ultimately doing nothing to save it.
I’m weighted a little heavier than normal on precious metals for the long haul because I am pretty firm in my belief that no matter what the fed says, it cannot raise rates more than a token amount.