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Wall Street’s Most Accurate Analyst: “Today’s Bear Market Ends In October With The S&P At 3,000”

Wall Street’s Most Accurate Analyst: "Today’s Bear Market Ends In October With The S&P At 3,000"

Two weeks ago, just when everyone thought…

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Wall Street's Most Accurate Analyst: "Today's Bear Market Ends In October With The S&P At 3,000"

Two weeks ago, just when everyone thought that he couldn't turn any more bearish, BofA's chief investment strategist Michael Hartnett, Wall Street's biggest bear who is by implication has also emerged as the most accurate sellside analyst (the average S&P price target of his peers is still around 4,700), stunned everyone when he told readers that while the mood on the street was already dismal, relaying the the Heard on the Street line was "I'm so bearish, and even I'm miserable", he warned that even though everyone was bearish, redemptions were just starting, and the real selling was only just beginning.

One week later - and much to the embarrassment of JPM's in house permabull who at the same time said to take the other side of the trade and to buy stocks - Hartnett was again been proven right, with the S&P tumbling and the Nasdaq suffering its worst month since the Lehman bankruptcy. Hartnett also correctly warned that the closer we got to the 4,000 "strange attractor" level, the more aggressive the selling would become (as we discussed in "Hartnett Turns Apocalyptic, Says Carnage To Accelerate With "Max Pain" And "Exit" Waiting Below 4,000")

Since then it's gotten even worse, providing the biggest bear on Wall Street with even more ammo for his latest weekly Flow Show note (available to pro subscribers in the usual place), and he wastes no time to terrify his readers of the hell that is coming, warning that with the NYSE Composite (US stocks + ADR's + bond ETFs) down -9% YTD to 100-week moving average, "recession/crises in past 25 years have always seen our fave Wall St barometer break decisively below this level (15350 today)...at 100wma;" And in case that's not enough, he also warns that "every crisis/recession sees meaningful dip below 100wma...game time!"

Extending this analogy to all bear markets - because the only ones who still don't realize that the S&P is in a brutal bear market are JPMorgan's strategists - Hartnett compiles the following useful information:

  • 9 bear markets in the past 140 years
  • Average price decline = 37.3%
  • Average duration is 289 days

And while past performance no guide to future performance, if it were, today's bear market ends Oct 19th '22 with S&P500 at 3000, Nasdaq at 10000.  There are two silver linings here:

  • first: many stocks are already there, i.e., 49% of Nasdaq >50% below their 52-week highs, 58% of Nasdaq >37.3% down, and 77% of index in bear market, i.e. down >20%;
  • second: bear markets are quicker than bull markets.

Hartnett next echoes what we said yesterday in our discussion of the BOE's shocking decision, which we said confirms the worst stagflationary case for the economy. According to the BofA strategist, the BoE projected UK CPI >10% by Oct'22, cut '23 GDP forecast 150bps to -0.25%; in other words, 10% inflation, 0% growth the living definition of stagflation. 

It's why to Hartnett, the correct relative playbook is 1973/74 and it shows that cash and commodities beat bonds & stocks (esp consumer & tech; note Big Tech starting to ape Nifty 50 crash).

Meanwhile, flows - which are always a leading indicator for sentiment - confirm that none of this is a shock to investors, and after some huge outflows in the past month, the latest weekly flows into the FOMC were massively “risk-off” as investors waved in the cash: $0.3bn from gold, $3.4bn from stocks, $9.1bn from bonds, $14.0bn from cash. Some more details:

  • big inflow to Treasuries ($6.0bn),
  • big outflow from TIPS ($3.2bn),
  • big outflow IG bonds ($7.3bn),
  • largest REIT (real estate) outflow ever ($2.2bn),
  • big outflow financials ($1.6bn),
  • 4-week average of flows to stocks turning most negative since May’20 when the Fed had to step in to bail out the market.

