Goldman Sachs has the temerity to print the following:
“Our model suggests SPX calls are more attractive than at any time over the past 20 years”.
It’s hard to fathom how Goldman has any real customers left.
To wit, the Fed and other central banks have thoroughly falsified financial market prices and destroyed all of the ordinary mechanisms of financial discipline. Foremost among these are short sellers and a meaningfully positive cost of carry trades.
Markets are therefore unhinged from any connection to fundamental economic and financial reality, meaning that they are capable of an extended period of spasmodic deadcat bounces that will have only one end result.
David Stockman, March 7, 2016
David Stockman at IntCom