Investors, Fed Were ‘Lulled To Sleep,’ Mike Wilson Says
"The real story for equity markets is the impact of the Fed's actions over the past year," Morgan Stanley's Mike Wilson said Monday, commenting on the second-largest US bank failure in American history and official efforts to avert contagion.
As discussed at length in the weekly+, Fed tightening cycles always end in tears for somebody. It's just a matter of who ends up crying. This time around, it's regional banks.
Wilson's overarching message was that the "long and variable lags" are coming h
The necessary condition is curve inversion. The sufficient condition is credit spreads widening. We are here.
BTC is up ~20% today (>25% since Thursday). I’m becoming more convinced that people (maybe companies, especially SVB customers) are buying BTC as a “safe place” to store your funds. I haven’t been able to figure out another immediate demand driver that would cause this price action in BTC. Anyone else have ideas? If I’m right, this won’t end well.
I noticed that also and gold not so much so.
If Gold (5%5day)takes off, then the masses are scared.
GFI it’s up 11% today so I guess investors are front running that idea
Not sure who’s doing the crypto buying, but Bitcoin long has been touted as a “modern” alternative to gold as an inflation hedge, safe haven etc.. Certainly the correlation with risk equities over the recent past had put that concept into serious doubt – but it seems the idea isn’t dead (now that there’s been a shakeout of much of the absurd excesses in the crypto world)? Meanwhile, it’s somewhat reassuring to see all the PM mining stocks and ETFs…along with long treasury ETFs…reversing their recent correlations with other risk assets and doing what they’re “supposed to” as diversifying elements of my portfolio!
Good, point. I personally never saw crypto as a hedge/safe haven but rather a result of excess global liquidity and a playground for speculators. Maybe you’re right, maybe I’m right. I would say I doubt the excess has actually been shaken out yet of crypto yet. We’ll just have to wait to see how it plays out. I expect crypto to go similar to web 1.0 before the best of bread survive to create a sustainable model.