Turning from the past - both distant and recent - to the future, and Hartnett's 2022 View, it will come as no surprise that the BofA strategist is not exactly bullish. Here's how he see things playing out

  • Base case remains equity lows, yield highs yet to be reached
  • Wall St to spend much of '22 working through "inflation shock", "rates shock", "recession shock" = negative, volatile returns in absolute terms
  • Relative calls defensive...cash/volatility/commodities>stocks/bonds, IG>HY, defensives>cyclicals
  • Meantime as recession risks next move up in commodities should be tactically sold,
  • Lead indicators of bear market were trough in yields & US$ + peak in EM, crypto, speculative tech (e.g. biotech) in Q1'21; only once yields & US$ peak, and floor in EM, crypto, speculative tech follow, should risk be added, first and foremost in corporate bonds – we are not there yet (and note speculative tech will remain in bear market for next 2 years, a floor does not = new bull market)

Finally, Harnett turns to his favorite topic - the three types of shocks that define the transition from 2020 to 2022. According to the BofA strategist, in past 9 months “inflation shock” was priced-in slowly, “rates shock” was priced-in slowly, but “recession shock” was priced-in too quickly; this is a problem as stronger-than-expected economic data in H1’22 is causing market to price-in longer/bigger inflation/rates shock.

Inflation shock: inflation set to "peak" but lower inflation likely to be "transitory" given biggest macro story of ‘22...a lack of supply of energy, food, housing, labor relative to demand showing scant signs of improvement...

Energy...natural gas prices at highest since '08 as world scrambles to reconfigure energy supplies (note explosive upside of Russian ruble now at new highs vs sterling, euro, US dollar),

Food...fertilizer prices @ all-time highs = cost of food production up = supply of food down = price of food up, note corn prices @ new highs & food prices seriously vulnerable to super-spike on poor harvests,

Houses...mortgage rate surging but 93% of US mortgages are fixed and supply of existing homes near record low, as evidenced by housing permits highest since '74

Labor...there are 12mn US job openings versus a 6mn supply of unemployed workers , you do the math.

Rates shock: yes central banks on course to hike rates 251 times in 2022, yes net 34% tightening monetary policy most since '08, yes QT starts H2'22, yes not a lot rate hikes can do about broken supply chains; but yields & volatility will rise until Fed & central banks ahead of the curve...this week they moved further behind curve; US inflation 8%, EU inflation 8%, UK inflation heading >10%, yet they are quivering at the thought of selling $1 of bonds (QT) after buying $23,000,000,000,000 since Lehman, and $11,000,000,000,000 since COVID-19; little wonder bond vigilantes back to trading “end of central bank credibility” = volatility entrenched.

Recession shock: the economy today is strong, a problem; but macro data has turned from unambiguously strong to ambiguously strong; business confidence has stalled (see PMI’s) which threatens to stall improvement in labor market in H2; Asian FX devaluation discounts weaker Asian export growth...

... which discounts weaker US consumer; and quickest route to recession on Main St is via a sharp decline in asset valuations on Wall St, & risk of systemic events on bond/stock/real estate deleveraging in risk parity (RPAR)...

...  private equity, sovereign wealth funds, credit events in speculative tech, shadow banking, US consumer buy now, pay later models, Emerging Markets, zombie corporations, goes up with every rate hike.

There is more in the full Hartnett note, available to pro subscribers in the usual place.

Tyler Durden Sat, 05/07/2022 - 06:35

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‘The Scandal Would Be Enormous’: Pfizer Director Worried About Vax-Induced Menstrual Irregularities

‘The Scandal Would Be Enormous’: Pfizer Director Worried About Vax-Induced Menstrual Irregularities

Project Veritas on Thursday released a…

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'The Scandal Would Be Enormous': Pfizer Director Worried About Vax-Induced Menstrual Irregularities

Project Veritas on Thursday released a new segment of undercover footage of Pfizer director Jordon Walker in which the Director of R&D within the company's mRNA operation expressed concern over how the COVID-19 vaccine may be affecting women's reproductive health.

"There is something irregular about the menstrual cycles. So, people will have to investigate that down the line," Walker told an undercover journalist he thought he was on a date with.

"The [COVID] vaccine shouldn’t be interfering with that [menstrual cycles]. So, we don’t really know," he added.

