The contrast couldn't be more stark - or more alarming ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ 

Katusa's Investment Insights December 20, 2024 Five Alarm Chart Fire: Some Wall Street Money Is Quietly Heading for the Exit By Marin Katusa The contrast couldn't be more stark - or more alarming. The champagne is flowing on Wall Street as markets hit record highs, but behind the scenes, some of the savviest players in finance are quietly packing their bags.   The Retail Stampede: Everyone's a Genius in a Bull Market Retail Investors are pouring money into the market at a dizzying pace, with 2024 seeing an unprecedented $448 billion flowing into U.S. equity funds. It's reminiscent of the late 1990s, when taxi drivers were giving stock tips and every dinner party turned into an investment seminar. The difference? Today's investors are armed with leveraged ETFs and commission-free trading apps. Our “Brother-in-Law” indicator is beeping faster and faster. Sponsored Corporate Executives Are Cashing Out While Main Street Buys Corporate America's top brass is selling - and selling big. Corporate executive stock sales have hit all-time highs, creating a seller-to-buyer ratio that should make any investor pause. When the people running the companies are rushing to cash in their chips, it might be time to ask why. Leverage Fever: The Return of Financial Heroin Remember those warnings about not using leverage in an unstable market? Investors apparently don't. Trading in leveraged ETF products has exploded to $80 billion weekly, turning the market into a high-stakes casino where every bet is doubled down. It's financial heroin - thrilling until it isn't.   The Oracle's Warning: Buffett's $160 Billion Message Warren Buffett, the legendary investor who made his fortune being "fearful when others are greedy," is sitting on his largest cash pile since the 2008 financial crisis. Berkshire Hathaway's cash position has swelled to historic levels, suggesting the Oracle of Omaha sees storm clouds where others see clear skies. In the December issue of Katusa’s Resource Opportunities, we discussed Marin Katusa’s personal cash percentage weighting, and talked about the merits of being an alligator investor: waiting before we buy our targeted resource companies. We have our list of great companies to buy, but just as important as buying great companies is “what price” you pay for that great company.   The Smart Money's Last Dance? Professional Traders Hit New Records Professional traders have pushed their bullish positions in S&P 500 futures to unprecedented levels. But here's the twist - historically, when everyone's positioned the same way, the market has a nasty habit of proving the majority wrong. Is Slowing Steel Production a Warning Sign for the Economy? History tells us that reduced steel output coincided with major economic downturns, like the dot-com crash and the global financial crisis. As we observe a similar trend today, could this be a red flag for the current stock market boom? Is the extended bull run nearing its end? A steep decline might be just around the corner. Look at the chart below to see how steel production trends have aligned with economic shifts over time. The Irony is Intense… As retail investors embrace ever-riskier bets and leverage their positions to the hilt, the smart money is quietly building defensive positions and raising cash. It's a tale as old as Wall Street itself - the question is, which side of history will you be on when the music stops? The current euphoria might continue - markets have a way of defying logic longer than anyone expects. But when the smartest players in the room start heading for the exits while smiling and telling everyone what a great party it is, it might be wise to at least know where your coat is. After all, as one veteran trader once quipped, "The problem with bubbles isn't spotting them - it's knowing when to stop dancing." Regards, Marin Katusa For Real-Time Market Alerts, Follow Us: Share Tweet Share Copyright © 2024, Katusa Research, All rights reserved. PLEASE READ: RETURNS AND TESTIMONIAL DISCLOSURE  Contact Us | Privacy | Terms & Conditions Details and Disclosures Investing can have large potential rewards, but it can also have large potential risks. You must be aware of the risks and be willing to accept them in order to invest in financial instruments, including stocks, options, and futures. Katusa Research makes every best effort in adhering to publishing exemptions and securities laws. By reading this, you agree to all of the following: You understand this to be an expression of opinions and NOT professional advice. You are solely responsible for the use of any content and hold Katusa Research, and all partners, members, and affiliates harmless in any event or claim. 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