happy TEA PARTY anniversary; leaving the (equity risk premium) 'high risk zone' and now entering the "Death Zone" (queued Kenny Loggins video)

Happy anniversary of … The Tea Party. No, not THE Tea Party of 1773 but perhaps you know of this OTHER one … more of a movement,

On February 19th, 2009, CNBC’s Rick Santelli delivered an epic rant on Obama's mortgage-bailout plan with trader Eric -The Wolfman- Wilkinson from the floor of the CME. Thought to be the moment the Tea Party was created.  

AND while that was then and this is now, we’ll just move right along assuming we’ve all learned our lessons (because, you know, if we don’t learn from them we’re doomed to repeat…), we’ll just move right along …

First up, and in the case you missed yesterday’s update, … HERE are a few observations from Global Wall St inbox … I noted that there seems to be more dip buying (at least in thought and on paper — recommendations and narratives) than I would have thought. BMO, BAML, SG, TD to name a few. I was NOT as surprised to see some upward revision TO hike expectations (BAMLs Gapen and CSFB for example) as narratives get marked to market.

In as far as a couple / few OTHER items which caught my eye (so far) and which may very well be talk ‘round the water cooler ahead of markets opening this week …

A chart from Mike Wilson — stock jockey in chief at MS as we are apparently entering the ‘death zone’,

THIS CHART can be viewed on its own via twitter (HERE for example) or, in its full context and with some word salad HERE where Mr Wilson notes,

What's Next in Global Macro: Into Thin Air

Jon Krakauer’s Into Thin Air chronicles one of the deadliest years on Mount Everest, when 12 mountaineers died trying to scale the highest peak on earth. The story reveals both the best and the worst traits of people as many of the climbers try to reach the summit without proper regard for the risks. While scaling Everest has some highly technical aspects, the most dangerous feature is its sheer size. The peak is 3,000 feet above the start of the “death zone” – the altitude at which oxygen pressure is insufficient to sustain human life for an extended period. Many fatalities in high-altitude mountaineering have been caused by the death zone, either directly through loss of vital functions, or indirectly by wrong decisions made under stress or physical weakening that lead to accidents.

This is a perfect analogy for where equity investors find themselves today, and quite frankly, where they’ve been many times over the past decade. More specifically, either by choice or out of necessity investors have followed stock prices to dizzying heights once again as liquidity (bottled oxygen) allows them to climb into a region where they know they shouldn’t go and cannot live very long. They climb in pursuit of the ultimate topping out of greed, assuming they will be able to descend without catastrophic consequences. But the oxygen eventually runs out and those who ignore the risks get hurt…

… Bottom line: the bear market rally that began in October from reasonable prices and low expectations has morphed into a speculative frenzy based on a Fed pause/pivot that isn’t coming. And, while the economic situation appears to have improved at the margin, this will not forestall the earnings recession that has a long way to go, based on our negative operating leverage scenario that is well under way. As the Fed is tightening, financial conditions are continuing to loosen thanks to the liquidity provided by other central banks (mainly the PBOC and BoJ), China’s reopening and a weaker US dollar. Since October, global M2 has increased by a staggering $6 trillion, providing the supplemental oxygen investors need to survive in the death zone. While this oxygen supply can last a bit longer and help the climbers go farther than they should, it can also trick them into thinking they are safer than they really are, which leads to them getting hurt.

From Tea Parties TO danger / DEATH zones … I’m gonna quit while I’m behind and will have some sort of boots-on-the-ground car buying experiences / auto market update in the coming days as we continue to help Thing 1 secure a vehicle. But for now, well, here’s how stock jockeys view themselves these days