Walker also hopes we don't discover that "somehow this mRNA lingers in the body and like -- because it has to be affecting something hormonal to impact menstrual cycles," adding "I hope we don’t discover something really bad down the line…If something were to happen downstream and it was, like, really bad? I mean, the scale of that scandal would be enormous."

Watch:

 

Tyler Durden Thu, 02/02/2023 - 19:30

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Growing Number Of Doctors Say They Won’t Get COVID-19 Booster Shots

Growing Number Of Doctors Say They Won’t Get COVID-19 Booster Shots

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

A…

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Growing Number Of Doctors Say They Won’t Get COVID-19 Booster Shots

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

A growing number of doctors say that they will not get COVID-19 vaccine boosters, citing a lack of clinical trial evidence.

I have taken my last COVID vaccine without RCT level evidence it will reduce my risk of severe disease,” Dr. Todd Lee, an infectious disease expert at McGill University, wrote on Twitter.

A vial of the Pfizer-BioNTech COVID-19 vaccine is seen in a file photograph. (Justin Sullivan/Getty Images)

Lee was pointing to the lack of randomized clinical trial (RCT) results for the updated boosters, which were cleared in the United States and Canada in the fall of 2022 primarily based on data from experiments with mice.

Lee, who has received three vaccine doses, noted that he was infected with the Omicron virus variant—the vaccines provide little protection against infection—and described himself as a healthy male in his 40s.

Dr. Vinay Prasad, a professor of epidemiology and biostatics at the University of California, San Francisco, also said he wouldn’t take any additional shots until clinical trial data become available.

“I took at least 1 dose against my will. It was unethical and scientifically bankrupt,” he said.

Allison Krug, an epidemiologist who co-authored a study that found teenage boys were more likely to suffer heart inflammation after COVID-19 vaccination than COVID-19 infection, recounted explaining to her doctor why she was refusing a booster and said her doctor agreed with her position.

She called on people to “join the movement to demand appropriate evidence,” pointing to a blog post from Prasad.

“Pay close attention to note this isn’t anti-vaccine sentiment. This is ‘provide [hard] evidence of benefit to justify ongoing use’ which is very different. It is only fair for a 30 billion dollar a year product given to hundreds of millions,” Lee said.

Dr. Mark Silverberg, who founded the Toronto Immune and Digestive Health Institute; Kevin Bass, a medical student; and Dr. Tracy Høeg, an epidemiologist at the University of California, San Francisco, joined Lee and Prasad in stating their opposition to more boosters, at least for now.

Høeg said she did not need clinical trials to know she’s not getting any boosters after receiving a two-dose primary series, adding that she took the second dose “against my will.”

I also had an adverse reaction to dose 1 moderna and, if I could do it again, I would not have had any covid vaccines,” she said on Twitter. “I was glad my parents in their 70s could get covid vaccinated but have yet to see non-confounded data to advise them about the bivalent booster. I would have liked to see an RCT for the bivalent for people their age and for adults with health conditions that put them at risk.”

The U.S. Food and Drug Administration (FDA) granted emergency use authorization to updated boosters, or bivalent shots, from Pfizer and Moderna in August 2022 despite there being no human data.

Observational data suggests the boosters provide little protection against infection and solid shielding against severe illness, at least initially.

Five months after the authorization was granted, no clinical trial data has been made available for the bivalents, which target the Wuhan strain as well as the BA.4 and BA.5 subvariants of Omicron. Moderna presented efficacy estimates for a different bivalent, which has never been used in the United States, during a recent meeting. The company estimated the booster increased protection against infection by just 10 percent.

The FDA is preparing to order all Pfizer and Moderna COVID-19 vaccines be replaced with the bivalents. The U.S. Centers for Disease Control and Prevention, which issues recommendations on vaccines, continues advising virtually all Americans to get a primary series and multiple boosters.

Professor Calls for Halt to Messenger RNA Vaccines

A professor, meanwhile, became the latest to call for a halt to the Pfizer and Moderna vaccines, which are both based on messenger RNA technology.

