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Here Are The 4 Drivers Of The ‘Local Vol. Ceiling’
It's been a wild-ish week - but that's not saying a whole lot in 2019.
Central banks' coordinated dovish pivot (spearheaded by the Fed's "epic" relent and then iterated via the ECB's announcement of new TLTROs, Japan's forward guidance enhancement, the RBA's pivot to neutral, the RBNZ's eventual capitulatory cut, the Riksbank's throwing of the towel, etc.) helped crush cross-asset vol., ushered back in "carry mania" and reinvigorated the global hunt for yield.
That marks a stark contrast to
Maybe these volatility players are getting good at identifying which selloffs are “forced” (Feb 2018), justified (early Oct/Dec 2018), and not justified (late Dec 2018 and all of 2019 including this one).
CNBC is talking about a “trump put”. don’t know if that’s true or not, but it is not likely to be as effective as a central bank put. but either way, these “puts” are lower than most people would like. unlike a central bank put, i think the trump put also comes with a “trump cap”. don’t want the rug pulled out again. at least the central banks give forward guidance.