You take away the big themes, you abandon what makes us disdain what we loved for so long, then you get what we got today, an unruly, ugly market that did tremendous damage to the Nasdaq, which is laden with the long-term winning ideas that have propelled stocks higher for so long.
The pain was so great that, in the end, it took down all of the averages, even the Dow, which had been up nicely for most of the session.
It was quite a change of pace from yesterday's gigantic rally. This kind of day reminds me of the old Stylistics song, "Break up to Make up." When they sing "first you love me, then you hate me, that's a game for fools" you have to wonder after a day like today were the lyrics about the stock market? Given the losses racked up today it sure does seem like a game for fools.
What themes were taken away? I talked about the notion of the decline and fall, or at least stumble, from some of the major props behind this market when it collapsed last Thursday and Friday. We got a recovery yesterday but then the pressure began anew today.
Let's start with social media. While Facebook's (FB) CEO Mark Zuckerberg and Chief Operating officer Sheryl Sandberg were apologetic and sorrowful about what is said to be their unauthorized sale of your data, it didn't matter one whit to lawmakers here or in London. Zuck said no to an invitation to address Parliament causing a lot of sturm and drang among the shareholder base. But his lack of an answer to calls to come to Capitol Hill accelerated the decline.
There will be no bottom, as I have said, until they appoint an outside counsel of some renown to look into what really happened here. My suggestion is Ted Wells, who is the outside investigator both Fox News and the NFL brought in to be figure out their crises and render a verdict.
Short of that Zuckerberg is not going to be able to stop the calls for him to testify somewhere, anywhere about what really happened. A stock cannot advance in that atmosphere.
Now Congress doesn't just want to hear from Facebook. It wants to hear from Alphabet's (GOOGL) Google division and it wants to hear from Twitter (TWTR) .
That prompted the short-selling firm, Citrin, to issue a blistering call to sell Twitter because Citrin's editor, Andrew Left, believes it has the most to lose from regulation because of its freewheeling style of selling your data. Twitter denied that it sells anything confidential. But Left insisted that it's the most vulnerable of the three. When he was on Closing Bell, Kelly Evans and Wilfred Frost tried to pin Left down on what he meant about these charges given that Twitter questioned their accuracy.
But by that point, with the stock down more than 10%, Left said it was obvious that the stock was vulnerable and expensive or it wouldn't have fallen so hard on his charges. It was classic circular reasoning but it was darned effective if you were short it.
As for Alphabet, it got double duty as a piñata because, frankly, you could say that tomorrow is Alphabet's turn on the cross as Left could easily say the same thing about Alphabet that he said about Twitter and then say it is vulnerable to selling so case closed. No wonder it fell so hard.
But it could also be a victim of another theme lost: the driverless car theme. Alphabet's stock fell in part because of fears of a bear raid and in part because it has autonomous driving technology with Waymo and, as I said last week, ever since the Arizona Uber self-driving fatality, we've seen this group under pressure. Today Nvidia (NVDA) , which makes self-driving semis, including some for Uber, suspended self-driving car testing and that crushed the stock of one of the greatest performers of all time. It was a total pummeling with Nvidia's shares falling more than 20 points on the move.
As I have said over and over again, the self-driving car is crucial to the next leg of tech because it uses so many chips. But today's reckoning really focused more on Nvidia more than any other. We will have a chance to speak to Jensen Huang, the CEO of Nvidia which makes chips for so much artificial intelligence including self-driving cars, on Thursday. I have no doubt that self-driving cars will be adopted en masse one day, but there is no denying that the accident was a huge setback to the opportunities that so many believed were closer than they may turn out to be.
We love the theory of Tesla (TSLA) , the notion of the electric car and the possibility of the self-driving electric car, but today was not Tesla's day as we got a report from a research firm saying Model 3 sales could be soft. This is incredible given how long the wait was once for the Model 3. Hey, I put in for one but gave up some months later because I needed a new car. It looks like others might have, too. The combination of the self-driving hysteria and fears about Model 3 weakness, crushed Tesla's stock. Just obliterated it.
Out of nowhere the industrials that had been so strong yesterday as it looked like the tariff battle with China had cooled just gave up the ghost entirely today. If you didn't know any better you would think that the war is back on and the next thing we are going to hear is that the Chinese are going to put the duties back on that they threatened. Why not think that? Boeing (BA) and all of its suppliers were crushed. Remember the Chinese were going to hit Apple (AAPL) and Intel (INTC) , too, and their stocks were hit hard near the end of the day.
About the only stocks that did hold in were what we call the wrong ones, the consumer packaged goods stocks, the stocks that do well when we are headed into a recession. I get that. Interest rates fell rather dramatically today and that inspired a lot of fear, the kind of fear that makes you want to buy the stocks of companies like Clorox (CLX) , Procter & Gamble (PG) and Kimberly Clark (KMB) . Yes, it was that nasty.
Now, the question is, was yesterday's rally an aberration and was today's sell-off the real deal continuation of last week or was today's sell-off just part of some overall retest that we have to expect after an overexuberant Monday.
I have to say that I think this market is treacherous and the best examples of that are Nvidia and Twitter. I think it would be natural for Nvidia to suspend self-driving chips until it figured out what the issues were. How can you blame them? Isn't that responsible? Why didn't the car have peripheral vision that night. I think the problem will be solved. I also think that it's inevitable there will be more fatalities. Will it set Nvidia's stock back? It is likely that it's not done going down, but I think that the longer-term Nvidia story is intact.
And Twitter? I think the fact that it can go down because a short-seller says it is vulnerable and wouldn't be called to Congress unless there are issues is a sign of fragility for the stock and the market. I have liked Twitter ever since that last good quarter, but I recognize that it, like Nvidia, has moved up a lot.
Stocks that have moved up a lot can go down a lot. What matters is can they find footing? Obviously right now the big themes that have swirled around tech and the fears that have become commonplace out of Washington aren't behind us. In fact, we seem engulfed in them.
But the bottom line is that what we really need to do is get used to wide swings that send down stocks after any rally. It may be too hard, it may be, alas, about breaking up and not making up because the whole thing, at least for now, does feel a bit like the fool's game that the Stylistics foreshadowed with their breakout 1973 song.