At this point in time, all COVID mRNA vaccination program[s] should stop immediately,” Retsef Levi, a professor of operations management at the Massachusetts Institute of Technology, said in a video statement. “They should stop because they completely failed to fulfill any of their advertised promise[s] regarding efficacy. And more importantly, they should stop because of the mounting and indisputable evidence that they cause unprecedented level of harm, including the death of young people and children.”

Levi was referring to post-vaccination heart inflammation, or myocarditis. The condition is one of the few that authorities have acknowledged is caused by the messenger RNA vaccines.

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Tyler Durden Thu, 02/02/2023 - 19:10

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Government

Inside The Secret Government Meeting On COVID-19 Natural Immunity

Inside The Secret Government Meeting On COVID-19 Natural Immunity

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Four of…

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Inside The Secret Government Meeting On COVID-19 Natural Immunity

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Four of the highest ranking U.S. health officials—including Dr. Anthony Fauci—met in secret to discuss whether or not naturally immune people should be exempt from getting COVID-19 vaccines, The Epoch Times can reveal.

National Institute of Allergy and Infectious Diseases Director Dr. Anthony Fauci during a Senate hearing in Washington on May 17, 2022. (Shawn Thew/Pool/AFP via Getty Images)

The officials brought in four outside experts to discuss whether the protection gained after recovering from COVID-19—known as natural immunity—should count as one or more vaccine doses.

“There was interest in several people in the administration in hearing basically the opinions of four immunologists in terms of what we thought about … natural infection as contributing to protection against moderate to severe disease, and to what extent that should influence dosing,” Dr. Paul Offit, one of the experts, told The Epoch Times.

Offit and another expert took the position that the naturally immune need fewer doses. The other two experts argued natural immunity shouldn’t count as anything.

The discussion did not lead to a change in U.S. vaccination policy, which has never acknowledged post-infection protection. Fauci and the other U.S. officials who heard from the experts have repeatedly downplayed that protection, claiming that it is inferior to vaccine-bestowed immunity. Most studies on the subject indicate the opposite.

The meeting, held in October 2021, was briefly discussed before on a podcast. The Epoch Times has independently confirmed the meeting took place, identified all of the participants, and uncovered other key details.

Dr. Jay Bhattacharya, a professor of medicine at Stanford University who did not participate in the meeting, criticized how such a consequential discussion took place behind closed doors with only a few people present.

“It was a really impactful decision that they made in private with a very small number of people involved. And they reached the wrong decision,” Bhattacharya told The Epoch Times.

An email obtained by The Epoch Times shows Dr. Vivek Murthy contacting colleagues to arrange the meeting. (The Epoch Times)

The Participants

From the government:

  • Fauci, the head of the U.S. National Institute of Allergy and Infectious Diseases and the chief medical adviser to President Joe Biden until the end of 2022
  • Dr. Vivek Murthy, the U.S. surgeon general
  • Dr. Rochelle Walensky, the head of U.S. Centers for Disease Control and Prevention (CDC)
  • Dr. Francis Collins, head of the U.S. National Institutes of Health, which includes the National Institute of Allergy and Infectious Diseases, until December 2021
  • Dr. Bechara Choucair, the White House vaccine coordinator until November 2021

From outside the government:

  • Offit, director of the Vaccine Education Center at Children’s Hospital of Philadelphia and an adviser to the U.S. Food and Drug Administration on vaccines
  • Dr. Michael Osterholm, director of the Center for Infectious Disease Research and Policy at the University of Minnesota and a former member of Biden’s COVID-19 advisory board
  • Akiko Iwasaki, professor of immunobiology and molecular, cellular, and developmental biology at Yale University
  • Dr. Peter Hotez, co-director of Texas Children’s Hospital Center for Vaccine Development and dean of the Baylor College of Medicine’s School of Tropical Medicine

Fauci and Murthy decided to hold the meeting, according to emails The Epoch Times obtained.

“Would you be available tonight from 9-9:30 for a call with a few other scientific colleagues on infection-induced immunity? Tony and I just discussed and were hoping to do this sooner rather than later if possible,” Murthy wrote in one missive to Fauci, Walensky, and Collins.

