Don’t Fight the Fed: Biotechs at RECORD Highs

One of the mainstream’s former bullish meme has long been “Don’t fight the FED”. This meant that when the FED has assumed a dovish stance then such sentiment should percolate into monetary policies that has been supportive of stocks. So long stocks.

But as recently mentioned, such 'dovishness' has become more restrained. Central bankers have adapted what I call as: “I recognize the addiction problem but a withdrawal syndrome would even be more cataclysmic”. For instance, US Fed Chairwoman Janet Yellen has recently warned of overvalued biotech and small cap stocks as I pointed out here 

Does the market care, apparently not.

 

As proof of the self-feeding frenzy of a mania phase as I explained last weekend, the Don’t Fight the Fed appears to have gone into the opposite direction.

Notes the Zero Hedge: (bold original)

Biotechs are up 33% from the April lows and have reached all-time record highs and have now totally ignored 2 warnings from Yellen - who just last week was heralded as omnipotent. This is the best 3-week run in 13 months..

So people conjure up any rationalization to justify their actions.

Yet the “Best run” has merely been a symptom of the fast accelerating manic phase. 

With the S&P closing at 2000, the milestone high has been accompanied by other landmark events

Notes the Wall Street Journal’s Money Beat (bold mine)

The S&P 500 has gone 65 trading days since it first finished above 1900 in May…it would mark the fourth quickest 100-point move in the index’s history, according to WSJ Market Data Group.

The table below provides a historical look at 100-point milestones for the S&P 500 dating back to 1968, when it crossed above 100 for the first time. It needed 11,208 trading days to reach that mark.

The second-longest time frame that spanned 100-point moves came from 2000 through 2013, when the index needed 3,298 trading days to go to 1600 from 1500. Of course that period included two major bear markets during the bursting of the tech bubble and the financial crisis.

It’s a fantastic showcase where the higher the benchmark, the greater the risk.

But who cares about risks, stocks have been destined to rise forever!

Video: Peter Diamandis: Abundance is our future

Peter Diamandis, Founder and Chairman of the X PRIZE Foundation, an educational non-profit prize institute whose mission is to create radical breakthroughs for the benefit of humanity, in a talk at the TED explains why he thinks the world is headed for abundance.



Essentially Mr.Diamandis is banking on the explosive growth of human capital facilitated by technology (information age) through the following media

Technologies riding Moore’s Laws:
1. Infinite Computing
2. Sensor and Networks
3. Robotics
4. 3D Printing
5. Synthethic Biology
6. Digital Medicine
7. Nanomaterials
8. Artificial intelligence

Here are some noteworthy quotes

When I think about creating abundance, it is not about creating a life of luxury…it is about creating a life of possibilities. It is about taking that which was scarce and making it abundant. You see scarcity is contextual and technology is a resource liberating force. 6:34

It is not about being scarce it’s about accessibility. 8:17

By the way the biggest protection against population explosion is making the world educated and healthy 12:26

3 billion new minds would never been heard before are connecting to global conversation. What do these people want? What would they consume? What do they desire? Rather than having an economic shutdown we are about to have is the biggest economic injection ever. These people represent tens of trillions of dollars injected in the global economy 12:47

In spite of the restrictive role of governments, I share his optimism that people will find ways and means to circumvent them mostly through technological innovations.

(hat tip Professor Mark Perry)

Is The Island of Dr Moreau Becoming a Reality?

In a creepy parallel to the H.G. Wells’ science fiction novel “The Island of Doctor Moreau”, UK’s public and independent schools have secretly “created more than 150 human-animal hybrid”

From the Daily Mail,

Scientists have created more than 150 human-animal hybrid embryos in British laboratories.

The hybrids have been produced secretively over the past three years by researchers looking into possible cures for a wide range of diseases.

The revelation comes just a day after a committee of scientists warned of a nightmare ‘Planet of the Apes’ scenario in which work on human-animal creations goes too far.

Last night a campaigner against the excesses of medical research said he was disgusted that scientists were ‘dabbling in the grotesque’.

Figures seen by the Daily Mail show that 155 ‘admixed’ embryos, containing both human and animal genetic material, have been created since the introduction of the 2008 Human Fertilisation Embryology Act.

This legalised the creation of a variety of hybrids, including an animal egg fertilised by a human sperm; ‘cybrids’, in which a human nucleus is implanted into an animal cell; and ‘chimeras’, in which human cells are mixed with animal embryos.

Scientists say the techniques can be used to develop embryonic stem cells which can be used to treat a range of incurable illnesses.

Three labs in the UK – at King’s College London, Newcastle University and Warwick University – were granted licences to carry out the research after the Act came into force.

In the H.G. Well’s novel, Dr. Moreau was a scientist who conducted cruel experiments on animals attempting to create sentient beings out of animals

In the movie version (see above), Dr. Moreau embarked on using human DNA in animals to make them more humanlike and regress their animal instincts and make the divine human, free of malice and hatred. [Wikipedia]

In the fictional story, the experiment was conducted by a deranged doctor at a mythical island. In the above, similar experiments are being done by government personnel at legally mandated (public and independent) schools in UK.

If the story line ends the way as the novel played out, where their stealth experiments goes awry, then maybe we should expect zombies, Godzilla, King Kong, Mothra, satyrs, the abominable snowman, hydra, the Minotaur, the Kraken and other fictional or mythical monsters come to life. L.O.L.!