Of the American crowd
For the calm side of the table
His offer sheet the same shares, a new price each morning
Mr. Market stood in the street in his bathrobe, offering his life’s work for whatever anyone would say out loud. You remember that month yourself. The empty streets, and the brokerage statement you did not want to open.
Out of one hundred, on the twelfth.
No drop that deep had ever come that fast.
Almost ten percent below the day it printed 2.
The shortest bear market in American history.
No bell rang at the bottom. The gauge printed its 2 on the twelfth and the true low came eleven days later. A thermometer does not tell you the hour the fever breaks. It tells you, while everyone is shouting, exactly how hot the room is.
Somebody always is. We tell you what he just did, with the surveys and the flows named and dated, and we report what it did and stop there.
Frightened or euphoric people with real money, which is scarier than stupid. The professionals sit on this side more often than they admit.
It sits positioned and quiet on the other side of every trade the room is desperate to make. We show you what it did this week, with its name on it.
The crowd, 0 to 100, seven inputs, every trading day.
Bank of America’s survey, running since 2002. Cash levels, and the trade they call the most crowded.
Individual investors, polled every Thursday against their long-run averages.
Today’s number, its zone word, one line on what moved it, and the two values that put it in context.
We trace what caused what, why now, and why this size, from the catalyst through the mood to the money.
We name the counterparty and show the evidence. When the professionals are the herd, we say so.
One specific, observable thing that would confirm today’s read or break it, phrased so you can check it yourself within days. An observation with a date on it.
This is the print from Thursday, March 12, 2020, read from inside the scariest month in modern markets, so you can see what this letter does on the mornings that decide retirements.
Then he knocks again tomorrow, with a fresh price and a fresh mood, and you read the mood first.
On that Thursday morning, the stock exchange tripped its own circuit breaker minutes after the open. Trading simply stopped. The crowd had hit a speed the machinery was not built for.
The gauge at the top of this email read 2 that day, out of a possible 100. It takes the market’s temperature every trading day, fear to greed. That morning it had nearly run out of scale.
We read the crowd. The other side is yours.
Edition 00, as it arrives, from the instrument block through to the close.
Not once, and not softly as “consider trimming.” We report what the gauges say and what the positioned money is doing, with sources. You take the other side yourself, or you do not.
The desk never becomes an advisor. If an edition cannot carry a real gauge reading and a sourced view of the other side, it is not an edition yet.
Every reading is real, dated, and named to its source. A soft number carries the sample, the month and the platform, or it stays out.
The herd is never stupid here, and neither are you. It is frightened or euphoric people with real money.
“Prudent investors should reduce exposure and wait for better entry points.”
That is three instructions in a row off an anonymous survey, and the desk just became an advisor.“73 percent named the same trade as the most crowded on Earth. Six weeks later it is the one thing on the board bleeding, and their cash is close to spent.”
Named and dated, with no instruction attached.Then comes a morning like March 12. When it does, you will be the one in the room holding the thermometer.
We read the crowd. The other side is yours.