All three quickly said they could make it.

Walensky asked who would be there.

Murthy listed the participants. “I think you know all of them right?” he said.

Walensky said she knew all but one person. “Sounds like a good crew,” she added.

From top left, clockwise: Dr. Vivek Murthy, Dr. Francis Collins, Dr. Anthony Fauci, and Dr. Rochelle Walensky. (Getty Images)

‘Clear Benefit’

During the meeting, Offit put forth his position—that natural immunity should count as two doses.

At the time, the CDC recommended three shots—a two-dose primary series and a booster—for many Americans 18 and older, soon expanding that advice to all adults, even though trials of the boosters only analyzed immunogenicity and efficacy among those without evidence of prior infection.

Research indicated that natural immunity was long-lasting and superior to vaccination. On the other hand, the CDC published a paper in its quasi-journal that concluded vaccination was better.

Osterholm sided with Offit, but thought that having recovered from COVID-19 should only count as a single dose.

“I added my voice at the meeting to count an infection as equivalent to a dose of vaccine! I’ve always believed hybrid immunity likely provides the most protection,” Osterholm told The Epoch Times via email.

Hybrid immunity refers to getting a vaccine after recovering from COVID-19.

Some papers have found vaccination after recovery boosts antibodies, which are believed to be a correlate of protection. Other research has shown that the naturally immune have a higher risk of side effects than those who haven’t recovered from infection. Some experts believe the risk is worth the benefit but others do not.

Hotez and Iwasaki, meanwhile, made the case that natural immunity should not count as any dose—as has been the case in virtually the entire United States since the COVID-19 vaccines were first rolled out.

Iwasaki referred to a British preprint study, soon after published in Nature, that concluded, based on survey data, that the protection from the Pfizer and AstraZeneca vaccines was heightened among people with evidence of prior infection. She also noted a study she worked on that found the naturally immune had higher antibody titers than the vaccinated, but that the vaccinated “reached comparable levels of neutralization responses to the ancestral strain after the second vaccine dose.” The researchers also discovered T cells—thought to protect against severe illness—were boosted by vaccination.

There’s a “clear benefit” to boosting regardless of prior infection, Iwasaki, who has since received more than $2 million in grants from the National Institutes of Health (NIH), told participants after the meeting in an email obtained by The Epoch Times. Hotez received $789,000 in grants from the NIH in fiscal year 2020, and has received other grants totaling millions in previous years. Offit, who co-invented the rotavirus vaccine, received $3.5 million in NIH grants from 1985 through 2004.

Hotez declined interview requests through a spokesperson. Iwasaki did not respond to requests for comment.

No participants represented experts like Bhattacharya who say that the naturally immune generally don’t need any doses at all.

In an email obtained by The Epoch Times, Akiko Iwasaki wrote to other meeting participants shortly after the meeting ended. (The Epoch Times)

Public Statements

In public, Hotez repeatedly portrayed natural immunity as worse than vaccination, including citing the widely criticized CDC paper, which drew from just two months of testing in a single state.

In one post on Twitter on Oct. 29, 2021, he referred to another CDC study, which concluded that the naturally immune were five times as likely to test positive compared to vaccinated people with no prior infection, and stated: “Still more evidence, this time from @CDCMMWR showing that vaccine-induced immunity is way better than infection and recovery, what some call weirdly ‘natural immunity’. The antivaccine and far right groups go ballistic, but it’s the reality.”

That same day, the CDC issued a “science brief” that detailed the agency’s position on natural immunity versus the protection from vaccines. The brief, which has never been updated, says that available evidence shows both the vaccinated and naturally immune “have a low risk of subsequent infection for at least 6 months” but that “the body of evidence for infection-induced immunity is more limited than that for vaccine-induced immunity.”

Evidence shows that vaccination after infection, or hybrid immunity, “significantly enhances protection and further reduces risk of reinfection” and is the foundation of the CDC’s recommendations, the agency said.

