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Subzero Kakistocracy Renders Black Wednesday for Americazuela

Black Wednesday on the stonk exchange was a hard landing wakeup call resulting in a 4.03% drop in the S&P 500 and 4.9% in the Nasdaq. Transports fell 7%. Pre-market Thursday is pointing to another rough day.

The catalysts were poor earnings and operational reports from a series of big-box retailers; however, most of the damage was on the margin side. This was led off by Walmart, which reported flattish sales below estimates. Then, Lowe’s confirmed the slow down.

Reuters on Wednesday reported Lowe’s Cos, Inc. had a bigger-than-expected drop in same-store sales, decreasing 4% in the first quarter (through April 29) compared to Wall Street expectation of a 2.5% fall.

Pre-market Thursday Bath & Body Works updated fiscal 2022 outlook reflects the company’s decision to “accelerate investments in information technology and its customer loyalty program, as well as projected increases in inflationary pressures.” Stonk is being hammered.

It was followed by Target, which fell Wednesday by 24.9%. But the biggest part of the story is what the COO said on the earnings call. It’s now expecting $1 BILLION in incremental freight costs increases this year.

Americazuela

Another datapoint in the Walmart and Target reports was a massive surge in inventories. I suspect much of this is inflationary hoarding or front running anticipated future price increases. This is classic early hyper-inflationary behavior aka as crack up boom seen in places and times like Weimar Germany and Venezuela.

When you see this in real time, it makes it all the more astonishing that subzero, delusional and recently reappointed Fed mucky muck Jerome Powell took a 75 bps hike off the table. As of today, he hasn’t reduced the “Fed’s” balance sheet and slush fund one dollar. On June 1, the runoff will be a mere $47.5 billion/month of a $9 trillion stash of funny money. So far, the drawdown in stonks has not lessened inflation expectations.

Latest rhetoric from subzero empty suits at the Fed.

Curiously, we are now seeing hints that shipments and massive backlogs may start to be released from China as Covid restrictions there are lifted. Will this also be hoarded when it arrives? Is there even enough diesel to move goods off the docks?

We continue to track kakistocrat decisions on fuel distillates. Here we see a modest bump in distillate inventory, and a huge drop in gasoline. Rob four Peters to pay one Paul. Gird yourself for the summer driving season — that’s if it isn’t cancelled. These numbers suggest more subzero exporting of finished product is going on despite the crisis. Total non-jet distillate exports were just over 1 million barrels per day last week

Crude -3.394MM, Exp. +2.0MM Gasoline -4.779MM Distillate +1.235MM Cushing -2.403MM

We also learn — not surprisingly — that a summer of electricity blackouts awaits.

And if that’s not enough, the subzeros are warning of another scamdemic going into the summer months. You can’t make this up.

Food Trainwreck in Americazuela

Also from China, we see that as subzero Americazuela front runs inflation and hoards consumer products, China hoards grain.

The U.S. Department of Agriculture says China has 69% of world grain reserves in warehouses! Wow. I can’t help but think that this is asymmetrical warfare. Unfortunately, the Americazuela side has subzero kakistocrats making the calls.

I had earlier written that I thought (because of smaller fertilizer needs) a normal soybean crop might be forthcoming, even if wheat and corn were disasters. However, it now look as if I was too optimistic. High diesel prices and poor growing conditions are taking their toll. Planting progress for corn, spring wheat and soybeans are all seriously subpar.

Perfect-storm conditions for food is in play in Europe. What are the odds?

2 Comments on Subzero Kakistocracy Renders Black Wednesday for Americazuela

  1. So I guess the kakistocracy here wants what’s happening to the kakistocracy in Sri Lanka (burning of govt. official homes, oligarch mansions, etc) or Iran (riots over food, etc., in an oil producing nation)… But criminal psychopaths want what criminal psychopaths want…. Bring it on? Hmmmmmm….. The criminal psychos really ought to consider the ramifications of their psy-ops…

  2. Just wait and see what happens with migration when there are food shortages and lengthy blackouts in Central and South America. “Migration” could suddenly turn into organized raids by large criminal gangs.

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