Step right up and don't be shy
'Cause you will not believe your eyes
--The Tubes
So, we have stocks back to pre-credit crisis levels. Bond yields near all time lows. Margin debt back to pre crisis levels. What else? Why, house flipping, of course. Buying and sellling homes for quick profit in some markets is approaching levels last seen in 2005. California markets are particularly hot.
When the Fed first embarked on the QE path many wondered what bubbles the Fed would blow. Stocks? Bonds? Real Estate? Credit?
The answer, we now know, is yes to all. As a last hurrah, the Fed is trying to demonstrate that it can blow bubbles in all markets simultaneously.
positions in SPX, Treasuries
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A very successful oilman dies. He faces Saint Peter, who says, “You’ve been a good man, and normally I’d send you to heaven, but heaven is full. We only have a place for you in hell.” The oilman asks, “Any chance I could talk to other oilmen who are in heaven? Maybe I can convince someone to switch places with me.” Saint Peter says, “It’s never happened before, but sure, I don’t see any harm in it.” The oilman goes to heaven, finds an oilmen convention, and yells, “They found a huge, cheap oil discovery in hell!” So oilmen are stampeding out of heaven straight to hell, and our oilman is running with them; he’s leading the pack. Saint Peter shouts to him, “Why are you going to hell with them? I have a spot here in heaven for you now!” The oilman shouts back, “Are you kidding, what if it’s true?”
~Warren Buffett
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