Several months later, the CDC acknowledged that natural immunity was superior to vaccination against the Delta variant, which was displaced in late 2021 by Omicron. The CDC, which has made misleading representations before on the evidence supporting vaccination of the naturally immune, did not respond to a request for comment regarding whether the agency will ever update the brief.

Iwasaki had initially been open to curbing the number of doses for the naturally immune—”I think this supports the idea of just giving one dose to people who had covid19,” she said in response to one Twitter post in early 2021, which is restricted from view—but later came to argue that each person who is infected has a different immune response, and that the natural immunity, even if strong initially, wanes over time.

Osterholm has knocked people who claim natural immunity is weak or non-existent, but has also claimed that vaccine-bestowed immunity is better. Osterholm also changed the stance he took in the meeting just several months later, saying in February 2022 that “we’ve got to make three doses the actual standard” while also “trying to understand what kind of immunity we get from a previous infection.”

Offit has been the leading critic on the Vaccines and Related Biological Products Advisory Committee, which advises U.S. regulators on vaccines, over their authorizations of COVID-19 boosters. Offit has said boosters are unnecessary for the young and healthy because they don’t add much to the primary series. He also criticized regulators for authorizing updated shots without consulting the committee and absent clinical data. Two of the top U.S. Food and Drug Administration (FDA) officials resigned over the booster push. No FDA officials were listed on invitations to the secret meeting on natural immunity.

Fauci and Walensky Downplay Natural Immunity

Fauci and Walensky, two of the most visible U.S. health officials during the pandemic, have repeatedly downplayed natural immunity.

Fauci, who said in an email in March 2020 that he assumed there would be “substantial immunity post infection,” would say later that natural immunity was real but that the durability was uncertain. He noted the studies finding higher antibody levels from hybrid immunity.

In September 2021, months after claiming that vaccinated people “can feel safe that they are not going to get infected,” Fauci said that he did not have “a really firm answer” on whether the naturally immune should get vaccinated.

“It is conceivable that you got infected, you’re protected—but you may not be protected for an indefinite period of time,” Fauci said on CNN when pressed on the issue. “So I think that is something that we need to sit down and discuss seriously.”

After the meeting, Fauci would say that natural immunity and vaccine-bestowed immunity both wane, and that people should get vaccinated regardless of prior infection to boost their protection.

Walensky, before she became CDC director, signed a document called the John Snow Memorandum in response to the Great Barrington Declaration, which Bhattacharya coauthored. The declaration called for focused protection of the elderly and otherwise infirm, stating, “The most compassionate approach that balances the risks and benefits of reaching herd immunity, is to allow those who are at minimal risk of death to live their lives normally to build up immunity to the virus through natural infection, while better protecting those who are at highest risk.”

The memorandum, in contrast, said there was “no evidence for lasting protective immunity to SARS-CoV-2 following natural infection” and supported the harsh lockdown measures that had been imposed in the United States and elsewhere.

In March 2021, after becoming director, Walensky released recommendations that the naturally immune get vaccinated, noting that there was “substantial durability” of protection six months after infection but that “rare cases of reinfection” had been reported.

Walensky hyped the CDC study on natural immunity in August 2021, and the second study in October 2021. But when the third paper came out concluding natural immunity was superior, she did not issue a statement. Walensky later told a blog that the study found natural immunity provided strong protection, “perhaps even more so than those who had been vaccinated and not yet boosted.”

But, because it came before Omicron, she said, “it’s not entirely clear how that protection works in the context of Omicron and boosting.”

Walensky, Murthy, and Collins did not respond to requests for interviews. Fauci, who stepped down from his positions in late 2022, could not be reached.

Murthy and Collins also portrayed natural immunity as inferior. “From the studies about natural immunity, we are seeing more and more data that tells us that while you get some protection from natural infection, it’s not nearly as strong as what you get from the vaccine,” Murthy said on CNN about two months before the meeting. Collins, in a series of blog posts, highlighted the studies showing higher antibody levels after vaccination and urged people to get vaccinated. He also voiced support for vaccine mandates.

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Tyler Durden Thu, 02/02/2023 - 21:10

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