“Traders Got It Wrong Before The Election, And Continue To Get It Wrong Today”

In light of the only thing that matters for markets (that would be Donald Trump for those who have slept through the past three months), here are some salient thoughts from the latest weekend notes by One River Asset Management’s Eric Peters, whose uncanny ability to put a unique spin on events in third person continues to impress.
Beep Beep: ‘The world got caught in its own trap,’ said Roadrunner, the market’s biggest equity volatility trader. ‘Traders got it wrong before the election, and continue to get it wrong today.’ The VIX touched 10.50. ‘You see the tweets, the media battle, illegal voters, conspiracy theories, Mexican feuds, European taunts, border walls, fake news, and lies,’ said Roadrunner, looking left, right, up. ‘But be careful what you watch. There is only one thing that doesn’t lie, and that’s the price,’ he said. ‘Look where the price is, what it’s telling us.’
‘VIX tells you that there’s someone in charge who’s not a madman,’ continued Roadrunner. ‘He speaks and acts like he’s crazy, but the market is wiser than all of us, it’s smarter than everyone combined.’ He paused, contemplating our new surroundings. ‘Barnum and Bailey closed just ahead of the inauguration. How could they compete with this circus?’ The wall is a show. Our world is now theatre. We’re all extras. ‘Of course at some point vol will explode, but for the moment the market is saying maybe America First will work.’

This post was published at Zero Hedge on Jan 29, 2017.