The “Echo Bubble” May Be Popping – Short Autonation

July 25, 2023

The following commentary and short idea is from the latest issue of my Short Seller’s Journal. This is a weekly newsletter with economic and general market analysis as well as my favorite short ideas based on in-depth fundamental analysis. You can learn about the newsletter here: Short Seller’s Journal information.

I truly believe that what we’re seeing in the stock market is the anticipation of the Fed abandoning rate hikes after this month’s and possibly cutting rates starting in early 2024. In addition, I think the market actually believes in Santa Claus in the form of a soft landing or even no recession. Ironically, the economy is already recessing – just look at the latest retail sales report. The expression of the market’s view is in the format of hedge fund algo gamma squeezing, rabid short-squeezing and drooling retail idiots throwing everything they have at tech stocks and risky call options.