I have been pretty much out of the picture for the last five days, and now there are 400 emails in my inbox. I know a lot of them will be Over My Shoulder candidates, so you will likely get a few more OMSs in your inbox in the coming week.
 
This one is from my friend Doug Kass, who is talking about the ginormous, over the top, huge, colossal , massive short positions in volatility. He quotes one of his friends who looks back at the 1987 crisis/crash, which was driven by and large by computer algorithms using "portfolio insurance."
 
A few days back I mentioned that Friday’s close in the DJIA had it the most overbought market since 1955 and 1944 before then, according to RSI. I got the following yesterday from my friend Art Cashin, who was quoting SentimenTrader on Friday, saying, “Everything’s just perfect. The S&P 500 has recorded a record high every day this week, so kudos to the bulls. But wait, there’s more – it has also hit a record weekly close for 6 straight weeks and a record monthly close for 7 months. That’s 18 consecutive record closes over daily, weekly, and monthly time frames, which has never been seen before in market history. The few time periods that came close didn’t coincide with major highs, but further upside was limited and given back at some point.” Lastly, I pulled this from Twitter last night from Charlie Bilello at Pension Partners: “S&P 500 has not traded more than 3% below an all-time high for 242 consecutive trading days, longest run in history.” Truly unprecedented times in so many ways, and this set-up comes before the global central bank liquidity flow turns into a drip in 2018.
 
There is a major bull market in complacency, and I believe it is driven by an almost mindless move to passive investments, especially passive indexes, which buy both the good and the bad stocks in an index and drive everything up. I don't know what stops it. Someone asked me this morning what the markets would do if there was a nuclear war with North Korea. I joked that I'm not  sure that even that would be enough to panic this market. More people might try to see it as a reason to buy. Now I am half joking – but only half.
 
I truly don't understand what's going on here.