It’s Not Just The S&P 500 Making All-Time Records 

S&P 500 At All-Time High

The S&P 500 closed at an all-time high of 6173 last week with little sign of a retracement on the horizon.

Bank of America reported that its institutional clients’ net buying of Tech stocks last week was the highest in its data history.

S&P 500 call option volumes hit record highs, with $1.1 trillion in call options traded on Friday.

The global M2 money supply hit an all-time high.

The global M2 money supply, which has proven to be a reliable forward indicator and a proxy for liquidity, continues its upward momentum. Liquidity underpins the business cycle and is positive for stocks.

The S&P 500 lags global M2 by 11 weeks.

However, some records make for less comfortable reading.

The U.S. national debt has reached a record of $37 trillion, with each taxpayer owing approximately $108,000.

The national debt over the last 18 months has increased by $4 trillion, and the annual payments to service the debt now exceed $1 trillion.

For context, the U.S. national debt stood at $23 trillion as of the start of 2020.  

Globally, the debt stands at $310 trillion, with interest on the debt totalling $22 trillion. Global GDP is just $101 trillion.

Sadly, it’s not just the government that has a debt problem.

Consumer debt in the U.S. reached an all-time high of $18.2 trillion, driven by soaring credit card balances, mortgage payments, and the return of student loans.

Annual interest payments on that debt are $560 billion, and the growth rate of interest payments has outpaced wage growth by a factor of five since the 1970s.  

The U.S. Dollar is also getting in on the act. The dollar has lost approximately 96% of its value since its creation in 1913, a record low.  

Debt is growing at a rate far faster than the economy. The money supply is also growing faster than the economy, which is eroding the currency’s value and reducing purchasing power.

S&P 500 Key Levels

The S&P 500 opens in positive gamma today.

The gamma flip zone has moved up significantly and now sits at 6028; the call resistance level is 6229, and the put support level is 5873.

Hedge fund positioning in the S&P 500 is at its lowest in twelve months.

Some institutional investors sold into the market post-Liberation Day and have had limited opportunities (retracements in the S&P 500) to re-enter the market.

They are now attempting to catch up and, ideally, will be looking for a retracement.

The probability of a continued squeeze to the upside this week is high. Dips will likely be shallow, and the S&P 500 could continue to make all-time highs.